Two Nations Divided by a Common Language

From Agatha Christie's Cat Among the Pigeons, where Ali, the ruler of a small Middle Eastern kingdom, is talking to Bob, his English confidante: "You have common sense. You are honest. And I remember, from the days when you were my fag, that you could always think up some ingenious idea..." It must have meant something different then and there, right? (Although, on the other hand, the book did mention that the two men had met at a British boarding school...)