otherwise it will be swallowed up by the latter, and the former will be no better off than before.

3. The aid must be elastic. It is impossible to regard the existing cost of education as a maximum which will never be exceeded. If the cost in Board schools increases, the Boards have the rates to fall back upon. The managers of Voluntary schools must have a source of income capable of simultaneous augmentation.

4. The aid must be permanent. Any relief given now to Voluntary schools which might be withdrawn a few years hence will only ensure their destruction. Differential treatment by the Exchequer, unless it is generally accepted, is a perilous expedient. There are so many ways in which a policy of this kind can be reversed—either by cutting off the supplies, or by extending the grants to the Board schools, and thus reviving the present inequality-that its permanence can only be relied on if it is the result of a common understanding.

5. Lastly, the managers of Voluntary schools must make up their minds to accept, along with increased grants of public money, increased public control. If aid come from the State, Parliament is sure to impose conditions with the view of securing the application of the special grant to increasing the efficiency of the schools. If from the rates, the representatives of the ratepayers must have some sort of voice in the management of the schools. The ingenious expedient of the Duke of Newcastle's Commission, to make rate aid a payment for results, is not likely to be accepted now. Payment for results is discredited as mischievous to education. Managers must submit to such conditions as ratepayers may properly require for securing the efficiency of the secular education in their schools: they may have to surrender some part of that independence of management which the Duke of Newcastle's Commission thought so valuable; the only thing which they cannot surrender, and for which they must stand out to the last, is full liberty to teach their distinctive religious doctrines to the children of their own communion. There is no reason from past history to suppose that Parliament will seek to take that liberty away.

JOHN E. GORST.

1896

6

THE WESTRALIAN MINING BOOM'

BETWEEN the first day of March 1894 and the last day of September 1896 not less than 731 Western Australian gold-mining companies, with an aggregate nominal capital of 75,871,372l., have offered their shares for subscription to British investors. The greater part of these companies to be exact, 423-made their first bow to our public during the last twelve months. One hundred and eighty were floated when the late lamented' boom' in South African mining shares, which I discussed in this Review for October 1895, was in its zenith; and about the same number were children of the spring of the present

year.

To the 80,000,000 Westralian mining shares now in existence the Stock Exchange has long since conceded a special market;' and it has even conferred upon these stocks a nickname-the surest indication of importance and popularity. And that Kangaroos,' as they were fondly called, could boast of importance and popularity nobody would dare to gainsay. During many months they were the only class of stocks which furnished stockbrokers and company promoters with a living, financial newspapers with advertisements, and dabblers in shares with an opportunity to dabble. When the South African market was in a chronic state of collapse; when Home Railways had been carried to such high prices that nobody could muster pluck enough to touch them; when Argentine stocks had been worked for all they were worth;' and American railways were going to the dogs, along with the Democratic party—when, in short, every department of the Stock Exchange was inactive-Westralians came to the rescue, and the creation and distribution of these shares kept the financial community profitably employed.

I propose to enter presently into a brief examination of the methods pursued in creating these 80,000,000 shares, and particularly of the means adopted to distribute them among the public. I also intend to show how little reason the public have to congratulate themselves upon their new acquisitions. But before I do that I must show what foundation there is for these shares and their market -in other words, what are the position and the prospects of the gold industry of Western Australia, which provides the basis of this gambling mania.

The Western Australia Goldfields, first somewhat vaguely known as Coolgardie,' really consist of a large number of districts spread over an area considerably more than 100,000 square miles in extent, and almost exclusively consisting of arid lands situate between the thirtieth and thirty-fifth degrees south. Until quite recently the whole colony of Western Australia had neither future nor history; and, as far as the latter is concerned, it has only just begun to manufacture the article. Although the honour is claimed by two men named Ryan and Sweetman, the first important discovery of gold is generally placed to the credit of two prospectors named Bayley and Ford, who in 1892 discovered some rich gold-bearing quartz from which they extracted 700 ounces of gold. They took this gold to Southern Cross, then a small mining camp. Within one day every able-bodied person in the town was prospecting, and needless to say a rush also ensued from the coast. It is a curious fact that the principal drawback with which these pioneers had to contend whilst they were making many important discoveries was excessive rain. Horses and carts had to be left in the mud, we are told, and 'dry-blowing' was impossible. That was in the summer of 1892. By Christmas water sold, in some places, at five shillings a bottle, and it has been at a premium ever since.

By degrees many fresh discoveries were made, and 'Coolgardie was divided into sections, whilst new fields-Pilbarra, Murchison, Yalgoo, Kurnalpi, Kalgoorlie, and others--were added. Many of the 'finds' created a sensation, and numerous 'pockets' were found that eclipsed the most famous bonanzas' of the halcyon days of California. Gradually, also, mining operations were extended. Foreign capital and foreign experts were attracted, and the goldfields soon became by far the most valuable asset of one of the least prosperous of British colonies. Many mines were started, although most of them remain in an embryonic state until the present day.' And there has been this peculiarity about these enterprises, that people often embarked upon them without ascertaining the extent of the mines, their probable permanence, or their presumable prospects as commercial ventures. Westralian' mining companies, as I have already shown, were promoted by the hundred rather than by the score; but hardly anybody seems to have taken the trouble to ask for, or to provide, proof that these mines, into which scores of millions have been sunk, would ever repay the original outlay, let alone yield profits. This omission appears the more remarkable, since it has always been known that these rich fields had serious drawbacks. There were no means of communication except camels; there was no adequate supply of labour; there was little timber; there was hardly any surface water; and, worst of all, the auriferous deposits-one can hardly call them

6

It is but right to add that this seems in part due to the cost of transportation, and its prospective reduction owing to the construction of a line of railway.

strata-proved tricky and patchy.' The mines have an unpleasant way of looking marvellously rich near the surface, and of giving out suddenly at small depth; and the deplorable failure of the Londonderry mine, promoted with a capital of 700,000l. by Lord Fingall and the late Colonel North, brought this fact home to the venturesome folk who bought shares. For a time, indeed, the Londonderry fiasco damped the ardour of the promoter to bring out more companies, and suppressed the eagerness of the 'investor' to purchase more shares. But the patience of the company promoter is long, and the memories of shareholders are short, and after a time promotion was resumed afresh and soon reached truly unprecedented dimensions. As many as eighty-one companies have been brought out in a single month-April 1896. And yet there never were any sufficient hard, solid facts, reliable data, or results worth speaking of, to explain this renewed favour. Herr Bergrath Dr. Schmeisser, a German geologist whose name is well remembered in this country in connection with a very sanguine report written by him a couple of years ago on the Witwatersrand mines, had been sent to Western Australia by one of the leading 'finance companies' interested in these fields. His report, translated by his employers, was by no means wholly favourable, and received but scant publicity. It emphasised the unreliable nature of the strata, already known to everybody not wholly devoid of the faculty to observe; and it went so far as to say plainly that 'the richness of the outcrops, either in the "pockets" or for continuous stretches . . . has repeatedly led to erroneous valuations of the deposit.'

The richness of these 'outcrops' is explained by the gradual decomposition of rock near the surface. The decomposed layer, the layer where Nature has been doing imperfectly during many centuries what mercury and cyanide of potassium accomplish in a few days, varies in depth from about 60 feet in the Cue district to 140 or 150 feet in Mensies or Kurnalpi. Beyond that depth the ore is, as a rule, poor. It is true that no great depth has yet been reached. On the Rand-where people have, at any rate, always had confidence in the continuity of the strata-very deep bore-holes have been sunk, and the diamond drill has established the existence of the well-known series of reefs at a vertical depth of over 3,000 feet. In Western Australia nobody has ventured to sink deep test holes or shafts; there are not ten mines which have followed their reefs down to a vertical depth of more than 200 feet. That is to say, most companies have kept within the semi-decayed zone, within the rich upper layer. It is undoubtedly true that this upper layer has in many cases proved very rich. Some bodies of ore-for instance, on the Hill End mine-have

2 See note on next page.

VOL. XL-No. 237

3 B

yielded as much as fifteen ounces per ton, whilst most mines on the Rand do not yield as many pennyweights. Three or four ounces of gold per ton is a common figure, and four ounces means 15l. worth of gold. But there is no doubt whatsoever that these ores are selected; even the boldest of 'experts' does not assert that they are not. And it is necessary to select, because the cost of treatment is so high that it would be rank folly to work low-grade ores. All the necessaries of life and all materials are dear. There are no transportation facilities. Water is unobtainable in most places; where it can be had, it costs money.

This question of water supply, indeed, is one of the most important with which the fields are confronted. The Government is, no doubt, anxious to assist in providing the life-blood of the mines; in fact, Sir John Forrest, the Premier of the colony, who has learnt that these mines must create a strong political force, has virtually undertaken to supply water.3 But Western Australia is a sparsely peopled colony, which has less than 100,000 inhabitants; and the fields are very extensive. Even if water can be procured-which is not by any means certain in any bar a few cases, and very doubtful in many-it will be at a heavy cost. Ten million gallons a day, which would not go very far, would, according to a Mr. O'Connor, require an initial outlay of 5,323,000l., and would cost 38. 10d. per 1,000 gallons. But it remains yet to be seen whether water can be had in such large quantities. Then there are difficulties of transport. Even an imperfect railway system would require an outlay of at least 3,000,000l. in addition to the sum already spent upon the trunk line to Coolgardie, and it would leave the vast majority of mines dependent upon supplementary means, chiefly camels. Also, there is a great scarcity of labour. But coolies and Chinamen can probably be had for the asking, and the question is less how to provide muscle and sinew than how to maintain them at reasonable cost.

I have in the foregoing endeavoured to point out the four salient characteristics of this young mining region. First, the gold strata are unreliable and erratic; they decrease in value at small depth,

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A special correspondent of the Economist, whose letter from Perth, Western Australia, can be found in that journal of the 10th of October, says concerning this matter: The goldfields are absolutely without fresh water, and the most feasible method of supplying Coolgardie and the surrounding district with fresh water is considered to be by means of a line of pipes 300 miles long and involving pumping the water not only along that distance, but raising it in the process some 1,500 feet. For this project a loan of 2,500,000l. will shortly be asked for in the London market.' 4 Dr. Schmeisser says in his report: This irregularity in the distribution of the pay ore makes it necessary to determine by careful sampling and examination during the progress of the development work which portions will pay to work. Another fact which I have frequently observed is the richness of the outcrops, either in pockets or for continuous stretches. This circumstance has repeatedly led to erroneous valuations of the deposit. For as soon as mining operations are extended in depth, a considerable decrease in the value of the bulk of the ore takes place, and corresponding