&   > COPY NO. h8.
'THIS DOCUMENT IS THE PROPERTY OF HIS MAJESTY'S GOVERNMENT IN NEW ZEALAND.
All communications \ . — In. your reply please
to be addressed to quote this number:-
"The Secretary".
' p.c.   0* (Apt) 2.
DEFENCE CONFERENCE 1939.
Parliament Buildings,
WELLINGTON, C.1;
SECRET. _50th   April, 1939.
MEMORANDUM for:-
mlfbh lf*Sl 2*~  ?ot?? of Proceedings of the Qonnittee
f^JS?*^0*!0?     Nation to the Trans-rtusifie
air route and United States activities in the Pacific."
(MMni Day, Tuesday, 16th April, 1939.)
With reference to the above paper which has
already been forwarded to you, I have to inform you that this has
been replaced by a final edition which is forwarded herewith.
I shall be glad, therefores if you will destroy
the copy of the first edition in your possession.
Secretary,
Defence Conference 1939
FORM D.C.F. 13-
Ty IS DOCUMENT IS THE PROPERTY OF HIS MAJESTY'S GOVERNMENT IN NEW ZEALAND.
D.C.C.(AIR) 2.
SECRET.
FINAL EDITION.
COPY NO. "8.. 4 ^
20th April, 1939
DEFENCE CONFERENCE, 1939.
It is requested that special care may be taken to ensure
the secrecy of this document.
NOTES    OP PROCEEDINGS
OP
COMMITTEE   SET   UP   TO DISCUSS
"POLICY IN RELATION TO THE TRAITS-PACIFIC AIR
ROUTE AND UNITED STATES ACTIVITIES IN THE PACIFIC."
SECOND DAY - TUESDAY3 APRIL 18, 1939)
PRESENT:
Hon. P. Fraser - Chairman.
Group Capt. Wilkes
Sir Harry Batterbee
Air Marshal Sir Arthur Longmore
Capt. Johnston
Paymaster Capt. Tottenham
Mr. Barrov/
Sqd.Ldr. Gibson
Mr. Ashwin
Dr. Barnett
Mr.Vaskess
Mr. Boyd Shannon
Sqd. Ldr. Grundy
Notes on the Meeting of "the Committee held in Room G^.
Parliament Buildings, on the 18th April. 1939, to discuss:
"POLICY" IN RELATION TO THE TRANS-PACIFIC AIR
ROUTS¦  AND UNITED STATES ACTIVITIES IN THE
PACIFIC."
Opening the proceedings the Chairman, the HON. MR.
FRASERf said that there were several corrections to "be made to
the notes of the previous day's meeting. The&e were discussed and
it was decided -bo issue revised notes.
SQUADRON LEADER GIBSON then asked if it was the
intention of the committee to consider the establishment of land
plane bases as of secondary or as of equal importance to the
establishment of flying boat alighting areas.
THE CHAIRMAN replied that the Committee should
bear in mind that they should endeavour to grapple with what was
immediately practical, at the same time keeping their eyes on the
future.   He considered that the deliberations of the Committee to
date had not prevented the eventual employment of land planes,
but had rather tended to facilitate their use.
The Committee then considered the following
points -
(1) The establishment of a complete British A.ir Service
running side by side with an American Service from
Australia via New Zealand, the Western Pacific
Islands, Hawaii and San Francisco to Canada.
(2) A proposal   emanating from Australia, for the
operation of a service from Australia via Auckland
to Fiji or Honolulu, or some other intermediate point,
from where all traffic should be transferred to an
American Service.
CAPT. JOHNSTON raised the point as to what would
be the position in wartime of one of the Islands held jointly
by the U.S.A. and Britain in the event of one country being at
war and the other neutral.
SIR ARTHUR LONGMORE said this was a difficult
question, but he did not think there could be any objection to
a civil air route.   There might be objections to the use of such
Islands as a base for operating service madaines.   In certain
circumstances it might be an advantage to have the joint
arrangement.
THE CHAIRMAN said that as far as Panning and
Christmas Islands were concerned, New Zealand had objected to
their being included in any offer of arbitration because it was*
desirable that British Sovereignty should be firmly established
there.     He thought that if we came to a reasonable understanding
with the United States in regard to Honolulu, it might be quite
advantageous to us to allow them to land on and use these as veil
as other Islands.     He thought that this might be the basis of a
splendid agreement.
CAPT.  JOHNSTON said it was not so much a matter
of bargaining one island against another, as bargaining for our
route to go through to the American mainland.    If we owned all
the Islands but were not allowed to land at Honolulu, the
service could not go through, and similarly, if the United States
owned all the Islands but were not allowed to land in New Zealand
or Australia, their service could not go through. He
suggested that the first and immediate step to be taken was for
the British interests concerned to apply to the American
Government for permission to operate a service to Honolulu,
notifying them that that would be our terminus temporarily, but
that we intended to go on to the American mainland shortly
thereafter.     If they agreed the problem would be solved. If
they did not agree, or hedged, then New Zealand should take
advantage of the powers she possessed under the Pan-American
Airways-New Zealand agreement and give notice of termination. He
realized that this might be difficult to do politically, and
therefore suggested that at the same time we should give them
notice that we were prepared to meet them half-way if they were
not prepared to agree to our going over their section as we have
agreed to their American Company going over our section.     It could
still be a joint service, meeting half-way at Fiji or some other
point - the actual point was not important at the moment.   In any
event, he thought we should proceed immediately with the
preparation of the New Zealand-Hawaiian service as far as lay
3..
within our power*   We should "be in a position to operate as far
as Hawaii, or somewhere short of that, in the near future. There
were no operational difficulties in the way, and no great period
of time was necessary to prepare the route or to obtain suitable
aircraft.    In that way only would we he likely to get any real
progress.   The real crux of the matter was the permit to land at
Honolulu and the American continent, and it was only "by making
an application that the matter could he brought to a test. If
America would not agree, our only redress was against Pan-
American Airways, and even if we gave notice of termination now
it would not become operative for another fifteen months. He
therefore considered that there should be no delay in lodging
the application with the American Government for a permit to go
through..   These v/ere his own views, and he could not say that
they v/ere fully accepted by the Commonwealth Government, but
broadly speaking, the view of the Government was that some step
should be taken to press an application.   The suggestion that we
meet half way was partly a real proposal and partly a threat to
the United States interests in the hope that it would give us
even more than the half-way junction we asked for.   His suggestion
was aiming at a British service and an American service, both
running right across the Pacific.   But if America would not let
British interests use Hawaii - as they might not - then, rather
than let the Americans run down to New Zealand and v/e not run at
all, we should put forward the proposition to meet them half-way.
9. MR. BARROW said that we could not stop Pan-
American Airways from running to Noumea because they could do it
through their own islands.   Also, he doubted whether it would be
wise to serve notice of the termination of their agreement on
Pan-American Airways as a threat.    He felt that the more we
encouraged the interests of the American Government and the
American people in the Pacific area, the better the British
Commonwealth would be served, and the use of the Pan-American
agreement as a bargaining point was really putting ourselves at
a disadvantage if the ultimate effect was going to "be to drive
the   Americans out of this area.   He would certainly favour an
approach to the American Government for the use of Hawaii, and
if necessary would let them go through to Australia.   But to use
the threat of cancelling their service to Auckland when they
could simply go to Noumea. .:as, he. thought, not the wisest of
tactics.   If, "by approach to the American Government, we could
get permission to land at the Hawaiian Group and then continue
on to San Francisco and up to Canada, any concession we could
give the Americans in the Pacific area would he of the utmost
value to the Empire in defence "because of the supply of war
materials coming down to "both Australia and New Zealand from
the United States over that route.   He would agree with Gapt.
Johnston, except that he did not think it should "be used as a
"bargaining point.
10. CAPT. JOHNSTON pointed out that a service to
Noumea was of no value in itself.   It would still have to get to
Australia, and that would "be dependent on Australian permission
or an Australian company operating.
11. SIR ARTHUR LONGMORS thought the Committee should
have regard to the aspect that we should stand out at all costs
for the route from Australia via New Zealand to America and
subsequently on to Canada, however it was finally arranged.
That was definitely the feeling of the Air Ivtinistry on the
subject.   Capt, Johnston's proposal really envisaged two stages,
one the stage when permission was obtained to go as far as the
Sandwich Group or Honolulu, and second, a further stage to come
which envisaged passage right through to San Francisco en route
to Canada.
12. CAPT. JOHNSTON said he put forward the idea of
stopping at Honolulu "because we were in a position now, or at
very short notice, to operate as far as that.
13< SIR ARTHUR LONGMORS suggested that in the
negotiations with the United States permission should "be sought
to go the whole distance and that it should not "be stated that
5.
we were not yet ready to go further than Honolulu.    If they
knew that, America might say that they would consider the
further stage later on.     Any negotiations should be on the basis
of the route right through.
1U. CAPT.  JOHNSTON agreed that our rights to go right
through to America should be established from the beginning,
but he would Just raise the consideration that it might not be
the best thing psychologically to attempt to hide both from the
American and our own people our inability to do all that we were
asking to be able to do.     He thought it might be better to say
frankly that v/e were only prepared to go half-way at this stage.
It was to meet the possibility of the United States refusing
that we put forward the proposal of the half-way junction, which
would be better than a continuation of the present one-sided
position.
15. SIR ARTHUR LONGMORE thought that part of it
should not be raised until we had definitely been given a
complete refusal.    He thought the point raised by Mr.Barrow
was extremely important, and he thought it was for the Committee
to recommend that the neogitations should proceed on the basis
of obtaining from the United States Government permission to go
right through.
16. CAPT.JOHNSTON still thought that the United States
should be told that v/e proposed to do it in two stages. He
considered it was only because of the delay in the British
service that the Noumea proposition had been put forward, and he
pointed out that it would be extremely difficult for Australia to
continue to refuse permits for an American service to run direct
if the British service did not seem to be getting anywhere.
17. SIR HARRY BATTERBEE wondered whether the Noumea
project was seriously meant by America or whether it was merely
meant as a tactical move.
18. SIR ARTHUR LONGMORE said that he understood that
the Americans had had permission to use Noumea since 1937.
6.
19. SQUADRON-LEADER GIBSON said if they "began work
at Canton it would mean they were committed to Noumea.
20. CAPT. JOHNSTON said the main point he wished to
stress was that something should "be done immediately ahout
running a service at teast part of the way.
The Committee adjourned at U.10 p.m. and
re-assembled at U.30 p.m.
(Continued on Page 7.)
' 7.
21. After the adjournment CAPTAIN JOHNSTON pointed out that
the ultimate idea of Pan American Airways was to run through to
Australia, and that, any agreement to that plan, except on a
reciprocal basis, would ruin the chance of the Trans-Tasman
service being a success.     He also suggested that in any possible
conference or despatches the Americans might put forward the view
that New Zealand was to be compared with Honolulu, and if we
wanted to go beyond Honolulu they would want to go beyond New
Zealand.
22. MR.FRASER thought they probably took the view that New
Zealand was just a stepping stone on an American world route, and
he raised the point that the United States could declare Honolulu-
San Francisco passengers as coast-wise traffic as they had done
with the steamers, but the same conditions could be applied to
trans-Tasman passengers.     He continued that a conference with
America would be most desirable, but British representatives
should not be tied down to any one limited definite project. We
should be prepared to give and take over the matter of reciprocal
landing rights.
23. CAPTAIN JOHNSTON considered one of thereasons why America
would not agree to have a conference was that they did not know
what was going to be put forward, and he stressed the view that
we should come into the open and offer a fair and equitable
proposal so that they could see that it was intended to serve
them as well as ourselves.     He pointed out that at the conference
three years ago they had talked of cancelling the Pan American
agreement but nothing had yet been done.
2L|.. MR. FRASER replied that though it was disappointing to find
that nothing had been done in that respect in the three years it
would have been worse if the wrong thing had been done.
25. MR.BARROW moved that a drafting committee should be set up
to prepare a statement, and the motion was unanimously carried.
26, SIR ARTHUR LONGMORE. sar.d that while everyone was agreed as
to the objective, they were not in accord as regards the course to
be pursued. There was a political issue to be taken into consid-
eration and it was not a question of selecting the islands, but
1
8.
of deciding on the method of approach to the United States
Government and the ultimate arrangements would have to be made
by the Home Government through the usual diplomatic channels.
27. MR.FRASER was in favour of asking America for the through
reciprocal rights as he considered the policy of bringin^ up the
alternatives before the through rights were refused would show a
broken front.
28. SIR ARTHUR LONGMORE said that one of the most important
decisions that had been reached was that the Pacific route should
run from Australia via New Zealand.     MR.FRASER said that this
meant that the New Zealand Government would have to inform Pan
American Airways that it was not agreeable to their varying the
route and going to Noumea.     CAPTAIN JOHNSTON assured the committee
that his endorsement of that view would be concurred in by the
Australian Government on the understanding that the route would
be started in the near future.     He considered that an application
should be made for through rights immediately.
29. MR.FRASER said it would have to be a genuine application and
not one for tactical purposes and we would have to undertake that
we would take advantage of the sanctions if granted, within a
definite time.   CAPTAIN JOHNSTON went further and stated that
survey flights, at any rate, should begin this year.     He had
certain alternatives in connection with the method of approach and
gave an undertaking to produce them in writing in the morning.
30. SIR ARTHUR LONGMORB doubted whether the committee was called
upon to discuss the argument as to the ownership of the various
islands in the Pacific.     MR.FRASER was of the opinion that
the Committee should reach an understanding on the matter,
though it would be a matter for the respective Governments to
discuss if they met the United States in conference.     He read
two cablegrams, dated 23rd March 1939, from the Secretary of State
for the Dominions to the Governor-General.
CAPTAI?! JOHNSTON read a letter from the High Commissioner
for the United Kingdom in Australia to the Minister of Defence
for the Commonwealth, dated the 20th March 1939.    (See Appendix
A).
32. SIR ARTHUR LONGMORE thought it would be practical to
approach the United States through the usual diplomatic channels
and indicate that we had the intention of establishing a through
route via Hawaii and San Francisco to Canada on the basis of
reciprocal rights, naming all the islands on the route.    If they
questioned our claim to any of the islands it would open up the
opportunity for a Conference.     Immediate action along those
lines might stop the Noumea project.
33. MR¦FRASER   stressed the point that the matter of holding a
Conference with the United States was of more importance than
even the Pacific air route, because the closer that the British
Commonwealth and the United States kept together the better for
the British countries in the Pacific.      Even if we had a
Conference on such a minor matter, and in the scheme of world
affairs a trans-Pacific air route is a comparatively minor matter,
the Foreign Office would be pleased.
31;. MR.FRASER asked Squadron-Leader Grundy, as secretary to the
Committee, to draft with the assistance of Mr. Boyd-Shannon, a
report setting out the conclusions that the Committee had reached
with regard to the proposed route and reciprocal arrangements with
the United States of America.
35. The Committee adjourned at 5.30 p.m., to resume at 2.30 p.m.
on v'ednesday, the 19th April, 1939.
APPENDIX B.
COPY B.
OFFICE OF THE HIGH COMMISSIONER
FOR THE UNITED KINGDOM,
CANBERRA,
20th March, 1939.
SECRET.
My dear Minister,
I have now received the views of my Government on
the proposals which you recently discussed with me that (i) item (j)
should he omitted from the agenda of the forthcoming Defence Conference
in New Zealand and (ii) an endeavour should he made to reach an
agreement with the United States Government on the "basis that the
United States should control the portion of the trans-Pacific route
north of the Equator,and that British interests should control the
portion south of the Equator.
2. As regards (i), the position as seen "by my
Government is as follows:-
While they fully share the desire to press on
with the estahlishment of a trans-Pacific air route as rapidly as
possible, they consider that the best way of making positive progress
would be by inducing the United States Government to co-operate for
the purpose.   As yet, however, the United States Government have
abstained from accepting repeated invitations to enter into a four-
party conference to discuss the settlement of the problem on a
practical basis of reciprocal air facilities.   Instead they have
sought to secure for themselves control over intermediary links in the
chain of trans-Pacific aviation by advancing a claim to Pacific Island
hitherto regarded as British and have recently renewed their proposal
for/
The Hon. H.V.S. Thorby, M.P.,
Minister of Civil Aviation,
CANBERRA, A.C.T.
2,
for discussions designed to regulate the status and use of the
islands in dispute.   As the Commonwealth Government are aware from
the draft reply to this proposal, in which they have concurred, my
Government, though not excluding the possibility of a discussion
of the status of individual islands as a secondary matter at the
four-party conference when it materialises, are opposed to the
United States solution, which "brings the difficult question of
sovereignty into the foreground and assumes that the ownership of such
islands can "be determined independently of their value as part of a
general system of air navigation.   Moreover, it seems to them that the
attitude of His Majesty's Governments concerned towards the question
of ownership cannot "be determined without reference to the importance
of the islands concerned in connection with plans for colonisation
and defence.    In their opinion,  the forthcoming conference in
New Zealand offers an exceptional opportunity for co-ordinating the
available information concerning the use of outlying Pacific islands
for the above-mentioned purposes and of formulating recommendations
as to the most practical method of ensuring that the problem of
trans-Pacific navigation can be settled with due regard to the various
interests involved.   They therefore earnestly hope that the Common-
wealth Government will withdraw their proposal to omit item (j) from
the agenda, especially as the forv/ard policy of the United States
Government has rendered the consideration of this subject a matter of
urgency.
3, As regards (ii), my Government see considerable
difficulties in adopting the Commonwealth Government's proposal to
sectionalise the trans-Pacific air route.    The main objection, in
their view, is that the proposal would not'be in accordance with the
policy of the open door and complete reciprocity in the Pacific which
they desire to see established.   My Government's plan contemplates the
operation of United States and British Commonwealth services in close
co-operation right across the Pacific, with reciprocal landing rights
in the American Continent and New Zealand, respectively, open rights at
intermediate stopping places, common use of ground organization and
mutual/
7
/ 3.
mutual consultation regarding time-tables and frequency.   The Common-
wealth Government's scheme would involve abandoning the above
principles and sectionalising operations.
^* Other objections seen to the scheme are that:
(a) it involves abandonment of the idea of a direct British
Commonwealth air link between .Australia, New Zealand and Canada;
(b) it would restrict the general development of Imperial
communications and prevent the completion of a trunk route round the
world;
(c) as a bargain it would be too completely one sided.
It would mean, on the one hand, that we surrendered reciprocal rights
in United States territory which we are entitled to claim, and, on the
other hand, that we granted rights in Christmas and other British
islands north of the Equator without compensating advantages. We
already possess suitable intermediate air ports in the South Pacifics
rights in which could properly be exchanged for reciprocal rights in
the United States- islands, pariicularly Hawaii.
5. My Government appreciate that it may be argued
that the Commonwealth Government proposals are intende^only as a
short term policy pending the conclusion of a later arrangement for
full through service on the basis of reciprocity.   It seems to them,
however, that the proposed sectionalisation would prejudice rather
than facilitate a subsequent development on the lines we desire•
Moreover,  as regards the actual operation of the route, British flying
boats which will fly the North Atlantic this summer have the range
necessary for the trans-Pacific service and there is no reason why
the development of the latter service by British Commonwealth
interests should be regarded as a remote contingency.
6, For these reasons, my Government would be unwilling
to adopt the Australian scheme, involving as it would the acceptance
of the position that the United States air service would alone provide
the important part of the link between Australia, New Zealand and
Canada.
in these circumstances, it seems to them that the
forthcoming conference in New Zealand would provide an excellent
opportunity to discuss the matter further; and they hope therefore
that the Commonwealth Government will not press the proposal to omit
item (j) from the agenda.
8. I have sent copies of this letter to the Treasurer
and the Minister of Defence.
Yours sincerely,
(Sgd.)   Geoffrey Whiskard.