manned on mobilisation, but the increase in _personnel_ was required to train the men for the fleet of 1916-17. In 1920 Germany would have 108,000, and was reaching that figure by increments of 6,000 annually. After noticing the questions of pay and insurance, and mentioning that instead of grand manoeuvres there would be a general mobilisation of the Third Fleet, he dealt _inter alia_ with the supply of officers, and the new rank of Lieut.-Commander (lieutenants of eight years' standing) and then came to _matériel_. The programme was wholly normal. One of the four battleships would burn oil only. He extolled the 15-inch gun, in which Great Britain was ahead of all other Powers. Naval battles were now like "two eggshells striking each other with hammers"; hence the "awful importance" of good gunnery. After touching on the submarine service--the number to be built being secret--and its dangers, the destroyer flotillas, and the armed merchantmen--seventy by the end of 1914-15, armed with two guns solely for self-defence--he said that the Cabinet had again considered the capture of private property at sea and refused to change the practice, but had decided on the abolition of prize-money. Coming to the question of standards of naval superiority, he interpreted the 60 per cent. standard of superiority (A.R., 1912, p. 45) in _Dreadnoughts_ for the six years following 1912-13 as follows:-- Great Britain 4, 5, 4, 4, 4, 4 As compared with Germany 2, 3, 2, 2, 3, 2. For the provision to cover the period of delay of the Canadian ships, however, there was a special reason--_viz._, that, in July, 1912, the Cabinet had decided that a British battle squadron should be maintained in the Mediterranean, that Great Britain might be the guardian of her own interests there, and by the end of 1915 a battle squadron of eight battleships, based on Malta, would replace the four battle cruisers now stationed there. The force there would then consist of eight battleships, four large armed cruisers, four light cruisers of the "Town" type and sixteen destroyers of the _Beagle_ type. Hence the acceleration of three ships of the 1913-14 programme and two of the 1914-15 programme; these latter would be ready in the third quarter of 1916. Turning to the Pacific, the situation there was regulated by the British naval strength in European waters, which protected New Zealand and Australia from European Powers, and from any present danger from Japan, and Japan from European attack by sea. The Anglo-Japanese alliance, renewed up to 1921 and likely to continue, was the true protection of Australia and New Zealand, and depended entirely on the maintenance of British naval supremacy. He extolled the policy of New Zealand in giving a splendid ship to strengthen the British Navy at a decisive point; and, though the natural desire of the Dominions to have their ships in their own waters was hard to reconcile with naval