Much might be done in all these directions. Much has been accomplished already. The worst that can happen is that a separate legislature should be set up in Dublin, devoid of the requisite means, as it would most certainly be (unless, indeed, it had recourse to the rates, or the taxpayer) of financing Irish Education; swayed from side to side by the exigencies of the party programme of the moment; and temperamentally unable to look at the educational problem from the standpoint alone of the needs of the country in the way that it is now regarded. At present, under the Union, Irish Education is fortunately liberated from all appeals to party passion, and organised with but one end in view, the upbringing of the infant race whose possession is the future.

SECONDARY EDUCATION.

The need for reform is more urgent and, in many respects, better defined in the system of Secondary than in that of Primary Education in Ireland. But the two ought to be closely interconnected, and in discussing one at least of the more important changes which it is desirable to introduce, the National Schools have as good a claim to be heard in the matter as their elder brethren.

Since 1900 great efforts have been made by the Intermediate Board to promote the interests of Secondary Schools and to supply the educational needs of those who want to equip themselves for the struggle of life in its various departments. In 1900, the Board of Intermediate Education was empowered to appoint inspectors, but it was not until quite recently, after many fruitless applications and under a threat of resignation by the Board, that inspection was placed on a business-like footing and a permanent staff of six inspectors appointed. But this, after all, is a comparative detail, and reform will have to strike deep indeed if the secondary schools in Ireland are to take their place as a living part of a living body.

The question of reform may be dealt with under three principal heads: (1) the abolition of the examination tests, (2) the inter-relationship between the Primary and Secondary systems, and (3) the position of teachers. Although there are other matters which will be briefly referred to, these are the three cardinal difficulties that beset the Intermediate Board to-day and obstruct the most public-spirited efforts to convert the Irish educational system into one organic whole.

(1) Although the mischievous principle of fees by results has disappeared for ever from the National Schools, it still clings to Intermediate Education, numbing and constricting, like some remorseless ivy limb, the growth and free exercise of the central stem and its branches, and preventing the natural sap from rising and vitalising the whole. It is not as though the rest of the world had set the seal of its approval upon this kind of examination. The contrary is the fact. Almost every country in the world has rejected this system as wholly pernicious, injurious for the pupil, demoralising for the teacher, and wasteful for the State. To regard the youth of the Secondary Schools merely as the geese that lay the golden eggs when the examinations occur, is to destroy the true aims of education and pervert the principle of rational development. In fact, payments to Intermediate Schools ought to depend largely on the results of inspection, and much less on written examinations, a change which would involve the appointment of a larger number of inspectors than at present exist. It is all-important that this alteration should be undertaken without delay. The mechanical agglomeration of lifeless snippets of information which characterises the present method is an absurd and antiquated remnant of the bad old times, and the sooner this part of the system is hewn down the better it will be for the conscientious discharge of the teacher's duties and the self-respect of all concerned.

(2) As for any proper official relationship between the Primary and Secondary systems, it may be said as yet to be practically non-existent. That co-ordination of the two is essential—nay, vital—if Irish education is to be placed on a sound footing, may be appreciated from the fact that a large proportion, or 57 per cent, of the membership of Intermediate Schools is recruited from the schools of the National Board. There seem to be only two ways in which this co-ordination can be satisfactorily effected. Either the pupils must transfer from the National to the Secondary Schools at an age when they will be young enough to profit by Secondary instruction, or some sort of higher instruction must be given in the National Schools so as to fit the children, when they leave the latter at rather a later age, for the curriculum awaiting them in the Secondary system. It is the Treasury at the present moment, and the Treasury alone, that blocks the way to this reform. Since 1902 it has been asked to sanction the establishment of higher grade schools in large centres; the National Board also has repeatedly pleaded for the institution of a "higher top," or advanced departments, in connection with selected Primary Schools in rural districts. But all these requests, founded though they have been on intimate knowledge of the requirements of Irish Education and a ripe experience ranging over many years, have been brushed aside by the officials at the Exchequer, although the cost would be only about £25,000 a year, on the very insufficient ground that the Development Grant has been depleted to defray the loss of flotation of stock for the purposes of land purchase. What, in the name of common sense, has land purchase to do with education? What indissoluble relationship is there between the two that the expenditure upon the one should be made dependent upon the requirements of the other? This niggardly and short-sighted attitude is hardly worthy of one of the richest countries in the world. It is but a matter of a few thousands, and surely the efficient training of the youth of Ireland is quite as important as buying out the Irish landlords and placing the Irish tenant in possession of the soil. The result of the present want of co-ordination is that the clever pupil is now kept far too long in the lower school. There he remains, kicking his heels until he is sent up to the Intermediate School at 15 or 16—much too late an age at which to begin the study of languages. The Primary teachers are, of course, only too pleased to retain the clever boys as long as possible in the National Schools, but it is unfair to the children, and is robbing the community of services which might be rendered to it by these pupils in the future if fair opportunities were afforded them of training themselves while there was yet time. Without higher grade schools, without scholarships, without at least some system of a "higher top" in connection with the Primary Schools, there can never be proper co-ordination of administration, and education in Ireland will never be able to progress beyond a certain point. The Christian Brothers have set the Treasury a good example in this matter. In their schools there is close co-ordination of primary and intermediate education. Promising boys in the fifth standard are removed when they are 11 or 12 years of age into the higher schools and thus given an opportunity, at the most receptive period of their lives, of acquiring knowledge which they will be able to turn to good account in after life. Over and over again has the National Board attempted to persuade the Treasury to adopt a similar system, but hitherto without avail. The crust of the official mind has been impervious to every appeal. There seems, indeed, to be now some chance of the establishment of scholarships for pupils in primary schools, but unless an intelligent mind is brought to bear upon it, and the scholarships limited, as in England and Scotland, to pupils under 12 or 13 years of age, the same unfortunate result will follow, as in the case of the Society for Promoting Protestant Schools and other similar bodies, where the scholarships have turned out to be a practical failure. An exception, however, as suggested by Dr. Starkie, and as allowed in Scotland, might be made in favour of the best Primary Schools. That is to say, where satisfactory Secondary teaching is given at a Primary School, the pupil might be relieved of one or two of the three years he is obliged to spend in the Secondary School before he can compete for the Intermediate Certificate which is awarded at 15 years of age.

The argument is sometimes used that the establishment of higher grade schools would lead to unfair competition with the Intermediate Schools already in existence. No one desires to do this. Where the Intermediate Schools already hold the field, such overlapping can easily be avoided by proper administrative co-ordination between the National and Secondary systems. Where, on the other hand, there is a dearth of Intermediate Schools, as in Connaught and Kerry, higher grade schools can, and should be established without any risk either of overlapping or competition. They would supply a want which is deplored by all educational reformers, and make their influence felt far outside the mere circle of the schoolroom. A private commercial school has already been founded in Kerry and has continued for some time without State help, but, through want of encouragement, it has recently been compelled to adopt the programme of the Intermediate Board, which is entirely unsuited to its particular aims. Surely, private enterprise of this kind ought not only to be welcomed, but stimulated by a State grant, and everything possible done to encourage schools to develop along their own lines. At the present moment, they are bound hand and foot by the examination rules of the Intermediate Board, and it is quite impossible for any central authority, however eagle-eyed and sympathetic, to appreciate the peculiar atmosphere and wants of every locality. In such cases, local initiative is far more valuable than red tape, and more likely to result in an intelligent interest in his pupils and subject on the part of the teacher.

(3) The position of the Secondary teachers, especially of lay assistant teachers, cries aloud for reform. In fact, their case is an acknowledged scandal. How can any one expect that the training of the youth in the Secondary Schools can be really satisfactory when the teachers are so miserably underpaid, when the elements of self-respect are given no room in which to develop, and the whole profession are treated rather as beasts of burden than as a noble and responsible body to whom is entrusted much of the destiny of the race? The question of reform is here largely a question of money. There are signs that this fact is becoming more appreciated as the years go by, and it is devoutly to be hoped that before long the teaching profession in the Secondary Schools will have no more to complain of than the Primary teachers, or than is usual in even the most cared-for and prosperous professions in this our imperfect world. Salaries, pensions, a register, security of tenure, opportunities of proper training—these may be said to embody the chief requirements of Secondary teachers at the present moment. In existing circumstances there is no attraction for competent men and women to enter the teaching profession so far as Intermediate education is concerned. The most incompetent crowd into it, although there are many exceptions, and teaching is regarded as a stop-gap during periods of impecuniosity rather than as a permanent career to be proud of and to be worked for. The salaries are beggarly—considerably lower than the incomes of the teachers in the Primary Schools. In 1908, the average salaries of principals in the Primary Schools were £112 for men and £90 for women, and in the County Boroughs £163 and £126 respectively, whilst in the Secondary Schools lay assistants were paid about £80 per annum. In view of this, surely the demand that is being made on behalf of highly qualified Secondary teachers is not exorbitant, namely, salaries of £100 to £300 for men and of £80 to £220 for women. If the maximum rate were £150 for men and £100 for women the cost would be £220,000 a year. Where is the money to come from? Will a Nationalist Parliament be prepared to find it, and if so, from what source? Ireland is a comparatively poor country and is not in a position to bear much more taxation. The Intermediate Board, with its present resources, cannot afford to step into the breach, and the only solution seems to be that the British Exchequer should come to the rescue and that the Board should be granted the means of dealing with this all-important matter, the neglect of which is having a most injurious effect upon the efficiency of the Intermediate Schools. It has been suggested that a half-way house might be found, that the Treasury should grant £60 for each assistant master and £40 for each assistant mistress, and that the remainder should be raised by the authorities of the schools under the direction of the Board. This alternative scheme would cost the State about £88,300 a year, but, like all makeshifts, would not effect a real settlement of the difficulty, creating, as it would, a patchwork system of payment which might break down at any moment. On the other hand, let the settlement be a generous one, and the return will be a hundredfold in added efficiency, a higher sense of duty, and an increased personal interest on the part of the teacher in the class of which he has charge.

In close connection with the question of salaries are those of pensions and security of tenure. The pensions of the Primary teachers, inadequate though they be, would be looked upon as a provision of the most munificent kind by the poor men and women who enter service under the Intermediate system. The Primary teachers, moreover, can fall back upon subsidiary occupations if they find that their salaries are insufficient for their maintenance. They can run a little farm or keep a shop or do other remunerative work, but the assistants in Secondary Schools are debarred from these methods of supplementing their exiguous wage. Those terrible words might, without any extravagance, be inscribed for them over the doors of their schools: "All hope abandon ye who enter here." Something must be done. A starvation wage, with an adequate pension to follow, might be tolerable, a decent wage, without any pension, might be borne, but starvation at both ends is a disgrace to the Treasury while it lasts and one of the things which should be taken in hand without any further delay.

Security of tenure is equally important. How can a teacher be expected to devote the whole of his mental energies to his scholastic duties, how can any one expect him to throw himself heart and soul into his work, if there is always lurking in his mind the haunting fear of dismissal through no fault of his own? It is unreasonable to suppose that any human being can give of his best under these distracting conditions. In the National Schools a system of appeal has been in force for some time, and has been carried out with fairness on the part of those in authority and to the apparent satisfaction of the teaching profession. The dismissal order of every Roman Catholic manager has to be countersigned by the Bishop of the Diocese, and in the case of all teachers an appeal is now allowed to the Board itself, and is often utilised by Protestants. In fact, so far as the National Schools are concerned, the tenure of the Primary teachers during good behaviour is practically secured. Why cannot similar safeguards be introduced into the Intermediate system? An appeal to the Board in this case is not proposed by those who know all the circumstances best; but teachers in Roman Catholic schools might have the right of appeal, in the case of Diocesan Colleges, to the Bishop of the Diocese, or in the case of schools under religious orders to the Provincials or Generals, and Protestant teachers might be allowed to appeal to the Board of Governors of their schools, or they might sign an agreement, providing for a referee, such as the No. 3 and 4 agreements under the National Board.

A register of teachers is also required. Every existing teacher in the Intermediate Schools who satisfies the tests of efficiency should be placed upon it without delay. As far as future appointments are concerned, qualifications might be adopted similar to those which now obtain in the Scotch Department, e.g. (a) a degree in a University, or its equivalent; (b) a diploma following professional training for one year; and (c) two probationary years in a good school. Special terms would probably be demanded for those who, like Nuns, are precluded by their calling from attending lectures at a University.

These are some of the reforms which could, and should be introduced to make the teaching profession more efficient, more attractive for competent and clever men and women, and more of a permanent and honourable career than it has been in the past. Once again, it is not unreasonable to ask—How will a Dublin Parliament be able to provide the necessary funds? An extra annual sum of roughly £300,000 is required, in addition to a further sum of about £330,000 to meet non-recurring expenditure. These are, admittedly, moderate estimates. The matter, anyway, is now ripe for settlement, and procrastination can only aggravate the financial difficulty. So far as the educational problem is concerned, it is a manifest obligation upon the Nationalist Party to outline their proposals for the redress of these grievances, and to indicate the means by which they can be carried out, before a separate Legislature is set up for the people of Ireland.

Within the scope of these few pages it is not possible to comprise all the aspects of modern Irish Education which are worthy of discussion. What are most urgently needed to-day are the necessary funds to continue the good work which is being done, and to introduce the reforms that have been sketched above. Parsimony in educational matters is the most wasteful of all misplaced thrift. Let the reformers be dealt with wisely and generously, and the harvest will exceed even the expectations of those who are working most hopefully upon the problem. Withhold the funds on some niggardly and mistaken principle of petty economy, and the present progress will be discouraged and the educational tree become stunted in its growth. From an administrative point of view, nothing, finance apart, would contribute more to the efficiency of Irish Education than the amalgamation of the National and Intermediate systems, as well as of the Technical work at present administered by the Department of Agriculture and Technical Education, under one Board. The method of examination by the Department is far sounder than that which is forced upon the Intermediate Board by the Acts of Parliament under which it works. In the case of science, the two are to be seen working to-day side by side in the Secondary Schools, to the undoubted benefit of the scientific course, which enjoys a double subsidy from the State, and is subject to the superior method of examination by the Department, being treated as a detached subject and the candidates being passed en bloc. On the other hand, the obsolete method of examination by the Board tends to the serious disadvantage of the classical curriculum, the grants being made on the unprofitable results of a general examination of individual candidates, the class not being regarded as a whole, as is the case with the Department. By the repeal of the Intermediate Acts, and by the amalgamation of the various Boards into one, these anomalies would rapidly disappear, and for the first time a genuine system of co-ordination could be introduced into Irish Education, which would knit together the strength of all the parts and overcome many of the prevailing weaknesses, making the whole system what it ought to be, a living, growing, pulsating organism, developing and shaping itself with the life of the nation.

Is it conceivable that all this can he accomplished if the Union between the countries is rent asunder? What chance will there be of effecting this great settlement, which requires money and, above all, requires peace, when Ireland is plunged once again into the old internecine struggles of the eighteenth century? The warning is writ very large upon the wall, so that he who runs may read. The best hope for education in Ireland are the resources of Great Britain and a uniform policy undisturbed by party feuds. Neither of these can be looked for under a separate Parliament. Under the Union Ireland can have both, for the welfare of her children and the building of a noble history.

XX

If this trade is to expand, Irish traffic routes and facilities with Great Britain must be improved and increased, especially as the articles carried are largely of a perishable kind. Moreover, the internal traffic of Ireland, by rail, waterways, and canals is capable of and needs great development, as witness the recent Reports of the Viceregal Commission on Irish Railways, and of the Royal Commission on Canals and Waterways.[92] The problem of inland navigation is again intimately bound up with that of arterial drainage, as the Commissioners have reported. It is then strange to find, that on these pressing questions of first importance, there is an almost absolute silence on the part of those who advocate Home Rule in and out of Parliament.

SOLUTION OF TRANSIT PROBLEM IMPOSSIBLE UNDER HOME RULE.

It is true that the nationalisation of the Irish railways has in past years found the keenest advocates amongst individual members of the Home Rule Party; that the Majority Report of the late Viceregal Commission favouring State purchase of the Irish railways was formally approved of by the Parliamentary Party, and that Mr. Redmond has named "transit" as one of the special matters that should be left to be dealt with by an Irish Legislature. But there the matter ends. We are not given the slightest inkling what is proposed to be done on this matter, or how it will be done, or the slightest proof that under any system of Home Rule, the financial difficulties of the problem can be solved at all.

The Reports of both the Commissions referred to are based, first on the continuance of the present system of laws and government, and secondly, on the use of Imperial credit to the tune of many millions. Yet amongst the shoals of literature on Home Rule problems and finance, I can find no enlightenment as to how the transit problem is to be solved under the new conditions; i.e. how any Home Rule Government, whether it has control of Customs and Excise or not, and however it economises, is to find the money necessary to buy out the Irish railways and canals. A Government that is faced with the problems of poverty and congestion, of housing, of increased educational grants, of afforestation, and of arterial land drainage, will have an almost impossible task in raising money for these purposes alone. And, let those who can, inform us how an Irish Parliament and Executive (with all else they will have in hand), will be able to raise even the £5,000,000 necessary to improve the Irish Light Railway System; not to speak of the sum at least tenfold greater which will be required for a complete purchase scheme.

So far we are without that information. The Irish Parliamentary leaders have not touched upon the point. The pamphleteers are almost equally silent. Professor Kettle, in his "Home Rule Finance," mentions the "Nationalisation of Railways" in one line of print, merely stating that "the project will have to be financed by loans and not out of annual revenue" (p. 41); and he further remarks, generally (p. 72), "that for the development of any future policy, approved by her own people, Ireland relies absolutely on her own fiscal resources." What fiscal resources, and under what conditions are they obtainable?

In the volume entitled "Home Rule Problems" issued by the Liberal Home Rule Committee, with a preface by Viscount Haldane, not one word is said on the subject, though there are chapters on Irish finance, and on Irish commercial and industrial conditions. Neither has Mr. Stephen Gwynn a single word on the subject in his "Case for Home Rule," though he makes the large assertion that "there is no country in the world where resources are more undeveloped than those of Ireland."

Mr. Erskine Childers[93] merely refers to the Irish railway problem as one that is "obvious and urgent," "which no Parliament but an Irish Parliament can deal with, and which calls aloud for settlement."

DETAILS OF RAILWAY TRANSIT PROBLEM.

Let us now look at the problem in more detail; and first is the question of the railways. The property to be dealt with consists of 3411 miles of railway, representing a total capital of £45,163,000, of which, at the date of the Report of the Commission, £2,873,000 paid no dividend; the gross annual receipts of the whole system being £4,255,000 and the net receipts £1,690,000, representing a return on the whole capital of 3.77 per cent.[94]

Of these lines, the railways constructed under the Tramways and Light Railways Acts cover 603 miles, of which 322 are narrow gauge, involving a liability on various baronies which have guaranteed interest on capital to the amount of £36,000 per annum. To bring these light railways up to a proper standard and equipment; to widen the gauge in many cases; to provide new sheds, stations, and rolling stock, and redeem the guarantees, a sum of about £5,000,000 would probably be necessary. In addition, projects for no less than eighty-three new railways were brought before the Commission;[95] and it is admitted on all hands, and the Commission find, that practically none of these railway extensions would be undertaken by private enterprise, and that these developments need the credit, help, and direction of the State. Even the necessary improvement of the existing light railways cannot now be undertaken, for under the system of legislation under which they were constructed, there is no means of raising new capital.[96]

Now, what is advocated by the Majority Report is the—

This was the scheme supported by the Parliamentary Party, written up unceasingly by the Freeman's Journal, and held out under the term "Nationalisation of Railways," as one of the special boons which Home Rule will bring to Irish traders and farmers.

But mark how the operation is to be carried out. The Commission reported that the sum required should be raised by a railway stock charged primarily on the Consolidated Fund of the United Kingdom, with recourse to Irish rates to make up possible deficiencies, and further, that there should be an annual grant from the Exchequer of not less than £250,000 to the Irish railway authority. Seeing that the Commissioners refer to "the financial terms prescribed by the Act of 1844" (Regulation of Railways Act, 7 & 8 Vict. c. 85, ss. 2-4), and that a cash payment to shareholders was provided for by that Act, it is to be presumed that the Commissioners intended Irish shareholders to be paid in cash. The Act of 1844 provided for payment to the companies of a sum in cash equal to twenty-five years' purchase of the previous three years' annual profits; but this was the minimum only, for it was provided that the companies could, under arbitration, claim additional payment in respect of future "prospects."

Now twenty-five years' purchase of the divisible profits, which at the date of the Commission, were £1,690,000, would amount to over £42,000,000, and if in addition sums had to be raised for "prospects," purchase of lines paying no dividend, special provision for prior stocks standing at a premium, redemption of guarantees, and the large sums required for the extensions and improvements we have mentioned, a sum not less than £50,000,000, and probably nearer £55,000,000, would be required.[98]

From the beginning to the end of the inquiry there was no suggestion that this immense operation could be carried out except by the use of Imperial credit, involving the two conditions: (1) that the Consolidated Fund of the United Kingdom be charged, and (2) that the British public be asked, and should be willing to find the money. Although the Majority Report contemplated an Irish elected authority to work the railways so purchased and amalgamated, it was never suggested that any such Irish authority could raise the necessary purchase capital, or, indeed, any portion of it. The whole scheme from beginning to end pre-supposed the continuance of the Union, with its advantages of credit and capital. Upset that Union, establish an Irish Parliament working out its own salvation, financially and otherwise, and the basis of the whole scheme of railway nationalisation vanishes.

That the British Government should allow its credit to be used to the tune of fifty millions, after full legislative, executive and taxing powers were handed over to an Irish Parliament, is too fantastic to be considered seriously. Whether an Irish or English authority controlled the working of the railways would under such circumstances make little difference, with the Courts of Law, the Executive, and Police in other hands than that of the Government guaranteeing the interest. The security for the advance would be imperilled; and, indeed, it is doubtful whether a tenth of the money required would be advanced, even in London, on those terms. For a similar reason any formal pledge of Irish rates and taxes, to make up deficiencies in working, would be illusory. At any rate, if Irish Land Purchase is to be continued under British credit (and it certainly will be a prior claim and charge), it is idle to expect Parliament to undertake the vast additional obligations involved in Irish railway nationalisation. Parliament would pay the piper but could not call the tune.

IRISH CREDIT NOT SUFFICIENT.

There remains the alternative of the new Irish Parliament financing the operation. This it must do by means of payment in cash to the selling shareholders, for reasons which will be hereafter stated, unless it wishes to start its career by a scheme of spoliation, which would not merely rob the shareholders (who are mostly Irish), but would destroy the credit of the Irish Government. Mr. Redmond has recently acknowledged that a large number of Irish railway shareholders are good Nationalists; and it is certain that a great portion of the ordinary stock is held by Irish farmers and traders; and much of the preference and debenture stocks are also held by Irish charities, convents, diocesan trustees, and monastic institutions. These persons will expect, and justly expect, cash on a compulsory purchase, on basis of market value, or capitalisation of dividend, so as to secure the same return of interest.

Could the Irish Government borrow £50,000,000, and at what rate? To borrow at a higher rate than the present return on Irish railway capital, namely, 3.77 per cent., would be to incur a loss on working the railways, from the outset, which Irish ratepayers or taxpayers would have to make up. The net receipts, at the time of the Commission's Report, were, in round figures, £1,600,000, and thus to borrow £50,000,000, even at 4 per cent., would mean an annual loss of £300,000 a year, even if there were no sinking fund. A 10s. per cent sinking fund would increase the total annual loss to £550,000.

But, could an Irish Government Guaranteed Railway Stock be issued at 4 per cent.? Would Ireland's credit stand better than that of Hungary, whose 4 per cent. gold rentes stand at 92, or of the Argentine, which has to borrow at nearly 5 per cent.? There are grave doubts whether the large sum required would be subscribed at all, at even 4 1/4 per cent, or 4 1/2 per cent. basis. It is not likely that English investors would take up such a loan, seeing that they have consistently fought shy of Irish investments, and they are not likely to change their views upon the break up of the Union.

It may be said that the sum required could be raised in Ireland—that patriotic feeling would stimulate the operation, and the large sum of money (over £50,000,000), lying on deposit at the Irish banks may be referred to as available. Patriotism that has not financed the Irish Parliamentary Party will not be likely to finance a gigantic railway loan. Nor is the large sum appearing as banking deposits really free money available for investment. With increase of deposits, the items of loans and advances in banking accounts have also correspondingly increased, and they largely balance each other. Not only is the money deposited by one customer lent to another, and therefore already utilized, but, to a large extent well known to bankers, the deposits, i.e. the credits to particular accounts, represent money lent to the persons having these accounts, and are not, in fact, their own free balances. So also credits in the accounts of one bank, figure as debits on the balance sheet of another bank. There probably has been in recent years considerable saving in Ireland, but it is also certain that those savings have largely gone, and will continue rightly to go in improvements of farms, which the Land Acts and Land Purchase Acts have made worth improving for their possessors. Those who have not saved enough borrow, and the bank advances represent largely the capital required by farmers and traders. The deposits, therefore, are being well used, and are not dead money. Divert them to any large extent to another purpose, and there will probably be a contraction of banking credit, which Irish farming and industry will be the first to feel.

PURCHASE BY STATE PAPER.

It may be said that the nationalisation of railways could be carried out, not by a cash payment, but by a paper exchange of existing Railway Stocks into newly created Irish Government Stock, the amount of the existing net receipts being guaranteed. But, unless the Irish Government could actually borrow in cash the sum required, at a rate equal to that nominally put on the new stock, the shareholders would be robbed of a capital sum equal to the amount of the discount on the stock, i.e. the amount of the market quotation below par, or issue price. There will be sellers of the new stock from the beginning, and what the public will give for it, and not the nominal figure put upon it by the Irish Government, will be its real value. The Irish Government may issue the Railway Stock at 3-1/2 per cent., but if they could borrow the sum required only at 4-1/2 per cent., the new stock will at once find its level at about 77 instead of 100, and the capital value of Irish railways will be reduced from, say, £45,000,000 to £35,000,000, and the difference, £10,000,000, would come out of the pockets of Irish shareholders. The Irish Government would be, however, in this unpleasant dilemma, that if they issued the stock at a rate per cent, nominally higher than the present return in railway capital, namely, 3.77 per cent., the annual charge for interest would be greater than the net receipts, and so from the beginning there would be an annual loss; and the fact of this annual loss would be another factor tending to depreciate the new Railway Stock. The alternatives before an Irish Prime Minister, pressed to carry out a "Nationalisation" policy, are not enviable. He will either have to provide by taxation for the annual loss involved in taking over the railways on a fair basis, or to deprive the most thrifty and industrious classes of his fellow-countrymen of a large slice of their savings and investments. In either event, the new Government will have received a serious blow to its credit at the outset of its career.

EFFECT OF REDUCTION OF RAILWAY RATES.

There is, moreover, a special reason why such a stock, from its inception, would tend to depreciate in value; namely, that from the moment the Irish Government or their nominees became the owners, there would be almost irresistible pressure put upon them to reduce the railway rates, and generally (as indeed the Majority Report recommends) to work the railways on other than commercial lines.[99] A reduction of rates has been held out as the great resulting boon of nationalisation ever since the Irish Parliamentary Party specifically raised the question in Parliament in 1899. A 25 per cent. reduction in rates and fares (suggested by Nationalist witnesses) would involve an annual diminution of net receipts to the Government of over £1,000,000 per annum, and if the reduction were in goods rates alone, the loss would be £568,000 per annum. It would be years, if ever, before such a loss could be recouped, however the traffic was increased. Experience has shown that in recent years running expenses tend to increase nearly parallel with the gross receipts, and a large increase in gross traffic would involve enormous capital outlay for rolling stock, engines, sidings, etc. It is unnecessary to comment upon the suggestion that the railways should not be run on "commercial principles." The Irish ratepayers and taxpayers, who would have to bear the loss, would loudly call out for business management when it was too late.

It is hardly necessary to add that another result of such an operation would be to prevent the Irish Government raising the very large sum necessary for improving and standardising the light railways and for extensions, except at an unremunerative rate of interest. Even if shareholders be put off with State paper, contractors will have to be paid with cash. Moreover the creation of such a large amount of debt at the beginning of the new regime would render it difficult, if not impossible, for the Irish Government to raise sums necessary for other public works and services of a pressing character, arterial drainage, canals, education, and other objects, not to speak of migration, congestion, and land purchase. The conclusion, in fact, is inevitable, that without the security of the United Kingdom, and the market of British investors willing to lend, it is idle to think that either State purchase of railways, or any other of the boons mentioned, are reasonably possible. Mr. Erskine Childers, though a Home Ruler, does not fail to perceive, to use his own words, "that financial independence will now mean a financial sacrifice to Ireland."[100]

EFFECT OF NATIONALISATION ON TRADE RELATIONS.

There are other important considerations which confirm the view that, if the control of Irish railways were taken away from the Imperial Parliament, and placed under a Parliament sitting in Dublin, and if the general code of railway legislation now binding on both countries could be altered by a Home Rule legislature, results disastrous to the trade between the two countries would probably follow, whether "Nationalisation" were carried out or not.

The Majority Report recommends, as one of the chief objects of "Nationalisation" under an Irish authority, the reduction of export rates, both local and through rates, on the Irish railways, as "essential to the development of Irish industry," and this seems the pet project of a large number of witnesses, and of Irish local authorities. Import and export railway rates are now the same for the same classes of produce, and no Irish railway company could now differentiate between them, without being pulled up by the Railway Commission at the suit of British traders, or British railway companies. The policy suggested is practically to use railway rates as a system of local protection, similar to the existing practice and policy on the continental, and notably the Prussian State Railways. It is easy to see that without any Customs barrier between the two countries, such a policy would inaugurate practically a tariff war between Ireland and Great Britain, which would be disastrous to both. That such a policy should be subscribed to by Free-traders, and that a Free-trade Government should advocate a change in the relations between the two countries, under which such a system could be possible, is indeed surprising. To use Imperial credit for such a purpose would be midsummer madness. Even without any scheme of nationalisation, the establishment of a separate Executive and Legislature in Ireland might have sinister effects on traffic arrangements between Great Britain and Ireland and on the harmonious administration of the railways.

THE RIGHT SOLUTION.

The truth of the matter, and the inference to be drawn from the above considerations and the whole trend of modern trade, is that to break up the railway systems of Great Britain and Ireland into two rival and hostile systems of transit, working for different objects and by different methods, would be to stop a natural and healthy process of uniform working and harmony, which has enormously advanced in the last decade, to the great advantage of Ireland.

Almost every scheme of amalgamation in Ireland has been connected with the opening or development of a new cross-Channel route, as the history of the Fishguard and Rosslare and the new Heysham routes fully shows. As part of this process, English companies, like the Midland and the Great Western, are either acquiring Irish lines or making special traffic arrangements with them. Enormous sums have been spent on harbours and steamers by English companies for the purpose of developing traffic with Ireland, and the increased interchange of goods has been of great advantage to both countries. The ideal put forward by advocates of railway nationalisation and Irish independence, that in respect of trade and traffic Ireland should be a sort of watertight compartment, self-supporting and self-contained, is, I submit, a mischievous delusion which, if put into practice, would undo much of the good progress Ireland has recently made. Such an ideal would also be the exact contrary of the line of national development as based on transit and transport followed in almost every other civilized country. In Germany, Canada, the United States, and Australia, we see the policy consistently pursued of amalgamation, consolidation, and facilities for long-distance traffic, so that between all parts of each State and Empire there shall be the freest and most perfect interchange of traffic. Canada and the United States have been so far inspired by this principle as to spend countless millions first on East and West (and now on North and South) lines, even before there was traffic to carry, and in order to create traffic; and the principle has been justified in its results.

From this point of view St. George's Channel and the Irish Sea should be a means of communication, constant and in every direction, between the two Islands, and not a sort of boundary ditch to be deepened and rendered difficult of passage.

If Ireland wishes to share England's prosperity she must not build up a wall against the credit, trade, and special products of her richer sister. If England wishes to have and to foster a magnificent source of food supply, well and strategically secured against continental foes, she also must do all that can be done to encourage intercourse. To develop traffic between Great Britain and Ireland is the policy which both experience and theory point to as advantageous to both countries; to subvert this policy and make Ireland's commerce local and self-sufficing, seems to be the narrow and mistaken ideal of Nationalist aspirations.

UNIONIST POLICY.

It follows that the Unionist Party must oppose any plan for "nationalising" the Irish railways, whether by the credit of the United Kingdom, or otherwise. The policy we advocate is to be found in the Minority Report of the Viceregal Commission, signed by Sir Herbert Jekyll, Mr. W.M. Acworth, and Mr. John Aspinall, not as politicians, but experts; and in the Report of the Royal Commission on Canals and Inland Navigation dealing with the question of canals and water transport in Ireland.

In the case of railways, the aim should be to amalgamate them into two or three large companies to standardise as far as possible the light railways, and level them in respect of gauge, gradients, works, and rolling stock with the larger companies. Unquestionably many of the smaller railways to be amalgamated, though not light railways, need large expenditure for the purpose of duplication of running lines, straightening of curves, stations, stores, and conveniences, and many extensions and cross-lines will also be needed to connect them with the trunk lines, and to open out districts now unprovided with railway facilities. Many of these projects, though industrially remunerative to Ireland and advantageous to England also as tapping new sources of food supply, would not be, in strictness, commercially remunerative in the sense of giving fair return on capital over working expenses, and it is idle to expect that private capital will ever be subscribed for these purposes. They can only be undertaken either directly by State funds, or by money provided by the State, and lent to the large amalgamated lines at low interest. This is the policy inaugurated by Mr. Arthur Balfour, which has been of untold benefit to many districts in Ireland. Probably a public grant of, say, £2,000,000, and loanable money available to the extent of £8,000,000, would largely solve the problem. For the reasons already given it is only by Imperial credit, and under the ægis of a united Parliament and Government, that capital on this large scale can be available for these purposes.

CANALS AND NAVIGATION.

The problem of canals and inland navigation in Ireland is a minor one, but the same principles largely apply. The Royal Commission[101] recommended that all the chief waterways, canals, and rivers necessary for inland transport should be purchased and remain under the control of the State, the controlling authority, however, not themselves, to become carriers on any waterways. At the same time, they strongly urged that the problem of arterial drainage and relief from floods should not be treated separately, but that the control of drainage works should be under the same central authority as that which is to control waterways and navigation.

It is not necessary to refer in detail to the Report. Apart from the sum necessary to buy out the existing owners of canals and waterways, towards which £2,451,346 had been contributed from private sources, the Commissioners contemplated a further expenditure of about £200,000 on new works. In addition the sum of £500,000 would be required, on a moderate estimate for drainage and the prevention of floods. The pressing nature of the latter problem is once more emphatically evidenced by the wholesale injury to property and the public health by the recent flooding of the basins of the Shannon, Barrow, Bann, and other rivers. Here, again, we have problems which it is idle to expect an Irish Parliament to solve satisfactorily for years to come, or, indeed, ever. Ways and means must be an effectual bar. Drainage and navigation form only one problem out of a dozen facing a Home Rule Government needing the raising of enormous capital. Probably the Commissioners conducting the Canals inquiry, who were persons of all shades of political opinion, were well aware that only under the present system of State credit could the financial difficulties be overcome. According to their report, the State (i.e. the Government of the United Kingdom) were to acquire the control, which was to be carried out by an Act of Parliament, naming the Waterways Commissioners, "who should be persons disassociated from party politics."

The one dissentient out of twenty-one signatories, Lord Farrer, significantly adds that he does not favour a "charge on the public purse and new Boards of Management until a purely Irish elected authority has agreed to pay for them." Precisely; Lord Farrer has looked ahead. Will an Irish elected authority agree to pay for these boons, and will they be able to pay? That is a question which will cause some searching of hearts amongst all interested in Ireland's welfare;—in these pages we have attempted to give an answer.

CONCLUSION.

The conclusion is in fact inevitable. Ireland cannot have it both ways. She cannot have financial independence and financial dependence at the same time. No Colony has ever claimed or been granted these inconsistent conditions. If Colonial precedents are cited, their essential limitations should also be borne in mind. Colonial loans are not charged on the Consolidated Fund. Nor have Colonial railways been nationalised with the money and credit of the United Kingdom, in order to favour local exports at the expense of imports from England.

Our examination of the question brings us to the clear conclusion that it is only under the existing system of a single Parliament and Executive for the United Kingdom that the problems of transit and transport in Ireland, or between Great Britain and Ireland, can be satisfactorily solved, whether from the point of view of finance, justice to shareholders, or advantage to the trade and convenience of both countries.