Mr. Haldane brought back with him the actual text of the new German Navy Law, or “Novelle” as it was called. This had been handed to him by the Emperor during the course of the discussion. It was an elaborate technical document. Mr. Haldane had had the prudence to refuse to express any opinion upon it till it had been examined by the Admiralty experts. We now subjected this document to a rigorous scrutiny. The result more than confirmed my first unfavourable impression. ‘The main feature in the new law,’ I reported to the Cabinet on February 14, ‘is the extraordinary increase in the striking force of ships of all classes immediately available throughout the year. Whereas formerly we reckoned against 17 battleships, 4 battle cruisers, and 12 small cruisers in the active battle fleet, demobilised to a great extent during the winter months, we must in future prepare against 25, 12 and 18, which are not to be subject to anything like the same degree of temporary demobilisation.... Full permanent crews are to be provided for all, or nearly all, torpedo boat destroyers, now aggregating 115, and working up to an authorised total of 144, instead of for half the number as at present. There is to be an increase on the already large provision of £750,000 in this year’s Estimates for submarines. The numbers are not stated, but from the fact that 121 additional executive officers are required for this service alone by 1920, we may infer that between 50 and 60 submarines are to be added.[14] We know nothing of the rate at which this construction is to be achieved. The increases in personnel are also important. Under their existing law, the Germans are working to a total of 86,500 in 1917 by annual increments of 3,500. The new law adds 15,000 officers and men, and raises the total in 1920 to 101,500.’ On March 9 I pointed out that the fundamental proposition of the negotiations from the Admiralty point of view had been that the existing Germany Navy Law should not be increased, but, if possible, reduced, whereas on the contrary a new law was certainly to be enacted providing for large and progressive increases not only in 1912 but in the five following years. Practically four-fifths of the German Navy were to be placed permanently upon a war footing. The German Government would be able to have available at all seasons of the year twenty-five, or perhaps twenty-nine, fully commissioned battleships, ‘whereas at the present time the British Government have in full commission in Home Waters only twenty-two, even counting the Atlantic Fleet.’