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FEDERAL FINANCE. affecting the United Kingdom as a whole, to hand over to subordinate legislatures in England, Scotland, Ireland, and possibly in Wales, the power to deal with the internal affairs of each country. This implies the establishment of a federal form of government in the United Kingdom, somewhat similar to that which exists in Canada. It would be out of place to give the arguments for and against this great reform in our Constitution in this paper, which is based on the assumption that such a reform has become a necessity.

The main difficulty in devising a workable scheme of federal government for the United Kingdom is that of adjusting the financial relations between the Imperial Government and the subordinate national legislatures. It has been asserted that Imperial cannot be separated from national finance, and that the problem is so complex as to be insoluble. Problems which have been solved in other countries, such as Germany and the United States, and under the British flag in Australia and Canada, cannot, however, be admitted to be beyond the capacity of British statesmen. It is, at any rate, well that in a society of experts such as this, they should be ventilated and discussed; and it is as a humble contribution to the discussion that I venture to offer this paper. Though the principal suggestion is my own, most of its conclusions are the result of much discussion with others.

In order to appreciate the conditions of the problem, it is necessary to study the 'The Return of Revenue and Expenditure' (England, Scotland, and Ireland) annually issued under the authority of Parliament. 97