Dear Mr. Bruce,

During the past week I have been suffering from a slight accident
to an eye and I am, therefore, deferring several points for the
next mail.

EMPIRE PARLIAMENTARY DELEGATION

I enclose a memorandum giving a few points in regard to those
members of the British Delegation with whom I am personally
acquainted or about whom I have reliable information.

IMPERIAL ECONOMIC COMMITTEE

The Committee have made considerable further progress with the
Dairy Produce Enquiry. It is now clear, provided the Chairman [1]
can be induced to work on the Drafting Committee, the Main Report
and the Report on Margarine will be available by the first week of
August. I will try to arrange for a copy of the report to reach
you at Colombo.

It has been decided to allow a larger measure of time to the Honey
and Eggs Sub-Committee and the full Committee will consider this
subject later and issue a small separate report.

I can now confirm the remarks in my letter of June 24th [2] as to
the way in which the Committee will view Export Control.

EMPIRE MARKETING BOARD

As reported in my last letter, the series of consultations and
preliminary meetings consequent upon the setting up of this Board
are still demanding a very great deal of attention.

This week the six Overseas Representatives dined together and
discussed our general attitude to certain questions. My Oversea
colleagues asked me to act as their spokesman at the Board on
these points.

PUBLICITY

The full Publicity Committee has not yet met but Captain
OrmsbyGore [3] had a preliminary meeting of those members of the
Board who are to serve upon the Committee in order to allow of
certain preliminary decisions being taken. I find Ministers have a
very natural dread of commercial advertising and are more
interested in educational propaganda.

For the initial publicity campaign it is probable that the scheme
(of which I sent you particulars together with my letter of
October 22nd [4]) will be the ground work.

RESEARCH

The report of the Provisional Committee on Research was presented
to the Board at yesterday's meeting and was unanimously adopted.

I enclose a copy of this secret report for your own personal
information. It is a very interesting document.

The Board agreed that it would be wiser at any rate at the outset
to have a Research Committee of laymen and to confine it to
members of the Board. All the Oversea Representatives warmly
supported this point of view.

GENERAL

It has become obvious that certain British Departments especially
the Department of Scientific and Industrial Research and the
Departments of Agriculture for England and Wales and the
Department for Scotland will try to obtain grants from the Empire
Marketing Board to compensate them for the hard hearted attitude
of the Treasury presided over by rather a harassed Chancellor.

This tendency is dangerous owing to the presence of the
Parliamentary Secretaries for two of these Departments upon the
Board.

Yesterday, therefore, I raised the issue as to a definition of the
type of scheme which could properly be assisted from the Annual
Grant. I urged that on the research side the Grant should be used
to cause new work of value to the Empire to be undertaken and that
the Board should be upon its guard against using the grant to
subsidize work which should properly fall within the province of
the normal expenditure of a department.

In general terms the Board agreed with me but I feel sure that we
shall have to be continuously on our guard on this subject.

It is certainly necessary for at least one overseas representative
to be prepared to express the view that under no circumstances
should the original purpose of the Grant (i.e. a grant in lieu of
Tariff Preference) be lost sight of.

While welcoming the inclusion of British Agriculture in the
recipients of advantage from the Grant, this fact has greatly
complicated the situation. I am very glad that as
(a) I know all the British members of the Board;

(b) I am known to be sympathetic to British agriculture;

I can speak pretty firmly on such subjects as the proper use of
the Grant without risk of being misunderstood.

PARLIAMENTARY QUESTION

I would particularly draw your attention to Dr. Haden Guest's [5]
questions and Mr. Amery's [6] answer regarding the personnel of
the Empire Marketing Board.

U.S.A. REPORT ON COMMODITY CONTROL

I enclose an interesting report on this subject presented to the
House of Representatives by the Committee on Interstate and
Foreign Commerce.

Yours sincerely,
F. L. MCDOUGALL

[Handwritten]

P.S. I also enclose 14th article from 'Times Trade Supplement' on
the Economic Problems of the Empire. [7]