Balancing the budget:
- Sold off 90 ships and put 64 in reserve- too weak to fight and too slow to run away
- Created the Royal Navy Volunteer Reserve in order to augment the Royal Navy Reserve.
- Britain had a large reserve to call on in times of war
- The strenght of the Mediterranean Fleet was reduced to 12 ships and the 5 battleships stationed in China were sent back to Britain.
- South Atlantic fleet was abolished. Channel Fleet moved to Gibraltar and was renamed the Atlantic Fleet.
- Home Fleet became the Channel Fleet. Reserve Fleet stationed at the Thames.
Effect of the Russo-Japanese War:
- Showed the importance of having more and bigger guns
- Importance of Submarines
- Building of Battle cruisers
HMS Dreadnought:
- 20,000 tonnes. Ten 12" guns. Could fire 18,000 yards and a top speed of 21.6 knots.
- Had technology which could take into account the direction and speed of the target
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