In the meantime Lord Milner had returned to Johannesburg. His "hard-begged" holiday had proved a change of occupation rather than a respite from work. Before he left England (August 10th), he had made known to the Home Government the actual condition of the infant administrations of the new colonies, and obtained a provision for their immediate wants. The Letters Patent constituting him Governor and Commander-in-Chief of the Transvaal and Orange River Colony had been passed under the Great Seal; and these and other instruments creating a system of Crown Colony Government, with Executive and Legislative Councils in both colonies, had been sent to him in readiness for use "whenever it might be thought expedient to bring them into operation."[298] And on August 6th the House of Commons had voted £6,500,000 as a grant in aid of the revenues of the Transvaal and Orange River Colony. Of this sum £1,000,000 was required for the purchase of fresh rolling-stock for the Imperial Military Railways, still placed under the direction of Sir Percy (then Colonel) Girouard, and £500,000 was assigned to "relief and re-settlement," an item which included the purchase of land and other arrangements for the establishment of suitable British settlers on farms in both colonies. The debate on the vote afforded a significant exhibition of the spirit of mingled pessimism and distrust in which the Liberal Opposition approached every aspect of the South African question. The idea of the Transvaal ever being able to repay this grant-in-aid out of the "hypothetical" development loan appeared ridiculous to Sir William Harcourt. "Why," asked the Liberal ex-Chancellor of the Exchequer, "was not the money required for the South African Constabulary put forward in a supplementary military vote, instead of being proposed in this form and, under the grant-in-aid, subject to future repayment by the Transvaal, in which nobody believed?"[299]

This temporary financial assistance was of the utmost importance. Just as in the Cape Colony Lord Milner had seen that the Boers and Afrikander nationalists were to be beaten at their own game of renewed invasion by enabling the loyalist population to defend the Colony, so in the new colonies he proposed to beat the guerilla leaders at their game of wanton and mischievous resistance by building up a new prosperity faster than they could destroy the old. The conditions under which he worked, and the state in which he found South Africa when he began to engage actively in the work of reconstruction, he has himself described. In a despatch, written from the "High Commissioner's Office, Johannesburg," on November 15th, 1901, not only has Lord Milner placed on record the actual position of affairs in the new colonies at this time, but he has sketched with masterly precision the nature of the economic and administrative problems that awaited solution. The progress towards pacification won by the mobile columns and the blockhouse system, the dominant influence of the railways as the agency of transport, the condition of the Concentration Camps, and the degree in which our responsibility for the non-combatant and surrendered Boers limited our capacity to restore our own people to their homes, the economic exhaustion of the country, the threatened danger of the scarcity of native labour, and the processes and problems of repatriation—all these subjects are touched as by a master of statecraft.

Improved situation.

"Without being unduly optimistic," he writes, "it is impossible not to be struck by two great changes for the better in [the military situation] since the time when I first took up my residence in the Transvaal—just eight months ago. These are the now almost absolute safety and uninterrupted working of the railways and the complete pacification of certain central districts. As regards the railways, I cannot illustrate the contrast better than by my own experiences. In the end of last year and the earlier months of this I had occasion to make several journeys between Capetown and Johannesburg or Pretoria, and between Johannesburg and Bloemfontein. Though most careful preparations were made and every precaution taken, I was frequently 'hung up' on these journeys because the line had been blown up—not, I think, with any reference to my movements, but in the ordinary course of affairs. Small bodies of the enemy were always hovering about, and a state of extreme vigilance, not to say anxiety, was observable almost everywhere along the line. Since my return from England I have again traversed the country from East London to Bloemfontein and Johannesburg, and from Johannesburg to Durban and back, to say nothing of constant journeys between this place and Pretoria. On no single occasion has there been the slightest hitch or the least cause for alarm. The trains have been absolutely up to time, and very good time. They could not have been more regular in the most peaceful country. This personal experience, in itself unimportant, is typical of a general improvement. I may add, in confirmation of it, that during the last two months the mail train from Capetown to the north has only been late on one or two occasions, and then it was a matter of hours. Six months ago it was quite a common event for it to arrive a day, or a couple of days, late. I need not enlarge on the far-reaching importance of the improvement which these instances illustrate. Not only have the derailments, often accompanied by deplorable loss of life, which were at one time so common, almost entirely ceased, but, owing to more regular running, and especially the resumption of night running, the carrying capacity of the railways has greatly increased. Indeed, it is the inadequacy of the lines themselves to meet the enormous and ever-increasing extra requirements resulting from the war, and the shortness of rolling-stock, not any interference from the enemy, which causes us whatever difficulties—and they are still considerable—we now labour under in the matter of transport. When the large amount of additional rolling-stock ordered for the Imperial Military Railways last summer is received—and the first instalment will arrive very shortly—there will be a further great and progressive improvement in the conveyance of supplies and materials for the troops, the civil population of the towns, and the concentration camps.

"The advance made in clearing the country is equally marked. Six months ago the enemy were everywhere, outside the principal towns. It is true they held nothing, but they raided wherever they pleased, and, though mostly in small bodies, which made little or no attempt at resistance when seriously pressed, they almost invariably returned to their old haunts when the pressure was over. It looked as though the process might go on indefinitely. I had every opportunity of watching it, for during the first two months of my residence here it was in full swing in the immediate neighbourhood. There were half a dozen Boer strong-holds, or rather trysting-places, quite close to Pretoria and Johannesburg, and the country round was quite useless to us for any purpose but that of marching through it, while the enemy seemed to find no difficulty in subsisting there....

"To-day a large and important district of the Transvaal is now firmly held by us. But it must not be supposed that all the rest is held, or even roamed over, by the enemy. Wide districts of both the new colonies are virtually derelict, except, in some cases, for the native population. This is especially true of the northern part of the Transvaal, which has always been a native district, and where, excepting in Pietersburg and some other positions held by our troops, the natives are now almost the only inhabitants. Indeed, nothing is more characteristic of the latest stage of the war than the contraction of Boer resistance within certain wide but fairly well-defined districts, separated from one another by considerable spaces. Instead of ranging indifferently over the whole of the two late Republics, the enemy show an increasing tendency to confine themselves to certain neighbourhoods, which have always been their chief, though till recently by no means their exclusive, centres of strength.... From time to time the commandos try to break out of these districts and to extend the scene of operations. But the failure of the latest of these raids—Botha's bold attempt to invade Natal—shows the disadvantages under which the Boers now labour in attempting to undertake distant expeditions.

"The contraction of the theatre of war is doubtless due to the increased difficulty which the enemy have in obtaining horses and supplies, but, above all, to the great reduction in their numbers.... To wear out the resistance of the Boers still in the field—not more than one-eighth, I think, of the total number of burghers who have, first and last, been engaged in the war[300]—may take a considerable time yet, and will almost certainly involve further losses. I will not attempt to forecast either the time or the cost. What seems evident is that the concentration of the Boers, and the substitution of several fairly well-defined small campaigns for that sort of running fight all over the country which preceded them, is on the whole an advantage to us, and tends to bring the end of the struggle within a more measurable distance. Our great object, it seems to me, should be to keep the Boers within the areas of their main strength, even if such concentration makes the commandos individually more dangerous and involves more desperate fighting, and meanwhile to push on with might and main the settlement of those parts of the country out of which they have been driven. No doubt this is a difficult, and must be a gradual, process. The full extent of the difficulty will appear from the sequel. But it is the point to which the main efforts, of the civil authorities at any rate, should be continually directed.

"If the latest phase of the military situation is maintained, i.e., if we are able to prevent the Boers from breaking back into the cleared areas, or from injuring the railway lines, I can see no reason why the work of settlement should not proceed at a greatly quickened pace in the immediate future. The most urgent point is to bring back the exiled Uitlanders to the Rand, always provided that they are able to find employment when they arrive there. But the basis of any general revival of industrial and commercial activity on the Rand is the resumption of mining operations. So far it has only been found possible to proceed very slowly in this respect. The full capacity of the Rand is about 6,000 stamps. The first step was taken in April last, when the Commander-in-Chief agreed to allow the Chamber of Mines to open three mines with 50 stamps each. Up till now permission has been granted for the working of 600 stamps, but only 450 have actually been started. This is slow work, but even this beginning, modest as it is, has made an immense difference in the aspect of Johannesburg since first I came here in March last.

"The number of people allowed to return from time to time, for other than mining employments, is in proportion to the number of stamps re-started. This, no doubt, is a wise principle, for business generally can only expand pari passu with the resumption of mining. Up to the present something like 10,000 people have been allowed to come up, the vast majority of them being refugees, though there is a small new element of civil servants and civilians in the employ of the military. Assuming that from 8,000 to 9,000 are refugees, this would represent about one-sixth of the total number of well-accredited Uitlanders registered in the books of the 'Central Registration Committee.'

"The best that can be said on the thorny subject of the return of the refugees, is that latterly the rate of return has been steadily increasing. Last month the military authorities allowed us to grant 400 ordinary permits (this number is over and above permits given to officials or persons specially required for particular services to the Army or the Government). This month the number has been raised to 800. I need hardly say that the selection of 800 people out of something like fifty times that number is an onerous and ungrateful task. South Africa simply rings with complaints as to favouritism in the distribution of permits. As a matter of fact, whatever mistakes have been made, there has been no favouritism. I do not mean to say that a certain number of people—not a large number—have not slipped through or been smuggled up under false pretences. But the great bulk of the permits have been allotted by the Central Registration Committee, a large, capable, and most representative body of the citizens of this town and neighbourhood. And they have been allotted on well-defined principles, and with great impartiality.... I am satisfied that no body of officials, even if our officials were not already over-worked in other directions, could have done the business so well.