A very important financial issue has lately been raised by the proposition to permit the investment of British Trust Funds in colonial securities. The proposal has for some time been steadily urged upon the English Government by the Agents General who {277} officially represent the Australian colonies, and by the High Commissioner for Canada, and it is generally believed that the negociations had proceeded so far that at one time Her Majesty's Government had consented to initiate the Legislation necessary for the purpose. Though the discussion is now in abeyance, it will no doubt come up at a later time for decision. If favourable, that decision would confer a considerable financial advantage upon the colonies. Of the sufficiency of the guarantee furnished in such investments careful and responsible financiers entertain no reasonable doubt. It is obvious, however, that any determination to concede this privilege to trustees implies a belief that the colonies will remain a part of the Empire. It is equally obvious that any tendency in an opposite direction on the part of any great colony would be fatal to the proposition. At present such investment can only be made in certain home securities, or in Indian, and a very limited number of colonial securities which are under direct Imperial guarantee. There would be as valid reason for extending them to French, Italian or Russian securities as to those of colonies which might soon become independent nations. It will be scarcely possible to avoid the consideration of ultimate inter-imperial relations should this subject come up for final decision in Parliament. Under a settled system of Imperial unity colonial securities, even without Legislation, would naturally rank with the best in the Empire. {278} CHAPTER XIII. TRADE AND FISCAL POLICY. IN matters of fiscal policy the British Empire at present occupies a position peculiar among all the nations of the world, in that for nearly half a century it has been without any fiscal system common to its various parts. Nor does the fact seem to have seriously affected the sense of unity. It cannot be said that New South Wales, which till quite lately has in its fiscal arrangements followed the example of the mother-country, is united a whit more closely to her than is Victoria or Canada, where duties have long been imposed not merely for revenue but for protection. 'Nor can it be truly said that the ties, practical or sentimental, which bind together Canada and the United Kingdom, have grown weaker since the adoption in the Dominion of a trade policy opposite to that of the mother-land. Should the new commonwealth of Australia, in its eager desire to create varied industries, decide upon a system of inter-colonial free trade, with protection against the rest of the world, including Britain, no one would now anticipate therefrom any fundamental change {279} in the political relations between mother-land and colony.