22

28th May, 1925

CONFIDENTIAL

(Due to arrive Melbourne-27.6.25)

My dear P.M.,

I met Sir John Baird [1] on 20th May. He put a large number of questions to me about conditions in Australia. He indicated that his close contact with the members of the Government and members of Parliament generally would be of value to you in Australia, in that it would enable him to keep, for your benefit, in close touch with the machinery and trend of thought in England. He used the words that he would be able to talk to Bruce, the Privy Counsellor, with perhaps greater freedom and usefulness than to Bruce, the Prime Minister. He gave me to understand that he was not prepared to spend more than a certain sum which he did not specify, but which Lord Forster [2] had told him was sufficient.

He proposes to take three Daimler cars out with him. He will take such staff and servants as Lord Forster advises him are necessary, over and above those that he hopes to take over from Lord Forster.

He was not surprised that 'The Times' had not given better publicity to his appointment, as he said there were reasons why he was not persona grata to the late Northcliffe press.

He admits he knows nothing of Australia and he has taken the sensible line with the various Australian Press representatives who have interviewed him, that he has no views on Australia, as it is so long since he was there, that his knowledge of conditions there will be valueless.

The remark that almost everyone makes who knows him is that he is a 'nice little man'.

Hankey [3], I am glad to say, takes me increasingly into his confidence. I show him my file of letters (not letters such as this, which go on a personal file) to you at intervals, to let him see what sort of material I am sending you, and I am perfectly frank with him as regards all I hear and do. He now has the P.M.'s authority to show me anything at all, except of course that I am not to have possession of copies of Cabinet minutes, although I am (in confidence) allowed to become acquainted with their deliberations. Naturally I make as little mention as possible to people here as to what papers I see, as I don't want any queries raised as to why it is thought necessary for me to see all the material I do.

Amongst other things, Hankey now has the P.M.'s permission to let me see the weekly reports of the Special Branch (at New Scotland Yard) on revolutionary organisations in Great Britain.

This is more a matter of interest than anything else, although something of value to us may come to the surface at times.

Scotland Yard's knowledge of what goes on in Communist circles is remarkable. From the last few weeks reading of the bulky weekly report that is circulated to the Cabinet, it is hard to believe that any revolutionary or subversive activity could be hatched without their knowledge.

It would only weary you to report on this subject. I will merely watch for any points that might affect Australia.

Hankey tells me that the turnouts that the Press get from time to time about Austen Chamberlain [4] resigning are without foundation. There is no doubt that he is meeting some opposition from Birkenhead [5], Churchill [6] and, probably, Amery [7], in his efforts to get a Security Pact through the Cabinet, and it is also probably true that more than one Cabinet Minister would like to be Foreign Secretary. But Chamberlain could by no means be said to have failed, and it would be unlike him to resign on account of a little passive resistance to his scheme.

The best 'inspired' opinion that I can get is that there is very little sign of 'clique' in the Cabinet, other than between Birkenhead and Churchill, who usually hunt as a pair.

I don't think I have ever mentioned Tom Jones [8] to you. He is nominally Assistant Secretary to the Cabinet, but in reality (and in great confidence) he writes the bulk of the Prime Minister's speeches, and keeps the P.M. informed on a large range of subjects. He is in the room above me, and is a mine of information about people and movements. A self-educated Welshman of great personal attraction, sound, calm judgment, well-read and, as a side line, with considerable artistic leanings and knowledge. He is in the confidence of a wide range of people, from the P.M. and Hankey downwards-or outwards.

It is quite noticeable, and has been commented on, that New Zealand invariably agrees with any proposal put forward by H.M.G.

The phrase that occurred in a recent telegram from N.Z. to H.M.G.

is quite typical: 'The N.Z. Government have no observations to make on the subject and are content to leave the whole matter absolutely to the discretion of H.M.G.'

I am glad to say that it is now pretty well established as to how the 'Nicolson' document became public property. [9] The answer only tends to make one more cautious of the press than before, if that is possible. I was warned early in my time here that one had to choose between loyalty to the F.O. and being a 'good fellow' with the press in giving them hints and clues. There was never better advice.

Sir William Tyrrell [10] said in conversation recently that he regarded the modern press as a 'stinking fish' profession, which battens on sensationalism and misconception. He said that the older he got, the more he realised what a large proportion of his time was taken up in combatting misconception in people's and foreign countries' minds, engendered by false or half-true press reports. His strong remarks are no doubt prompted by the recent 'Nicolson' document episode and the unsavoury connection of the press with it.

The Governorship of Kenya is going begging at the moment. Smuts [11] wrote to Hankey urging him to make an effort to get it for himself (Hankey), but he will not, of course, do so. Amery is going to offer it to Grigg [12], but I doubt if he will accept as he is all aflame with 'migration and increased trade within the Empire', and is busy sharpening his sword in preparation for an all-in political campaign on this worthy subject. He talks and thinks of nothing else, and is marshalling his prospective supporters and increasing his knowledge of the subject before he pulls the trigger.

As you will have realised, this job has grown imperceptibly out of being straight liaison with the F.O. to being liaison with F.O., C.O., C.I.D. and Hankey. This has not come about from my seeking, but as a natural growth. I mentioned this to Hankey lately, when taking stock of the position, and he said he preferred to call it 'liaison with H.M.G.'. This, I think, is too wide. I have nothing in between to suggest as a name yet-and I don't think yet that the name matters much, but when the time comes to put another label on the appointment, it should, I think, include more than the F.O.

only.

This liaison is a curious thing. Sitting in an office only a hundred yards away from the F.O., it is very difficult to get a correct and live picture of any event from reading their despatches and cables in and out. One has to supplement reading print by going and talking to the man concerned. This disability must be intensified many times at the other end of the world, and can only, I should think, be got over by a rapid and continuous interchange of cabled question and answer, during any crisis.

Hankey said to me recently that, as far as he could see, the liaison was working well in these times of peace, but he said that it would be put to the test in time of a real crisis. When such crisis comes about, I hope Henderson [13] will bombard me with cabled questions, as only by so doing can I readily put myself in his place and send the necessary cables elucidating the position.

If he keeps me continuously informed of the facts and colour that are lacking at your end, I have then no excuse for not keeping him completely in touch. But I can well imagine that the success of the liaison experiment may be impaired if I am telegraphically garrulous and he is departmentally silent and relying on my unaided efforts to supply information.

It is interesting to think that if you got notice the day before of a Parliamentary question on foreign affairs, and cabled me at once, I could find out and cable you the answer in time for Parliament the next day.

On any subject of importance and urgency, I can get a 'clear the line' message through to you in under half-an-hour (G.P.O., London to G.P.O., Melbourne), and presumably you can get a message to London in the same time.

I enclose sheet of press cuttings on your recent remarks on Dominions and Foreign Policy. [14] They attracted considerable attention here and I have been questioned by all manner of people as to what was behind them.

Amery's comment was that he thought that both a liaison officer and someone with diplomatic status corresponding to that of an Ambassador would be required in course of time. The 'Ambassador' could not be housed in the Cabinet Offices and could not delve into the F.O., C.O. and C.I.D., as I am doing as liaison officer.

He would have to have at least one 'Counsellor' or liaison officer to do exactly the work I am doing now.

With regard to Dominion co-operation in the conduct of Foreign Affairs, Tyrrell holds the view that we should all let well alone for a bit. He thinks the subject has had more prominence recently than is necessary. He realises that the Dominions dislike the possibility that they might be dragged into a war at the tail of the British chariot, and, because of this, are laying particular stress on the fact that their Parliaments are the only bodies that can commit them to war. He thinks, however, that the aspect of the Imperial connection that has existed since the war is too new for even the wisest men to be able to suggest hard and fast machinery to deal with it. He would like sufficient time to pass with the existing simple and flexible mechanism to enable the metamorphosis to come about gradually and the solution to evolve slowly without any cut and dried scheme.

Tyrrell is one of the old school, and I think really looks with a good deal of horror on the assumption by the Dominions of the right to run their own shows. He raises the point of the status of a Dominion diplomatic representative in London and many incidental difficulties.

Amery still talks of a quick round trip to South Africa, Australia and back by Canada, leaving some time before the House rises in July. I don't think he has yet made up his mind, and probably will not do so for another month.

You probably know of the hold that this country has over France in the shape of a mountain of French Treasury bills in the vaults of H.M. Treasury. I did not realise it until the story was told to me by a Treasury man in so many words. The scheme is said to have been put up to Lloyd George [15] by Blackett [16], the then Controller of Finance at the Treasury, as a last resort that we could use to bring France to heel. France continually duns Germany for reparations, which she wants in francs and not in marks. We have something over 500 million worth of negotiable French Treasury bills, which we have precious little chance of being able to fund or cash in. We could hand all or part of them over to Germany (in return for some substantial quid pro quo) who could use them to pay reparations (55% of which would go to France). Or we could put them on the market and crash the franc at any moment.

We could thus do Germany an extremely good turn, or France a bad turn, with little or no real cost to ourselves. Which is a lever that France, of course, realises and which no doubt restrains her from kicking over the traces.

A good story is being told about Lionel Curtis [17], who is supposed to have said to a friend after a long period of silence:

'And now, of course, the mantle of Milner [18] falls on ... me.'

I am, Yours sincerely, R. G. CASEY

1 See note 4 to Letter 21.

2 Governor-General of Australia 1920-25.

3 Sir Maurice Hankey, Secretary to the Cabinet.

4 Foreign Secretary.

5 Lord Birkenhead, Secretary for India.

6 Winston Churchill, Chancellor of the Exchequer.

7 Leopold Amery, Secretary for the Colonies.

8 Formerly an academic economist with a special interest in welfare, Jones was Deputy Secretary to the Cabinet under Hankey.

Like Hankey, Jones frequently took political initiatives himself.

9 See note 15 to Letter 21.

10 Permanent Under-Secretary at the Foreign Office.

11 Lt Gen Jan Smuts, then in opposition, had been South Africa's Prime Minister 1919-24 12 Sir Edward Grigg, National Liberal M.P., accepted the post.

13 Dr Walter Henderson, Head of the External Affairs Branch.

14 In a statement for an Empire Day supplement published in The Times on 23 May 1925 Bruce called for firmer imperial policies on foreign affairs, defence, migration and trade.

15 David Lloyd George, Prime Minister 1916-22.

16 Sir Basil Blackett, Finance Member of the Executive Council of the Governor-General of India 1922-28, formerly Controller of Finance at the Treasury 1919-22.

17 Fellow of All Souls and Secretary of the Royal Institute of International Affairs.

18 Lord Milner had been Governor of the Cape of Good Hope 1897- 1901, Governor of Transvaal and Orange River Colony 1901-05 and High Commissioner for South Africa 1897-1905. He entered Lloyd George's Cabinet in 1916, becoming Secretary for War in 1918, and was Secretary for the Colonies 1918-21. He died in May 1925. In his vigorous administration in South Africa he was supported by a talented group of young men known as 'Milner's kindergarten', which included Philip Kerr, John Buchan and Lionel Curtis.