One simple principle should regulate the official pay both of natives and of Europeans. The Government, being trustees of the public revenue, are not justified in spending one shilling of this revenue unnecessarily, and consequently they are bound not to pay more for any work which may require to be done than is sufficient to secure the services of those who are competent to perform it. If a qualified native is willing to accept 1,000l. a year where it would be requisite to give an equally competent European 2,000l. a year, a strong argument is afforded, not for making an unnecessary addition of 1,000l. a year to the salary of the native, but for saving this amount by employing him instead of the European.

Although much may be undoubtedly done to improve the financial position of India by carrying out a policy of strict retrenchment in all departments of civil administration, yet it will scarcely be denied that, in order to effect the saving which is needed, chief reliance must be placed on largely diminishing the present cost of the Indian army. It appears, from the latest official statement,1 that the net cost of the Indian army for the present year is estimated at 17,375,000l. A considerable portion of the cost of the late Afghan war will have to be borne during the present year; but as, at the time when the military expenditure was estimated at 17,375,000l., peace had been restored, and no renewal of hostilities was anticipated, it may be only too certainly concluded that the military expenditure for the present year will greatly exceed the amount stated. Even in the time of peace the cost of the army has of late years shown a tendency to increase, for in 1877, when there was no war, Sir John Strachey laid special stress upon the fact that in a single year there had been an increase of no less than 1,000,000l, in military expenditure.

It is evident that, if decided measures are not at once taken, the military expenditure will soon absorb one half of the entire net revenue of India. It would be difficult for any country, and it is impossible for one so poor as India, to bear such a drain on her resources. The Government seem at length fully to have recognised the necessity of immediately adopting measures to reduce this expenditure. A commission, with Sir Ashley Eden, the present Lieutenant-Governor of Bengal, as its president, has been appointed in India, " with a view to assist Government in determining what share of the unavoidable reductions in public expenditure can be borne by the military charges without injury to the general efficiency of the army, and in what manner such savings can best be effected." Simultaneously a small commission has been appointed in England to investigate the home army charges which are borne by India, especially those connected with the cost of recruits. This commission consists of Lord Northbrook, Sir Thomas Seccombe, who for many years ably discharged the duties of Financial Secretary at the India Office, and Mr. Knox, Deputy Accountant-General at the War Office, who has deservedly gained the confidence of successive Secretaries of State for War. It may be anticipated that much good will result from these inquiries, and that many suggestions will be made which, if adopted, will lead to a considerable reduction of expenditure.

Thus it can hardly be doubted that the Commission in India will recommend the abolition of the offices of Commander-in-Chief at Bombay and Madras, with a considerable portion of their costly and unnecessary staff. Public opinion in India is almost unanimously in favour of this change, and it was long since strongly advocated by some of the highest authorities, such as Lord Sandhurst and Sir Henry Durand, not only on the ground of economy, but also as likely to add to the efficiency of the army. The experience of the recent Afghan war must enforce upon the Commission the conclusion that the present commissariat system is alike costly and defective. The large amount which India has annually to spend in non-effective army charges cannot fail to be a prominent subject in any inquiry which has for its object the reduction of the military expenditure of that country. The sum which India has annually to pay in pensions is steadily increasing, and many of these pensions, earned after a comparatively short period of service, are received by those who are still capable of doing useful work for the State. Thus, in an account of the Indian army lately published, it is stated that "at the present moment there are thousands of soldiers who have completed little over fifteen years' service in India in receipt of pensions for life." If some kind of civil employment in India were given to these men, the army would become more popular, and the burden of the pension establishment be sensibly lightened.

The question of the non-effective charges presents itself in a still more serious aspect when the pensions and furlough allowances received by officers in the Indian army are considered. It was stated before the Indian Finance Committee in 1872 by Sir Thomas Pears, then Military Secretary at the India Office, that India was at that time annually paying no less than 1,600,000l. to officers in the form of pensions and furlough allowances, and he showed that about one-fourth of the entire number of officers of the Indian army, who are wholly maintained by India, were not in India, but in England. When such questions as these are investigated, I believe the Commissions which have just been appointed, will arrive at the conclusion that in order to effect any important reduction in the military expenditure of India, it will not be sufficient simply to deal with details, but it will be necessary to introduce fundamental changes into the system on which the present Indian army is based. With regard to the army, a partnership has been established between England and India, and as one of these countries is extremely rich, and the other extremely poor, much of the same incongruity and many of the same inconveniences arise as if two individuals were to join in housekeeping, one of whom had 20,000l. a year, and the other only 1,000l. An expenditure which may be quite appropriate to the one whose income is 20,000l. would bring nothing but embarrassment to the one whose income is only 1,000l. The money which is expended may be judiciously laid out, but if the man with the smaller income finds that he is gradually becoming embarrassed with debt because he has to live beyond his means, it is no compensation to him to be told that he is only called on to contribute his proper share of the expenses.