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diff --git a/53222-0.txt b/53222-0.txt new file mode 100644 index 0000000..cc0ca19 --- /dev/null +++ b/53222-0.txt @@ -0,0 +1,3203 @@ +Project Gutenberg's Royal Railways with Uniform Rates, by Whately C. Arnold
+
+This eBook is for the use of anyone anywhere in the United States and most
+other parts of the world at no cost and with almost no restrictions
+whatsoever. You may copy it, give it away or re-use it under the terms of
+the Project Gutenberg License included with this eBook or online at
+www.gutenberg.org. If you are not located in the United States, you'll have
+to check the laws of the country where you are located before using this ebook.
+
+
+
+Title: Royal Railways with Uniform Rates
+ A proposal for amalgamation of Railways with the General
+ Post Office and adoption of uniform fares and rates for
+ any distance
+
+Author: Whately C. Arnold
+
+Release Date: October 6, 2016 [EBook #53222]
+
+Language: English
+
+Character set encoding: UTF-8
+
+*** START OF THIS PROJECT GUTENBERG EBOOK ROYAL RAILWAYS WITH UNIFORM RATES ***
+
+
+
+
+Produced by MWS, Adrian Mastronardi, The Philatelic Digital
+Library Project at http://www.tpdlp.net and the Online
+Distributed Proofreading Team at http://www.pgdp.net (This
+file was produced from images generously made available
+by The Internet Archive/American Libraries.)
+
+
+
+
+
+
+
+
+
+
+ A RAILWAY REVOLUTION!
+
+ [Illustration]
+
+ ROYAL RAILWAYS
+
+ FARES & RATES
+ FOR ANY DISTANCE.
+
+ LOCAL TRAINS ONE PENNY
+ MAIN LINE ” ONE SHILLING
+ SLOW GOODS average } 1s. 6d.
+ FAST ” per ton } 10s.
+
+ A business proposition for Shareholders
+ and the Nation.
+
+ _Sixpence Nett._
+
+ SIMPKIN, MARSHALL, HAMILTON, KENT & CO., LTD.,
+ LONDON
+
+
+
+
+ ROYAL RAILWAYS
+ with Uniform Rates
+
+ _by_
+ WHATELY C. ARNOLD, LL.B. LOND.
+
+ _A PROPOSAL
+ for amalgamation of Railways with the
+ General Post Office and adoption of
+ uniform fares and rates for any distance._
+
+ LONDON: SIMPKIN, MARSHALL,
+ HAMILTON, KENT & CO., LTD
+ 1914
+
+
+
+
+_Preface._
+
+
+This pamphlet has been printed and published with the assistance of
+friends who share my opinion that the scheme proposed will solve the
+railway problem--now at an acute stage.
+
+A rough outline of the Scheme has been submitted to Sir Charles
+Cameron, Bart. (on whose initiative sixpenny telegrams were adopted),
+and while reserving his opinion as to the advantages of State ownership
+and the difficulties of purchase, he has been good enough to write
+that this scheme is the boldest and best reasoned plea for the
+Nationalisation of Railways that he has come across.
+
+The scheme has also been submitted to, among others, Mr. Emil Davies,
+Chairman of the Railway Nationalisation Society, to Mr. L. G. Chiozza
+Money, M.P., and to Mr. Philip Snowden, M.P., all of whom have
+expressed their approval subject to the figures and estimates being
+correct. These figures and estimates are based on the Official Board of
+Trade returns for Railways of 1911 and 1912.
+
+I also had the temerity to submit my draft to Mr. W. M. Acworth, the
+well-known Railway expert, who very courteously gave me his views
+generally, although refraining from any detailed criticism. I deal
+with his remarks at the end of Chapter IV., but may here mention that
+Mr. Acworth called my attention to an article by himself on Railways
+in “Palgrave’s Encyclopædia of Political Economy” published in 1899.
+In such article he referred to a suggestion which had then been made
+for uniform fares on the Postal system, and he dismissed the idea in a
+sentence as impracticable, because no one would pay for a short journey
+as much as 8d., then the average fare for the whole country.
+
+It is therefore evident that the principle of a flat rate is not novel;
+yet I can find no reference in any books or pamphlets on railways to
+any practical scheme for carrying it into effect. Apparently it has
+been assumed that there can be only one uniform rate, equivalent to the
+average rate, and that therefore the proposal is quite impossible. The
+simple expedient of dividing the traffic into the two kinds of “Fast”
+and “Slow,” on the analogy of the Postal rate of one penny for letters
+and sixpence for telegrams, overcomes this difficulty. The scheme is
+in effect an extension to the Railway System of the principle upon
+which the existing Postal System is founded, and therefore involves
+Nationalisation.
+
+As submitted to the above-named gentlemen, the draft did not include
+my remarks on the principles which in my opinion should govern all
+National and Municipal Trading, and which are now contained in Chapter
+IV. The attention of both opponents and advocates of Nationalisation
+is particularly called to these principles, which I have not found
+elsewhere, but which as laid down are believed to be absolutely sound,
+and of the highest importance, as removing most, if not all, of the
+objections of opponents, while retaining all the advantages claimed by
+advocates of National and Municipal Trading.
+
+I do not pretend to be a railway expert, and have only been able to
+devote the small leisure time available from an exacting business to
+putting into writing the thoughts which have exercised my mind for many
+years past. But the well-known expert, Mr. Edwin A. Pratt, who is a
+strong opponent of Railway Nationalisation, admits in one of his books
+that “the greatest advances made by the Post Office have been due to
+the persistence of outside and far-seeing reformers, rather than to the
+Postal Officials themselves.” This admission and the conviction that
+the further advance now proposed is based upon sound principles and
+undisputed facts, encourages me to submit my scheme with confidence to
+the consideration of experts and the public.
+
+ W. C. A.
+
+ 37, NORFOLK STREET,
+ STRAND, LONDON, W.C.
+
+ DECEMBER, 1913.
+
+
+
+
+SYNOPSIS OF CONTENTS
+
+
+ PROPOSED UNIFORM FARES AND RATES:
+
+ =Passenger Fares=: Any Distance, so far as train travels.
+
+ _Main Lines_: =First Class 5/-=, =Third Class 1/-=.
+ _Local Lines_: ” =6d.= ” =1d.=
+
+ =Goods Rates=: Any Distance.
+
+ _Fast Service_: =Average 10/- per ton=.
+ _Slow Service_: ” =1/6= ”
+
+ =Introduction.= Page 15.
+
+The Royal Mail.--Letters carried for same price any distance. Why
+not passengers and goods? Object of pamphlet to prove that this is
+financially possible with small uniform fares and rates mentioned. A
+Business Proposition for Nation and Shareholders.
+
+ CHAPTER I.
+ =The Scheme.= Page 17.
+
+=All Railways= to be purchased by State and amalgamated with General
+Post Office. Trains of two kinds only, viz.:--
+
+ (1) =Main Line Trains=, _i.e._, non-stop for at least 30 miles.
+
+ (2) =Local Trains=, _i.e._, all trains other than Main Line.
+
+=Passenger tickets= vary according to above fares only--no reference
+to stations or distance. =Goods rates=, payable by stamps vary only
+according to weight or size of goods, whether carried in bulk, in open
+or closed trucks, or with special packing, but irrespective of any
+other difference in nature or value of goods, or of distance, as now
+with parcel post.
+
+=All Railway Stations to be Post Offices.= All Post Offices to sell
+Railway Tickets, and, where required, to be Railway Receiving Offices.
+=Steamers= to be regarded as trains.
+
+ CHAPTER II.
+ =Advantages of Scheme.= Page 20.
+
+1. =Cheapness= and regularity of transport.
+
+2. =Economy= of service;--by unification of railways;--abolition
+of Railway Clearing House, of expenses of varying rates and fares,
+of multiplication of receiving offices, stations, &c.,--and by
+amalgamation with Post Office;--all railway land and buildings
+available for Government purposes--Postal, Civil, Military and Naval.
+
+3. =Progressive increase always follows= adoption of small uniform
+fares (_e.g._, in Post Office); hence progressive increase of
+revenue available for working expenses, purchase money, extensions,
+improvements, and adoption of new safety appliances.
+
+ CHAPTER III.
+ =Principles of Scheme.= Page 27.
+
+=Present system= founded on two principles, both mistaken and
+illogical, viz.:--(=1=) According to distance travelled. (=2=)
+According to “what the traffic will bear.”
+
+(1) Although cost of building 200 miles, and hauling train that
+distance is more than for two miles, yet because regular train service
+required for whole distance, say, A to Z and back, passing intermediate
+places, therefore cost of travelling from A to B, or to N, identical
+with A to Z. For goods, cost of loading and unloading twice only,
+whether sent from A to B, or A to Z.
+
+(2) Cost of hauling ton of coal exactly same as of bricks, sand, loaded
+van, in open truck, yet now different rates for each, according to
+“what the traffic will bear.”
+
+=True principle= advocated by Sir Rowland Hill in Penny Post--whole
+country suffers by neglect or expense of transport to distant parts,
+and gains by including small districts with same rates as populous
+parts.
+
+=For a flat rate, three rules necessary.=
+
+ (_a_) Must not exceed lowest in use prior to adoption.
+
+ (_b_) Increased traffic resulting must produce at least same
+ net revenue.
+
+ (_c_) Variations of rate to be according to speed, not distance.
+
+Hence:
+
+ (_a_) =1d.= now lowest fare, fixed for Local Lines.
+
+ =1s.= now lowest fare, (_e.g._, 2s. 6d. return London
+ to Brighton) fixed for Main Lines.
+
+ =1s. 6d.= per ton fixed for goods train or slow
+ service, as the present average for minerals, and
+ allowing present lowest rate for goods in open
+ trucks, rising to, say, 6d. per cwt. (10s. per ton)
+ for small consignments, in covered trucks.
+
+ =10s.= per ton, now lowest “per passenger train”
+ (_e.g._, 6d. per cwt. for returned empties) fixed for
+ fast service.
+
+ (_b_) The increased traffic dealt with under “Finance.”
+
+ (_c_) The two rates suggested for fast and slow trains solve
+ the difficulty hitherto felt of charging lowest fare of
+ 1d. as uniform fare--the 1s. fare and 10s. goods rate
+ being double the present averages.
+
+ CHAPTER IV.
+ =OBJECTIONS TO THE SCHEME.=
+
+ =1.--State Ownership.= Page 33.
+
+Writers for and against--All assume that on Nationalisation, system
+followed of charging according to distance, and to “what traffic will
+bear”--Fundamental differences between State Monopoly and Private
+Monopoly--Evils of applying profits of State monopolies in reductions
+of taxation--Strikes.
+
+Four rules to be observed on Nationalisation:--
+
+ 1. Natural monopolies only to be taken over.
+
+ 2. When taken over, only to be worked for benefit of community
+ and not for profit.
+
+ 3. Competition of private enterprises not to be prohibited.
+
+ 4. Monopoly to be worked by Department of State responsible to
+ Parliament.
+
+=Chief grounds of objection to State ownership=--
+
+(1) Difficulty of Government in dealing with conflicting interests of
+traders and general public. (2) Difficulty of Railway servants (being
+also voters) using political pressure to obtain better wages, against
+interests of traders and general public. Both of these objections
+removed if scheme (which avoids all preferential or differential rates
+or treatment) adopted with above four rules.
+
+Other grounds of objection, _e.g._, want of competition, officialism,
+&c., apply equally to present Company system, but may be remedied if
+owned by State. Suggested remedies:--Railway Council to deal with
+all matters of administration; Railway Courts to deal with questions
+of compensation, labour disputes, &c. Railways and Post Office being
+Department of State with Cabinet Minister at head subject to vote of
+censure in Parliament, provides better security for public than private
+Companies or Railway Trust.
+
+ =2.--General Objections.= Page 43.
+
+=Fear of Losses=--
+
+All existing staffs required for increased traffic--therefore no loss
+to them.
+
+Traders, like newspapers more than make up for any losses by economy in
+rates and fares and increased circulation.
+
+Mr. Acworth’s objections to “average” rates considered.
+
+ CHAPTER V.
+ =Finance of Scheme.= Page 45.
+
+=Present averages= per annum in round figures taken from Board of Trade
+returns 1911 and 1912:--
+
+ Receipts from Passengers £45,000,000
+ ” ” Goods per passenger train 10,000,000
+ ” ” Goods Train Traffic 64,000,000
+ ” (Miscellaneous) 10,000,000
+ --------------
+ Gross Revenue £129,000,000
+ Working Expenses 81,000,000
+ --------------
+ Net Receipts £48,000,000
+ ==============
+ Total Paid-up Capital and Debentures £1,400,000,000
+
+ Net receipts show average income of 3½ per cent.
+
+ * * * * *
+
+ Total passenger journeys (of which 10 per
+ cent. were 1st and 2nd class) 1,620,000,000
+
+ =Average fare for each journey only 6½d.=
+
+ * * * * *
+
+ Total tonnage of goods:--
+
+ Estimate per passenger trains 20,000,000
+
+ Actual per goods trains 524,000,000
+ ------------
+ 544,000,000
+
+ * * * * *
+
+ Average rates per goods train:--
+
+ Minerals only 1s. 6d. per ton
+ General Merchandise 6s. ”
+ Both together 2s. 4d. ”
+
+=Estimate under proposed scheme=:-- Page 48.
+
+=I. Passengers.=--Assuming Main Line passenger journeys are
+300,000,000, _i.e._, under 20 per cent. of the total passenger journeys.
+
+ 300,000,000 at 1s. = £15,000,000
+ add 30,000,000 at 4s. for 1st class = 6,000,000
+ 1,320,000,000 at 1d. = 5,500,000
+ add 132,000,000 at 5d. for 1st class = 2,750,000
+ ------------- -----------
+ Present No. 1,620,000,000 will produce £29,250,000
+
+Increased number of Main Line passengers required to make up deficiency:--
+
+ 250,000,000 at 1s £12,500,000
+ add 25,000,000 at 4s. extra 5,000,000
+ ---------- £17,500,000
+ -----------
+ Estimated total £46,750,000
+
+This is £1,750,000 more than the present gross revenue from passengers
+and requires an increase of 250,000,000 = 15 per cent. on the total
+present number of passenger journeys.
+
+=II. Goods.=
+
+ Total tonnage by goods train as now,
+ viz., 524,000,000, at 1s. 6d £39,300,000
+
+ Ditto per passenger train, 20,000,000
+ at 10s 10,000,000
+
+ Live Stock, as now 1,500,000
+ -----------
+ £50,800,000
+
+ Increased tonnage required to make up
+ present revenue, 48,000,000 tons at 10s. 24,000,000
+ -----------
+ £74,800,000
+ ===========
+
+which is £800,000 more than present total receipts from goods per
+passenger and goods trains, and requires an increase of under 10 per
+cent. in tonnage.
+
+=Reasons for anticipating increase=:--
+
+ =(_a_) Of Passengers.= Long distance journeys now restricted
+ by expense.--Through tickets now counted as one journey will,
+ under new scheme, be sometimes two or three, _e.g._, London to
+ Londonderry would be three tickets--Every single journey taken,
+ usually means also return journey home.
+
+ =(_b_) Of Goods.= Example of Post Office--Before Penny Post,
+ average price per letter 7d., and letters carried 76,000,000.
+ After Penny Post, first year number doubled; in twenty years,
+ increased by eight times; about doubled every twenty years
+ since. Before three letters per head of population, now 72 per
+ head. Goods now sent by road motors will, with cheaper rates,
+ go by rail--perishable articles, now not sent at all by fast
+ train owing to expense, will be sent when rates cheaper.
+
+ CHAPTER VI.
+ =Working Expenses.= Page 53.
+
+=If increase= of traffic no more than above, increase of working
+expenses negligible, apart from economies made by unification. Expense
+of carrying 200 passengers no more than 20. If increase of traffic
+more, then revenue increases, but working expenses only by about 50
+per cent., as expenses of permanent way, stations, signal boxes, and
+establishment charges but little affected. Expenses of Post Office and
+Railways to be lumped together.
+
+ CHAPTER VII.
+ =Terms of Purchase.= Page 56.
+
+ =Present total market price= of all
+ Railway Stock and shares about £1,350,000,000
+ Debentures and Loans ” 350,000,000
+ --------------
+ Total about £1,700,000,000
+
+=Estimate of annual sum= required according to precedent of purchase
+of the East Indian Railway Company, namely, by annuities for 73 years,
+equal to 4¼ per cent. per annum on market value, plus liability for
+Loans and Debentures with interest at 3 per cent.
+
+ 4¼ per cent. on £1,350,000,000 £57,375,000
+
+ 3 ” ” 350,000,000 10,800,000
+ -----------
+ Total annual sum required for purchase £68,175,000
+
+=Revenue available as per= above estimates:--
+
+ Passengers £46,750,000
+ Goods 74,800,000
+ Miscellaneous, as now 10,000,000
+ ------------
+ £131,550,000
+
+ Less Working Expenses, with
+ say, increase of £4,000,000 85,000,000
+ ------------
+ Net revenue available £46,550,000
+ -----------
+ Balance required for purchase £21,625,000
+
+ would be provided by following further increase of traffic, viz.
+
+ 100,000,000 passengers at 1s. £5,000,000
+
+ 10,000,000 ” ” 4s. 2,000,000
+
+ 30,000,000 tons ” 10s. 15,000,000
+ -----------
+ £22,000,000
+ ===========
+
+This further traffic brings total increase of traffic to:--
+
+ 350,000,000 passengers = about 21 per cent.
+ 78,000,000 tons of goods = about 15 per cent.
+
+Essential to purchase all Railways at same date--Railway Stock to be
+converted into Government Stock--Price to be fixed by average of market
+price of Stocks for three years prior to introduction of Bill.
+
+ CHAPTER VIII.
+ =Conclusion.= Page 62.
+
+Interested parties not prejudiced--Staff now employed in services
+to be discarded will be required for increased traffic--Facility of
+transport will increase trade, and open new markets, not only here
+but abroad--Foreign countries would adopt reform as they did Postal
+system--Advantages of inter-communication with Foreign Nations.
+
+
+
+
+ ROYAL RAILWAYS
+ with Uniform Rates.
+
+
+
+
+INTRODUCTION.
+
+
+=The Royal Mail!= What scenes and memories are conjured up by these
+words! In the olden days, the Royal Mail coaches--in these modern days,
+the well-known scarlet Mail carts and motor vans arriving at all the
+larger railway stations from which the mail trains, always the fastest,
+convey the mails to every quarter of the United Kingdom, and over the
+whole world.
+
+It is now a commonplace to post in the nearest pillar-box a batch of
+letters, some to addresses in the same town, others to provincial
+towns and villages, to Scotland, Ireland and far distant Colonies,
+each of them being conveyed to their destination, near or far, for
+the modest sum of one penny, by the speediest mode of locomotion
+that steam and electricity can provide. In order that travellers may
+have the advantage of that speed and regularity which is a feature
+of the Royal Mail, passengers and goods have always been carried by
+the Mail--formerly by the coach, now by the train. But whereas the
+mails are carried at the same price for any distance, the charges for
+passengers, and for goods which exceed the regulation size and weight
+permitted for the “Parcels Post,” vary according to the distance
+travelled, and as to goods also according to their nature or quality,
+with the result that for the greater part of our population long
+journeys are luxuries which can only be undertaken in cases of life
+and death, and not always then; the rates for carriage of goods by
+fast train are mostly prohibitive, and even by goods train for long
+distances are so great as to seriously restrict the traffic.
+
+If mail trains can carry mails, with parcels up to 7 lbs. in weight at
+the same price for any distance, why cannot all trains carry passengers
+and goods of any size and weight at the same price for any distance?
+The answer is that they can, and it is the object of this pamphlet to
+prove not only that it is possible financially, but that, with the
+small uniform fares and rates indicated on the title page, sufficient
+revenue can be obtained to pay working expenses, and provide the sum
+required to purchase the whole of the existing railway undertakings at
+their full market price, or such a price as willing vendors would be
+ready to accept.
+
+This, then, is “=A Business Proposition=” for all concerned; in other
+words, the magnificent net-work of railways in the United Kingdom, with
+all that is included in their undertakings, may be acquired by the
+nation at such a price as will make it worth the while of the present
+Companies and their shareholders to sell, and as the result to give the
+nation the benefit of speedy and efficient transport at the nominal
+fares and rates mentioned. It will, indeed, be a “Revolution,” but one
+of the most beneficial that can befall a nation.
+
+The Royal Mail is an institution of which the nation is justly proud.
+How much more will it be so of an institution which will include the
+Royal Mail, namely, =Royal Railways=.
+
+
+
+
+CHAPTER I.
+
+THE SCHEME.
+
+
+This is the scheme proposed:--
+
+The whole of the existing undertakings of all the Railway Companies in
+the United Kingdom of Great Britain and Ireland will be acquired by
+purchase on some such terms as are set out at the end of this pamphlet
+and vested in the Government. The whole system will be amalgamated
+with the General Post Office and form one of the Departments of State,
+of which the Postmaster-General for the time being will be the head,
+and probably adopt the style of “Minister of Transport,” who will be a
+Member of the Cabinet. =It will be expressly enacted that any profit
+made by the combined services shall be used only for increasing their
+efficiency, for payment of purchase money, or in reduction of fares
+and rates charged for the services, and in no case for general revenue
+of the country. There shall also be no prohibition of competition by
+private enterprise.=[1]
+
+All passenger trains will be regarded as consisting of two kinds,
+namely:--
+
+ (1) =Main Line Trains=, by which will be meant express trains
+ running on the Main trunk lines between, and only stopping at,
+ important towns.
+
+A ticket for =one shilling= will entitle the holder to enter any Main
+Line train at any station, and to travel in it to any other station at
+which it stops, and a ticket for =five shillings= will entitle him to
+travel first class in such trains.
+
+ (2) =Local Trains=, by which will be meant all trains,
+ other than Main Line trains as defined above, including all
+ Metropolitan, Suburban and Branch Line trains throughout the
+ Kingdom, as well as trains on Main lines which stop at all
+ stations.
+
+A ticket for =one penny= will entitle the holder to enter any Local
+train at any station, and to travel in it to any other station at which
+it stops, and a ticket for =sixpence= will entitle him to travel first
+class in such train if that accommodation is provided.
+
+=Steamers= which form part of the railway undertakings will also be
+regarded as of two kinds, according to whether they form part of a
+Main Line, _e.g._, the Irish Packets or the Cross Channel steamers, in
+which case admission to them will be 1s. or 5s., according to class, or
+simply as part of a Branch line, _e.g._, the Isle of Wight steamers, to
+which admission would be 1d. or 6d. according to class.
+
+In the case of Main Line trains and steamers, additional fixed charges
+(the same for any distance) will be made for the use of refreshment
+cars, sleeping cars, State cabins, reserved seats and any other special
+services.
+
+In the case of Local trains, and possibly Main Line trains, =Season
+Tickets= may be issued, in each case available for any Main Line train
+or Local train as the case may be. For Local trains the following rates
+are suggested, viz.:--
+
+ 3rd class 1s. per week, 4s. per month, £2 per annum.
+ 1st class 2s. 6d. ” 10s. ” £5 ” ”
+
+=Passenger Tickets= will not be issued to or from any particular
+stations, but like postage stamps will vary only according to the fares
+and special charges for the time being in force. The four denominations
+of 5s., 1s., 6d. and 1d. will, of course, be required, and 4s. and 5d.
+tickets could also be issued to make up the first class fares with the
+1s. and 1d. tickets.
+
+These tickets will be sold not only at every railway station, but also
+at every Post Office and in automatic machines. Every railway station
+will be, or will contain, a Post Office, with all postal, telegraphic
+and telephonic facilities, and every Post Office will sell not only
+passenger tickets but also railway stamps for parcels, goods and live
+stock.
+
+=Goods traffic= will also consist of two services only, namely:--
+
+ (1) =Fast Service=, corresponding with the present service “per
+ passenger train,” the charge for which will be an average of
+ =ten shillings per ton for any distance=.
+
+ (2) =Slow Service=, corresponding with the present service “per
+ goods train,” the charge for which will be an average of =one
+ shilling and sixpence per ton for any distance=.
+
+For both these services stamps will be issued of various denominations,
+and applied in manner now in use for the Parcels Post, with any
+necessary modification; for instance, the stamps might be affixed to
+consignment notes in the case of goods in bulk, or other suitable
+arrangements might be made for large quantities of goods.
+
+For the _slow_ goods traffic a regular service of goods trains will
+be organised so that at every town or village in the United Kingdom
+served by rail there may be at least one delivery and one collection
+daily, more populous places, of course, having more frequent services.
+
+For the _fast_ goods traffic a similar regular service will be
+organised, and in cases where the traffic will warrant it special fast
+goods trains will be run; otherwise the goods will be carried by the
+passenger trains.
+
+In course of time provision should be made for all trunk lines to have
+at least two double lines of rails, upon one of which fast trains
+for passengers and goods will run at uniform speeds, and at regular
+intervals, and upon the other the local trains and slow goods trains,
+also at uniform speed and at regular intervals.
+
+The present complicated system of differential rates, which vary not
+only according to distance but also according to the nature, quality
+and value of goods, and involving different rates, amounting in number
+literally to millions, would be swept away, the only variations in
+rates being in respect of such obvious matters as weight, size, whether
+carried in bulk or in packages, in open trucks or closed, whether
+requiring special care or labour in packing or otherwise. The average
+rates proposed would, it is believed, admit of a uniform rate for any
+distance for minerals and other goods carried in bulk in open trucks,
+of no more than the lowest rate now in force, by charging higher rates
+for goods requiring closed trucks and more labour in handling, still
+higher rates for goods of abnormal size or weight, and higher rates
+still for single small parcels, on account of greater proportionate
+expense of handling. For the small single parcels the rate might be
+for slow service as much as 6d. for any weight up to 1cwt. (equal to
+10s. per ton), and for fast service say 1s., or possibly more, for any
+weight up to 1cwt., the weight being graduated downwards for parcels
+of greater weight as are the rates now in force for letter and parcels
+post. The goods traffic would be in effect an extension of the present
+parcels post, the present rates for which would probably be capable of
+very substantial reduction.
+
+These figures are put forward by way of suggestion only, and the
+question of terminal charges and fees for loading and unloading may
+have to be taken into account. Numerous details must necessarily be
+gone into in fixing an average uniform rate, and it is very likely
+that considerable modifications may be found necessary. Any such
+modifications, however, must be based upon the three rules set out on
+page 30 in order that the scheme may effect its object.
+
+
+FOOTNOTES
+
+[1] For reasons of these modifications of the present practice in
+National and Municipal Trading see Chapter IV., pp. 33-41.
+
+
+
+
+CHAPTER II.
+
+ADVANTAGES OF THE SCHEME.
+
+
+If this scheme is practicable financially (and one object of this
+pamphlet is to prove that this is so), then it seems almost superfluous
+to point out the great advantages of its adoption.
+
+It has been well said that “=transport is the life-blood of a nation=.”
+If circulation is impeded or restricted the whole country must suffer,
+and, conversely, if all obstructions and restrictions are removed the
+whole country must benefit. This scheme will, in effect, remove the
+principal obstruction to free circulation of passengers and goods,
+namely, expense. Cheapness of transport is “twice blessed; it blesseth
+him that gives and him that takes”--in other words, it enables the
+producer, whether agriculturist, manufacturer or merchant, to increase
+his market for goods, and enables the consumer who requires those goods
+to purchase at a lower price. It is common knowledge that agriculture
+in particular in this country is hampered and restricted by heavy
+charges for freight.[2] Under our present system the carriage of
+goods from abroad to London is cheaper than from the Midlands, and
+the foreigner has a great preference (so far as freight is concerned)
+over our own farmers. Fruit and fish is often thrown away on account
+of the cost of carriage being more than the value of the goods. On the
+other hand, the price of food and every commodity has been gradually
+increasing. With the removal of this obstruction of expense of carriage
+there must be an increase in the supply of goods, and increased supply
+means lower prices.
+
+As to passenger traffic, traders will appreciate the great benefit of
+nominal fares for themselves and their commercial travellers. So also
+will the greater part of the population, namely, those of very moderate
+means who are now prevented, solely on account of expense, from
+travelling any considerable distance, either on business or pleasure,
+or from visiting friends and relatives.
+
+These are some of the general advantages attending cheapness of
+transport, but it may be as well to point out in detail some of the
+very substantial economies and other special advantages to be obtained
+by adopting the proposed scheme.
+
+
+1. ECONOMICAL ADVANTAGES.
+
+A few examples of the waste attending the present system, both of money
+and time will illustrate some of these advantages.
+
+=In the Strand, London=, within a few yards of each other, are the
+following premises:--
+
+ No. 168, Strand.--The Strand Station of the Piccadilly and
+ Finsbury Park Tube Railway.
+
+ No. 170, Strand.--Great Western Railway Receiving Office.
+
+ No. 173-4, Strand.--East Strand Post Office.
+
+ No. 179, Strand.--Great Northern Railway Receiving Office.
+
+ No. 4, Norfolk Street, Strand, almost adjoining No. 179,
+ Strand.--Inland Revenue Office.
+
+ No. 183, Strand.--Midland Railway and London and North Western
+ Railway Receiving Office.
+
+Within sight, at the other end of Norfolk Street, is the Temple Station
+District Railway, and at 6, Catherine Street, about the same distance
+from the other side of the Strand, is a Labour Exchange.
+
+It is assumed that the rents of shops in the Strand would average
+about £500 per annum. Under the proposed scheme, the whole of the
+business transacted at the above eight premises could, with greater
+convenience, be carried on at the two railway stations, possibly with
+some extensions, but with a saving not only of rent but also of rates,
+taxes and other outgoings.
+
+=At Bexhill-on-Sea=, with a population of only about 15,500, there
+are two large railway stations, one belonging to the South Eastern &
+Chatham Railway Company, the other to the London, Brighton & South
+Coast Railway Company, and situate about a mile apart. Half a mile
+from each is the Head Post Office, within a few doors from one of
+the stations is a branch Post Office, and within a small radius are
+Government offices for Inland Revenue and other purposes.
+
+Letters posted at a pillar box outside the station are collected
+there, taken to the Head Post Office for sorting, then returned with
+others to the railway for the Mail train leaving the same station. The
+majority of the passengers are for London, and go by the two different
+routes, but the fares are identical, and the time occupied is about the
+same, no advantage being gained by the public through the so-called
+competition.
+
+If both stations were amalgamated one staff only would be required,
+there would be ample room on the premises to accommodate the Head Post
+Office with sorting rooms, etc. (the branch office now near the station
+would not be required), and there would be plenty of room also for the
+Government Offices. In addition to the saving of expense, there would
+also be the great convenience and saving of time in the transport of,
+and dealing with, mails, passengers and goods.
+
+These two examples with many others have come under my personal
+observation, and they may be multiplied ten thousand times throughout
+the United Kingdom. Where is there a railway station, whether a great
+London terminus, or small provincial station, where postal facilities
+are available; while just outside rents are paid, in some cases very
+heavy ones, for other premises, to and from which the mails have to be
+conveyed?
+
+Other examples of waste under the present system, although not so
+apparent to the public, are well-known to the railway expert, and
+involve much greater expenditure of time and money.
+
+I refer in particular to the =waste of rolling stock=, especially of
+goods wagons, occasioned by the multiplicity of goods stations, the
+transfer of rolling stock to and from the lines of different railway
+companies, the shunting of trains, and the large number of road vans
+used by the various companies. In London alone there are 74 goods
+stations, used for goods only, and 700 goods trains per day travel
+between these 74 stations, doing nothing but transferring goods from
+one of these stations to another! Goods consigned to one warehouse in
+London from places on, say, seven different railway companies’ lines
+are sent by seven different vans, one belonging to each company. Under
+my proposed scheme one or two central goods stations of large area
+would not only suffice, but would provide a far more efficient and
+speedy transport service, and yet with the nominal rates referred to.
+
+Under the present system goods trains, having been unloaded, must be
+returned in order to clear the line, so that it is not uncommon to
+find goods trains belonging to the various companies returning empty
+for long distances on each line, on the G. W. R. as far as Bristol, on
+the S. W. R. to Basingstoke, on the G. C. R. to Banbury, and so on.
+It has been estimated that of the 1,400,000 goods wagons now on the
+railways of the United Kingdom, no more than 3 per cent. are actually
+in effective use at one time, the remaining 97 per cent. being either
+stationary or running empty![3] One reason for this, no doubt, is the
+use of merely hand labour for loading and unloading.
+
+With a view to avoiding this waste the New Transport Company, Limited
+was registered in 1908, for the purpose of introducing new and
+ingenious machinery, invented by Mr. A. W. Gattie and Mr. A. G. Seaman,
+for handling goods, including the adoption of movable “containers” on
+trucks and wagons, and a scheme for a “Goods Clearing House” occupying
+a site of about 30 acres, in Clerkenwell, to be connected by rail with
+all the lines coming to London.
+
+It is, of course, necessary, in order to carry so important a scheme
+into effect to negotiate with all the various railway companies
+interested, as well as to obtain an Act of Parliament. Besides this,
+a large amount of capital is required for the acquisition of the
+site, the construction of the connecting lines, installation of the
+machinery, etc.
+
+Notwithstanding the large cost, estimated by Mr. Edgar Harper, F.S.S.,
+late Statistical Officer of the London County Council, at £14,000,000,
+he shows that such a system would more than pay for itself in a year by
+the economies in transport which it would effect directly or indirectly.
+
+No estimate, however, is given, nor probably can be given by anyone, of
+the time that will be occupied in carrying such a scheme into effect,
+so long as this present system of numerous companies and conflicting
+interests continues. Five years have already gone by since the Company
+was registered.
+
+If, however, the scheme of nationalisation and amalgamation with the
+Post Office be adopted, there should be no difficulty in providing as
+part of such scheme for the system and machinery of the New Transport
+Company already referred to, not only in London but in every other
+traffic centre. It might also be possible to avoid the expense of
+acquiring a new site for a “Goods Clearing House” by utilising some
+portion of the large area occupied by the three large termini and
+approaches thereto of King’s Cross, St. Pancras and Euston.
+
+There will then be no conflicting interests, no multiplicity of
+companies, and no difficulty in raising the necessary capital for
+establishing the system, and what is still more important, no
+difficulty, as will be shown hereafter under the heading of “Finance,”
+in producing the necessary revenue to repay the capital and interest,
+by reason of the progressively increasing traffic which will result
+from the adoption of the small uniform average rates advocated.
+
+The following, then, are some of the very substantial economies which
+will be effected by my scheme:--
+
+=I. Expenditure which would be entirely abolished=:--
+
+ (_a_) The Railway Clearing House, the sole object of which
+ is to apportion receipts and payments between the various
+ companies, about 217 in number, and requiring for its work a
+ large and expensive staff, not only of clerks, but also of
+ inspectors at every junction, and a large establishment at
+ Seymour Street, Euston.
+
+ (_b_) The separate Boards of Directors, officers, and clerical
+ staff of all the separate companies.
+
+ (_c_) The legal and parliamentary expenses incurred in disputes
+ between the various companies, and in opposing rival companies’
+ new lines.
+
+ (_d_) Advertisements by rival companies of their own routes.
+
+=II. Expenditure and waste which would be diminished=:--
+
+ =1. By reason of unification of systems.=
+
+ (_a_) Competing receiving offices and their staffs would be
+ reduced to one in each locality.
+
+ (_b_) Rolling stock, which is now often idle because owned
+ by different companies, could be used solely according to
+ the requirements of the traffic.
+
+ (_c_) Competing trains now running on different lines at
+ the same time between London and other large towns could be
+ run at different times with largely increased numbers of
+ passengers at same cost.
+
+ (_d_) Adjoining stations belonging to competing companies
+ would be amalgamated.
+
+ =2. By reason of the adoption of uniform rates and fares.=
+
+ (_a_) The abolition of the elaborate book-keeping and
+ staffs needful for the present complicated system of
+ passengers’ fares and goods rates, especially the latter,
+ with the waste not only of expense but also of time.
+
+ (_b_) The saving of the expense of printing and advertising
+ various priced tickets and fare tables, also of the large
+ staff of booking clerks, inspectors and others.
+
+ (_c_) The saving of the legal expenses now incurred by the
+ Railway and Canal Commission Court in appeals and disputes
+ between the companies and traders as to rates, etc.
+
+ =3. By reason of the amalgamation of railways with the Post Office.=
+
+ (_a_) The rent and expenses of numerous Post Offices in
+ the neighbourhood of railway stations would be saved, all
+ stations being used for postal purposes.
+
+ (_b_) All postal sorting and other offices could be situate
+ on railway premises in or near the stations, and besides
+ thus saving the rent would be in closer touch with the
+ railway.
+
+ (_c_) The whole of the railway tracks would be available
+ without rent for laying of telegraph and telephone wires,
+ either over or underground.
+
+ (_d_) Surplus land of the railways, in particular where
+ adjoining to stations, would be available for other
+ Government purposes, such as Inland Revenue Offices, Labour
+ Exchanges, Military, Naval or Civil Service purposes,
+ Police Stations, Fire Stations, County Courts, Police
+ Courts, Land Courts, as well as Courts for dealing with
+ questions arising out of the railways themselves.
+
+
+2. GENERAL ADVANTAGES.
+
+Unification enables each part of the country to have as good a
+service of trains as every other part, notwithstanding differences of
+population and resources. The Companies now operating on the South
+Coast cannot provide so good a service as the Northern Companies owing
+to the lack of the great mining and industrial centres which are served
+by the latter.
+
+One of the most conspicuous examples of this is =Ireland=. A Royal
+Commission was sitting for many years on the question of Irish
+railways, and ultimately reported in favour of State acquisition. Even
+this, it is clear, would not entirely solve the difficulty, which
+arises from the natural causes of being an island with (compared to the
+rest of Great Britain) a small population, mostly agricultural. If,
+however, the Irish railways were amalgamated with all the others of
+the United Kingdom under the proposed scheme the problem is solved. In
+the estimate given in considering the finance of the scheme the Irish
+railways are included.
+
+The conversion of the railway system into Government property will,
+apart from the question of economy already referred to, provide a most
+important advantage to the State. For example, the War Office can make
+use of the railway system, not only for the purposes of transport, but
+for the erection on surplus land throughout the country of barracks,
+stores, and other buildings, for wireless telegraph stations and for
+aviation purposes. The Admiralty will have the use of the great docks
+and wharves now owned by railways. The Civil Service will also find
+ample space for additional office accommodation, often in the most
+convenient spots both in town and country.
+
+Still more important even than these advantages is the fact that by the
+removal of all money restrictions from transport, not only an immediate
+but a =progressive increase of traffic= will result. That this will be
+so is shown hereafter when considering the question of the finance of
+the scheme, but it is referred to here as one of the most important
+advantages of the scheme, apart from the benefits to the nation already
+referred to of free circulation of passengers and goods.
+
+In the first place, the increase of traffic will require in all
+probability the whole of the staff now employed, who would otherwise
+be thrown out of employment by reason of the economies referred to
+above. It will be noticed that in the estimates given under the
+heading of “Finance of the Scheme” no decrease, but on the contrary,
+a slight increase has been estimated for in the working expenses,
+notwithstanding the enormous saving to be anticipated by the abolition
+and reduction of wasteful expenditure under the present system. My
+reason for so doing is partly to err on the side of caution in the
+estimates, but also to provide for the probability of having to retain
+the whole of the existing staff, and possibly increasing their wages
+and reducing their hours of labour. Most of the economies referred to
+must necessarily be effected gradually; for instance, the clerical
+staffs of the various railway companies and of the Railway Clearing
+House would be required for some considerable time in the process
+of winding-up, and by the time this is finished the traffic will
+have still further increased and their work will then be required in
+the more necessary departments of, say, the Goods Clearing Houses
+throughout the country.
+
+Secondly, the progressive increase of traffic will produce a
+corresponding increase of revenue which will be available for
+extensions and additions, for electrification of lines, and other
+improvements in means of transport, and ultimately even in still
+further reduction in charges, but last and by no means least in the
+adoption of appliances and inventions for the safety of life and limb
+both of passengers and railway servants.
+
+Unlike the present companies, the Government will have no difficulty
+in raising the capital required for any such purposes, and in relying
+upon the inevitable increase of traffic, as now is the case of the Post
+Office, for repayment.
+
+Take the case of automatic couplings. These were invented 40 years
+ago[4] and their adoption has been urged on the companies ever since,
+not only on the merciful ground of saving life and limb, but also on
+the financial ground of saving waste of time in shunting; but the
+initial expense of fitting these to every truck and carriage has been
+too much for the directors of the Companies to risk.
+
+Many inventions for automatic signalling, instantaneous brakes, and
+other life-saving appliances have been from time to time submitted to
+railway companies, but the initial expense of installation throughout
+the many miles of railway of each company has been so great that one
+hardly wonders at the hesitation of directors in laying out money
+belonging to the shareholders, especially when, notwithstanding a small
+normal increase of traffic, the working expenses have increased to a
+greater degree.
+
+
+FOOTNOTES
+
+[2] See “The Rural Problem,” by H. D. Harben (Constable & Co., 1913,
+2s. 6d.). Mr. Balfour Browne, K.C., also, in addressing the London
+Chamber of Commerce, February, 1897, said, “I am not exaggerating when
+I say that the Agricultural question … is nothing else but a question
+of Railway Rates.”
+
+[3] Lecture by A. W. Gattie, at London School of Economics, 11th March,
+1913.
+
+[4] “Mammon’s Victims,” by T. A. Brocklebank, published by C. W.
+Daniel, 1911--Price 6d.
+
+
+
+
+CHAPTER III.
+
+THE PRINCIPLES UPON WHICH THE SCHEME IS BASED.
+
+
+At first sight it seems preposterous that the fare =from London to
+Glasgow should be only one shilling=, the same as from London to
+Brighton, or that the fare of one penny from Mansion House to Victoria
+should be the same as from Victoria to Croydon. To a railway expert it
+will doubtless appear still more preposterous that the rate for a ton
+of iron-ore should be the same as for a ton of manufactured iron, and
+that the rate for general merchandise should be as low as 1s. 6d. per
+ton for any distance; and yet it is now considered a matter of course
+that the rate of 1d. for 4 ozs. for a letter from London to Londonderry
+should be the same as from one part of London to another, or 3d. for 1
+lb. should be the rate by parcel post for any distance great or small,
+and irrespective of what the contents of the parcel may be.
+
+The system of charging for transport =according to distance=, which is
+still in force throughout the civilised world, except in the Postal
+Service, appears to me to be =founded on a wrong principle=. It has
+no doubt been adopted on the assumption that the greater the cost of
+production the greater should be the charge, and, therefore, that as it
+costs more to build 100 miles of railway than one mile, and takes more
+coal or electric current to haul a train for 100 miles than for one
+mile, it is necessary to charge more for the longer distance. Even the
+Post Office still clings to the same idea, in charging higher rates for
+the telephone trunk service according to distance, although the charges
+for telegrams are the same for any distance! It is significant that
+whereas the net profits from railways remain more or less stationary,
+that of the Post Office with uniform rates continually increases, and
+that the telephone system with charges according to distance is so far
+the least satisfactory branch of the Post Office.
+
+It is no doubt a general rule that the price of an article depends upon
+the cost of production, but when dealing with transport the analogy
+fails. In the case of a national system of railways the provision of
+a regular service of trains to and from all parts of the country is
+a necessity. Such a service requires that trains must run at stated
+intervals advertised beforehand from one terminus to another, say from
+A to Z, with various stopping places between those points, which may
+be represented by other letters of the alphabet. The cost of running
+each train will be the same, whether it contains 20 passengers or 200,
+whether some or all of the passengers alight from or board the train at
+any intermediate station or at either terminus. Therefore, the actual
+cost of carrying a passenger from A to Z is not, in fact, more than
+from A to B, or from M to Z.
+
+The same consideration applies to goods with even greater force. With
+goods the cost of handling them has to be considered, as well as the
+cost of haulage. If goods are sent from A to B only they must be
+handled twice, and this is no more than if they are sent from A to Z,
+assuming there is no need for change of trucks.
+
+In the case of goods under the present system there is a further
+principle acted upon, which is still more obviously a wrong one,
+_viz._, what is known as charging =according to “what the traffic
+will bear.”= This term is well known to all railway experts, and is a
+convenient way of explaining the reasons governing the various rates
+under the present system. For instance, if too high a rate is charged
+for goods of comparatively small value, traders prefer to send by
+the cheaper modes, namely, by sea or by road, and in many cases it
+would not be worth while to send at all, whereas in the case of an
+article like silk or bullion of considerable value the extra cost of
+carriage even at a high rate would not add appreciably to the price.
+Therefore, the railway companies are compelled to make lower charges
+for low-priced goods, otherwise they would lose the traffic altogether.
+Accordingly there are such anomalies as a higher rate for the carriage
+of manufactured iron than of iron-ore for the same distance, although
+the cost of trucks, of haulage, and of handling may be identical.
+Again, the rate for carriage of meat from the Midlands to London is
+greater than that from Liverpool to London, partly on account of the
+competition of the sea, and partly on account of the large consignments
+of foreign meat. Again, the rate for the carriage of bricks from
+one part of London to another is greater than from Peterborough to
+London, because Peterborough is in a brick-producing district. These
+inconsistencies and anomalies are intensified by the necessity of the
+goods having to be carried over the lines of several different railway
+companies, all of whom must receive some profit out of the carriage of
+the goods, in addition to the actual cost.
+
+It is quite clear that the actual cost of haulage for the same distance
+of say a ton of coal is no more than that of a ton of bricks or of
+manufactured iron, or of sand, or of a pantechnicon full of furniture,
+all of which can be carried in open trucks, yet the rates for all these
+various goods, even for the same distance, differ widely from each
+other under the present system, and differ again not only according to
+distance but actually according to the different towns between which
+the service is rendered. Many examples of the present anomalies are
+strikingly shown by Mr. Emil Davies in his book, “The Case for Railway
+Nationalisation,”[5] which should be read by all interested in the
+subject.
+
+Now assume that the whole of the various existing railways are
+amalgamated; that Main line trains both for goods and passengers run
+at regular intervals to and from the principal towns; that Local
+trains run from station to station and on branch lines also at regular
+intervals, connecting at junctions with Main line trains; that just as
+there are now regular times for delivery and collections of letters
+and parcels by post, varying in number according to the population of
+each locality, so there are regular collections and deliveries of goods
+to and from every town and village in the United Kingdom; and that a
+uniform rate, no more than, or even less than, the smallest rate now
+charged, is all that has to be paid. It is true that with such a system
+at many of the smaller places the actual expense of collection and
+delivery may, indeed, be “more than the traffic would bear,” certainly
+much more than the Directors of a railway company would feel warranted
+in risking under the present system with their necessarily limited
+area, but when these smaller places are part of such a system as is
+here described, extending to every town in the United Kingdom, then the
+whole becomes self-supporting, and there is no advantage in charging,
+either according to distance, or according to “what the traffic will
+bear.”
+
+Every little village Post Office in the United Kingdom is an
+object-lesson to us. Here we have all the resources of civilisation,
+letter and parcel post, telegraph, telephone, savings bank, money
+orders, all provided at exactly the same rate as in the largest Cities
+of the Empire. Although the actual expense of each village Post Office
+taken by itself is out of all proportion to the population of the
+district, the combination of all of them in one national unified system
+enables these remote villages to benefit, not only with no financial
+loss to the nation, but actually with a handsome net profit which has
+actually contributed to the general revenue of the nation. This was not
+contemplated when the Penny Post was established, and is a practice
+which, in my view, is a great mistake, as explained in Chapter IV.
+
+The same principle has been applied to the ordinary roads of the
+country, which are now open free of charge to the whole population,
+although many of this generation can still remember the restrictions of
+the old toll-gates.
+
+It is only applying the same principle to the nation which applies
+to the human body. “The body is not one member, but many.… Whether
+one member suffers, all the members suffer with it, or one member be
+honoured, all the members rejoice with it.”
+
+If from any cause, such as a flood or other physical disturbance
+a small industrial or agricultural district were cut off from all
+communication with the rest of the Country, it is not only that
+district but also the whole of the Country which suffers loss, namely,
+the loss of trade with that district. And if by reason of high rates
+the remote towns, villages, and districts, as well as those nearer
+to great centres, are prevented from obtaining an outlet for their
+produce, the whole Country suffers. The converse is equally true:
+as soon as free circulation of passengers and goods is provided,
+the prosperity of the whole Country as well as of each district is
+increased.
+
+This, then, is the principle upon which the scheme of uniform fares
+and rates is founded, as opposed to the existing system of charging
+according to distance and according to “what the traffic will bear.”
+There remains, however, to be considered the principle upon which the
+particular uniform fares and rates mentioned on the title page have
+been suggested for the proposed scheme. These have not been selected
+at haphazard, but in accordance with three rules which, I believe, are
+founded upon a sound principle, namely:--
+
+ =(1) That any flat rate to be successful must not exceed the
+ minimum rate in force prior to the adoption of the scheme=;
+
+ =(2) That there should result from the change a sufficient
+ increase of traffic to produce at least the same net revenue as
+ before=;
+
+ =(3) That in a system of transport the fares and rates should
+ vary, not according to distance travelled, but according to
+ speed of service.=
+
+In accordance with these rules I take =for Passenger Traffic= first
+the present minimum railway fare now charged, that is, 1d. for short
+distances of one mile or under. If the flat rate were fixed at say
+2d., or, indeed, any sum over 1d., passengers who now pay that sum
+would have to pay at least double the existing fare; this would, of
+course, render the whole scheme impracticable. On the other hand, under
+a flat rate of 1d. throughout the whole country the receipts would
+not be sufficient to produce the present revenue unless and until the
+number of passengers carried should increase by as much as six or seven
+times. That this is so is clear when it is remembered that the =present
+average railway fare for the whole of the United Kingdom= (allowing
+for season ticket holders), =is 6½d.= In other words, if all the
+passengers now travelling would pay 6½d. for every journey, both for
+short ones, as from Mansion House to Charing Cross, and long ones, as
+from London to Londonderry, then the same gross revenue from passengers
+would be obtained as now; or, on the other hand, if a flat rate of 1d.
+any distance were fixed, and the number of passenger journeys were
+increased by six-and-a-half times as a result of this great reduction,
+then, again, the same gross revenue would be obtained. The first of
+these alternatives is, of course, impracticable, and the second one is
+certainly not likely to be attained for some time to come, and even
+then account would have to be taken of the additional working expenses
+occasioned by so large an increase of traffic. It is on account of
+these difficulties that any system of uniform fares has hitherto been
+regarded as impracticable.
+
+The solution of this problem was suggested to me by the practice of
+the Post Office of charging 3d. for express delivery, and 6d. for a
+telegram. Here we have the third rule before referred to of charging
+according to speed of service. Applying this to railways, and again
+searching for the lowest fares now charged for fast Main line trains,
+it will be observed that these are the regular cheap excursion fares of
+2s. 6d. from London to Brighton or Southend and back, which amounts to
+1s. 3d. each way. It is true that these are exceptionally cheap fares.
+Return tickets only are issued at this price, available by certain
+trains only, but on the principle already laid down that the flat
+rate must not exceed the lowest, this forms the basis of the proposed
+uniform fare of 1s. for Main line trains. Although this uniform fare
+is so exceptionally low, it is still nearly double the present average
+fare, and it is precisely on the Main line trains that increase of
+traffic (now restricted by expense) is sure to take place. These facts
+(as will appear in the chapter, “Finance of the Scheme”) enable me to
+estimate the increase of passenger traffic required to make up the
+present gross revenue at only 15 per cent. of the present number of
+passengers carried.
+
+=For goods traffic= the uniform rates suggested have been ascertained
+in accordance with the same rules. It is more difficult to ascertain
+the present minimum owing to the enormous complication of goods rates.
+
+Under the present system, goods are divided into eight different
+classes according to the rate charged, and a maximum rate is fixed by
+law for each class. In the lowest of these classes the rates vary from
+one penny and a fraction up to 4d. per ton per mile for any distance
+up to 20 miles, and smaller proportionate rates for distances over 20
+miles. But although these are the greatest amounts that the companies
+may charge for this class of goods, they do make special rates of
+considerably lower amounts for special kinds of goods. It is estimated
+that five-sevenths of all the goods carried are charged according to
+special rates not included in the eight classes mentioned.
+
+The Board of Trade returns give the totals of two classes of goods
+only, namely, “minerals,” of which 410 million tons are carried, and
+“general merchandise,” of which only 116 million tons are carried.
+These returns are possibly misleading as, although derived from returns
+made by the several companies themselves, it may be that those returns
+include the same goods sent over different lines.
+
+For the purposes of my estimates, however, I have assumed that the
+Board of Trade returns are correct, and if they are so, the average
+charge for “minerals” is now about 1s. 6d. per ton, and for “general
+merchandise” about 6s. per ton. Taking the two classes of goods traffic
+together, as representing what under my scheme will be the “slow goods
+traffic,” =the average is only 2s. 4d. per ton=.
+
+The average rate of 1s. 6d. per ton has been suggested for the slow
+service because it is believed that this average will allow of a rate
+for all goods in open trucks as small as the lowest rate now charged
+for minerals for short distances, the average being maintained by
+higher rates chargeable for other kinds of goods as already described.
+If the actual tonnage of goods carried is really less than that
+mentioned in the official returns (it cannot be more), it may be found
+necessary to fix a somewhat higher uniform rate, and the estimates may
+be affected to a certain degree. The figures, especially those relating
+to goods traffic, are put forward by way of suggestion only, and there
+should be no difficulty in ascertaining a uniform rate in accordance
+with the rules already stated.
+
+It is believed that any difficulty in this respect will be solved by
+the large accession of traffic by Fast service, which, as with Main
+line passengers, is sure to follow the adoption of the scheme.
+
+The average rate for “fast” service has been obtained by ascertaining
+the lowest rate now charged for goods carried “per passenger train.”
+This appears to be the rate for returned empties for any distance up
+to 25 miles, namely, 6d. per cwt. (equals 10s. per ton). There is
+also a charge of £1 for a load not exceeding 2 1/2 tons on carriage
+trucks attached to a passenger train for a distance of 40 miles, and
+thereafter at 6d. a mile. It is evident that an average of 10s. per ton
+would allow of a still smaller rate than that amount for goods carried
+in bulk and in large consignments.
+
+
+FOOTNOTES
+
+[5] “The Case for Railway Nationalisation” by Emil Davies, published by
+Collins, 1913--Price 1s.
+
+
+
+
+CHAPTER IV.
+
+OBJECTIONS TO THE SCHEME.
+
+
+I now propose to consider objections which may be raised to the
+proposed scheme.
+
+I anticipate opposition from those who object to all forms of =State
+Ownership= or State Management.
+
+The late Lord Avebury was one of the most prominent opponents of
+nationalisation, and his views are set out in his book “On Municipal
+and National Trading.”[6]
+
+Mr. Edwin A. Pratt has written several books on the subject and has
+recently collected all the arguments up to date against State Ownership
+in his book, “The Case against Railway Nationalisation,”[7] In this
+book examples are given of the experience of foreign countries and the
+Colonies where railways have been taken over by the State.
+
+Other writers who have advocated the retention of our present system,
+and are quoted with approval by Lord Avebury, are the following:--
+
+ Messrs. G. Foxwell and T. C. Farrer (now Lord Farrer), in
+ “Express Trains, English and Foreign.” (1889);
+
+ Mr. W. M. Acworth, in “The Railways and the Traders”;
+
+ Mr. H. R. Meyer, in “Government Regulation of Railway Rates,”
+ and in “Railway Rates”;
+
+ and Lord Farrer and Mr. Giffin, in “The State in its Relation
+ to Trade.”
+
+On the other side, the following, among other advocates of railway
+nationalisation have shown the great advantages to be anticipated by
+such a measure, and have given very cogent answers to the objections of
+the opponents, namely:--
+
+ Mr. William Cunningham, “Railway Nationalisation.” (Published
+ by himself at Dunfermline, 1906, 2s. 6d.);
+
+ Mr. Clement Edwards, M.P., “Railway Nationalisation.” (Methuen
+ & Co., 1907, 2s. 6d.);
+
+ and Mr. Emil Davies in several books, including his latest,
+ already referred to, “The Case for Railway Nationalisation.”
+ (Collins, 1913, 1s.)
+
+But in all these books, and in other books and articles, both for and
+against nationalisation, it has been assumed that if, and when, the
+railways are acquired by the State, the same system will obtain as now,
+and as obtains in the case of all the foreign countries and colonies
+referred to, namely, =to charge according to distance and according to
+“what the traffic will bear,” and with the primary object of making the
+most profit=.
+
+With very great deference to all these distinguished writers, it
+appears to me that they have one and all overlooked the fundamental
+principles which should be acted upon by a State or a Municipality
+first in deciding whether or not to acquire a monopoly, and secondly,
+in the administration of it when acquired. These principles depend upon
+=the fundamental difference between the objects in view, and actuating
+a Company or individual on the one hand and a Nation or Municipality
+on the other in acquiring a monopoly=. In the former case the =sole
+object= is that of =pecuniary gain or profit=; in the latter the =sole
+object= is, or ought to be, the =benefit of the community=. It may
+be said that these are not respectively the sole objects, but only
+the =primary objects=. My reply is that in the case of the company it
+is the duty of the directors, as trustees for the shareholders, to
+so carry on the business in question as to produce the most profit,
+irrespective of any benefit to the community, or, indeed, to any
+persons other than the shareholders. Railway companies, it is true,
+provide the benefit of transport, and various advantages held out by
+the companies as inducements to use their particular lines, but these
+are, of course, solely offered with the view of increasing the profits.
+Other advantages for the comfort, safety and benefit of the public
+are provided under compulsion from the Government, as a condition
+of the grant of privileges and compulsory powers conferred upon the
+companies, without which the railways could not have been made. I refer
+to such matters as rules and regulations for the safety and benefit of
+the public; workmen’s trains; maximum fares and rates allowed to be
+charged; provision for at least one train a day at all stations, etc.
+
+Conversely, in the case of a Nation or Municipality taking over a
+monopoly, it is the duty of the Government Department or Town Council
+to so carry on the business as to render the most efficient service,
+at the lowest cost consistent with efficiency, with paying for the
+cost of acquisition and with paying the working expenses. Advocates
+of nationalisation urge that profits should be applied in reduction
+of taxation, and suggest that this is in itself one of the benefits
+to be derived therefrom. Opponents always assume that national and
+municipal trading must be carried on with a view to profit, and some
+even ridicule the idea that any trading concern can be successfully
+carried on unless with this view and with a resulting profit.
+Acrimonious discussions have taken place as to whether profits which
+have been claimed by advocates of municipal trading to have been made
+by tramways, gas, water and electricity works, are only paper profits
+as alleged by the opponents. In Lord Avebury’s book already referred
+to,[8] one whole chapter, headed “Loss and Profit,” treats of the
+question whether municipal enterprises have been profitable or not,
+and he adduces many examples to prove that in most cases the alleged
+profits are imaginary.
+
+It has, in fact, been the practice universally to apply profits made
+out of municipal trading in this Country in reduction of rates, and
+in foreign Countries, where railways are owned by the State, their
+revenues are made use of either as general revenue or, as in Prussia,
+for social or educational purposes, which would otherwise be provided
+for by direct taxation. The only instance of national trading in
+this Country is the General Post Office, and I think it is correct
+to say that the original intention when Penny Post was established
+was to so carry it on that working expenses only should be covered
+by the revenue. In practice, the gross revenue is entered with other
+items of revenue in the National Accounts, and the gross expenditure
+with other items of general and non-productive expenditure, with the
+result that the net profits of the Post Office, in effect, become a
+source of general revenue, and are therefore applied in reduction of
+general taxation. Until recent years this net profit has not been
+considerable, but last year it was as much as £5,000,000. Having regard
+to the continual and progressive increase in postal business, and the
+acquisition of the whole telephone system, there is every prospect of
+still further increase in net profits. What will be the result of a
+continuance of this practice of applying net profits of Municipal and
+National trading towards reduction of rates and taxes? It has not, so
+far, had any very serious result, simply on account of the fact that
+such net profits have not yet been of a very startling amount. But if
+these profits should increase, will not the result be the very evils
+which are the natural consequence of a private monopoly?
+
+Once the principle is admitted that profits from such trading shall go
+in relief of taxation, the service will, and must, be worked more or
+less with the primary object of making as much profit as possible, with
+the inevitable result that the service in question will be starved for
+the sake of the profits. This has actually happened in the case of the
+Prussian State Railways, the one State Railway which has so far made
+the greatest net profit.
+
+In addition to this difficulty there are others inherent in State or
+Municipal trading, if the principle of making profits be admitted, and
+if profits are actually made. In such a case the Chancellor of the
+Exchequer will be expected to budget for further profits, the general
+public will expect improvements in the service, traders will expect
+that the charges to them should be reduced, and the workers will expect
+that their wages should be increased.
+
+This view is not a new one. It has been advocated in respect of the
+Post Office for many years by such well-known postal reformers as Lord
+Eversley (formerly Mr. Shaw Lefevre), and Sir Henniker Heaton, Bart.
+The latter, I believe, has several times moved resolutions in the House
+of Commons for the express purpose of having the postal profit applied
+to the use of the Post Office itself, instead of to general revenue.
+
+It is well known that “=strikes=” are more likely to arise in a period
+of trade prosperity. It is the natural result of the workers seeing
+large profits made out of their industry, if they should have no
+benefit, by increase of wages, by sharing in such profits or otherwise.
+It makes but little difference to the workers that those profits go to
+ratepayers, instead of to shareholders, more especially as they usually
+inhabit houses let on weekly inclusive rentals, and are exempt from
+income-tax, so that they do not directly pay either rates or taxes. If,
+on the other hand, the profits are devoted to improving the efficiency
+of the service or cheapening the charges, then, not only are there no
+profits to excite the cupidity of various sections of the community,
+but the workers do, in fact, benefit by themselves and their families,
+as well as the whole of the public for whom the services are worked. No
+strike is ever successful which does not gain general public support,
+and even under existing conditions there is much less likelihood of
+strikes in the case of Civil Servants or postal or municipal employees,
+partly on account of the better wages paid, the certainty of continuing
+in employment except for misconduct, and the prospects of a pension,
+but still more on account of the practical certainty that public
+support would not be given to a strike which interferes with one of the
+most important of the public services.[9]
+
+Another evil of ignoring the difference in principle of a public
+monopoly and a private monopoly has been the practice of applying to
+public monopolies the practice which all private monopolies endeavour
+to achieve (and properly so as their sole object is profit), namely,
+to put down all possible competition. If the principle I advocate,
+namely, that the =sole object of a public monopoly is the benefit of
+the community=, then if some improvement in the service, the subject of
+such monopoly, shall be invented, which is proved to be practicable,
+the public should have the benefit of such improvement, and, =instead
+of a prohibition of such private enterprise every encouragement should
+be given= to it.
+
+In our Navy, when new inventions are found which increase its
+efficiency, no time or money is lost in adopting them, even at the
+expense of discarding comparatively modern men-of-war or appliances.
+The risk to the nation of not doing so is too great to allow
+considerations of expense to stand in the way.
+
+But what has happened in the case of so important a commercial matter
+as the Telephone? The Post Office are authorised by Act of Parliament
+to forbid any competition, a provision evidently enacted under the
+impression that a public monopoly must have Statutory protection
+against competition, which a private monopoly always seeks to obtain,
+but has to pay for. Having this monopoly, and having purchased the
+telegraphs, the Post Office from the first regarded telephones with
+the utmost jealousy, because it seemed likely to interfere with its
+“Profits”! Lord Avebury quotes from “The Times” of 13th June, 1884, as
+follows:--[10]
+
+ “… the action of the Post Office has been so directed as to
+ throw every possible difficulty in the way of the development
+ of the telephone, and of its constant employment by the
+ public. We say advisedly, ‘every possible difficulty,’ because
+ the regulations under which licences have been granted to
+ the telephone companies are in many respects as completely
+ prohibitory as an absolute refusal of them.” “… the effects of
+ this claim are nearly as disastrous to the Country as to the
+ inventors and owners of the instruments.”
+
+When it is remembered that the Post Office insisted on being paid
+one-tenth, not of the profits, but of the gross receipts, the wonder
+is that our telephone system is not more backward than it is. Lord
+Avebury, of course, uses this and other instances, such as the
+opposition of municipalities owning tramway and gas undertakings,
+to tramway extensions in adjoining districts, and licences to motor
+omnibuses and also to the introduction of electricity for lighting
+and power, as an argument against nationalisation and municipal
+trading.[11] That these constitute a strong argument against public
+monopolies being worked for profit, I readily admit, but they do not
+weaken the argument that all such concerns which must, in their very
+nature, be incapable of effective competition, should be taken over
+by the community, and be worked solely for its benefit. What possible
+chance is there of competition in a telephone system? It is, of course,
+an essential element to its success that each subscriber should be able
+to communicate with every other one. How, then, can it ever have been
+imagined that there could be any effective competition between rival
+systems? And yet competition was actually attempted between various
+municipalities and the National Telephone Company, and afterwards the
+Post Office itself was authorised to “compete” with that Company.
+
+The ultimate purchase by the State was, of course, a foregone
+conclusion, but at what expense of both time and money has this at
+length been effected! The complaints which have been made since
+the completion of this purchase are evidently the result, not of
+nationalisation, but of the mistaken practice followed in a fruitless
+attempt at making or retaining so-called “profits” of the telegraph
+system, by at first putting “every possible difficulty” in the way of
+telephones, then attempting to compete with them, and then waiting a
+number of years before completing the purchase, with the result of
+being compelled to take over a large number of obsolete plant and
+instruments, and linking them up with a new system, thus producing a
+state of confusion and useless expenditure of time and money, which
+could all have been avoided by purchase of the patents and patent
+rights more than 30 years ago.
+
+It is only right to say that Lord Avebury was still of opinion in 1907
+that the resolution of the Government to buy up the National Telephone
+Company was “an extraordinary and most unfortunate policy.”[12]
+
+Mr. Hanbury, who was the Minister mainly responsible in 1906 for the
+purchase of the telephones, had evidently changed his opinion since
+1889, when, in answer to a deputation in favour of purchasing the
+telephones, he said, according to a report quoted by Lord Avebury from
+“The Times”:--
+
+ “If the telephone service was cast upon the Post Office it
+ would be to the detriment of both the postal and telegraph
+ services. Then, again, it would increase enormously the
+ Government staff. He need only appeal to the Members of
+ Parliament present to say whether they would like to have the
+ weekly appeals for increase of wages from those State servants
+ still further extended.”
+
+Here we have exactly one of the arguments which is now being used
+against railway nationalisation, and by the very Minister who, 17 years
+after, did the very thing he had clearly condemned.
+
+I admit the argument would hold good if the restriction be not imposed
+by an inflexible rule that there should be no attempt to work the
+concern, whether Post Office, telephone, railway or other monopoly for
+purposes of profit.
+
+I have already referred to the mistake the Post Office are making in
+following the example of the private monopolist, the National Telephone
+Company, in charging for telephones according to distance, although
+between the very same towns in which different rates are charged the
+same department charges 6d. only for telegrams! This can only be with
+the strange, yet futile, intention of making more profit without
+regard to the benefit of the community. If the same rate were charged
+for Trunk calls as for local calls, many more provincial and country
+people would subscribe, and the wires being already laid and exchanges
+established, the additional expense would be but small.
+
+It would seem, indeed, that the search after profits in the case of
+Government or municipal monopolies is as futile as the search by people
+after happiness, personified by Maeterlinck as “The Blue Bird,” and
+that when the only object is to benefit the community, the profits
+come, as does happiness, when the only object is that of benefiting
+other people.
+
+Now, in considering the principle here laid down, it appears to me
+that there are four rules which should be observed when a nation or
+municipality undertakes anything in the nature of a trading concern:--
+
+ 1. Only such concerns should be taken over as are, and must be,
+ =in the very nature of things, a monopoly=, or, in other words,
+ are not susceptible of effective competition.
+
+ 2. Any such concern taken over should be worked with =the sole
+ object in view of benefiting the community= and, therefore,
+ the charges made should be so adjusted as to pay for the
+ acquisition of the concern and for working expenses, and any
+ surplus from time to time applied, only in improving the
+ efficiency of the undertaking, or in reducing the charges made.
+
+ 3. In the event of any invention or improvement being made,
+ and proved to be commercially successful, whereby the benefit
+ to the community can be increased, and provided the concern
+ remains in its nature a monopoly, such improvements should
+ be taken over and worked by the State or municipality, and
+ meantime =there should be no prohibition of any private
+ enterprise carried on in competition= apparent or real.
+
+ 4. All such concerns, whether national or municipal, should be
+ worked or directed by one or more Department of State, having
+ at its head a Minister, who should be a Member of the Cabinet,
+ and =responsible to the House of Commons, and as such liable to
+ a vote of censure for any abuse or want of efficiency in the
+ concern=.
+
+As to Rule No. 1, there appears sometimes to be a very thin line
+between what is, and is not, susceptible of effective competition. As
+a general rule, =any concern which involves a right or easement over
+land, must be in the nature of a monopoly=. Thus the supply of gas,
+water and electricity, all of which must be conveyed by pipes or wires
+into houses, are in the nature of a monopoly, but the fittings used in
+the houses are not, but are susceptible of very efficient competition,
+both as to workmanship, manufacture and design. All roads, including
+railroads and tramways, are, and must be, in the nature of a monopoly,
+but the manufacture of materials and rolling stock, the catering of
+hotels, forming part of the railway undertakings, or in the trains
+themselves, or in railway steamers, are all the subject of effective
+competition and should, therefore, be put up for competition with
+special supervision and restrictions against abuse of the privileges
+obtained by competition on Government property.
+
+Now, I would ask any unprejudiced reader who has studied the writings
+of the eminent authors already quoted, and other opponents of
+nationalisation, to read those books again with these four rules in
+his mind, and consider whether all the objections so forcibly brought
+forward against nationalisation would not be very nearly, if not
+completely, answered, if such nationalisation were carried out with
+strict adherence to these rules.
+
+I venture to think that Lord Avebury himself would have admitted the
+force of this contention. It would, at least, answer the question he
+puts more than once, “Where, indeed, is it (municipal and national
+trading) to stop? Is it to stop at all?… It is sometimes said that the
+line should be drawn at necessaries. But if so, to light, gas, water
+and tramways, we should have to add bread, meat, fire insurance, …
+etc., while many would also add tobacco, tea and beer.”[13]
+
+In effect, the whole of the objections to State ownership, as will
+appear from a perusal of the various books referred to above, and the
+arguments of other opponents, are all comprised under three heads,
+namely, according to the relationship of the State:--
+
+ 1. With traders.
+
+ 2. With railway servants.
+
+ 3. With the general public, especially on such matters as
+ officialism and inefficiency, owing to want of competition, bad
+ administration, and interference with private enterprise.
+
+The first of the two objections referred to is that the Government
+would be in the great difficulty of having to meet the conflicting
+interests of traders and merchants on the one hand, and the general
+public on the other, with continual disputes as to the claims of
+various parties, and possible attempts to bring influence to bear on
+the Government and Members of Parliament. This objection was raised
+by the Prime Minister recently in reply to a deputation supporting
+railway nationalisation. The difficulty has been found in countries
+where railways are State owned, and would, I admit, be a most serious
+objection, if, after nationalisation, the railways should be worked on
+the same principle as now, namely, with the object of making the most
+profit possible, and charging according to “what the traffic will bear.”
+
+The objection, however, disappears if the proposed rules are adhered
+to, especially when, as in the proposed scheme, fares and rates are
+fixed irrespective of distance, locality, class of traders or goods,
+and in which, therefore, no question of preference or, indeed, of any
+conflicting interests can arise.
+
+As to the second heading, affecting the relationship of the State with
+the railway servants. It is suggested that the railway servants (who
+would, on nationalisation, become Civil servants) could use their
+voting powers to exact undue privileges for themselves which they
+cannot now obtain, and that serious abuses might arise owing to the
+great political power exercised by a large increase in the number of
+voters who are also Civil servants.
+
+This does not appear to me so formidable an objection as the first, but
+it is quite possible that a large united body of Civil servants might
+have power to so influence the Government as to extract higher wages
+or less hours, if they discovered that by their exertions a very large
+profit was derived by the railway system.
+
+Some writers have gone so far as to suggest that all persons employed
+by Government should be disfranchised. Others suggest that special
+representatives of Government officials should be returned to
+Parliament. Others that all such officials should take the same oath
+of allegiance as soldiers, and, in short, become subject to military
+discipline. In two articles appearing recently in the “Westminster
+Gazette,” under the title of “Unrest in the Railway World, by an
+Expert,”[14] it is suggested that “unless some discipline of the
+military kind were introduced” (in the event of nationalisation),
+“there would be no available methods of dealing with a national strike
+of railwaymen, other than to concede to their demands.” The question
+of “Strikes” has already been dealt with above (page 36). As to the
+political difficulty, although it is true that the number of Civil
+servants would be greatly increased (and it has been estimated that
+the total number of postal and railway servants who would have the
+vote might be as many as 600,000), it must be remembered, as pointed
+out by Mr. Emil Davies, that this number is spread over the whole
+Country, and the percentages in each district, compared to the whole
+number of voters, would not be a large one, except in railway centres
+like Crewe, where they already have a preponderance of votes. In any
+case, the same considerations which, as above mentioned, would be
+likely to prevent strikes, would operate equally in the region of
+politics if the four rules mentioned are adhered to, especially under
+the proposed scheme, carried on with the primary object of the public
+benefit. Exactly the same conditions would obtain as with the Post
+Office now.
+
+Other grounds of objection to State ownership are:--
+
+ =1. The fear of inefficiency owing to lack of competition.=
+
+ =2. The fear of difficulty in obtaining redress for loss or
+ injury from a Government Department.=
+
+ =3. The fear of officialism.=
+
+=As to competition=, it is now generally admitted that there is no
+effective competition on railways.[15] In most parts of the country
+there never has been any competition, as one company only is available.
+In others, where more than one company operates, working arrangements
+have been made not only as to the fares and rates but also as to time
+of trains, thus precluding any effective competition. In the very
+nature of things no competition can be effective in a system of railway
+transit.
+
+As to the questions of =officialism= and =difficulties of obtaining
+redress=, can anyone suggest that these are less in the case of private
+companies, responsible to no one but themselves, than in the case
+of a Government Department with a Cabinet Minister at the head who
+is responsible to Parliament? A vote of censure is one of the most
+powerful weapons in Constitutional countries against any serious abuse
+in a Government Department.
+
+Mr. Edwin A. Pratt, in his book before referred to, cannot but
+admit the cogency of the argument in favour of the amalgamation and
+unification of the railways, but urges that this should be accomplished
+by the amalgamation of the whole of the existing railways into =a Trust
+or Traffic Board=. The answer to this is that when once constituted,
+even though appointed by Parliament, such a Board =is responsible to no
+one but itself=, and, however eminent may be the directors or managers,
+the want of ultimate responsibility inevitably and unconsciously leads
+to abuses. =Can any instance be adduced of the successful working of
+any such large Trust or Board?= On the other hand, instances are well
+known to the contrary. One of these was the notorious Metropolitan
+Board of Works. And is it certain that the Metropolitan Water Board and
+the Port of London Authority, both of which are constituted on similar
+lines, will answer all the expectations which were formed of them?
+
+There are, of course, difficulties inherent in the administration
+of a great Government Department, but, as already hinted, various
+remedies may be suggested for many of these difficulties. For instance,
+there might be elected =a Railway Council= or Standing Committee in
+Parliament, consisting of representatives of several large districts
+of the United Kingdom, and of which the “Minister of Transport” would
+be, ex-officio, the President. In the first instance possibly some of
+the present directors of railway companies, many of whom are already
+in Parliament, could be members of this Council. Any proposals for
+improvements, extensions or alterations in the services of the railway
+or Post Office would be submitted to and decided upon by this Council
+or Committee, subject to an appeal to Parliament on questions of
+principle or finance. This would be one means of obviating an objection
+found in some countries where the railways are owned by the State,
+namely, the continual trivial complaints made in Parliament about the
+railways.
+
+A further suggestion is that a =special Railway Court= should be
+established in London with branches in every important centre, and
+presided over by competent arbitrators to determine and adjudicate upon
+claims against the Department for personal injuries to passengers and
+servants, or for loss of or damage to goods, or by reason of delay,
+any one accident, involving a large number of claims, being dealt with
+by the same Court instead of being, as now, the subject of innumerable
+actions at law in the ordinary Courts. This Railway Court might also be
+useful in settling disputes between the Government and the men.
+
+
+OTHER OBJECTIONS.
+
+Apart from the objection to State ownership there are no doubt many
+who are now deriving income from railways who will fear that their
+interests may be prejudiced by the proposed change. Fortunately
+=there can be but very few who will be thus prejudiced=. As to the
+existing staffs, such as booking clerks and the Railway Clearing House
+staff, whose services would no longer be required in those particular
+departments, there ought to be more than sufficient vacancies for these
+in other but more necessary branches of the railway service, especially
+in view of the increased traffic which is sure to arise.
+
+=Many traders= who may at first sight consider that their profits would
+suffer if the scheme is adopted =will find= on further consideration
+=that the benefits= they will have by the proposed scheme =will be
+greater= than any loss they could possibly sustain. To take one
+instance. =Newspaper proprietors= may consider that upon railways
+being nationalised they would lose the benefit of the extensive and
+remunerative advertisements they now receive from competing railway
+companies. So far from there being any loss, there will be profits,
+partly by the official announcements which the Department will cause
+to be inserted in all newspapers of time tables, rates, etc., but
+even more so by the enormous saving in the carriage of paper and of
+the newspapers, in travelling expenses of special correspondents
+and others, and by the additional profits arising from increased
+circulation which is sure to follow upon the increased facility and
+cheapness of distribution.
+
+Mr. W. M. Acworth, the well-known railway expert, to whom I submitted
+a rough draft of this pamphlet, was kind enough, while refraining from
+any detailed criticism, to call my attention to what he considered a
+difficulty in my proposals. He says:
+
+ “The fundamental objection to a scheme of average fares and
+ rates is that people whose fares and goods rates are ‘averaged
+ up’ will, so far as possible, cease to use the trains; those
+ whose fares and rates are ‘averaged down’ will increase
+ enormously, with a corresponding increase in working expenses.
+ Have you appreciated that under your scheme a passenger from
+ London to Glasgow would, in fact, in most cases pay, not
+ 1s., but 3d. or 4d., by taking local tickets from London to
+ Birmingham, Birmingham to Crewe, etc?”
+
+And he instances the Hungarian zone system, which has completely broken
+down, as a case in point.
+
+My answer to this is, first, that according to my scheme there is
+no “averaging up;” the flat fares are all “averaged down” to the
+minimum. Secondly, while welcoming the admission that the effect of
+“averaging down” is to increase the traffic “enormously,” I am sure
+that Mr. Acworth himself does not mean that the working expenses will
+increase in anything like the same proportion. He has himself pointed
+out in an article on railways[16] that the train cost of carrying 200
+passengers and 10 passengers is practically the same. Further reasons
+for this fact are given under the heading of “Working Expenses” in this
+pamphlet. Thirdly, while admitting that under my scheme a passenger
+might, by taking three local trains which stop at all stations travel
+from London to Glasgow for 3d., I can hardly imagine that any but the
+smallest percentage of travellers would endeavour to save 9d. by taking
+a journey in which they would spend sixteen hours and have two changes
+at least, instead of travelling the same distance by one train, in
+eight hours, for 1s. As to the zone system, the whole advantage of the
+flat rate or uniform fare is lost by the difficulty of passing from one
+zone to the other.
+
+
+FOOTNOTES
+
+[6] “On Municipal and National Trading” by The Rt. Hon. Lord Avebury.
+Published by Macmillan & Co., 1907. Price 2/6.
+
+[7] “The Case Against Railway Nationalisation” by Edwin A. Pratt.
+Published by Collins, 1913. Price 1/-.
+
+[8] “On Municipal and National Trading,” pp. 56-92.
+
+[9] While this pamphlet has been in the Press, there has been a strike
+of the Leeds Municipal workers, and the threat of a strike in the Post
+Office. It will be interesting to see whether the considerations above
+mentioned under existing conditions will be borne out, and still more
+if when the causes are ascertained, it can be proved that had the
+principles here advocated been carried out in practice, there would
+have been no strike, nor any threat of one.
+
+[10] On Municipal and National Trading, p. 109.
+
+[11] Ibid, Chapter VII.
+
+[12] On Municipal and National Trading, p. 107.
+
+[13] “On Municipal and National Trading,” page 10.
+
+[14] “Westminster Gazette” of December 2nd, 1913.
+
+[15] See “The Railways of Great Britain” by Lord Monkswell. (Smith,
+Elder & Co., 1913. Price 6/-). A most interesting book, published
+since this pamphlet was written.--Lord Monkswell is not an advocate
+of nationalisation, but apparently has an open mind.--He admits that
+England is now only served by five groups of railways, and that there
+is no effective competition.
+
+[16] In Palgrave’s “Encyclopædia of Political Economy,” Vol. III.
+(1899), Article on Railways, signed W.M.A.
+
+
+
+
+CHAPTER V.
+
+FINANCE OF THE SCHEME.
+
+
+The final and most important criticism of the scheme will be on the
+matter of finance.
+
+The question is, can a sufficient revenue be obtained from the small
+uniform fares and rates proposed, after providing for working expenses,
+to pay not only interest on the purchase money but the purchase money
+itself?
+
+It is a curious coincidence that in the year 1838, before Penny Postage
+was instituted, the average amount received for every chargeable letter
+was 7d. and a fraction--the actual average railway fare now paid by
+every passenger (excluding season tickets).
+
+The number of letters carried during the first complete year after the
+uniform rate of 1d. was adopted was more than doubled. Notwithstanding
+this the deficiency in net revenue was about £2,000,000, and the
+deficiency was made good out of general revenue, this being well worth
+while owing to the great benefit to the nation of Penny Postage.
+
+In the case of railways, however, the amount involved is so large that
+no Government could be expected to give any consideration to a proposal
+which would involve making good so large a deficiency as would be
+occasioned by the reduction to a flat rate of 1d. As will be gathered
+from the remarks made when dealing with the principles of the scheme,
+this difficulty is now overcome by dividing the traffic on railways,
+both of passengers and goods, into two kinds of service, namely, Fast
+and Slow. It will be found that by this means =no greater percentages
+of increase of traffic will be required to produce the same gross
+revenue as at present than 15 per cent. of passenger traffic and 10 per
+cent. of goods traffic=. It will also be shown that if the increase of
+traffic should not exceed this estimate the additional working expenses
+will be so small that they would be more than met by the economies
+effected by unification. If these propositions prove to be true, then
+there will be no deficiency to be provided for.
+
+It is necessary in order to prove this to set out the figures of the
+present receipts and expenses, and an estimate of the same under the
+proposed new scheme.
+
+
+PRESENT FIGURES.
+
+The following are in round sums the average figures for the two years
+1911 and 1912, based on the Railway Returns published by the Board of
+Trade annually under the Regulations of Railways Act, 1871:--
+
+ =(_a_) Passenger traffic receipts.=
+
+ Season ticket holders £5,000,000
+ Other passengers 40,000,000
+ -----------
+ Total from passengers only 45,000,000
+ Mails and goods by passenger trains 10,000,000
+ -----------
+ Total from passenger traffic 55,000,000
+
+ =(_b_) Goods traffic receipts.=
+
+ Minerals £30,000,000
+ General merchandise 32,500,000
+ Livestock 1,500,000
+ -----------
+ 64,000,000
+
+ =(_c_) Miscellaneous receipts.=
+
+ Steamboats, docks, etc. 5,000,000
+ Hotels, rents, etc. 5,000,000
+ -----------
+ 10,000,000
+ -----------
+ Grand Total £129,000,000
+
+ =Expenditure.=
+
+ Maintenance of ways,
+ works, stations, docks,
+ etc. 18,000,000
+
+ Traffic expenses 23,000,000
+
+ Locomotive and rolling
+ stock expenses 28,000,000
+
+ General charges, rates
+ and taxes 12,000,000
+ -----------
+ 81,000,000
+ -----------
+ =Net receipts= £48,000,000
+ ===========
+
+ =Total number of passenger journeys=, including
+ season ticket holders (assuming that each
+ annual ticket represents 200 double journeys
+ per annum only), about 1,620,000,000
+
+ Of this total there were first or second class
+ passengers about 160,000,000
+
+ That is, about 10% of the total number carried.
+
+=The average fare for every journey is therefore 6½d.=
+
+In other words, if every passenger paid for every single journey, long
+or short, the sum of 6½d., then the gross receipts from passengers
+would be about the same amount as is now received.
+
+ =Total tonnage of goods= per goods train:
+
+ Minerals Tons 410,000,000
+
+ The receipts as above for these represent
+ =an average of 1/6 per ton.=
+
+ General Merchandise Tons 114,000,000
+
+ The receipts for these as above represent
+ =an average of 6/- per ton.=
+ -----------
+
+ Total tonnage per Goods Train Tons 524,000,000
+ ===========
+
+The total receipts for the two kinds of merchandise together =show an
+average of 2s. 4d. per ton.=
+
+Note that the total tonnage of minerals carried is about four times
+that of general merchandise.
+
+The total tonnage may be less than the above, owing to overlapping of
+the various companies, but for the purpose of my estimates I am taking
+these official figures.
+
+
+ESTIMATES UNDER PROPOSED SCHEME.
+
+
+(_a_) As to passenger traffic.
+
+There is, of course, no official return as to the proportions of Main
+line and Local passenger traffic, but it is clear that the percentage
+of small fares must be very great. Assume that this is over 80 per
+cent., then there would be in round figures about 300,000,000 (that is
+under 20 per cent.) of Main line passenger journeys, and assuming that
+the number of first class passengers will be only 10 per cent. (the
+above average percentage of first and second class passengers), then
+the revenue from the existing number of passengers under the new scheme
+would be as follows:--
+
+ =Main Line= 300,000,000 at 1/- equals £15,000,000
+ of whom 30,000,000 at an
+ additional 4/- for First
+ Class equals 6,000,000
+
+ =Local= 1,320,000,000 at 1d. equals 5,500,000
+ of whom 132,000,000 at an
+ additional 5d. for First
+ Class equals 2,750,000
+ ----------- -----------
+ =Present No.= 1,620,000,000 will produce £29,250,000
+ ===========
+
+as against the present total of £45,000,000, or a deficiency of about
+£16,000,000 per annum, assuming there should be no increase in the
+existing traffic. This seems an appalling deficiency, but “Wait and
+See!”
+
+It is quite clear that there would be a very large increase of traffic,
+more particularly of the long distance or Main line passengers, as
+under the existing system the fares for short distances up to 12
+or even 20 miles are sufficiently low to remove practically all
+restrictions. In the case of long distances, however, there is this
+double restriction for passengers--namely, the time occupied and the
+high price of the fares. If the latter restriction is removed a very
+large increase of traffic is sure to result, not only for purposes of
+pleasure but also for business and trade purposes. The Local traffic
+will also increase partly by reason of the increased number of long
+distance passengers requiring the use of the Local lines (both suburban
+and small branch lines), and partly by the reduction to 1d. of many of
+the present suburban fares. In order, however, to be on the safe side
+in the estimate, I propose to take no account of any increase in Local
+passengers and to reckon only the increase required in the number of
+Main line passenger journeys. It will then be found that 250,000,000
+more Main line passengers will provide for the above large yearly
+deficiency, as follows:--
+
+ 250,000,000 at 1/- £12,500,000
+ Add 25,000,000 at 4/- for First Class 5,000,000
+ -----------
+ £17,500,000
+ ===========
+
+This will bring the gross receipts from passengers to £46,750,000, with
+=an increase of about 15 per cent. only= on the present total number of
+passengers carried, and £1,750,000 more revenue.
+
+The criticism may be made, however, that this number is nearly double
+the existing number of long distance passengers. Will such an increase
+be realised?
+
+From a consideration of the following reasons it is submitted that not
+only will it be so, but that in point of fact a much larger increase
+may reasonably be anticipated.
+
+ 1. No account as to passenger traffic has been taken of the
+ normal increase in the number of passengers which has continued
+ to increase regularly with the increase of population.
+
+ 2. Under the proposed scheme the uniform fares are for _as far
+ as the train travels only_, so that a journey say from London
+ to Londonderry will involve at least three 1s. tickets, one
+ to Holyhead, a second from Holyhead to Dublin, and a third
+ from Dublin to Londonderry, whereas under the present system
+ one through ticket would be purchased and would appear in the
+ official returns as one journey only.
+
+ 3. In practice nearly every single journey undertaken means
+ _a return journey home_, so that an increase of 250,000,000
+ more passenger journeys does not involve a greater increase in
+ the movement of the population than is represented by, say,
+ 150,000,000 passengers.
+
+ 4. If the number of passengers carried by the railways is
+ compared with the population it may be noted that the total
+ number of passengers carried last year in the Tube and Suburban
+ Railways of London, with a population of between six and seven
+ millions, was about 500,000,000 in addition to about the same
+ number carried by omnibuses, and a further similar number by
+ tramways. A similar proportion of railway passengers to the
+ population of the United Kingdom of nearly 50 millions would
+ be over 4,000,000,000 per annum, so that an actual total
+ of 1,850,000,000 would undoubtedly be much less than may
+ reasonably be anticipated.
+
+ 5. It is not only the increased number of people who would
+ travel to and from all parts of the country who now cannot
+ or will not do so on account of the expense, but also the
+ increase in the number of journeys undertaken by existing
+ travellers. Parents living in remote parts of the country
+ whose children work in large towns and who, on account of high
+ fares, cannot visit each other, business men and commercial
+ travellers who will multiply their long distance journeys for
+ business purposes if they can do for 2s. what now costs 10 or
+ 20 times as much, are a few among many classes who will swell
+ the number. It will be remembered that by far the greater
+ proportion of the population are those in receipt of an income
+ of less than £3 per week to whom any fares of 10s. or over are
+ prohibitive except in extreme cases.
+
+Let me give one very homely illustration which has come under
+my notice. A domestic servant in London had a serious illness,
+necessitating an operation at one of the hospitals. Her parents lived
+in humble circumstances in a Cornish village. The mother came to London
+and had to pay £2 for a return ticket. Her daughter had to remain about
+two months in the hospital while the mother had to return home without
+being able to afford the luxury of another return journey to London.
+But during the whole of that time trains were going to and from the
+same place every day and night with plenty of room for the old lady,
+who could, of course, have been carried any number of times without any
+appreciable cost to the company.
+
+Now, suppose the uniform fare of 1s. each way had come into operation,
+she or some other member of the family would, no doubt, have come up
+at least once a week, and instead of one return ticket which cost £2,
+and would be included in the Board of Trade returns as two passenger
+journeys, the family would have only paid 16s. for the eight double
+journeys, the extra cost to the Government would be nil and the
+increase in the number of passenger journeys would be 14.
+
+It is not unusual to see long distance trains arrive in London with not
+more than 15 or 20 passengers.
+
+
+(_b_) As to goods traffic.
+
+For the purposes of the estimates of goods traffic there must be
+added to existing total receipts from goods train traffic the amount
+included in the official returns under the head of “passenger traffic”
+of £10,000,000 received for mails, luggage, and other goods carried
+by passenger trains, making the total revenue for goods at present of
+£74,000,000. There is no official Return as to the tonnage of goods
+carried by passenger trains, but assuming that the present average
+rate for goods carried by passenger trains is £2 per ton, this would
+represent a further tonnage, irrespective of passengers’ luggage, of
+20,000,000 tons.
+
+The figures under the new scheme, if there should be no increase in the
+tonnage carried, and assuming that goods by fast service should be no
+more than the amount now estimated per passenger train, would thus be
+as follows:--
+
+ By slow service 524,000,000 tons at 1/6 £39,300,000
+ By fast service 20,000,000 ” ” 10/- 10,000,000
+ Live Stock, as now 1,500,000
+ -----------
+ £50,800,000
+ Thus showing a deficiency of about 23,200,000
+ -----------
+ as against the present total of £74,000,000
+ ===========
+
+Following the analogy of the passenger traffic, I will only estimate
+for an increased traffic by fast trains, and for this purpose there
+will be required:--
+
+ 48,000,000 tons, which at 10s. equals £24,000,000, and will
+ bring the total to £800,000 more than the present total
+ receipts from goods, by both passenger and goods trains.
+
+This increased tonnage it will be seen is =an increase of under 10 per
+cent.= on the present total of 550,000,000 tons. It is probable that
+with a reduction of freight per fast train to the uniform rate of 10s.
+per ton, a considerable proportion of existing goods train traffic
+would be transferred to fast trains, so that the same figure might be
+arrived at with much less increase in tonnage. This fact may also be
+taken into account when adjusting any mistake in the official figures
+of the total tonnage carried.
+
+As in the case of passenger traffic, this percentage is surely not only
+a reasonable estimate, but one which may reasonably be anticipated,
+and, further, the increase will be progressive.
+
+The following among other reasons may be adduced:--
+
+ 1. The =example of the Post Office= is the best precedent that
+ can be given of the result of the adoption of a minimum uniform
+ rate. In the year before the introduction of Penny Post the
+ number of letters per head of population was only three. This
+ number is now 72, irrespective of postcards and parcels, and it
+ is still increasing. The number of letters carried in 1838 was
+ 70,000,000. In the first complete year after the Penny Post was
+ established this number was doubled. In 1863 it had multiplied
+ by eight times, and since then it has been doubled in about
+ every period of 20 years.
+
+ 2. The large amount of =goods sent now by road=, especially
+ in recent years by motors and steam tractors on account not
+ only of the heavy railway rates but also the cost of loading
+ and unloading, would with uniform rates be sent by rail. In
+ this connection it may be mentioned that a very considerable
+ increase of carriage by trolley trucks of loaded carts and
+ pantechnicons, or of the “containers” advocated by the New
+ Transport Company, Limited, thus avoiding both shunting and
+ the double expense of packing and unpacking, may reasonably be
+ anticipated.
+
+ 3. A still greater increase in fast train traffic may be
+ expected in =perishable articles=, such as fruit, fish, milk
+ and dairy produce. The so-called reduced rates now in force
+ for instance for carriage of fresh fruit vary from 1s. 6d. per
+ cwt. (equals £1 10s. per ton), from Hampshire to London up to
+ as much as 8s. per cwt. (equals £8 per ton), from Hampshire to
+ Scotland, these rates being “reduced” on account of the large
+ amount of fruit (strawberries), requiring in the season special
+ trains carrying nothing but fruit. The rates for the same goods
+ from other parts where the quantity is not so considerable are
+ in some cases more than double, so that the farmers cannot
+ afford to send the goods. The rates for fish are similar, and
+ the same considerations apply, so that very little is consigned
+ to town except from fishing centres like Grimsby where large
+ quantities are available.
+
+ 4. =With a regular service= from every station, village
+ stations as well as the large towns, and =similar to the
+ present postal service=, in fact forming an extension to all
+ goods of the present Parcels Post service, no one can doubt
+ that the total increase will be considerably more than the 10
+ per cent. estimated for.
+
+
+
+
+CHAPTER VI.
+
+WORKING EXPENSES.
+
+
+Most critics will contend that the increased traffic will lead to an
+enormous increase of working expenses.
+
+In the first place allowance must be made for the several economies in
+management occasioned by the amalgamation of the whole railway systems
+in one and with the Post Office as already mentioned, and of which the
+following is a brief list, viz.:--
+
+Abolition of,
+
+ (_a_) The Clearing House,
+
+ (_b_) Separate boards of directors and clerical staffs,
+
+ (_c_) Legal and Parliamentary expenses,
+
+ (_d_) Advertisements,
+
+ (_e_) Book-keeping, printing and booking clerks now required
+ for differential fares and rates.
+
+Economies by avoiding,
+
+ (_a_) Competing Receiving Offices, Post Offices or stations in
+ same localities,
+
+ (_b_) Competing trains,
+
+ (_c_) The waste of rolling stock now occasioned by the
+ ownership of different companies, instead of being used
+ according to the requirements of traffic.
+
+The latter has already been referred to in Chapter II. A further proof
+of a practical nature was given by Mr. Oliver Bury, the retiring
+General Manager of the Great Northern Railway in 1912, who then said
+that after the working arrangement with the Great Central Railway had
+been entered into, although there had been an increase of 4,000,000
+tons of merchandise carried, this additional traffic had actually been
+worked with a decrease in the goods train mileage of 1,000,000.
+
+Apart from all these economies, =the working expenses cannot increase
+proportionately with the increase of traffic=. Most of the long
+distance passenger trains now running, except on special occasions
+or holiday time, could easily hold twice the number of passengers
+with but little, if any, appreciable increase in the cost of haulage.
+It must be remembered that a sufficiently powerful locomotive and
+sufficient coal must be provided for every passenger train, on the
+assumption that it will be full, whether it leaves with a full
+complement of passengers or not. Therefore, even though the number
+of passengers now carried were to be doubled in the case of all Main
+line trains very little increase in the working expenses would result,
+certainly not so much as the saving effected by the various economies
+mentioned. So far as goods traffic is concerned, an increase of 10 per
+cent. only, as estimated in the tonnage would certainly not cause any
+great increase in the expenditure. If, on the other hand, the increase
+of traffic should be very much more than the percentages mentioned
+(as may very likely be the case), then the revenue derived will be
+more than sufficient to provide whatever additional working expenses
+there may be. The expenses of the important items (which constitute
+probably 50 per cent. of working expenses) of permanent ways, stations,
+signal boxes, and general establishment charges would not be seriously
+affected by increase of traffic, only the rolling stock, coal, and part
+of the staff.
+
+In addition to these economies, and others set out more fully in
+Chapter II., there will also be great economy in the working expenses
+of the Post Office itself, including the telegraph and telephone
+services. The actual effect of the amalgamation of the two services of
+railways and Post Office on the total working expenses of the combined
+services cannot be estimated with any degree of accuracy, but there
+can be no doubt that it will result in large economies. The working
+expenses of both, must, of course, be lumped together. No advantage can
+possibly be gained by attempting to separate the expenses of various
+branches of one State Department. This has actually been attempted in
+the case of the telegraph service, one of the numerous branches of
+the Post Office. It has been continually asserted that this service
+has been, and is being, carried on at a loss, especially since the
+introduction of the sixpenny rate. This assertion has always been an
+enigma to me, for how any proper apportionment of the working expenses
+of over 20,000 Post Offices throughout the United Kingdom can be made,
+in order to ascertain what proportion is to be attributed to the
+telegraph service alone, passes comprehension!
+
+That this impossible task has been attempted, and apparently carried
+out to the satisfaction of some persons in authority, does not prove
+that the alleged loss has actually been made, but only that a large
+amount of time and expense has been lost in elaborate and costly
+calculations, which can be of no possible advantage to the service or
+the Country! It is to be hoped that this attempt will not be continued
+with the telephone service.
+
+If, and when, the scheme proposed in this pamphlet for combining
+railways with the General Post Office is carried into effect, I trust
+that no such expensive and useless task will be attempted as to
+endeavour to ascertain what proportions respectively of the expenses
+of running the Royal Railways are to be attributed to carrying His
+Majesty’s Mails on the one hand, or His Majesty’s subjects and their
+goods on the other!
+
+It is quite evident that on the two services being combined a portion
+of the present working expenses of the Post Office, namely, those which
+now consist of amounts paid to the Railway Companies for carriage of
+mails, for rents of telegraph and telephone wires, and other services
+rendered, will be swallowed up in the general working expenses, just as
+the gross receipts of the Post Office will swell the total revenue of
+the combined services.
+
+For the purposes, however, of ascertaining what increase of traffic
+will be required to produce (_a_) the same net revenue as under the
+present system of railways, and (_b_) a sufficient revenue to purchase
+the present system, I have taken no account of the decrease of Postal
+expenses nor of the normal increase of the Postal Revenue. I also
+am assuming that notwithstanding all the economies referred to, the
+working expenses of railways will remain the same, or even increase,
+owing to higher prices of goods and materials and higher wages, to the
+round sum of £85,000,000.
+
+It will thus be apparent that ample margin has been allowed for any
+increase in working expenses that is likely to take place, and that
+allowance has been made for the whole of the existing staffs to be
+retained, whether now employed in services which may then be discarded
+or not.
+
+P.S.--While revising the final proofs of this pamphlet during the
+Christmas Holidays, I have noticed in the “Daily Telegraph,” of 24th
+December, 1913, a long letter signed “G.P.O.,” referring to an article
+in the same well-known newspaper of the previous day. The letter is
+printed in prominent type under the following heading:--
+
+“PREHISTORIC METHODS OF POST OFFICE FINANCE--TELEGRAPH SERVICE ‘LOSS.’”
+
+The correspondent, who evidently has expert knowledge of the subject,
+refers to the “alleged great loss” of the telegraph service as “a
+polite fiction.”
+
+His letter completely confirms the views expressed above as to the
+folly of attempting to apportion expenses of one branch of the service,
+and he places the cost of the accounts at “hundreds of thousands of
+pounds a year!”
+
+
+
+
+CHAPTER VII.
+
+TERMS OF PURCHASE.
+
+
+If the railway system be purchased by the nation it will be in
+contemplation as =a business proposition= to repay the capital expended
+in the purchase, and this means, therefore, that if this scheme is
+a practicable one =the shareholders and stockholders of the present
+companies will be able to receive back their capital=, although, under
+existing conditions, this appears absolutely hopeless. It is therefore
+now proposed to consider upon what terms the railways can be purchased
+and how the purchase money can be provided.
+
+1. By the Railway Act of 1844 the Government is empowered to purchase
+every railway company formed after that date. The price fixed is the
+equivalent of 25 years’ purchase of the average annual divisible
+profits for three years before such purchase, subject to the proviso
+that any company whose divisible profits are less than 10 per cent.
+on its capital is at liberty to have the terms of purchase fixed by
+arbitration. At the date of this Act most of the Trunk lines, to the
+extent of about 2,300 miles had already been constructed and are not
+therefore subject to the provisions of this Act, but as the total
+length of lines open in 1911 was 23,417 miles, it will be observed that
+the Act applies to 90 per cent. of the whole railway system.
+
+Notwithstanding this, there are undoubted difficulties in estimating
+the actual purchase price, having regard to the fact that the majority
+of the smaller companies, including the modern Tube Railways with
+their large prospective profits, and probably the whole of the Irish
+railways, pay less than 10 per cent. and would, therefore, be entitled
+to arbitration.
+
+There is, however, another precedent, viz., (2) The Indian State
+Railways, which have been actually purchased by the Government from the
+private companies by whom they were owned.
+
+The dates and terms of purchase of these railways are included in an
+official return of railways acquired by the Government. This return
+was issued by the Board of Trade in 1908, pursuant to an order of the
+House of Commons.[17] In India the railway undertakings of 16 separate
+companies were acquired by the State between the years 1868 and 1906.
+Of these companies six were purchased at a price mutually agreed upon
+between the Government and the companies, these being small companies,
+and the purchase moneys varying from £30,000 to £300,000. Three
+companies were acquired at a purchase price equal to the share capital.
+The remaining seven companies were purchased for a sum equal to the
+value of the shares calculated at the mean market price during the
+three years preceding the date on which notice of purchase was given.
+In addition to payment of the purchase price the Government assumed
+the liabilities of the company in respect of debentures and debenture
+stock. Four of these companies (the larger ones) were, under an option
+reserved by the contracts, paid by annuities spread over 73 or 74
+years. One of these, the East Indian Company, was purchased in 1879 at
+the price, calculated on the above basis, of £32,750,000, payable by an
+annuity of £1,473,750 for the term of 73 years from 1880. This amounts
+exactly to 4¼ per cent. on the purchase money, and will cease to be
+payable after the year 1953.
+
+In addition to this annuity, interest is paid on the debentures and
+loans amounting altogether to about £16,500,000, the interest whereon
+is about £500,000 or a little over 3 per cent.
+
+If the Act of 1844 were now applicable to the whole of the companies in
+the United Kingdom, and if we assume that by the time when the option
+to purchase is exercised the net profits of £48,000,000 in 1911 shall
+have risen to £50,000,000, the purchase money would be 25 times that
+sum, viz., £1,250,000,000.
+
+This sum is really slightly more than the total paid-up capital of the
+railways after allowing for “watered” stock.
+
+The following were the figures in 1911:--
+
+ Ordinary Stock £493,484,151
+ Preference and Guaranteed Stock 473,073,163
+ Loans and Debentures 357,461,047
+ ------------
+ =Total paid-up Capital= £1,324,018,361
+ ==============
+
+There is included in this total, stock to the nominal value of
+£198,000,000, or approximately 15 per cent., which represents nominal
+additions made on consolidations and divisions of stock, and commonly
+known as “watered” stock.
+
+It will be noticed that the present net revenue of £48,000,000 only
+represents an average of about 3½ per cent. on this total paid-up
+capital. The total paid-up capital in the returns recently published
+for 1912 is £1,334,963,518.
+
+The Railway Nationalisation Society has prepared heads of a Bill in
+Parliament, providing that the price to be paid for the whole of the
+railways shall be calculated on the basis of the Act of 1844. No doubt
+this would be opposed by holders of railway stocks and shares, having
+regard to the fact that the result might be in effect to merely return
+the capital, no account being taken of profits. If the purchase of the
+railways is to be considered as “a business proposition” it will be
+necessary to look fairly at both sides of the question, and endeavour
+if possible to arrange terms which will not prove an injustice to the
+present owners, and at the same time will be such as can be provided
+for out of the ordinary revenue of the railways without financial loss
+to the nation.
+
+It must be remembered that shareholders or their predecessors invested
+their money with the reasonable and proper expectation of having an
+adequate return for it. No doubt they put down their capital with the
+primary, possibly the sole, object of benefiting themselves, but the
+fact remains that their capital has been the means of providing the
+splendid net-work of British Railways now available for the nation to
+purchase.
+
+On the other hand, railway stock and shareholders must recognise that
+their position under the present system is by no means an enviable one.
+Many of them have for years been in receipt of no dividend whatever.
+In no case has there been any attempt at repayment of capital moneys,
+nor does there seem any prospect of it. The average net annual receipts
+now earned by the whole of the companies is only a fraction over 3½ per
+cent., and this percentage (which is less than before the year 1870)
+has for the last few years been practically stationary. The working
+expenses have been increasing to such an extent by reason of the
+increase of wages and price of materials that last year the companies
+decided on an all-round increase in fares and rates. According to the
+latest returns this has already been to a large extent counteracted by
+a decrease in traffic.
+
+If, therefore, an offer were made by the Government to purchase the
+whole of the railways upon similar terms to those on which the East
+Indian Railway was acquired, namely for a sum equal to the mean market
+price of the shares during the three years preceding the year in which
+the Act to acquire the railways is introduced, it is submitted that
+there could be no effective opposition to the proposal. In effect this
+would mean a purchase at a price which is the value the public to-day
+put upon each line of railway. The only practical difficulty of this
+proposal will be to ascertain the market value of the shares of some of
+the smaller companies, many of which are held by the larger companies.
+
+In order, however, to avoid under-estimating the amount required, I
+suggest for the purposes of my argument that the Government and the
+companies mutually agree on a total sum of £1,350,000,000 as the
+purchase price of all the undertakings of the companies, subject to
+the existing liabilities for loans and debenture stock, now amounting
+to £357,500,000, which would be assumed by the Government. This would
+make a total in round figures of £1,700,000,000, or nearly £400,000,000
+more than the total of the ordinary preference and guaranteed stock.
+Surely this would be an outside figure. Indeed, it might be suggested
+that the nation would be paying an excessive amount.
+
+Mr. E. A. Pratt gives various estimates of what the purchase
+price would probably be.[18] These vary from £1,052,000,000 up to
+£1,769,847,000, an estimate of “The Railway News,” confirmed by the
+“Financier and Bullionist,” of September 7th, 1912. “The Financial
+News” in 1912 suggested £1,941,865,000 in 2½ per cent. Stock in order
+to yield the present annual income of £48,546,000.
+
+Taking the precedent of the East Indian Railway as a mode of payment
+and without making any allowance for better terms of interest which the
+Imperial Government might well obtain, it will be seen that the annual
+amount required to provide a purchase money of £1,350,000,000 and meet
+the above liabilities would be as follows:--
+
+Annuities at the rate of:--
+
+ 4¼ per cent. on £1,350,000,000 £57,375,000
+ Interest at 3 per cent. on Debentures of £360,000,000 10,800,000
+ -----------
+ Total £68,175,000
+ ===========
+
+According to the estimates set out in Chapter V. (if no further
+increase of traffic is secured than is required for producing the
+present revenue), there would be available toward this annual sum
+required for purchase the following:--
+
+ Passengers 46,750,000
+ Goods 74,800,000
+ Miscellaneous, as now 10,000,000
+ ------------
+ Total £131,550,000
+ Deduct for working expenses, as above 85,000,000
+ ------------
+ Net revenue £46,550,000
+ This shows a deficiency to be made good of 21,625,000
+ ------------
+ In order to make up the annual sum of £68,175,000
+ ============
+
+This annual amount could be provided by the following further increase
+in passenger and goods traffic respectively, viz.:--
+
+ 100,000,000 passengers at 1/- £5,000,000
+ 10,000,000 ” ” 4/- 2,000,000
+ 30,000,000 tons ” 10/- 15,000,000
+ ----------
+ Total £22,000,000
+ ==========
+
+In these estimates no account has been taken of the increased revenue
+of the Post Office, nor the increase in Local passengers and slow goods
+traffic respectively, which is sure to be realised, and the receipts
+for which would probably cover any increase in working expenditure. It
+will be noticed that if the above increase should be obtained the total
+estimated increase of passengers over the present totals would be as
+follows:--
+
+ Passengers 350,000,000 or about 21%
+ Goods 78,000,000 or about 15%
+
+It is, of course, not essential to the success of the scheme that
+the whole of the increase here estimated should be obtained in the
+first year after nationalisation has been carried out, although it is
+considered that even in that short period, according to all precedents,
+so small a percentage of profits may fairly be anticipated. It would
+probably be necessary for the Government to raise a temporary loan
+for initiating the scheme, but in any case it appears essential that
+the purchase of the whole of the existing undertakings of the United
+Kingdom should be completed as =at one and the same date=.
+
+Other advocates of railway nationalisation suggest that the purchase
+should be carried out gradually, and this course has been followed by
+other nations. It is, however, of the very essence of the scheme here
+proposed that every part of the country shall have the benefit of the
+uniform fares and rates, and this would be impracticable unless the
+whole system be taken over by the Government at one time.
+
+The proposal that the price should be fixed by taking the mean price
+of stocks for the three years preceding the year in which the Act
+should be passed, is in order to avoid the market changes which might
+be caused by anticipation of purchase by the State. It is suggested
+that whatever price is taken as the basis of the purchase money, such
+price should include everything, so that the whole undertaking would be
+taken over without the necessity for any valuation of stock and plant,
+a prolific cause of so much trouble and expense, as in the case of the
+purchase of the National Telephone Company.
+
+It may be said that the figures of the railway systems are so vast
+that it would be impracticable to cope with them in one transaction.
+Enormous as the figures must necessarily be, the principle is exactly
+the same as in other financial transactions. Just as the Government
+acquired the undertaking of the National Telephone Company by purchase,
+which took effect on one day, so can this much larger transaction,
+or series of transactions, be carried out. It is assumed that the
+existing shares and stocks of railway companies would be converted into
+Government Stock, all necessary apportionments being made up to a date
+to be named in the Act of Parliament authorising the acquisition of the
+railways. Upon such date the completion of the whole transaction will
+be deemed to be effected.
+
+
+FOOTNOTES
+
+[17] This was on the initiation of Mr. Chiozza Money, M.P.
+
+[18] In “The Case against Nationalisation,” page 186.
+
+
+
+
+CHAPTER VIII.
+
+CONCLUSION.
+
+
+All reforms meet with opposition, mainly from persons whose interests
+may be prejudiced by the proposed change--also in many cases by
+experts. As to the latter, one remembers the story of the expert who,
+when the first proposal was made to cross the Atlantic by steam, wrote
+a pamphlet conclusively proving, to his own satisfaction, that it was
+a scientific impossibility to construct a steamer capable of carrying
+sufficient coal to do the journey! One of the first steamers to cross
+the Atlantic carried a consignment of such pamphlets!
+
+As to the former, as has already been pointed out in considering
+objections to the scheme, there is but a very small section whose
+interests need be prejudiced. Even those few who might suffer loss by
+the reform will recognise that the increased facilities of transport,
+with accompanying decrease of expense, will inevitably result in a
+great increase in and expansion of trade, by reason of the opening up
+of markets which have hitherto been practically inaccessible.
+
+Nor is there any reason why this opening up of new markets should
+be confined to the United Kingdom, for if other nations find that a
+system of small uniform fares and rates is not only practicable but
+remunerative here, they will surely follow our example, as in the case
+of Penny Postage, and the day will not be far distant, after the system
+has once been adopted in this country, when it will be possible to
+travel all over Europe at the cost of a few shillings, and to transmit
+and receive goods at correspondingly low rates.
+
+It is impossible to foresee all the social and political as well as
+financial effects which may be produced by such a revolution. The
+advantages of travel, which have hitherto been restricted to the
+wealthy, will be thrown open to all, whatever their means.
+
+Another important result may be anticipated and hoped for, namely, that
+the intermingling of the people of the various races and nations will
+tend to remove the prejudices, misconceptions and misrepresentations
+which have so often produced disastrous wars in the past.
+
+Should this be so, it may be that the reform here proposed will bring
+nations nearer to the desired haven of Peace.
+
+
+
+
+ _A QUESTION
+ for to-day and to-morrow_
+
+ The Case for
+ LAND
+ NATIONALISATION
+
+ BY JOSEPH HYDER
+
+ (_Secretary to the Land Nationalisation Society_).
+
+ It deals with every aspect of the land question in a
+ thorough and comprehensive manner.
+
+ Full of facts, figures and cases which every land
+ reformer ought to know. It gives numerous illustrations
+ of the abuses which spring from treating land as private
+ property.
+
+ =2s. 6d. net.=
+
+
+
+
+
+End of the Project Gutenberg EBook of Royal Railways with Uniform Rates, by
+Whately C. Arnold
+
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+Project Gutenberg's Royal Railways with Uniform Rates, by Whately C. Arnold
+
+This eBook is for the use of anyone anywhere in the United States and most
+other parts of the world at no cost and with almost no restrictions
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+
+
+
+Title: Royal Railways with Uniform Rates
+ A proposal for amalgamation of Railways with the General
+ Post Office and adoption of uniform fares and rates for
+ any distance
+
+Author: Whately C. Arnold
+
+Release Date: October 6, 2016 [EBook #53222]
+
+Language: English
+
+Character set encoding: UTF-8
+
+*** START OF THIS PROJECT GUTENBERG EBOOK ROYAL RAILWAYS WITH UNIFORM RATES ***
+
+
+
+
+Produced by MWS, Adrian Mastronardi, The Philatelic Digital
+Library Project at http://www.tpdlp.net and the Online
+Distributed Proofreading Team at http://www.pgdp.net (This
+file was produced from images generously made available
+by The Internet Archive/American Libraries.)
+
+
+
+
+
+
+</pre>
+
+
+<div class="red">
+
+<p class="center larger"><span class="smcap">A Railway Revolution!</span></p>
+
+<p class="center larger">ROYAL RAILWAYS</p>
+
+<p class="titlepage">FARES & RATES<br />
+FOR ANY DISTANCE.</p>
+
+<table summary="Fare proposals">
+ <tr>
+ <td>LOCAL TRAINS</td>
+ <td colspan="2" class="tdr">ONE PENNY</td>
+ </tr>
+ <tr>
+ <td>MAIN LINE ”</td>
+ <td colspan="2" class="tdr">ONE SHILLING</td>
+ </tr>
+ <tr>
+ <td>SLOW GOODS</td>
+ <td rowspan="2" class="valign-m">average<br />per ton <span class="bracket">}</span></td>
+ <td class="tdr">1s. 6d.</td>
+ </tr>
+ <tr>
+ <td>FAST <span class="ditto1">”</span></td>
+ <td class="tdr">10s.</td>
+ </tr>
+</table>
+
+<p class="center">A business proposition for Shareholders
+and the Nation.</p>
+
+<p class="center"><i>Sixpence Nett.</i></p>
+
+<p class="center smaller">SIMPKIN, MARSHALL, HAMILTON, KENT & CO., LTD.,<br />
+LONDON</p>
+
+</div>
+
+<div class="figcenter" style="width: 455px;">
+<img src="images/cover.jpg" width="455" height="700" alt="Image of the front cover" />
+</div>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_1" id="Page_1">[1]</a><br />
+<a name="Page_2" id="Page_2">[2]</a><br />
+<a name="Page_3" id="Page_3">[3]</a></span></p>
+
+<p class="titlepage"><span class="larger">ROYAL RAILWAYS</span><br />
+with Uniform Rates</p>
+
+<p class="titlepage"><span class="smaller"><i>by</i></span><br />
+<span class="smcap">Whately C. Arnold, LL.B. Lond.</span></p>
+
+<p class="titlepage"><i><span class="larger">A PROPOSAL</span><br />
+for amalgamation of Railways with the<br />
+General Post Office and adoption of<br />
+uniform fares and rates <span class="u">for any distance</span>.</i></p>
+
+<p class="titlepage smaller">LONDON: SIMPKIN, MARSHALL,<br />
+HAMILTON, KENT & CO., LTD<br />
+1914</p>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_4" id="Page_4">[4]</a></span></p>
+
+<h2><i>Preface.</i></h2>
+
+<p>This pamphlet has been printed and published with the
+assistance of friends who share my opinion that the scheme
+proposed will solve the railway problem—now at an acute
+stage.</p>
+
+<p>A rough outline of the Scheme has been submitted to
+Sir Charles Cameron, Bart. (on whose initiative sixpenny
+telegrams were adopted), and while reserving his opinion as
+to the advantages of State ownership and the difficulties of
+purchase, he has been good enough to write that this scheme
+is the boldest and best reasoned plea for the Nationalisation
+of Railways that he has come across.</p>
+
+<p>The scheme has also been submitted to, among others,
+Mr. Emil Davies, Chairman of the Railway Nationalisation
+Society, to Mr. L. G. Chiozza Money, M.P., and to Mr. Philip
+Snowden, M.P., all of whom have expressed their approval
+subject to the figures and estimates being correct. These
+figures and estimates are based on the Official Board of Trade
+returns for Railways of 1911 and 1912.</p>
+
+<p>I also had the temerity to submit my draft to Mr. W. M.
+Acworth, the well-known Railway expert, who very courteously
+gave me his views generally, although refraining from any detailed
+criticism. I deal with his remarks at the end of <a href="#CHAPTER_IV">Chapter
+IV.</a>, but may here mention that Mr. Acworth called my attention
+to an article by himself on Railways in “Palgrave’s
+Encyclopædia of Political Economy” published in 1899. In
+such article he referred to a suggestion which had then been
+made for uniform fares on the Postal system, and he dismissed
+the idea in a sentence as impracticable, because no one would pay
+for a short journey as much as 8d., then the average fare for
+the whole country.</p>
+
+<p>It is therefore evident that the principle of a flat rate is not
+novel; yet I can find no reference in any books or pamphlets
+on railways to any practical scheme for carrying it into effect.
+Apparently it has been assumed that there can be only one
+uniform rate, equivalent to the average rate, and that therefore
+the proposal is quite impossible. The simple expedient of
+dividing the traffic into the two kinds of “Fast” and “Slow,”<span class="pagenum"><a name="Page_5" id="Page_5">[5]</a></span>
+on the analogy of the Postal rate of one penny for letters and
+sixpence for telegrams, overcomes this difficulty. The scheme
+is in effect an extension to the Railway System of the principle
+upon which the existing Postal System is founded, and therefore
+involves Nationalisation.</p>
+
+<p>As submitted to the above-named gentlemen, the draft
+did not include my remarks on the principles which in my
+opinion should govern all National and Municipal Trading,
+and which are now contained in <a href="#CHAPTER_IV">Chapter IV.</a> The attention
+of both opponents and advocates of Nationalisation is
+particularly called to these principles, which I have not found
+elsewhere, but which as laid down are believed to be absolutely
+sound, and of the highest importance, as removing most, if
+not all, of the objections of opponents, while retaining all the
+advantages claimed by advocates of National and Municipal
+Trading.</p>
+
+<p>I do not pretend to be a railway expert, and have only
+been able to devote the small leisure time available from an
+exacting business to putting into writing the thoughts which
+have exercised my mind for many years past. But the
+well-known expert, Mr. Edwin A. Pratt, who is a strong
+opponent of Railway Nationalisation, admits in one of his
+books that “the greatest advances made by the Post Office
+have been due to the persistence of outside and far-seeing
+reformers, rather than to the Postal Officials themselves.”
+This admission and the conviction that the further advance
+now proposed is based upon sound principles and undisputed
+facts, encourages me to submit my scheme with confidence
+to the consideration of experts and the public.</p>
+
+<p class="right">W. C. A.</p>
+
+<p class="noindent"><span class="smcap">37, Norfolk Street,<br />
+<span class="indent">Strand, London, W.C.</span></span></p>
+
+<p class="noindent"><span class="smcap">December, 1913.</span></p>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_6" id="Page_6">[6]</a></span></p>
+
+<h2>SYNOPSIS OF CONTENTS</h2>
+
+<p class="center">PROPOSED UNIFORM FARES AND RATES:</p>
+
+<table summary="Proposal">
+ <tr>
+ <td><b><span class="u">Passenger Fares</span></b>:</td>
+ <td colspan="4">Any Distance, so far as train travels.</td>
+ </tr>
+ <tr>
+ <td class="indent"><i>Main Lines</i>:</td>
+ <td><b>First Class</b></td>
+ <td><b>5/-</b>,</td>
+ <td><b>Third Class</b></td>
+ <td><b>1/-</b>.</td>
+ </tr>
+ <tr>
+ <td class="indent"><i>Local Lines</i>:</td>
+ <td class="tdc"><b>”</b></td>
+ <td><b>6d.</b></td>
+ <td class="tdc"><b>”</b></td>
+ <td><b>1d.</b></td>
+ </tr>
+ <tr>
+ <td><b><span class="u">Goods Rates</span></b>:</td>
+ <td colspan="4">Any Distance.</td>
+ </tr>
+ <tr>
+ <td class="indent"><i>Fast Service</i>:</td>
+ <td colspan="4"><b>Average 10/- per ton</b>.</td>
+ </tr>
+ <tr>
+ <td class="indent"><i>Slow Service</i>:</td>
+ <td colspan="4"><span class="ditto2">”</span> <b>1/6</b> <span class="ditto2">”</span></td>
+ </tr>
+</table>
+
+<p><span class="pagenum"><a name="Page_7" id="Page_7">[7]</a></span></p>
+
+<h3><a href="#INTRODUCTION"><b>Introduction.</b></a></h3>
+
+<p class="pp"><a href="#Page_15">Page 15.</a></p>
+
+<p>The Royal Mail.—Letters carried for same price any distance.
+Why not passengers and goods? Object of pamphlet to prove that
+this is financially possible with small uniform fares and rates
+mentioned. A Business Proposition for Nation and Shareholders.</p>
+
+<h3><a href="#CHAPTER_I"><span class="smcap">Chapter I.</span></a><br />
+<b>The Scheme.</b></h3>
+
+<p class="pp"><a href="#Page_17">Page 17.</a></p>
+
+<p><b>All Railways</b> to be purchased by State and amalgamated with
+General Post Office. Trains of two kinds only, viz.:—</p>
+
+<div class="blockquote-list">
+
+<p>(1) <b>Main Line Trains</b>, <i>i.e.</i>, non-stop for at least 30 miles.</p>
+
+<p>(2) <b>Local Trains</b>, <i>i.e.</i>, all trains other than Main Line.</p>
+
+</div>
+
+<p><b>Passenger tickets</b> vary according to above fares only—no
+reference to stations or distance. <b>Goods rates</b>, payable by stamps
+vary only according to weight or size of goods, whether carried in
+bulk, in open or closed trucks, or with special packing, but
+irrespective of any other difference in nature or value of goods, or
+of distance, as now with parcel post.</p>
+
+<p><b>All Railway Stations to be Post Offices.</b> All Post Offices to
+sell Railway Tickets, and, where required, to be Railway Receiving
+Offices. <b>Steamers</b> to be regarded as trains.</p>
+
+<h3><a href="#CHAPTER_II"><span class="smcap">Chapter II.</span></a><br />
+<b>Advantages of Scheme.</b></h3>
+
+<p class="pp"><a href="#Page_20">Page 20.</a></p>
+
+<p>1. <b>Cheapness</b> and regularity of transport.</p>
+
+<p>2. <b>Economy</b> of service;—by unification of railways;—abolition
+of Railway Clearing House, of expenses of varying rates
+and fares, of multiplication of receiving offices, stations, &c.,—and
+by amalgamation with Post Office;—all railway land and buildings
+available for Government purposes—Postal, Civil, Military and
+Naval.</p>
+
+<p>3. <b>Progressive increase always follows</b> adoption of small
+uniform fares (<i>e.g.</i>, in Post Office); hence progressive increase of
+revenue available for working expenses, purchase money, extensions,
+improvements, and adoption of new safety appliances.</p>
+
+<p><span class="pagenum"><a name="Page_8" id="Page_8">[8]</a></span></p>
+
+<h3><a href="#CHAPTER_III"><span class="smcap">Chapter III.</span></a><br />
+<b>Principles of Scheme.</b></h3>
+
+<p class="pp"><a href="#Page_27">Page 27.</a></p>
+
+<p><b>Present system</b> founded on two principles, both mistaken and
+illogical, viz.:—(<b>1</b>) According to distance travelled. (<b>2</b>) According
+to “what the traffic will bear.”</p>
+
+<p>(1) Although cost of building 200 miles, and hauling train that
+distance is more than for two miles, yet because regular train service
+required for whole distance, say, A to Z and back, passing intermediate
+places, therefore cost of travelling from A to B, or to N,
+identical with A to Z. For goods, cost of loading and unloading
+twice only, whether sent from A to B, or A to Z.</p>
+
+<p>(2) Cost of hauling ton of coal exactly same as of bricks, sand,
+loaded van, in open truck, yet now different rates for each,
+according to “what the traffic will bear.”</p>
+
+<p><b>True principle</b> advocated by Sir Rowland Hill in Penny Post—whole
+country suffers by neglect or expense of transport to distant
+parts, and gains by including small districts with same rates as
+populous parts.</p>
+
+<p><b>For a flat rate, three rules necessary.</b></p>
+
+<div class="blockquote-list">
+
+<p>(<i>a</i>) Must not exceed lowest in use prior to adoption.</p>
+
+<p>(<i>b</i>) Increased traffic resulting must produce at least same
+net revenue.</p>
+
+<p>(<i>c</i>) Variations of rate to be according to speed, not distance.</p>
+
+</div>
+
+<p>Hence:</p>
+
+<div class="blockquote-list">
+
+<p>(<i>a</i>) <b>1d.</b> now lowest fare, fixed for Local Lines.</p>
+
+<div class="blockquote-list">
+
+<p><b>1s.</b> now lowest fare, (<i>e.g.</i>, 2s. 6d. return London to
+Brighton) fixed for Main Lines.</p>
+
+<p><b>1s. 6d.</b> per ton fixed for goods train or slow service,
+as the present average for minerals, and allowing
+present lowest rate for goods in open trucks, rising
+to, say, 6d. per cwt. (10s. per ton) for small consignments,
+in covered trucks.</p>
+
+<p><b>10s.</b> per ton, now lowest “per passenger train” (<i>e.g.</i>,
+6d. per cwt. for returned empties) fixed for fast
+service.</p>
+
+</div>
+
+<p><span class="pagenum"><a name="Page_9" id="Page_9">[9]</a></span></p>
+
+<p>(<i>b</i>) The increased traffic dealt with under “Finance.”</p>
+
+<p>(<i>c</i>) The two rates suggested for fast and slow trains
+solve the difficulty hitherto felt of charging lowest
+fare of 1d. as uniform fare—the 1s. fare and 10s.
+goods rate being double the present averages.</p>
+
+</div>
+
+<h3><a href="#CHAPTER_IV"><span class="smcap">Chapter IV.</span></a><br />
+<b>OBJECTIONS TO THE SCHEME.</b></h3>
+
+<h4><b>1.—State Ownership.</b></h4>
+
+<p class="pp"><a href="#Page_33">Page 33.</a></p>
+
+<p>Writers for and against—All assume that on Nationalisation,
+system followed of charging according to distance, and to
+“what traffic will bear”—Fundamental differences between State
+Monopoly and Private Monopoly—Evils of applying profits of
+State monopolies in reductions of taxation—Strikes.</p>
+
+<p>Four rules to be observed on Nationalisation:—</p>
+
+<div class="blockquote-list">
+
+<p>1. Natural monopolies only to be taken over.</p>
+
+<p>2. When taken over, only to be worked for benefit of
+community and not for profit.</p>
+
+<p>3. Competition of private enterprises not to be prohibited.</p>
+
+<p>4. Monopoly to be worked by Department of State
+responsible to Parliament.</p>
+
+</div>
+
+<p><b>Chief grounds of objection to State ownership</b>—</p>
+
+<p>(1) Difficulty of Government in dealing with conflicting interests
+of traders and general public. (2) Difficulty of Railway servants
+(being also voters) using political pressure to obtain better wages,
+against interests of traders and general public. Both of these
+objections removed if scheme (which avoids all preferential or
+differential rates or treatment) adopted with above four rules.</p>
+
+<p>Other grounds of objection, <i>e.g.</i>, want of competition, officialism,
+&c., apply equally to present Company system, but may be
+remedied if owned by State. Suggested remedies:—Railway Council
+to deal with all matters of administration; Railway Courts to deal
+with questions of compensation, labour disputes, &c. Railways and
+Post Office being Department of State with Cabinet Minister at
+head subject to vote of censure in Parliament, provides better
+security for public than private Companies or Railway Trust.</p>
+
+<p><span class="pagenum"><a name="Page_10" id="Page_10">[10]</a></span></p>
+
+<h4><b>2.—General Objections.</b></h4>
+
+<p class="pp"><a href="#Page_43">Page 43.</a></p>
+
+<p><b>Fear of Losses</b>—</p>
+
+<p>All existing staffs required for increased traffic—therefore no
+loss to them.</p>
+
+<p>Traders, like newspapers more than make up for any losses
+by economy in rates and fares and increased circulation.</p>
+
+<p>Mr. Acworth’s objections to “average” rates considered.</p>
+
+<h3><a href="#CHAPTER_V"><span class="smcap">Chapter V.</span></a><br />
+<b>Finance of Scheme.</b></h3>
+
+<p class="pp"><a href="#Page_45">Page 45.</a></p>
+
+<p><b>Present averages</b> per annum in round figures taken from Board
+of Trade returns 1911 and 1912:—</p>
+
+<table summary="Receipts from passengers">
+ <tr>
+ <td>Receipts from Passengers</td>
+ <td class="tdr">£45,000,000</td>
+ </tr>
+ <tr>
+ <td><span class="ditto2">”</span> <span class="ditto1">”</span> Goods per passenger train</td>
+ <td class="tdr">10,000,000</td>
+ </tr>
+ <tr>
+ <td><span class="ditto2">”</span> <span class="ditto1">”</span> Goods Train Traffic</td>
+ <td class="tdr">64,000,000</td>
+ </tr>
+ <tr>
+ <td><span class="ditto2">”</span> (Miscellaneous)</td>
+ <td class="tdr">10,000,000</td>
+ </tr>
+ <tr>
+ <td>Gross Revenue</td>
+ <td class="tdr total">£129,000,000</td>
+ </tr>
+ <tr>
+ <td>Working Expenses</td>
+ <td class="tdr">81,000,000</td>
+ </tr>
+ <tr>
+ <td>Net Receipts</td>
+ <td class="tdr total bb">£48,000,000</td>
+ </tr>
+ <tr>
+ <td>Total Paid-up Capital and Debentures</td>
+ <td class="tdr">£1,400,000,000</td>
+ </tr>
+</table>
+
+<p>Net receipts show average income of 3½ per cent.</p>
+
+<table summary="Total passenger journeys">
+ <tr>
+ <td>Total passenger journeys (of which 10 per cent. were 1st and 2nd class)</td>
+ <td class="tdr">1,620,000,000</td>
+ </tr>
+</table>
+
+<p><b>Average fare for each journey only 6½d.</b></p>
+
+<table summary="Total tonnage of goods">
+ <tr>
+ <td>Total tonnage of goods:—</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td class="indent">Estimate per passenger trains</td>
+ <td class="tdr">20,000,000</td>
+ </tr>
+ <tr>
+ <td class="indent">Actual per goods trains</td>
+ <td class="tdr">524,000,000</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td class="tdr total">544,000,000</td>
+ </tr>
+</table>
+
+<table summary="Average rates per goods train">
+ <tr>
+ <td>Average rates per goods train:—</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td class="indent">Minerals only</td>
+ <td>1s. 6d.</td>
+ <td>per ton</td>
+ </tr>
+ <tr>
+ <td class="indent">General Merchandise</td>
+ <td>6s.</td>
+ <td class="tdc">”</td>
+ </tr>
+ <tr>
+ <td class="indent">Both together</td>
+ <td>2s. 4d.</td>
+ <td class="tdc">”</td>
+ </tr>
+</table>
+
+<p><span class="pagenum"><a name="Page_11" id="Page_11">[11]</a></span></p>
+
+<p><b>Estimate under proposed scheme</b>:—</p>
+
+<p class="pp1"><a href="#Page_48">Page 48.</a></p>
+
+<p><b>I. Passengers.</b>—Assuming Main Line passenger journeys
+are 300,000,000, <i>i.e.</i>, under 20 per cent. of the total
+passenger journeys.</p>
+
+<table summary="Revenue from passengers">
+ <tr>
+ <td></td>
+ <td class="tdr">300,000,000</td>
+ <td>at 1s.</td>
+ <td class="tdc">=</td>
+ <td class="tdr">£15,000,000</td>
+ </tr>
+ <tr>
+ <td>add</td>
+ <td class="tdr">30,000,000</td>
+ <td>at 4s. for 1st class</td>
+ <td class="tdc">=</td>
+ <td class="tdr">6,000,000</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td class="tdr">1,320,000,000</td>
+ <td>at 1d.</td>
+ <td class="tdc">=</td>
+ <td class="tdr">5,500,000</td>
+ </tr>
+ <tr>
+ <td>add</td>
+ <td class="tdr">132,000,000</td>
+ <td>at 5d. for 1st class</td>
+ <td class="tdc">=</td>
+ <td class="tdr">2,750,000</td>
+ </tr>
+ <tr>
+ <td>Present No.</td>
+ <td class="tdr total">1,620,000,000</td>
+ <td>will produce</td>
+ <td class="tdc"></td>
+ <td class="tdr total">£29,250,000</td>
+ </tr>
+</table>
+
+<p>Increased number of Main Line passengers required to make up deficiency:—</p>
+
+<table summary="Revenue from increased number of passengers">
+ <tr>
+ <td></td>
+ <td class="tdr">250,000,000</td>
+ <td>at 1s</td>
+ <td class="tdr">£12,500,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>add</td>
+ <td class="tdr">25,000,000</td>
+ <td>at 4s. extra</td>
+ <td class="tdr">5,000,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td colspan="3"></td>
+ <td class="total"></td>
+ <td class="tdr">£17,500,000</td>
+ </tr>
+ <tr>
+ <td colspan="3" class="tdr">Estimated total</td>
+ <td></td>
+ <td class="tdr total bb">£46,750,000</td>
+ </tr>
+</table>
+
+<p>This is £1,750,000 more than the present gross revenue
+from passengers and requires an increase of
+250,000,000 = 15 per cent. on the total present number
+of passenger journeys.</p>
+
+<p><b>II. Goods.</b></p>
+
+<table summary="Revenue from goods">
+ <tr>
+ <td class="hang">Total tonnage by goods train as now,<br />viz., 524,000,000, at 1s. 6d</td>
+ <td class="tdr valign-b">£39,300,000</td>
+ </tr>
+ <tr>
+ <td>Ditto per passenger train, 20,000,000 at 10s</td>
+ <td class="tdr">10,000,000</td>
+ </tr>
+ <tr>
+ <td>Live Stock, as now</td>
+ <td class="tdr">1,500,000</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td class="tdr total">£50,800,000</td>
+ </tr>
+ <tr>
+ <td class="hang">Increased tonnage required to make up<br />present revenue, 48,000,000 tons at 10s.</td>
+ <td class="tdr valign-b">24,000,000</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td class="tdr total bb">£74,800,000</td>
+ </tr>
+</table>
+
+<p class="noindent">which is £800,000 more than present total receipts
+from goods per passenger and goods trains, and
+requires an increase of under 10 per cent. in
+tonnage.</p>
+
+<p><span class="pagenum"><a name="Page_12" id="Page_12">[12]</a></span></p>
+
+<p><b>Reasons for anticipating increase</b>:—</p>
+
+<div class="blockquote-list">
+
+<p><b>(<i>a</i>) Of Passengers.</b> Long distance journeys now restricted
+by expense.—Through tickets now counted as one
+journey will, under new scheme, be sometimes two
+or three, <i>e.g.</i>, London to Londonderry would be three
+tickets—Every single journey taken, usually means
+also return journey home.</p>
+
+<p><b>(<i>b</i>) Of Goods.</b> Example of Post Office—Before Penny
+Post, average price per letter 7d., and letters carried
+76,000,000. After Penny Post, first year number
+doubled; in twenty years, increased by eight times;
+about doubled every twenty years since. Before
+three letters per head of population, now 72 per head.
+Goods now sent by road motors will, with cheaper
+rates, go by rail—perishable articles, now not sent
+at all by fast train owing to expense, will be sent
+when rates cheaper.</p>
+
+</div>
+
+<h3><a href="#CHAPTER_VI"><span class="smcap">Chapter VI.</span></a><br />
+<b>Working Expenses.</b></h3>
+
+<p class="pp"><a href="#Page_53">Page 53.</a></p>
+
+<p><b>If increase</b> of traffic no more than above, increase of working
+expenses negligible, apart from economies made by unification.
+Expense of carrying 200 passengers no more than 20. If increase
+of traffic more, then revenue increases, but working expenses
+only by about 50 per cent., as expenses of permanent way, stations,
+signal boxes, and establishment charges but little affected. Expenses
+of Post Office and Railways to be lumped together.</p>
+
+<h3><a href="#CHAPTER_VII"><span class="smcap">CHAPTER VII.</span></a><br />
+<b>Terms of Purchase.</b></h3>
+
+<p class="pp"><a href="#Page_56">Page 56.</a></p>
+
+<table summary="Current prices">
+ <tr>
+ <td colspan="2"><b>Present total market price</b> of all</td>
+ </tr>
+ <tr>
+ <td class="indent">Railway Stock and shares about</td>
+ <td class="tdr">£1,350,000,000</td>
+ </tr>
+ <tr>
+ <td class="indent">Debentures and Loans <span class="ditto2">”</span></td>
+ <td class="tdr">350,000,000</td>
+ </tr>
+ <tr>
+ <td class="tdr">Total about</td>
+ <td class="tdr total">£1,700,000,000</td>
+ </tr>
+</table>
+
+<p><span class="pagenum"><a name="Page_13" id="Page_13">[13]</a></span></p>
+
+<p><b>Estimate of annual sum</b> required according to precedent
+of purchase of the East Indian Railway Company, namely, by
+annuities for 73 years, equal to 4¼ per cent. per annum on market
+value, plus liability for Loans and Debentures with interest at 3 per
+cent.</p>
+
+<table summary="Estimate of how much this crazy caper would cost">
+ <tr>
+ <td colspan="5" class="indent">4¼ per cent. on £1,350,000,000</td>
+ <td class="tdr">£57,375,000</td>
+ </tr>
+ <tr>
+ <td colspan="5" class="indent">3 <span class="ditto2">”</span> <span class="ditto1">”</span> 350,000,000</td>
+ <td class="tdr">10,800,000</td>
+ </tr>
+ <tr>
+ <td colspan="5" class="tdr">Total annual sum required for purchase</td>
+ <td class="tdr total">£68,175,000</td>
+ </tr>
+ <tr>
+ <td colspan="5"><b>Revenue available as per</b> above estimates:—</td>
+ </tr>
+ <tr>
+ <td colspan="4" class="indent">Passengers</td>
+ <td class="tdr">£46,750,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td colspan="4" class="indent">Goods</td>
+ <td class="tdr">74,800,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td colspan="4" class="indent">Miscellaneous, as now</td>
+ <td class="tdr">10,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="4"></td>
+ <td class="tdr total">£131,550,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td colspan="4" class="indent">Less Working Expenses, with<br />say, increase of £4,000,000</td>
+ <td class="tdr">85,000,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td colspan="4" class="indent">Net revenue available</td>
+ <td class="total"></td>
+ <td class="tdr">£46,550,000</td>
+ </tr>
+ <tr>
+ <td colspan="4" class="indent">Balance required for purchase</td>
+ <td></td>
+ <td class="tdr total bb">£21,625,000</td>
+ </tr>
+ <tr>
+ <td colspan="6" class="tdc">would be provided by following further increase of traffic, viz.</td>
+ </tr>
+ <tr>
+ <td class="tdr">100,000,000</td>
+ <td>passengers</td>
+ <td>at</td>
+ <td class="tdr">1s.</td>
+ <td></td>
+ <td class="tdr">£5,000,000</td>
+ </tr>
+ <tr>
+ <td class="tdr">10,000,000</td>
+ <td class="tdc">”</td>
+ <td class="tdc">”</td>
+ <td class="tdr">4s.</td>
+ <td></td>
+ <td class="tdr">2,000,000</td>
+ </tr>
+ <tr>
+ <td class="tdr">30,000,000</td>
+ <td>tons</td>
+ <td class="tdc">”</td>
+ <td class="tdr">10s.</td>
+ <td></td>
+ <td class="tdr">15,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="4"></td>
+ <td></td>
+ <td class="tdr total bb">£22,000,000</td>
+ </tr>
+</table>
+
+<p>This further traffic brings total increase of traffic to:—</p>
+
+<table summary="Estimated increase">
+ <tr>
+ <td class="tdr">350,000,000</td>
+ <td>passengers</td>
+ <td>= about 21 per cent.</td>
+ </tr>
+ <tr>
+ <td class="tdr">78,000,000</td>
+ <td>tons of goods</td>
+ <td>= about 15 per cent.</td>
+ </tr>
+</table>
+
+<p>Essential to purchase all Railways at same date—Railway Stock
+to be converted into Government Stock—Price to be fixed by
+average of market price of Stocks for three years prior to introduction
+of Bill.</p>
+
+<p><span class="pagenum"><a name="Page_14" id="Page_14">[14]</a></span></p>
+
+<h3><a href="#CHAPTER_VIII"><span class="smcap">Chapter VIII.</span></a><br />
+<b>Conclusion.</b></h3>
+
+<p class="pp"><a href="#Page_62">Page 62.</a></p>
+
+<p>Interested parties not prejudiced—Staff now employed in
+services to be discarded will be required for increased traffic—Facility
+of transport will increase trade, and open new markets,
+not only here but abroad—Foreign countries would adopt reform
+as they did Postal system—Advantages of inter-communication with
+Foreign Nations.</p>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_15" id="Page_15">[15]</a></span></p>
+
+<h1>ROYAL RAILWAYS<br />
+with Uniform Rates.</h1>
+
+<h2 id="INTRODUCTION">INTRODUCTION.</h2>
+
+<p><b>The Royal Mail!</b> What scenes and memories are conjured
+up by these words! In the olden days, the Royal Mail coaches—in
+these modern days, the well-known scarlet Mail carts and
+motor vans arriving at all the larger railway stations from which
+the mail trains, always the fastest, convey the mails to every
+quarter of the United Kingdom, and over the whole world.</p>
+
+<p>It is now a commonplace to post in the nearest pillar-box a
+batch of letters, some to addresses in the same town, others to
+provincial towns and villages, to Scotland, Ireland and far distant
+Colonies, each of them being conveyed to their destination,
+near or far, for the modest sum of one penny, by the speediest
+mode of locomotion that steam and electricity can provide. In
+order that travellers may have the advantage of that speed and
+regularity which is a feature of the Royal Mail, passengers and
+goods have always been carried by the Mail—formerly by the
+coach, now by the train. But whereas the mails are carried at
+the same price for any distance, the charges for passengers, and
+for goods which exceed the regulation size and weight permitted
+for the “Parcels Post,” vary according to the distance travelled,
+and as to goods also according to their nature or quality, with the
+result that for the greater part of our population long journeys
+are luxuries which can only be undertaken in cases of life and
+death, and not always then; the rates for carriage of goods by
+fast train are mostly prohibitive, and even by goods train for
+long distances are so great as to seriously restrict the traffic.</p>
+
+<p><span class="pagenum"><a name="Page_16" id="Page_16">[16]</a></span></p>
+
+<p>If mail trains can carry mails, with parcels up to 7 lbs. in
+weight at the same price for any distance, why cannot all trains
+carry passengers and goods of any size and weight at the same
+price for any distance? The answer is that they can, and it is
+the object of this pamphlet to prove not only that it is possible
+financially, but that, with the small uniform fares and rates indicated
+on the title page, sufficient revenue can be obtained to pay
+working expenses, and provide the sum required to purchase the
+whole of the existing railway undertakings at their full market
+price, or such a price as willing vendors would be ready to accept.</p>
+
+<p>This, then, is “<b>A Business Proposition</b>” for all concerned;
+in other words, the magnificent net-work of railways in
+the United Kingdom, with all that is included in their undertakings,
+may be acquired by the nation at such a price as will
+make it worth the while of the present Companies and their shareholders
+to sell, and as the result to give the nation the benefit of
+speedy and efficient transport at the nominal fares and rates
+mentioned. It will, indeed, be a “Revolution,” but one of the
+most beneficial that can befall a nation.</p>
+
+<p>The Royal Mail is an institution of which the nation is justly
+proud. How much more will it be so of an institution which will
+include the Royal Mail, namely, <b>Royal Railways</b>.</p>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_17" id="Page_17">[17]</a></span></p>
+
+<h2 id="CHAPTER_I">CHAPTER I.<br />
+THE SCHEME.</h2>
+
+<p>This is the scheme proposed:—</p>
+
+<p>The whole of the existing undertakings of all the Railway
+Companies in the United Kingdom of Great Britain and Ireland
+will be acquired by purchase on some such terms as are set out
+at the end of this pamphlet and vested in the Government. The
+whole system will be amalgamated with the General Post Office
+and form one of the Departments of State, of which the Postmaster-General
+for the time being will be the head, and probably
+adopt the style of “Minister of Transport,” who will be a Member
+of the Cabinet. <b>It will be expressly enacted that any profit
+made by the combined services shall be used only for
+increasing their efficiency, for payment of purchase money,
+or in reduction of fares and rates charged for the services,
+and in no case for general revenue of the country. There
+shall also be no prohibition of competition by private enterprise.</b><a name="FNanchor_1" id="FNanchor_1"></a><a href="#Footnote_1" class="fnanchor">[1]</a></p>
+
+<p>All passenger trains will be regarded as consisting of two
+kinds, namely:—</p>
+
+<div class="blockquote-list">
+
+<p>(1) <b>Main Line Trains</b>, by which will be meant express
+trains running on the Main trunk lines between, and only
+stopping at, important towns.</p>
+
+</div>
+
+<p>A ticket for <b>one shilling</b> will entitle the holder to enter any
+Main Line train at any station, and to travel in it to any other
+station at which it stops, and a ticket for <b>five shillings</b> will
+entitle him to travel first class in such trains.</p>
+
+<div class="blockquote-list">
+
+<p>(2) <b>Local Trains</b>, by which will be meant all trains, other
+than Main Line trains as defined above, including all
+Metropolitan, Suburban and Branch Line trains throughout
+the Kingdom, as well as trains on Main lines which
+stop at all stations.</p>
+
+</div>
+
+<p>A ticket for <b>one penny</b> will entitle the holder to enter any
+Local train at any station, and to travel in it to any other station
+at which it stops, and a ticket for <b>sixpence</b> will entitle him
+to travel first class in such train if that accommodation is provided.</p>
+
+<p><span class="pagenum"><a name="Page_18" id="Page_18">[18]</a></span></p>
+
+<p><b>Steamers</b> which form part of the railway undertakings will
+also be regarded as of two kinds, according to whether they form
+part of a Main Line, <i>e.g.</i>, the Irish Packets or the Cross Channel
+steamers, in which case admission to them will be 1s. or 5s.,
+according to class, or simply as part of a Branch line, <i>e.g.</i>, the
+Isle of Wight steamers, to which admission would be 1d. or 6d.
+according to class.</p>
+
+<p>In the case of Main Line trains and steamers, additional fixed
+charges (the same for any distance) will be made for the use of
+refreshment cars, sleeping cars, State cabins, reserved seats and
+any other special services.</p>
+
+<p>In the case of Local trains, and possibly Main Line trains,
+<b>Season Tickets</b> may be issued, in each case available for
+any Main Line train or Local train as the case may be. For
+Local trains the following rates are suggested, viz.:—</p>
+
+<table summary="Suggested rates for local trains">
+ <tr>
+ <td>3rd class</td>
+ <td>1s. per week,</td>
+ <td>4s. per month,</td>
+ <td>£2 per annum.</td>
+ </tr>
+ <tr>
+ <td>1st class</td>
+ <td>2s. 6d. <span class="ditto1">”</span></td>
+ <td>10s. <span class="ditto1">”</span></td>
+ <td>£5 <span class="ditto1">”</span></td>
+ </tr>
+</table>
+
+<p><b>Passenger Tickets</b> will not be issued to or from any particular
+stations, but like postage stamps will vary only according
+to the fares and special charges for the time being in force.
+The four denominations of 5s., 1s., 6d. and 1d. will, of course,
+be required, and 4s. and 5d. tickets could also be issued to make
+up the first class fares with the 1s. and 1d. tickets.</p>
+
+<p>These tickets will be sold not only at every railway station,
+but also at every Post Office and in automatic machines. Every
+railway station will be, or will contain, a Post Office, with all
+postal, telegraphic and telephonic facilities, and every Post Office
+will sell not only passenger tickets but also railway stamps for
+parcels, goods and live stock.</p>
+
+<p><b>Goods traffic</b> will also consist of two services only, namely:—</p>
+
+<div class="blockquote-list">
+
+<p>(1) <b>Fast Service</b>, corresponding with the present service
+“per passenger train,” the charge for which will be an
+average of <b>ten shillings per ton for any distance</b>.</p>
+
+<p>(2) <b>Slow Service</b>, corresponding with the present service
+“per goods train,” the charge for which will be an
+average of <b>one shilling and sixpence per ton for any
+distance</b>.</p>
+
+</div>
+
+<p>For both these services stamps will be issued of various denominations,
+and applied in manner now in use for the Parcels
+Post, with any necessary modification; for instance, the stamps
+might be affixed to consignment notes in the case of goods in
+bulk, or other suitable arrangements might be made for large
+quantities of goods.</p>
+
+<p>For the <i>slow</i> goods traffic a regular service of goods trains
+will be organised so that at every town or village in the United<span class="pagenum"><a name="Page_19" id="Page_19">[19]</a></span>
+Kingdom served by rail there may be at least one delivery and
+one collection daily, more populous places, of course, having
+more frequent services.</p>
+
+<p>For the <i>fast</i> goods traffic a similar regular service will be
+organised, and in cases where the traffic will warrant it special
+fast goods trains will be run; otherwise the goods will be carried
+by the passenger trains.</p>
+
+<p>In course of time provision should be made for all trunk
+lines to have at least two double lines of rails, upon one of which
+fast trains for passengers and goods will run at uniform
+speeds, and at regular intervals, and upon the other the local
+trains and slow goods trains, also at uniform speed and at regular
+intervals.</p>
+
+<p>The present complicated system of differential rates, which
+vary not only according to distance but also according to the
+nature, quality and value of goods, and involving different rates,
+amounting in number literally to millions, would be swept away,
+the only variations in rates being in respect of such obvious
+matters as weight, size, whether carried in bulk or in packages,
+in open trucks or closed, whether requiring special care or labour
+in packing or otherwise. The average rates proposed would, it
+is believed, admit of a uniform rate for any distance for minerals
+and other goods carried in bulk in open trucks, of no more than
+the lowest rate now in force, by charging higher rates for goods
+requiring closed trucks and more labour in handling, still higher
+rates for goods of abnormal size or weight, and higher rates still
+for single small parcels, on account of greater proportionate expense
+of handling. For the small single parcels the rate might
+be for slow service as much as 6d. for any weight up to 1cwt.
+(equal to 10s. per ton), and for fast service say 1s., or possibly
+more, for any weight up to 1cwt., the weight being graduated
+downwards for parcels of greater weight as are the rates now in
+force for letter and parcels post. The goods traffic would be in
+effect an extension of the present parcels post, the present rates
+for which would probably be capable of very substantial reduction.</p>
+
+<p>These figures are put forward by way of suggestion only, and
+the question of terminal charges and fees for loading and unloading
+may have to be taken into account. Numerous details
+must necessarily be gone into in fixing an average uniform rate,
+and it is very likely that considerable modifications may be found
+necessary. Any such modifications, however, must be based upon
+the three rules set out on <a href="#Page_30">page 30</a> in order that the scheme may
+effect its object.</p>
+
+<div class="footnotes">
+
+<h3>FOOTNOTES</h3>
+
+<div class="footnote">
+
+<p><a name="Footnote_1" id="Footnote_1"></a><a href="#FNanchor_1"><span class="label">[1]</span></a> For reasons of these modifications of the present practice in National and Municipal Trading
+see <a href="#CHAPTER_IV">Chapter IV.</a>, pp. 33-41.</p>
+
+</div>
+
+</div>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_20" id="Page_20">[20]</a></span></p>
+
+<h2 id="CHAPTER_II">CHAPTER II.<br />
+ADVANTAGES OF THE SCHEME.</h2>
+
+<p>If this scheme is practicable financially (and one object of this
+pamphlet is to prove that this is so), then it seems almost superfluous
+to point out the great advantages of its adoption.</p>
+
+<p>It has been well said that “<b>transport is the life-blood of a
+nation</b>.” If circulation is impeded or restricted the whole country
+must suffer, and, conversely, if all obstructions and restrictions
+are removed the whole country must benefit. This scheme will,
+in effect, remove the principal obstruction to free circulation of
+passengers and goods, namely, expense. Cheapness of transport
+is “twice blessed; it blesseth him that gives and him that
+takes”—in other words, it enables the producer, whether agriculturist,
+manufacturer or merchant, to increase his market for
+goods, and enables the consumer who requires those goods to
+purchase at a lower price. It is common knowledge that agriculture
+in particular in this country is hampered and restricted
+by heavy charges for freight.<a name="FNanchor_2" id="FNanchor_2"></a><a href="#Footnote_2" class="fnanchor">[2]</a> Under our present system the
+carriage of goods from abroad to London is cheaper than from
+the Midlands, and the foreigner has a great preference (so far as
+freight is concerned) over our own farmers. Fruit and fish is
+often thrown away on account of the cost of carriage being more
+than the value of the goods. On the other hand, the price of
+food and every commodity has been gradually increasing. With
+the removal of this obstruction of expense of carriage there must
+be an increase in the supply of goods, and increased supply means
+lower prices.</p>
+
+<p>As to passenger traffic, traders will appreciate the great benefit
+of nominal fares for themselves and their commercial travellers.
+So also will the greater part of the population, namely, those of
+very moderate means who are now prevented, solely on account
+of expense, from travelling any considerable distance, either on
+business or pleasure, or from visiting friends and relatives.</p>
+
+<p>These are some of the general advantages attending cheapness
+of transport, but it may be as well to point out in detail some of
+the very substantial economies and other special advantages to be
+obtained by adopting the proposed scheme.</p>
+
+<p><span class="pagenum"><a name="Page_21" id="Page_21">[21]</a></span></p>
+
+<h3>1. ECONOMICAL ADVANTAGES.</h3>
+
+<p>A few examples of the waste attending the present system,
+both of money and time will illustrate some of these advantages.</p>
+
+<p><b>In the Strand, London</b>, within a few yards of each other, are
+the following premises:—</p>
+
+<div class="blockquote-list">
+
+<p>No. 168, Strand.—The Strand Station of the Piccadilly
+and Finsbury Park Tube Railway.</p>
+
+<p>No. 170, Strand.—Great Western Railway Receiving
+Office.</p>
+
+<p>No. 173-4, Strand.—East Strand Post Office.</p>
+
+<p>No. 179, Strand.—Great Northern Railway Receiving
+Office.</p>
+
+<p>No. 4, Norfolk Street, Strand, almost adjoining No. 179,
+Strand.—Inland Revenue Office.</p>
+
+<p>No. 183, Strand.—Midland Railway and London and
+North Western Railway Receiving Office.</p>
+
+</div>
+
+<p>Within sight, at the other end of Norfolk Street, is the Temple
+Station District Railway, and at 6, Catherine Street, about the
+same distance from the other side of the Strand, is a Labour
+Exchange.</p>
+
+<p>It is assumed that the rents of shops in the Strand would
+average about £500 per annum. Under the proposed scheme,
+the whole of the business transacted at the above eight premises
+could, with greater convenience, be carried on at the two railway
+stations, possibly with some extensions, but with a saving not
+only of rent but also of rates, taxes and other outgoings.</p>
+
+<p><b>At Bexhill-on-Sea</b>, with a population of only about 15,500,
+there are two large railway stations, one belonging to the South
+Eastern & Chatham Railway Company, the other to the London,
+Brighton & South Coast Railway Company, and situate about a
+mile apart. Half a mile from each is the Head Post Office, within
+a few doors from one of the stations is a branch Post Office, and
+within a small radius are Government offices for Inland Revenue
+and other purposes.</p>
+
+<p>Letters posted at a pillar box outside the station are collected
+there, taken to the Head Post Office for sorting, then returned
+with others to the railway for the Mail train leaving the same
+station. The majority of the passengers are for London, and
+go by the two different routes, but the fares are identical, and
+the time occupied is about the same, no advantage being gained
+by the public through the so-called competition.</p>
+
+<p>If both stations were amalgamated one staff only would be
+required, there would be ample room on the premises to accommodate
+the Head Post Office with sorting rooms, etc. (the branch
+office now near the station would not be required), and there would
+be plenty of room also for the Government Offices. In addition<span class="pagenum"><a name="Page_22" id="Page_22">[22]</a></span>
+to the saving of expense, there would also be the great convenience
+and saving of time in the transport of, and dealing with, mails,
+passengers and goods.</p>
+
+<p>These two examples with many others have come under my
+personal observation, and they may be multiplied ten thousand
+times throughout the United Kingdom. Where is there a railway
+station, whether a great London terminus, or small provincial
+station, where postal facilities are available; while just outside
+rents are paid, in some cases very heavy ones, for other
+premises, to and from which the mails have to be conveyed?</p>
+
+<p>Other examples of waste under the present system, although
+not so apparent to the public, are well-known to the railway
+expert, and involve much greater expenditure of time and money.</p>
+
+<p>I refer in particular to the <b>waste of rolling stock</b>, especially of
+goods wagons, occasioned by the multiplicity of goods stations,
+the transfer of rolling stock to and from the lines of different railway
+companies, the shunting of trains, and the large number of
+road vans used by the various companies. In London alone there
+are 74 goods stations, used for goods only, and 700 goods trains
+per day travel between these 74 stations, doing nothing but transferring
+goods from one of these stations to another! Goods
+consigned to one warehouse in London from places on, say, seven
+different railway companies’ lines are sent by seven different
+vans, one belonging to each company. Under my proposed
+scheme one or two central goods stations of large area would
+not only suffice, but would provide a far more efficient and speedy
+transport service, and yet with the nominal rates referred to.</p>
+
+<p>Under the present system goods trains, having been unloaded,
+must be returned in order to clear the line, so that it is not uncommon
+to find goods trains belonging to the various companies
+returning empty for long distances on each line, on the G. W. R.
+as far as Bristol, on the S. W. R. to Basingstoke, on the G. C. R.
+to Banbury, and so on. It has been estimated that of the
+1,400,000 goods wagons now on the railways of the United
+Kingdom, no more than 3 per cent. are actually in effective use
+at one time, the remaining 97 per cent. being either stationary
+or running empty!<a name="FNanchor_3" id="FNanchor_3"></a><a href="#Footnote_3" class="fnanchor">[3]</a> One reason for this, no doubt, is the use of
+merely hand labour for loading and unloading.</p>
+
+<p>With a view to avoiding this waste the New Transport Company,
+Limited was registered in 1908, for the purpose of introducing
+new and ingenious machinery, invented by Mr. A. W.
+Gattie and Mr. A. G. Seaman, for handling goods, including the
+adoption of movable “containers” on trucks and wagons, and
+a scheme for a “Goods Clearing House” occupying a site of
+about 30 acres, in Clerkenwell, to be connected by rail with all
+the lines coming to London.</p>
+
+<p><span class="pagenum"><a name="Page_23" id="Page_23">[23]</a></span></p>
+
+<p>It is, of course, necessary, in order to carry so important a
+scheme into effect to negotiate with all the various railway companies
+interested, as well as to obtain an Act of Parliament.
+Besides this, a large amount of capital is required for the acquisition
+of the site, the construction of the connecting lines, installation
+of the machinery, etc.</p>
+
+<p>Notwithstanding the large cost, estimated by Mr. Edgar
+Harper, F.S.S., late Statistical Officer of the London County
+Council, at £14,000,000, he shows that such a system would more
+than pay for itself in a year by the economies in transport which
+it would effect directly or indirectly.</p>
+
+<p>No estimate, however, is given, nor probably can be given by
+anyone, of the time that will be occupied in carrying such a scheme
+into effect, so long as this present system of numerous companies
+and conflicting interests continues. Five years have already
+gone by since the Company was registered.</p>
+
+<p>If, however, the scheme of nationalisation and amalgamation
+with the Post Office be adopted, there should be no difficulty in
+providing as part of such scheme for the system and machinery
+of the New Transport Company already referred to, not only in
+London but in every other traffic centre. It might also be possible
+to avoid the expense of acquiring a new site for a “Goods Clearing
+House” by utilising some portion of the large area occupied
+by the three large termini and approaches thereto of King’s Cross,
+St. Pancras and Euston.</p>
+
+<p>There will then be no conflicting interests, no multiplicity of
+companies, and no difficulty in raising the necessary capital for
+establishing the system, and what is still more important, no
+difficulty, as will be shown hereafter under the heading of
+“Finance,” in producing the necessary revenue to repay the
+capital and interest, by reason of the progressively increasing
+traffic which will result from the adoption of the small uniform
+average rates advocated.</p>
+
+<p>The following, then, are some of the very substantial economies
+which will be effected by my scheme:—</p>
+
+<div class="blockquote-list">
+
+<p><b>I. Expenditure which would be entirely abolished</b>:—</p>
+
+<div class="blockquote-list">
+
+<p>(<i>a</i>) The Railway Clearing House, the sole object of which
+is to apportion receipts and payments between the
+various companies, about 217 in number, and requiring
+for its work a large and expensive staff, not only of
+clerks, but also of inspectors at every junction, and a
+large establishment at Seymour Street, Euston.</p>
+
+<p>(<i>b</i>) The separate Boards of Directors, officers, and clerical
+staff of all the separate companies.</p>
+
+<p>(<i>c</i>) The legal and parliamentary expenses incurred in disputes
+between the various companies, and in opposing
+rival companies’ new lines.</p>
+
+<p>(<i>d</i>) Advertisements by rival companies of their own routes.</p>
+
+</div>
+
+<p><span class="pagenum"><a name="Page_24" id="Page_24">[24]</a></span></p>
+
+<p><b>II. Expenditure and waste which would be diminished</b>:—</p>
+
+<div class="blockquote-list">
+
+<p><b>1. By reason of unification of systems.</b></p>
+
+<div class="blockquote-list">
+
+<p>(<i>a</i>) Competing receiving offices and their staffs would be
+reduced to one in each locality.</p>
+
+<p>(<i>b</i>) Rolling stock, which is now often idle because owned
+by different companies, could be used solely according
+to the requirements of the traffic.</p>
+
+<p>(<i>c</i>) Competing trains now running on different lines at the
+same time between London and other large towns could
+be run at different times with largely increased numbers
+of passengers at same cost.</p>
+
+<p>(<i>d</i>) Adjoining stations belonging to competing companies
+would be amalgamated.</p>
+
+</div>
+
+<p><b>2. By reason of the adoption of uniform rates and fares.</b></p>
+
+<div class="blockquote-list">
+
+<p>(<i>a</i>) The abolition of the elaborate book-keeping and staffs
+needful for the present complicated system of passengers’
+fares and goods rates, especially the latter, with
+the waste not only of expense but also of time.</p>
+
+<p>(<i>b</i>) The saving of the expense of printing and advertising
+various priced tickets and fare tables, also of the large
+staff of booking clerks, inspectors and others.</p>
+
+<p>(<i>c</i>) The saving of the legal expenses now incurred by the
+Railway and Canal Commission Court in appeals and
+disputes between the companies and traders as to rates,
+etc.</p>
+
+</div>
+
+<p><b>3. By reason of the amalgamation of railways with the
+Post Office.</b></p>
+
+<div class="blockquote-list">
+
+<p>(<i>a</i>) The rent and expenses of numerous Post Offices in the
+neighbourhood of railway stations would be saved, all
+stations being used for postal purposes.</p>
+
+<p>(<i>b</i>) All postal sorting and other offices could be situate on
+railway premises in or near the stations, and besides
+thus saving the rent would be in closer touch with the
+railway.</p>
+
+<p>(<i>c</i>) The whole of the railway tracks would be available
+without rent for laying of telegraph and telephone
+wires, either over or underground.</p>
+
+<p>(<i>d</i>) Surplus land of the railways, in particular where adjoining
+to stations, would be available for other Government
+purposes, such as Inland Revenue Offices, Labour
+Exchanges, Military, Naval or Civil Service purposes,
+Police Stations, Fire Stations, County Courts, Police
+Courts, Land Courts, as well as Courts for dealing with
+questions arising out of the railways themselves.</p>
+
+</div>
+
+</div>
+
+</div>
+
+<p><span class="pagenum"><a name="Page_25" id="Page_25">[25]</a></span></p>
+
+<h3>2. GENERAL ADVANTAGES.</h3>
+
+<p>Unification enables each part of the country to have as good
+a service of trains as every other part, notwithstanding differences
+of population and resources. The Companies now operating on
+the South Coast cannot provide so good a service as the Northern
+Companies owing to the lack of the great mining and industrial
+centres which are served by the latter.</p>
+
+<p>One of the most conspicuous examples of this is <b>Ireland</b>. A
+Royal Commission was sitting for many years on the question
+of Irish railways, and ultimately reported in favour of State
+acquisition. Even this, it is clear, would not entirely solve the
+difficulty, which arises from the natural causes of being an island
+with (compared to the rest of Great Britain) a small population,
+mostly agricultural. If, however, the Irish railways were amalgamated
+with all the others of the United Kingdom under the proposed
+scheme the problem is solved. In the estimate given in
+considering the finance of the scheme the Irish railways are included.</p>
+
+<p>The conversion of the railway system into Government property
+will, apart from the question of economy already referred
+to, provide a most important advantage to the State. For
+example, the War Office can make use of the railway system, not
+only for the purposes of transport, but for the erection on surplus
+land throughout the country of barracks, stores, and other buildings,
+for wireless telegraph stations and for aviation purposes.
+The Admiralty will have the use of the great docks and wharves
+now owned by railways. The Civil Service will also find ample
+space for additional office accommodation, often in the most
+convenient spots both in town and country.</p>
+
+<p>Still more important even than these advantages is the fact
+that by the removal of all money restrictions from transport, not
+only an immediate but a <b>progressive increase of traffic</b> will result.
+That this will be so is shown hereafter when considering the
+question of the finance of the scheme, but it is referred to here
+as one of the most important advantages of the scheme, apart
+from the benefits to the nation already referred to of free circulation
+of passengers and goods.</p>
+
+<p>In the first place, the increase of traffic will require in all
+probability the whole of the staff now employed, who would otherwise
+be thrown out of employment by reason of the economies
+referred to above. It will be noticed that in the estimates given
+under the heading of “Finance of the Scheme” no decrease,
+but on the contrary, a slight increase has been estimated for in
+the working expenses, notwithstanding the enormous saving to
+be anticipated by the abolition and reduction of wasteful expenditure
+under the present system. My reason for so doing is
+partly to err on the side of caution in the estimates, but also to
+provide for the probability of having to retain the whole of the<span class="pagenum"><a name="Page_26" id="Page_26">[26]</a></span>
+existing staff, and possibly increasing their wages and reducing
+their hours of labour. Most of the economies referred to must
+necessarily be effected gradually; for instance, the clerical staffs
+of the various railway companies and of the Railway Clearing
+House would be required for some considerable time in the process
+of winding-up, and by the time this is finished the traffic will
+have still further increased and their work will then be required
+in the more necessary departments of, say, the Goods Clearing
+Houses throughout the country.</p>
+
+<p>Secondly, the progressive increase of traffic will produce a
+corresponding increase of revenue which will be available for
+extensions and additions, for electrification of lines, and other
+improvements in means of transport, and ultimately even in still
+further reduction in charges, but last and by no means least in
+the adoption of appliances and inventions for the safety of life
+and limb both of passengers and railway servants.</p>
+
+<p>Unlike the present companies, the Government will have
+no difficulty in raising the capital required for any such purposes,
+and in relying upon the inevitable increase of traffic, as now is
+the case of the Post Office, for repayment.</p>
+
+<p>Take the case of automatic couplings. These were invented
+40 years ago<a name="FNanchor_4" id="FNanchor_4"></a><a href="#Footnote_4" class="fnanchor">[4]</a> and their adoption has been urged on the companies
+ever since, not only on the merciful ground of saving life and
+limb, but also on the financial ground of saving waste of time
+in shunting; but the initial expense of fitting these to every truck
+and carriage has been too much for the directors of the Companies
+to risk.</p>
+
+<p>Many inventions for automatic signalling, instantaneous
+brakes, and other life-saving appliances have been from time to
+time submitted to railway companies, but the initial expense of
+installation throughout the many miles of railway of each company
+has been so great that one hardly wonders at the hesitation
+of directors in laying out money belonging to the shareholders,
+especially when, notwithstanding a small normal increase of
+traffic, the working expenses have increased to a greater degree.</p>
+
+<div class="footnotes">
+
+<h3>FOOTNOTES</h3>
+
+<div class="footnote">
+
+<p><a name="Footnote_2" id="Footnote_2"></a><a href="#FNanchor_2"><span class="label">[2]</span></a> See “The Rural Problem,” by H. D. Harben (Constable & Co., 1913, 2s. 6d.). Mr. Balfour
+Browne, K.C., also, in addressing the London Chamber of Commerce, February, 1897, said,
+“I am not exaggerating when I say that the Agricultural question … is nothing else but
+a question of Railway Rates.”</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_3" id="Footnote_3"></a><a href="#FNanchor_3"><span class="label">[3]</span></a> Lecture by A. W. Gattie, at London School of Economics, 11th March, 1913.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_4" id="Footnote_4"></a><a href="#FNanchor_4"><span class="label">[4]</span></a> “Mammon’s Victims,” by T. A. Brocklebank, published by C. W. Daniel, 1911—Price 6d.</p>
+
+</div>
+
+</div>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_27" id="Page_27">[27]</a></span></p>
+
+<h2 id="CHAPTER_III">CHAPTER III.<br />
+THE PRINCIPLES UPON WHICH THE SCHEME IS BASED.</h2>
+
+<p>At first sight it seems preposterous that the fare <b>from London
+to Glasgow should be only one shilling</b>, the same as from London
+to Brighton, or that the fare of one penny from Mansion House
+to Victoria should be the same as from Victoria to Croydon. To
+a railway expert it will doubtless appear still more preposterous
+that the rate for a ton of iron-ore should be the same as for a
+ton of manufactured iron, and that the rate for general merchandise
+should be as low as 1s. 6d. per ton for any distance; and
+yet it is now considered a matter of course that the rate of 1d.
+for 4 ozs. for a letter from London to Londonderry should be the
+same as from one part of London to another, or 3d. for 1 lb.
+should be the rate by parcel post for any distance great or small,
+and irrespective of what the contents of the parcel may be.</p>
+
+<p>The system of charging for transport <b>according to distance</b>,
+which is still in force throughout the civilised world, except in
+the Postal Service, appears to me to be <b>founded on a wrong
+principle</b>. It has no doubt been adopted on the assumption that
+the greater the cost of production the greater should be the
+charge, and, therefore, that as it costs more to build 100 miles
+of railway than one mile, and takes more coal or electric current
+to haul a train for 100 miles than for one mile, it is necessary to
+charge more for the longer distance. Even the Post Office still
+clings to the same idea, in charging higher rates for the telephone
+trunk service according to distance, although the charges for
+telegrams are the same for any distance! It is significant that
+whereas the net profits from railways remain more or less stationary,
+that of the Post Office with uniform rates continually increases,
+and that the telephone system with charges according
+to distance is so far the least satisfactory branch of the Post
+Office.</p>
+
+<p>It is no doubt a general rule that the price of an article depends
+upon the cost of production, but when dealing with transport
+the analogy fails. In the case of a national system of railways<span class="pagenum"><a name="Page_28" id="Page_28">[28]</a></span>
+the provision of a regular service of trains to and from all parts
+of the country is a necessity. Such a service requires that trains
+must run at stated intervals advertised beforehand from one
+terminus to another, say from A to Z, with various stopping
+places between those points, which may be represented by other
+letters of the alphabet. The cost of running each train will be
+the same, whether it contains 20 passengers or 200, whether
+some or all of the passengers alight from or board the train at
+any intermediate station or at either terminus. Therefore, the
+actual cost of carrying a passenger from A to Z is not, in fact,
+more than from A to B, or from M to Z.</p>
+
+<p>The same consideration applies to goods with even greater
+force. With goods the cost of handling them has to be considered,
+as well as the cost of haulage. If goods are sent from
+A to B only they must be handled twice, and this is no more than
+if they are sent from A to Z, assuming there is no need for change
+of trucks.</p>
+
+<p>In the case of goods under the present system there is a
+further principle acted upon, which is still more obviously a wrong
+one, <i>viz.</i>, what is known as charging <b>according to “what the
+traffic will bear.”</b> This term is well known to all railway experts,
+and is a convenient way of explaining the reasons governing the
+various rates under the present system. For instance, if too
+high a rate is charged for goods of comparatively small value,
+traders prefer to send by the cheaper modes, namely, by sea or
+by road, and in many cases it would not be worth while to send
+at all, whereas in the case of an article like silk or bullion of
+considerable value the extra cost of carriage even at a high rate
+would not add appreciably to the price. Therefore, the railway
+companies are compelled to make lower charges for low-priced
+goods, otherwise they would lose the traffic altogether.
+Accordingly there are such anomalies as a higher rate for the
+carriage of manufactured iron than of iron-ore for the same distance,
+although the cost of trucks, of haulage, and of handling
+may be identical. Again, the rate for carriage of meat from the
+Midlands to London is greater than that from Liverpool to London,
+partly on account of the competition of the sea, and partly
+on account of the large consignments of foreign meat. Again,
+the rate for the carriage of bricks from one part of London to
+another is greater than from Peterborough to London, because
+Peterborough is in a brick-producing district. These inconsistencies
+and anomalies are intensified by the necessity of the goods
+having to be carried over the lines of several different railway
+companies, all of whom must receive some profit out of the
+carriage of the goods, in addition to the actual cost.</p>
+
+<p>It is quite clear that the actual cost of haulage for the same distance
+of say a ton of coal is no more than that of a ton of bricks or
+of manufactured iron, or of sand, or of a pantechnicon full of<span class="pagenum"><a name="Page_29" id="Page_29">[29]</a></span>
+furniture, all of which can be carried in open trucks, yet the rates
+for all these various goods, even for the same distance, differ
+widely from each other under the present system, and differ again
+not only according to distance but actually according to the
+different towns between which the service is rendered. Many
+examples of the present anomalies are strikingly shown by
+Mr. Emil Davies in his book, “The Case for Railway Nationalisation,”<a name="FNanchor_5" id="FNanchor_5"></a><a href="#Footnote_5" class="fnanchor">[5]</a>
+which should be read by all interested in the subject.</p>
+
+<p>Now assume that the whole of the various existing railways
+are amalgamated; that Main line trains both for goods and
+passengers run at regular intervals to and from the principal
+towns; that Local trains run from station to station and on
+branch lines also at regular intervals, connecting at junctions
+with Main line trains; that just as there are now regular times
+for delivery and collections of letters and parcels by post, varying
+in number according to the population of each locality, so there
+are regular collections and deliveries of goods to and from every
+town and village in the United Kingdom; and that a uniform
+rate, no more than, or even less than, the smallest rate now
+charged, is all that has to be paid. It is true that with such a
+system at many of the smaller places the actual expense of
+collection and delivery may, indeed, be “more than the traffic
+would bear,” certainly much more than the Directors of a railway
+company would feel warranted in risking under the present system
+with their necessarily limited area, but when these smaller places
+are part of such a system as is here described, extending to every
+town in the United Kingdom, then the whole becomes self-supporting,
+and there is no advantage in charging, either according
+to distance, or according to “what the traffic will bear.”</p>
+
+<p>Every little village Post Office in the United Kingdom is an
+object-lesson to us. Here we have all the resources of civilisation,
+letter and parcel post, telegraph, telephone, savings bank,
+money orders, all provided at exactly the same rate as in the
+largest Cities of the Empire. Although the actual expense of
+each village Post Office taken by itself is out of all proportion to
+the population of the district, the combination of all of them in
+one national unified system enables these remote villages to benefit,
+not only with no financial loss to the nation, but actually with a
+handsome net profit which has actually contributed to the general
+revenue of the nation. This was not contemplated when the
+Penny Post was established, and is a practice which, in my view,
+is a great mistake, as explained in <a href="#CHAPTER_IV">Chapter IV.</a></p>
+
+<p>The same principle has been applied to the ordinary roads
+of the country, which are now open free of charge to the whole
+population, although many of this generation can still remember
+the restrictions of the old toll-gates.</p>
+
+<p><span class="pagenum"><a name="Page_30" id="Page_30">[30]</a></span></p>
+
+<p>It is only applying the same principle to the nation which applies
+to the human body. “The body is not one member, but many.…
+Whether one member suffers, all the members suffer
+with it, or one member be honoured, all the members rejoice with
+it.”</p>
+
+<p>If from any cause, such as a flood or other physical disturbance
+a small industrial or agricultural district were cut off from all
+communication with the rest of the Country, it is not only that
+district but also the whole of the Country which suffers loss,
+namely, the loss of trade with that district. And if by reason of
+high rates the remote towns, villages, and districts, as well as
+those nearer to great centres, are prevented from obtaining an
+outlet for their produce, the whole Country suffers. The converse
+is equally true: as soon as free circulation of passengers and
+goods is provided, the prosperity of the whole Country as well as
+of each district is increased.</p>
+
+<p>This, then, is the principle upon which the scheme of uniform
+fares and rates is founded, as opposed to the existing system of
+charging according to distance and according to “what the traffic
+will bear.” There remains, however, to be considered the
+principle upon which the particular uniform fares and rates mentioned
+on the <a href="#Page_6">title page</a> have been suggested for the proposed
+scheme. These have not been selected at haphazard, but in
+accordance with three rules which, I believe, are founded upon a
+sound principle, namely:—</p>
+
+<div class="blockquote-list">
+
+<p><b>(1) That any flat rate to be successful must not exceed
+the minimum rate in force prior to the adoption of the
+scheme</b>;</p>
+
+<p><b>(2) That there should result from the change a sufficient
+increase of traffic to produce at least the same net
+revenue as before</b>;</p>
+
+<p><b>(3) That in a system of transport the fares and rates
+should vary, not according to distance travelled, but
+according to speed of service.</b></p>
+
+</div>
+
+<p>In accordance with these rules I take <b>for Passenger Traffic</b>
+first the present minimum railway fare now charged, that is, 1d.
+for short distances of one mile or under. If the flat rate were
+fixed at say 2d., or, indeed, any sum over 1d., passengers who
+now pay that sum would have to pay at least double the existing
+fare; this would, of course, render the whole scheme impracticable.
+On the other hand, under a flat rate of 1d. throughout
+the whole country the receipts would not be sufficient to produce
+the present revenue unless and until the number of passengers
+carried should increase by as much as six or seven times. That this
+is so is clear when it is remembered that the <b>present average<span class="pagenum"><a name="Page_31" id="Page_31">[31]</a></span>
+railway fare for the whole of the United Kingdom</b> (allowing
+for season ticket holders), <b>is 6½d.</b> In other words, if all the
+passengers now travelling would pay 6½d. for every journey,
+both for short ones, as from Mansion House to Charing
+Cross, and long ones, as from London to Londonderry, then
+the same gross revenue from passengers would be obtained
+as now; or, on the other hand, if a flat rate of 1d. any
+distance were fixed, and the number of passenger journeys
+were increased by six-and-a-half times as a result of this great reduction,
+then, again, the same gross revenue would be obtained.
+The first of these alternatives is, of course, impracticable, and the
+second one is certainly not likely to be attained for some time to
+come, and even then account would have to be taken of the
+additional working expenses occasioned by so large an increase
+of traffic. It is on account of these difficulties that any system
+of uniform fares has hitherto been regarded as impracticable.</p>
+
+<p>The solution of this problem was suggested to me by the
+practice of the Post Office of charging 3d. for express delivery,
+and 6d. for a telegram. Here we have the third rule before
+referred to of charging according to speed of service. Applying
+this to railways, and again searching for the lowest fares now
+charged for fast Main line trains, it will be observed that these are
+the regular cheap excursion fares of 2s. 6d. from London to
+Brighton or Southend and back, which amounts to 1s. 3d. each
+way. It is true that these are exceptionally cheap fares. Return
+tickets only are issued at this price, available by certain trains only,
+but on the principle already laid down that the flat rate must not
+exceed the lowest, this forms the basis of the proposed uniform
+fare of 1s. for Main line trains. Although this uniform fare is
+so exceptionally low, it is still nearly double the present average
+fare, and it is precisely on the Main line trains that increase of
+traffic (now restricted by expense) is sure to take place. These
+facts (as will appear in the chapter, “Finance of the Scheme”)
+enable me to estimate the increase of passenger traffic required
+to make up the present gross revenue at only 15 per cent. of the
+present number of passengers carried.</p>
+
+<p><b>For goods traffic</b> the uniform rates suggested have been ascertained
+in accordance with the same rules. It is more difficult to
+ascertain the present minimum owing to the enormous complication
+of goods rates.</p>
+
+<p>Under the present system, goods are divided into eight different
+classes according to the rate charged, and a maximum rate is fixed
+by law for each class. In the lowest of these classes the rates
+vary from one penny and a fraction up to 4d. per ton per mile
+for any distance up to 20 miles, and smaller proportionate rates
+for distances over 20 miles. But although these are the greatest
+amounts that the companies may charge for this class of goods,
+they do make special rates of considerably lower amounts for<span class="pagenum"><a name="Page_32" id="Page_32">[32]</a></span>
+special kinds of goods. It is estimated that five-sevenths of all
+the goods carried are charged according to special rates not
+included in the eight classes mentioned.</p>
+
+<p>The Board of Trade returns give the totals of two classes of
+goods only, namely, “minerals,” of which 410 million tons are
+carried, and “general merchandise,” of which only 116 million
+tons are carried. These returns are possibly misleading as, although
+derived from returns made by the several companies
+themselves, it may be that those returns include the same goods
+sent over different lines.</p>
+
+<p>For the purposes of my estimates, however, I have assumed
+that the Board of Trade returns are correct, and if they are so,
+the average charge for “minerals” is now about 1s. 6d. per ton,
+and for “general merchandise” about 6s. per ton. Taking the
+two classes of goods traffic together, as representing what under
+my scheme will be the “slow goods traffic,” <b>the average is only
+2s. 4d. per ton</b>.</p>
+
+<p>The average rate of 1s. 6d. per ton has been suggested for
+the slow service because it is believed that this average will allow
+of a rate for all goods in open trucks as small as the lowest rate
+now charged for minerals for short distances, the average being
+maintained by higher rates chargeable for other kinds of goods
+as already described. If the actual tonnage of goods carried is
+really less than that mentioned in the official returns (it cannot
+be more), it may be found necessary to fix a somewhat higher
+uniform rate, and the estimates may be affected to a certain
+degree. The figures, especially those relating to goods traffic,
+are put forward by way of suggestion only, and there should be
+no difficulty in ascertaining a uniform rate in accordance with
+the rules already stated.</p>
+
+<p>It is believed that any difficulty in this respect will be solved
+by the large accession of traffic by Fast service, which, as with
+Main line passengers, is sure to follow the adoption of the scheme.</p>
+
+<p>The average rate for “fast” service has been obtained by
+ascertaining the lowest rate now charged for goods carried “per
+passenger train.” This appears to be the rate for returned empties
+for any distance up to 25 miles, namely, 6d. per cwt. (equals 10s.
+per ton). There is also a charge of £1 for a load not exceeding
+2 1/2 tons on carriage trucks attached to a passenger train for a distance
+of 40 miles, and thereafter at 6d. a mile. It is evident that an
+average of 10s. per ton would allow of a still smaller rate than
+that amount for goods carried in bulk and in large consignments.</p>
+
+<div class="footnotes">
+
+<h3>FOOTNOTES</h3>
+
+<div class="footnote">
+
+<p><a name="Footnote_5" id="Footnote_5"></a><a href="#FNanchor_5"><span class="label">[5]</span></a> “The Case for Railway Nationalisation” by Emil Davies, published by Collins, 1913—Price 1s.</p>
+
+</div>
+
+</div>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_33" id="Page_33">[33]</a></span></p>
+
+<h2 id="CHAPTER_IV">CHAPTER IV.<br />
+OBJECTIONS TO THE SCHEME.</h2>
+
+<p>I now propose to consider objections which may be raised to
+the proposed scheme.</p>
+
+<p>I anticipate opposition from those who object to all forms of
+<b>State Ownership</b> or State Management.</p>
+
+<p>The late Lord Avebury was one of the most prominent
+opponents of nationalisation, and his views are set out in his
+book “On Municipal and National Trading.”<a name="FNanchor_6" id="FNanchor_6"></a><a href="#Footnote_6" class="fnanchor">[6]</a></p>
+
+<p>Mr. Edwin A. Pratt has written several books on the subject
+and has recently collected all the arguments up to date against
+State Ownership in his book, “The Case against Railway
+Nationalisation,”<a name="FNanchor_7" id="FNanchor_7"></a><a href="#Footnote_7" class="fnanchor">[7]</a> In this book examples are given of the
+experience of foreign countries and the Colonies where railways
+have been taken over by the State.</p>
+
+<p>Other writers who have advocated the retention of our
+present system, and are quoted with approval by Lord Avebury,
+are the following:—</p>
+
+<div class="blockquote-list">
+
+<p>Messrs. G. Foxwell and T. C. Farrer (now Lord Farrer), in
+“Express Trains, English and Foreign.” (1889);</p>
+
+<p>Mr. W. M. Acworth, in “The Railways and the Traders”;</p>
+
+<p>Mr. H. R. Meyer, in “Government Regulation of Railway
+Rates,” and in “Railway Rates”;</p>
+
+<p class="noindent">and Lord Farrer and Mr. Giffin, in “The State in its Relation
+to Trade.”</p>
+
+</div>
+
+<p>On the other side, the following, among other advocates of
+railway nationalisation have shown the great advantages to be
+anticipated by such a measure, and have given very cogent
+answers to the objections of the opponents, namely:—</p>
+
+<div class="blockquote-list">
+
+<p>Mr. William Cunningham, “Railway Nationalisation.”
+(Published by himself at Dunfermline, 1906, 2s. 6d.);</p>
+
+<p>Mr. Clement Edwards, M.P., “Railway Nationalisation.”
+(Methuen & Co., 1907, 2s. 6d.);</p>
+
+<p class="noindent">and Mr. Emil Davies in several books, including his latest, already
+referred to, “The Case for Railway Nationalisation.” (Collins,
+1913, 1s.)</p>
+
+</div>
+
+<p><span class="pagenum"><a name="Page_34" id="Page_34">[34]</a></span></p>
+
+<p>But in all these books, and in other books and articles, both
+for and against nationalisation, it has been assumed that if, and
+when, the railways are acquired by the State, the same system
+will obtain as now, and as obtains in the case of all the foreign
+countries and colonies referred to, namely, <b>to charge according
+to distance and according to “what the traffic will bear,”
+and with the primary object of making the most profit</b>.</p>
+
+<p>With very great deference to all these distinguished writers,
+it appears to me that they have one and all overlooked the fundamental
+principles which should be acted upon by a State or a
+Municipality first in deciding whether or not to acquire a monopoly,
+and secondly, in the administration of it when acquired. These
+principles depend upon <b>the fundamental difference between the
+objects in view, and actuating a Company or individual on
+the one hand and a Nation or Municipality on the other in
+acquiring a monopoly</b>. In the former case the <b>sole object</b> is
+that of <b>pecuniary gain or profit</b>; in the latter the <b>sole object</b>
+is, or ought to be, the <b>benefit of the community</b>. It may be said
+that these are not respectively the sole objects, but only the
+<b>primary objects</b>. My reply is that in the case of the company
+it is the duty of the directors, as trustees for the shareholders,
+to so carry on the business in question as to produce the
+most profit, irrespective of any benefit to the community, or, indeed,
+to any persons other than the shareholders. Railway
+companies, it is true, provide the benefit of transport, and various
+advantages held out by the companies as inducements to use their
+particular lines, but these are, of course, solely offered with the
+view of increasing the profits. Other advantages for the comfort,
+safety and benefit of the public are provided under compulsion
+from the Government, as a condition of the grant of privileges
+and compulsory powers conferred upon the companies, without
+which the railways could not have been made. I refer to such
+matters as rules and regulations for the safety and benefit of the
+public; workmen’s trains; maximum fares and rates allowed to be
+charged; provision for at least one train a day at all stations, etc.</p>
+
+<p>Conversely, in the case of a Nation or Municipality taking over
+a monopoly, it is the duty of the Government Department or Town
+Council to so carry on the business as to render the most efficient
+service, at the lowest cost consistent with efficiency, with paying
+for the cost of acquisition and with paying the working expenses.
+Advocates of nationalisation urge that profits should be applied
+in reduction of taxation, and suggest that this is in itself one of
+the benefits to be derived therefrom. Opponents always assume
+that national and municipal trading must be carried on with a<span class="pagenum"><a name="Page_35" id="Page_35">[35]</a></span>
+view to profit, and some even ridicule the idea that any trading
+concern can be successfully carried on unless with this view and
+with a resulting profit. Acrimonious discussions have taken place
+as to whether profits which have been claimed by advocates of
+municipal trading to have been made by tramways, gas, water
+and electricity works, are only paper profits as alleged by the
+opponents. In Lord Avebury’s book already referred to,<a name="FNanchor_8" id="FNanchor_8"></a><a href="#Footnote_8" class="fnanchor">[8]</a> one
+whole chapter, headed “Loss and Profit,” treats of the question
+whether municipal enterprises have been profitable or not, and
+he adduces many examples to prove that in most cases the alleged
+profits are imaginary.</p>
+
+<p>It has, in fact, been the practice universally to apply profits
+made out of municipal trading in this Country in reduction of
+rates, and in foreign Countries, where railways are owned by the
+State, their revenues are made use of either as general revenue
+or, as in Prussia, for social or educational purposes, which would
+otherwise be provided for by direct taxation. The only instance
+of national trading in this Country is the General Post Office,
+and I think it is correct to say that the original intention when
+Penny Post was established was to so carry it on that working
+expenses only should be covered by the revenue. In practice, the
+gross revenue is entered with other items of revenue in the
+National Accounts, and the gross expenditure with other items
+of general and non-productive expenditure, with the result that
+the net profits of the Post Office, in effect, become a source of
+general revenue, and are therefore applied in reduction of general
+taxation. Until recent years this net profit has not been considerable,
+but last year it was as much as £5,000,000. Having
+regard to the continual and progressive increase in postal business,
+and the acquisition of the whole telephone system, there is
+every prospect of still further increase in net profits. What will
+be the result of a continuance of this practice of applying net
+profits of Municipal and National trading towards reduction of
+rates and taxes? It has not, so far, had any very serious result,
+simply on account of the fact that such net profits have not yet
+been of a very startling amount. But if these profits should increase,
+will not the result be the very evils which are the natural
+consequence of a private monopoly?</p>
+
+<p>Once the principle is admitted that profits from such trading
+shall go in relief of taxation, the service will, and must, be worked
+more or less with the primary object of making as much profit
+as possible, with the inevitable result that the service in question
+will be starved for the sake of the profits. This has actually
+happened in the case of the Prussian State Railways, the one
+State Railway which has so far made the greatest net profit.</p>
+
+<p><span class="pagenum"><a name="Page_36" id="Page_36">[36]</a></span></p>
+
+<p>In addition to this difficulty there are others inherent in State
+or Municipal trading, if the principle of making profits be
+admitted, and if profits are actually made. In such a case the
+Chancellor of the Exchequer will be expected to budget for
+further profits, the general public will expect improvements in
+the service, traders will expect that the charges to them should
+be reduced, and the workers will expect that their wages should
+be increased.</p>
+
+<p>This view is not a new one. It has been advocated in respect
+of the Post Office for many years by such well-known postal reformers
+as Lord Eversley (formerly Mr. Shaw Lefevre), and Sir
+Henniker Heaton, Bart. The latter, I believe, has several times
+moved resolutions in the House of Commons for the express
+purpose of having the postal profit applied to the use of the
+Post Office itself, instead of to general revenue.</p>
+
+<p>It is well known that “<b>strikes</b>” are more likely to arise in a
+period of trade prosperity. It is the natural result of the workers
+seeing large profits made out of their industry, if they should
+have no benefit, by increase of wages, by sharing in such profits
+or otherwise. It makes but little difference to the workers
+that those profits go to ratepayers, instead of to shareholders,
+more especially as they usually inhabit houses let on weekly
+inclusive rentals, and are exempt from income-tax, so that they
+do not directly pay either rates or taxes. If, on the other hand,
+the profits are devoted to improving the efficiency of the service
+or cheapening the charges, then, not only are there no profits
+to excite the cupidity of various sections of the community, but
+the workers do, in fact, benefit by themselves and their families,
+as well as the whole of the public for whom the services are
+worked. No strike is ever successful which does not gain general
+public support, and even under existing conditions there is much
+less likelihood of strikes in the case of Civil Servants or postal
+or municipal employees, partly on account of the better wages
+paid, the certainty of continuing in employment except for misconduct,
+and the prospects of a pension, but still more on account
+of the practical certainty that public support would not be given
+to a strike which interferes with one of the most important of
+the public services.<a name="FNanchor_9" id="FNanchor_9"></a><a href="#Footnote_9" class="fnanchor">[9]</a></p>
+
+<p>Another evil of ignoring the difference in principle of a public
+monopoly and a private monopoly has been the practice of applying
+to public monopolies the practice which all private monopolies
+endeavour to achieve (and properly so as their sole object is
+profit), namely, to put down all possible competition. If the<span class="pagenum"><a name="Page_37" id="Page_37">[37]</a></span>
+principle I advocate, namely, that the <b>sole object of a public
+monopoly is the benefit of the community</b>, then if some
+improvement in the service, the subject of such monopoly,
+shall be invented, which is proved to be practicable, the public
+should have the benefit of such improvement, and, <b>instead of a
+prohibition of such private enterprise every encouragement
+should be given</b> to it.</p>
+
+<p>In our Navy, when new inventions are found which increase
+its efficiency, no time or money is lost in adopting them, even at
+the expense of discarding comparatively modern men-of-war or
+appliances. The risk to the nation of not doing so is too great
+to allow considerations of expense to stand in the way.</p>
+
+<p>But what has happened in the case of so important a commercial
+matter as the Telephone? The Post Office are authorised
+by Act of Parliament to forbid any competition, a provision
+evidently enacted under the impression that a public monopoly
+must have Statutory protection against competition, which a
+private monopoly always seeks to obtain, but has to pay for.
+Having this monopoly, and having purchased the telegraphs, the
+Post Office from the first regarded telephones with the utmost
+jealousy, because it seemed likely to interfere with its “Profits”!
+Lord Avebury quotes from “The Times” of 13th June, 1884,
+as follows:—<a name="FNanchor_10" id="FNanchor_10"></a><a href="#Footnote_10" class="fnanchor">[10]</a></p>
+
+<div class="blockquote">
+
+<p>“… the action of the Post Office has been so
+directed as to throw every possible difficulty in the way
+of the development of the telephone, and of its constant
+employment by the public. We say advisedly, ‘every possible
+difficulty,’ because the regulations under which licences
+have been granted to the telephone companies are in many
+respects as completely prohibitory as an absolute refusal
+of them.” “… the effects of this claim are nearly
+as disastrous to the Country as to the inventors and owners
+of the instruments.”</p>
+
+</div>
+
+<p>When it is remembered that the Post Office insisted on being
+paid one-tenth, not of the profits, but of the gross receipts, the
+wonder is that our telephone system is not more backward than
+it is. Lord Avebury, of course, uses this and other instances,
+such as the opposition of municipalities owning tramway and
+gas undertakings, to tramway extensions in adjoining districts,
+and licences to motor omnibuses and also to the introduction of
+electricity for lighting and power, as an argument against
+nationalisation and municipal trading.<a name="FNanchor_11" id="FNanchor_11"></a><a href="#Footnote_11" class="fnanchor">[11]</a> That these constitute
+a strong argument against public monopolies being worked for
+profit, I readily admit, but they do not weaken the argument that<span class="pagenum"><a name="Page_38" id="Page_38">[38]</a></span>
+all such concerns which must, in their very nature, be incapable
+of effective competition, should be taken over by the community,
+and be worked solely for its benefit. What possible chance is
+there of competition in a telephone system? It is, of course, an
+essential element to its success that each subscriber should be
+able to communicate with every other one. How, then, can it
+ever have been imagined that there could be any effective competition
+between rival systems? And yet competition was
+actually attempted between various municipalities and the National
+Telephone Company, and afterwards the Post Office itself was
+authorised to “compete” with that Company.</p>
+
+<p>The ultimate purchase by the State was, of course, a foregone
+conclusion, but at what expense of both time and money has this
+at length been effected! The complaints which have been made
+since the completion of this purchase are evidently the result, not
+of nationalisation, but of the mistaken practice followed in a
+fruitless attempt at making or retaining so-called “profits” of
+the telegraph system, by at first putting “every possible difficulty”
+in the way of telephones, then attempting to compete with them,
+and then waiting a number of years before completing the purchase,
+with the result of being compelled to take over a large
+number of obsolete plant and instruments, and linking them up
+with a new system, thus producing a state of confusion and useless
+expenditure of time and money, which could all have been
+avoided by purchase of the patents and patent rights more than
+30 years ago.</p>
+
+<p>It is only right to say that Lord Avebury was still of opinion
+in 1907 that the resolution of the Government to buy up the
+National Telephone Company was “an extraordinary and most
+unfortunate policy.”<a name="FNanchor_12" id="FNanchor_12"></a><a href="#Footnote_12" class="fnanchor">[12]</a></p>
+
+<p>Mr. Hanbury, who was the Minister mainly responsible in
+1906 for the purchase of the telephones, had evidently changed
+his opinion since 1889, when, in answer to a deputation in favour
+of purchasing the telephones, he said, according to a report
+quoted by Lord Avebury from “The Times”:—</p>
+
+<div class="blockquote">
+
+<p>“If the telephone service was cast upon the Post Office
+it would be to the detriment of both the postal and telegraph
+services. Then, again, it would increase enormously the
+Government staff. He need only appeal to the Members
+of Parliament present to say whether they would like to
+have the weekly appeals for increase of wages from those
+State servants still further extended.”</p>
+
+</div>
+
+<p>Here we have exactly one of the arguments which is now
+being used against railway nationalisation, and by the very
+Minister who, 17 years after, did the very thing he had clearly
+condemned.</p>
+
+<p><span class="pagenum"><a name="Page_39" id="Page_39">[39]</a></span></p>
+
+<p>I admit the argument would hold good if the restriction be
+not imposed by an inflexible rule that there should be no attempt
+to work the concern, whether Post Office, telephone, railway or
+other monopoly for purposes of profit.</p>
+
+<p>I have already referred to the mistake the Post Office are
+making in following the example of the private monopolist, the
+National Telephone Company, in charging for telephones according
+to distance, although between the very same towns in which
+different rates are charged the same department charges 6d.
+only for telegrams! This can only be with the strange, yet futile,
+intention of making more profit without regard to the benefit
+of the community. If the same rate were charged for Trunk
+calls as for local calls, many more provincial and country
+people would subscribe, and the wires being already laid and
+exchanges established, the additional expense would be but small.</p>
+
+<p>It would seem, indeed, that the search after profits in the case
+of Government or municipal monopolies is as futile as the search
+by people after happiness, personified by Maeterlinck as “The
+Blue Bird,” and that when the only object is to benefit the community,
+the profits come, as does happiness, when the only object
+is that of benefiting other people.</p>
+
+<p>Now, in considering the principle here laid down, it appears
+to me that there are four rules which should be observed when
+a nation or municipality undertakes anything in the nature of a
+trading concern:—</p>
+
+<div class="blockquote-list">
+
+<p>1. Only such concerns should be taken over as are, and
+must be, <b>in the very nature of things, a monopoly</b>, or,
+in other words, are not susceptible of effective competition.</p>
+
+<p>2. Any such concern taken over should be worked with
+<b>the sole object in view of benefiting the community</b>
+and, therefore, the charges made should be so adjusted
+as to pay for the acquisition of the concern
+and for working expenses, and any surplus from time
+to time applied, only in improving the efficiency of the
+undertaking, or in reducing the charges made.</p>
+
+<p>3. In the event of any invention or improvement being
+made, and proved to be commercially successful,
+whereby the benefit to the community can be increased,
+and provided the concern remains in its nature a
+monopoly, such improvements should be taken over
+and worked by the State or municipality, and meantime
+<b>there should be no prohibition of any private
+enterprise carried on in competition</b> apparent or real.</p>
+
+<p>4. All such concerns, whether national or municipal, should
+be worked or directed by one or more Department of<span class="pagenum"><a name="Page_40" id="Page_40">[40]</a></span>
+State, having at its head a Minister, who should be a
+Member of the Cabinet, and <b>responsible to the House
+of Commons, and as such liable to a vote of censure
+for any abuse or want of efficiency in the concern</b>.</p>
+
+</div>
+
+<p>As to Rule No. 1, there appears sometimes to be a very thin
+line between what is, and is not, susceptible of effective competition.
+As a general rule, <b>any concern which involves a right or
+easement over land, must be in the nature of a monopoly</b>.
+Thus the supply of gas, water and electricity, all of which must be
+conveyed by pipes or wires into houses, are in the nature of a
+monopoly, but the fittings used in the houses are not, but are
+susceptible of very efficient competition, both as to workmanship,
+manufacture and design. All roads, including railroads and tramways,
+are, and must be, in the nature of a monopoly, but the
+manufacture of materials and rolling stock, the catering of hotels,
+forming part of the railway undertakings, or in the trains themselves,
+or in railway steamers, are all the subject of effective competition
+and should, therefore, be put up for competition with
+special supervision and restrictions against abuse of the privileges
+obtained by competition on Government property.</p>
+
+<p>Now, I would ask any unprejudiced reader who has studied
+the writings of the eminent authors already quoted, and other
+opponents of nationalisation, to read those books again with these
+four rules in his mind, and consider whether all the objections
+so forcibly brought forward against nationalisation would not be
+very nearly, if not completely, answered, if such nationalisation
+were carried out with strict adherence to these rules.</p>
+
+<p>I venture to think that Lord Avebury himself would have
+admitted the force of this contention. It would, at least, answer
+the question he puts more than once, “Where, indeed, is it
+(municipal and national trading) to stop? Is it to stop at all?…
+It is sometimes said that the line should be drawn
+at necessaries. But if so, to light, gas, water and tramways, we
+should have to add bread, meat, fire insurance, … etc.,
+while many would also add tobacco, tea and beer.”<a name="FNanchor_13" id="FNanchor_13"></a><a href="#Footnote_13" class="fnanchor">[13]</a></p>
+
+<p>In effect, the whole of the objections to State ownership, as
+will appear from a perusal of the various books referred to above,
+and the arguments of other opponents, are all comprised under
+three heads, namely, according to the relationship of the State:—</p>
+
+<div class="blockquote-list">
+
+<p>1. With traders.</p>
+
+<p>2. With railway servants.</p>
+
+<p>3. With the general public, especially on such matters as
+officialism and inefficiency, owing to want of competition,
+bad administration, and interference with private
+enterprise.</p>
+
+</div>
+
+<p><span class="pagenum"><a name="Page_41" id="Page_41">[41]</a></span></p>
+
+<p>The first of the two objections referred to is that the Government
+would be in the great difficulty of having to meet the conflicting
+interests of traders and merchants on the one hand, and the
+general public on the other, with continual disputes as to the
+claims of various parties, and possible attempts to bring influence
+to bear on the Government and Members of Parliament. This
+objection was raised by the Prime Minister recently in reply to a
+deputation supporting railway nationalisation. The difficulty has
+been found in countries where railways are State owned, and
+would, I admit, be a most serious objection, if, after nationalisation,
+the railways should be worked on the same principle as now,
+namely, with the object of making the most profit possible, and
+charging according to “what the traffic will bear.”</p>
+
+<p>The objection, however, disappears if the proposed rules are
+adhered to, especially when, as in the proposed scheme, fares and
+rates are fixed irrespective of distance, locality, class of traders or
+goods, and in which, therefore, no question of preference or,
+indeed, of any conflicting interests can arise.</p>
+
+<p>As to the second heading, affecting the relationship of the State
+with the railway servants. It is suggested that the railway servants
+(who would, on nationalisation, become Civil servants)
+could use their voting powers to exact undue privileges for themselves
+which they cannot now obtain, and that serious abuses
+might arise owing to the great political power exercised by a
+large increase in the number of voters who are also Civil servants.</p>
+
+<p>This does not appear to me so formidable an objection as the
+first, but it is quite possible that a large united body of Civil
+servants might have power to so influence the Government as
+to extract higher wages or less hours, if they discovered that by
+their exertions a very large profit was derived by the railway
+system.</p>
+
+<p>Some writers have gone so far as to suggest that all persons
+employed by Government should be disfranchised. Others suggest
+that special representatives of Government officials should be returned
+to Parliament. Others that all such officials should take
+the same oath of allegiance as soldiers, and, in short, become
+subject to military discipline. In two articles appearing recently
+in the “Westminster Gazette,” under the title of “Unrest in the
+Railway World, by an Expert,”<a name="FNanchor_14" id="FNanchor_14"></a><a href="#Footnote_14" class="fnanchor">[14]</a> it is suggested that “unless
+some discipline of the military kind were introduced” (in the
+event of nationalisation), “there would be no available methods
+of dealing with a national strike of railwaymen, other than to
+concede to their demands.” The question of “Strikes” has already
+been dealt with above (<a href="#Page_36">page 36</a>). As to the political
+difficulty, although it is true that the number of Civil servants
+would be greatly increased (and it has been estimated that the<span class="pagenum"><a name="Page_42" id="Page_42">[42]</a></span>
+total number of postal and railway servants who would have the
+vote might be as many as 600,000), it must be remembered, as
+pointed out by Mr. Emil Davies, that this number is spread over
+the whole Country, and the percentages in each district, compared
+to the whole number of voters, would not be a large one, except in
+railway centres like Crewe, where they already have a preponderance
+of votes. In any case, the same considerations which, as
+above mentioned, would be likely to prevent strikes, would
+operate equally in the region of politics if the four rules mentioned
+are adhered to, especially under the proposed scheme, carried
+on with the primary object of the public benefit. Exactly the
+same conditions would obtain as with the Post Office now.</p>
+
+<p>Other grounds of objection to State ownership are:—</p>
+
+<div class="blockquote-list">
+
+<p><b>1. The fear of inefficiency owing to lack of competition.</b></p>
+
+<p><b>2. The fear of difficulty in obtaining redress for loss
+or injury from a Government Department.</b></p>
+
+<p><b>3. The fear of officialism.</b></p>
+
+</div>
+
+<p><b>As to competition</b>, it is now generally admitted that there is
+no effective competition on railways.<a name="FNanchor_15" id="FNanchor_15"></a><a href="#Footnote_15" class="fnanchor">[15]</a> In most parts of the
+country there never has been any competition, as one company
+only is available. In others, where more than one company operates,
+working arrangements have been made not only as to the
+fares and rates but also as to time of trains, thus precluding
+any effective competition. In the very nature of things no
+competition can be effective in a system of railway transit.</p>
+
+<p>As to the questions of <b>officialism</b> and <b>difficulties of obtaining
+redress</b>, can anyone suggest that these are less in the case of
+private companies, responsible to no one but themselves, than
+in the case of a Government Department with a Cabinet Minister
+at the head who is responsible to Parliament? A vote of censure
+is one of the most powerful weapons in Constitutional countries
+against any serious abuse in a Government Department.</p>
+
+<p>Mr. Edwin A. Pratt, in his book before referred to, cannot but
+admit the cogency of the argument in favour of the amalgamation
+and unification of the railways, but urges that this should be
+accomplished by the amalgamation of the whole of the existing
+railways into <b>a Trust or Traffic Board</b>. The answer to this is
+that when once constituted, even though appointed by Parliament,
+such a Board <b>is responsible to no one but itself</b>, and, however
+eminent may be the directors or managers, the want of
+ultimate responsibility inevitably and unconsciously leads to
+abuses. <b>Can any instance be adduced of the successful working
+of any such large Trust or Board?</b> On the other hand, instances<span class="pagenum"><a name="Page_43" id="Page_43">[43]</a></span>
+are well known to the contrary. One of these was the notorious
+Metropolitan Board of Works. And is it certain that the Metropolitan
+Water Board and the Port of London Authority, both of
+which are constituted on similar lines, will answer all the expectations
+which were formed of them?</p>
+
+<p>There are, of course, difficulties inherent in the administration
+of a great Government Department, but, as already hinted, various
+remedies may be suggested for many of these difficulties. For
+instance, there might be elected <b>a Railway Council</b> or Standing
+Committee in Parliament, consisting of representatives of several
+large districts of the United Kingdom, and of which the “Minister
+of Transport” would be, ex-officio, the President. In the
+first instance possibly some of the present directors of railway
+companies, many of whom are already in Parliament, could be
+members of this Council. Any proposals for improvements, extensions
+or alterations in the services of the railway or Post Office
+would be submitted to and decided upon by this Council or Committee,
+subject to an appeal to Parliament on questions of principle
+or finance. This would be one means of obviating an objection
+found in some countries where the railways are owned by the
+State, namely, the continual trivial complaints made in Parliament
+about the railways.</p>
+
+<p>A further suggestion is that a <b>special Railway Court</b> should
+be established in London with branches in every important centre,
+and presided over by competent arbitrators to determine and
+adjudicate upon claims against the Department for personal
+injuries to passengers and servants, or for loss of or damage to
+goods, or by reason of delay, any one accident, involving a large
+number of claims, being dealt with by the same Court instead of
+being, as now, the subject of innumerable actions at law in the
+ordinary Courts. This Railway Court might also be useful in
+settling disputes between the Government and the men.</p>
+
+<h3>OTHER OBJECTIONS.</h3>
+
+<p>Apart from the objection to State ownership there are no doubt
+many who are now deriving income from railways who will fear
+that their interests may be prejudiced by the proposed change.
+Fortunately <b>there can be but very few who will be thus prejudiced</b>.
+As to the existing staffs, such as booking clerks and the Railway
+Clearing House staff, whose services would no longer be required
+in those particular departments, there ought to be more than
+sufficient vacancies for these in other but more necessary branches
+of the railway service, especially in view of the increased traffic
+which is sure to arise.</p>
+
+<p><b>Many traders</b> who may at first sight consider that their profits
+would suffer if the scheme is adopted <b>will find</b> on further consideration
+<b>that the benefits</b> they will have by the proposed scheme
+<b>will be greater</b> than any loss they could possibly sustain. To take
+one instance. <b>Newspaper proprietors</b> may consider that upon<span class="pagenum"><a name="Page_44" id="Page_44">[44]</a></span>
+railways being nationalised they would lose the benefit of the
+extensive and remunerative advertisements they now receive
+from competing railway companies. So far from there being
+any loss, there will be profits, partly by the official
+announcements which the Department will cause to be inserted in
+all newspapers of time tables, rates, etc., but even more so by the
+enormous saving in the carriage of paper and of the newspapers,
+in travelling expenses of special correspondents and others, and
+by the additional profits arising from increased circulation which
+is sure to follow upon the increased facility and cheapness of
+distribution.</p>
+
+<p>Mr. W. M. Acworth, the well-known railway expert, to whom
+I submitted a rough draft of this pamphlet, was kind enough,
+while refraining from any detailed criticism, to call my attention
+to what he considered a difficulty in my proposals. He says:</p>
+
+<div class="blockquote">
+
+<p>“The fundamental objection to a scheme of average fares
+and rates is that people whose fares and goods rates are
+‘averaged up’ will, so far as possible, cease to use the
+trains; those whose fares and rates are ‘averaged down’
+will increase enormously, with a corresponding increase in
+working expenses. Have you appreciated that under your
+scheme a passenger from London to Glasgow would, in
+fact, in most cases pay, not 1s., but 3d. or 4d., by taking
+local tickets from London to Birmingham, Birmingham to
+Crewe, etc?”</p>
+
+</div>
+
+<p>And he instances the Hungarian zone system, which has completely
+broken down, as a case in point.</p>
+
+<p>My answer to this is, first, that according to my scheme there
+is no “averaging up;” the flat fares are all “averaged down”
+to the minimum. Secondly, while welcoming the admission that
+the effect of “averaging down” is to increase the traffic “enormously,”
+I am sure that Mr. Acworth himself does not mean
+that the working expenses will increase in anything like the same
+proportion. He has himself pointed out in an article on railways<a name="FNanchor_16" id="FNanchor_16"></a><a href="#Footnote_16" class="fnanchor">[16]</a>
+that the train cost of carrying 200 passengers and 10 passengers
+is practically the same. Further reasons for this fact are given
+under the heading of “Working Expenses” in this pamphlet.
+Thirdly, while admitting that under my scheme a passenger might,
+by taking three local trains which stop at all stations travel from
+London to Glasgow for 3d., I can hardly imagine that any but
+the smallest percentage of travellers would endeavour to save
+9d. by taking a journey in which they would spend sixteen hours
+and have two changes at least, instead of travelling the same
+distance by one train, in eight hours, for 1s. As to the zone
+system, the whole advantage of the flat rate or uniform fare is
+lost by the difficulty of passing from one zone to the other.</p>
+
+<div class="footnotes">
+
+<h3>FOOTNOTES</h3>
+
+<div class="footnote">
+
+<p><a name="Footnote_6" id="Footnote_6"></a><a href="#FNanchor_6"><span class="label">[6]</span></a> “On Municipal and National Trading” by The Rt. Hon. Lord Avebury. Published by Macmillan
+& Co., 1907. Price 2/6.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_7" id="Footnote_7"></a><a href="#FNanchor_7"><span class="label">[7]</span></a> “The Case Against Railway Nationalisation” by Edwin A. Pratt. Published by Collins, 1913.
+Price 1/-.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_8" id="Footnote_8"></a><a href="#FNanchor_8"><span class="label">[8]</span></a> “On Municipal and National Trading,” pp. 56-92.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_9" id="Footnote_9"></a><a href="#FNanchor_9"><span class="label">[9]</span></a> While this pamphlet has been in the Press, there has been a strike of the Leeds Municipal
+workers, and the threat of a strike in the Post Office. It will be interesting to see whether the
+considerations above mentioned under existing conditions will be borne out, and still more if
+when the causes are ascertained, it can be proved that had the principles here advocated been
+carried out in practice, there would have been no strike, nor any threat of one.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_10" id="Footnote_10"></a><a href="#FNanchor_10"><span class="label">[10]</span></a> On Municipal and National Trading, p. 109.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_11" id="Footnote_11"></a><a href="#FNanchor_11"><span class="label">[11]</span></a> Ibid, Chapter VII.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_12" id="Footnote_12"></a><a href="#FNanchor_12"><span class="label">[12]</span></a> On Municipal and National Trading, p. 107.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_13" id="Footnote_13"></a><a href="#FNanchor_13"><span class="label">[13]</span></a> “On Municipal and National Trading,” page 10.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_14" id="Footnote_14"></a><a href="#FNanchor_14"><span class="label">[14]</span></a> “Westminster Gazette” of December 2nd, 1913.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_15" id="Footnote_15"></a><a href="#FNanchor_15"><span class="label">[15]</span></a> See “The Railways of Great Britain” by Lord Monkswell. (Smith, Elder & Co., 1913.
+Price 6/-). A most interesting book, published since this pamphlet was written.—Lord
+Monkswell is not an advocate of nationalisation, but apparently has an open mind.—He admits
+that England is now only served by five groups of railways, and that there is no effective competition.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_16" id="Footnote_16"></a><a href="#FNanchor_16"><span class="label">[16]</span></a> In Palgrave’s “Encyclopædia of Political Economy,” Vol. III. (1899), Article on Railways, signed
+W.M.A.</p>
+
+</div>
+
+</div>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_45" id="Page_45">[45]</a></span></p>
+
+<h2 id="CHAPTER_V">CHAPTER V.<br />
+FINANCE OF THE SCHEME.</h2>
+
+<p>The final and most important criticism of the scheme will be
+on the matter of finance.</p>
+
+<p>The question is, can a sufficient revenue be obtained from the
+small uniform fares and rates proposed, after providing for working
+expenses, to pay not only interest on the purchase money but
+the purchase money itself?</p>
+
+<p>It is a curious coincidence that in the year 1838, before Penny
+Postage was instituted, the average amount received for every
+chargeable letter was 7d. and a fraction—the actual average railway
+fare now paid by every passenger (excluding season tickets).</p>
+
+<p>The number of letters carried during the first complete year
+after the uniform rate of 1d. was adopted was more than doubled.
+Notwithstanding this the deficiency in net revenue was about
+£2,000,000, and the deficiency was made good out of general
+revenue, this being well worth while owing to the great benefit
+to the nation of Penny Postage.</p>
+
+<p>In the case of railways, however, the amount involved is so
+large that no Government could be expected to give any consideration
+to a proposal which would involve making good so large a
+deficiency as would be occasioned by the reduction to a flat rate
+of 1d. As will be gathered from the remarks made when dealing
+with the principles of the scheme, this difficulty is now overcome
+by dividing the traffic on railways, both of passengers and goods,
+into two kinds of service, namely, Fast and Slow. It will be
+found that by this means <b>no greater percentages of increase of
+traffic will be required to produce the same gross revenue as at
+present than 15 per cent. of passenger traffic and 10 per cent. of
+goods traffic</b>. It will also be shown that if the increase of traffic
+should not exceed this estimate the additional working expenses
+will be so small that they would be more than met by the economies
+effected by unification. If these propositions prove to be
+true, then there will be no deficiency to be provided for.</p>
+
+<p>It is necessary in order to prove this to set out the figures of
+the present receipts and expenses, and an estimate of the same
+under the proposed new scheme.</p>
+
+<p><span class="pagenum"><a name="Page_46" id="Page_46">[46]</a></span></p>
+
+<h3>PRESENT FIGURES.</h3>
+
+<p>The following are in round sums the average figures for the
+two years 1911 and 1912, based on the Railway Returns published
+by the Board of Trade annually under the Regulations of Railways
+Act, 1871:—</p>
+
+<table summary="Summary of Railway Return figures">
+ <tr>
+ <td colspan="3"><b>(<i>a</i>) Passenger traffic receipts.</b></td>
+ </tr>
+ <tr>
+ <td colspan="2" class="indent">Season ticket holders</td>
+ <td class="tdr">£5,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="2" class="indent">Other passengers</td>
+ <td class="tdr">40,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="2" class="indent">Total from passengers only</td>
+ <td class="tdr total">45,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="2" class="indent">Mails and goods by passenger trains</td>
+ <td class="tdr">10,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="2" class="indent">Total from passenger traffic</td>
+ <td class="tdr total">55,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="3"><b>(<i>b</i>) Goods traffic receipts.</b></td>
+ </tr>
+ <tr>
+ <td class="indent">Minerals</td>
+ <td class="tdr">£30,000,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td class="indent">General merchandise</td>
+ <td class="tdr">32,500,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td class="indent">Livestock</td>
+ <td class="tdr">1,500,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td class="total"></td>
+ <td class="tdr">64,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="3"><b>(<i>c</i>) Miscellaneous receipts.</b></td>
+ </tr>
+ <tr>
+ <td class="indent">Steamboats, docks, etc.</td>
+ <td class="tdr">5,000,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td class="indent">Hotels, rents, etc.</td>
+ <td class="tdr">5,000,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td class="total"></td>
+ <td class="tdr">10,000,000</td>
+ </tr>
+ <tr>
+ <td class="indent">Grand Total</td>
+ <td></td>
+ <td class="tdr total">£129,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="3"><b>Expenditure.</b></td>
+ </tr>
+ <tr>
+ <td class="indent">Maintenance of ways, works, stations, docks, etc.</td>
+ <td class="tdr">18,000,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td class="indent">Traffic expenses</td>
+ <td class="tdr">23,000,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td class="indent">Locomotive and rolling stock expenses</td>
+ <td class="tdr">28,000,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td class="indent">General charges, rates and taxes</td>
+ <td class="tdr">12,000,000</td>
+ <td></td>
+ </tr>
+ <tr>
+ <td></td>
+ <td class="total"></td>
+ <td class="tdr">81,000,000</td>
+ </tr>
+ <tr>
+ <td class="indent"><b>Net receipts</b></td>
+ <td></td>
+ <td class="tdr total bb">£48,000,000</td>
+ </tr>
+</table>
+
+<p><span class="pagenum"><a name="Page_47" id="Page_47">[47]</a></span></p>
+
+<table summary="Passengers and classes of travel">
+ <tr>
+ <td class="hang"><b>Total number of passenger journeys</b>, including season ticket
+ holders (assuming that each annual ticket represents 200 double journeys
+ per annum only), about</td>
+ <td class="tdr valign-b">1,620,000,000</td>
+ </tr>
+ <tr>
+ <td class="hang">Of this total there were first or second class passengers about</td>
+ <td class="tdr valign-b">160,000,000</td>
+ </tr>
+ <tr>
+ <td class="hang">That is, about 10% of the total number carried.</td>
+ <td></td>
+ </tr>
+</table>
+
+<p><b>The average fare for every journey is therefore 6½d.</b></p>
+
+<p>In other words, if every passenger paid for every single
+journey, long or short, the sum of 6½d., then the gross receipts
+from passengers would be about the same amount as is now
+received.</p>
+
+<p><b>Total tonnage of goods</b> per goods train:</p>
+
+<table summary="Goods carried, values thereof">
+ <tr>
+ <td>Minerals</td>
+ <td>Tons</td>
+ <td class="tdr">410,000,000</td>
+ </tr>
+ <tr>
+ <td class="sub">The receipts as above for these represent<br /><b>an average of 1/6 per ton.</b></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>General Merchandise</td>
+ <td>Tons</td>
+ <td class="tdr">114,000,000</td>
+ </tr>
+ <tr>
+ <td class="sub">The receipts for these as above represent<br /><b>an average of 6/- per ton.</b></td>
+ <td></td>
+ <td></td>
+ </tr>
+ <tr>
+ <td>Total tonnage per Goods Train</td>
+ <td>Tons</td>
+ <td class="tdr total bb">524,000,000</td>
+ </tr>
+</table>
+
+<p>The total receipts for the two kinds of merchandise together
+<b>show an average of 2s. 4d. per ton.</b></p>
+
+<p>Note that the total tonnage of minerals carried is about four
+times that of general merchandise.</p>
+
+<p>The total tonnage may be less than the above, owing to overlapping
+of the various companies, but for the purpose of my
+estimates I am taking these official figures.</p>
+
+<h3>ESTIMATES UNDER PROPOSED SCHEME.</h3>
+
+<h4>(<i>a</i>) As to passenger traffic.</h4>
+
+<p>There is, of course, no official return as to the proportions
+of Main line and Local passenger traffic, but it is clear that
+the percentage of small fares must be very great. Assume that
+this is over 80 per cent., then there would be in round figures
+about 300,000,000 (that is under 20 per cent.) of Main line
+passenger journeys, and assuming that the number of first class
+passengers will be only 10 per cent. (the above average percentage
+of first and second class passengers), then the revenue from the
+existing number of passengers under the new scheme would be
+as follows:—</p>
+
+<p><span class="pagenum"><a name="Page_48" id="Page_48">[48]</a></span></p>
+
+<table summary="Revenue from passengers">
+ <tr>
+ <td class="nowrap"><b>Main Line</b></td>
+ <td class="tdr">300,000,000</td>
+ <td>at 1/- equals</td>
+ <td class="tdr">£15,000,000</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td class="sub">of whom 30,000,000 at an additional 4/- for First Class equals</td>
+ <td class="tdr valign-b">6,000,000</td>
+ </tr>
+ <tr>
+ <td class="nowrap"><b>Local</b></td>
+ <td class="tdr">1,320,000,000</td>
+ <td>at 1d. equals</td>
+ <td class="tdr">5,500,000</td>
+ </tr>
+ <tr>
+ <td></td>
+ <td></td>
+ <td class="sub">of whom 132,000,000 at an additional 5d. for First Class equals</td>
+ <td class="tdr valign-b">2,750,000</td>
+ </tr>
+ <tr>
+ <td class="nowrap"><b>Present No.</b></td>
+ <td class="tdr total">1,620,000,000</td>
+ <td>will produce</td>
+ <td class="tdr total bb">£29,250,000</td>
+ </tr>
+</table>
+
+<p class="noindent">as against the present total of £45,000,000, or a deficiency of
+about £16,000,000 per annum, assuming there should be no increase
+in the existing traffic. This seems an appalling deficiency,
+but “Wait and See!”</p>
+
+<p>It is quite clear that there would be a very large increase of
+traffic, more particularly of the long distance or Main line passengers,
+as under the existing system the fares for short distances
+up to 12 or even 20 miles are sufficiently low to remove practically
+all restrictions. In the case of long distances, however, there
+is this double restriction for passengers—namely, the time occupied
+and the high price of the fares. If the latter restriction is removed
+a very large increase of traffic is sure to result, not only for
+purposes of pleasure but also for business and trade purposes.
+The Local traffic will also increase partly by reason of the
+increased number of long distance passengers requiring the use
+of the Local lines (both suburban and small branch lines), and
+partly by the reduction to 1d. of many of the present suburban
+fares. In order, however, to be on the safe side in the estimate,
+I propose to take no account of any increase in Local passengers
+and to reckon only the increase required in the number of
+Main line passenger journeys. It will then be found that
+250,000,000 more Main line passengers will provide for the above
+large yearly deficiency, as follows:—</p>
+
+<table summary="How passenger increases will pay">
+ <tr>
+ <td></td>
+ <td class="tdr">250,000,000</td>
+ <td>at 1/-</td>
+ <td class="tdr">£12,500,000</td>
+ </tr>
+ <tr>
+ <td>Add</td>
+ <td class="tdr">25,000,000</td>
+ <td>at 4/- for First Class</td>
+ <td class="tdr">5,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="3"></td>
+ <td class="tdr total bb">£17,500,000</td>
+ </tr>
+</table>
+
+<p>This will bring the gross receipts from passengers to
+£46,750,000, with <b>an increase of about 15 per cent. only</b> on the
+present total number of passengers carried, and £1,750,000 more
+revenue.</p>
+
+<p>The criticism may be made, however, that this number is
+nearly double the existing number of long distance passengers.
+Will such an increase be realised?</p>
+
+<p><span class="pagenum"><a name="Page_49" id="Page_49">[49]</a></span></p>
+
+<p>From a consideration of the following reasons it is submitted
+that not only will it be so, but that in point of fact a much larger
+increase may reasonably be anticipated.</p>
+
+<div class="blockquote-list">
+
+<p>1. No account as to passenger traffic has been taken of
+the normal increase in the number of passengers which
+has continued to increase regularly with the increase
+of population.</p>
+
+<p>2. Under the proposed scheme the uniform fares are for
+<i>as far as the train travels only</i>, so that a journey say
+from London to Londonderry will involve at least three
+1s. tickets, one to Holyhead, a second from Holyhead
+to Dublin, and a third from Dublin to Londonderry,
+whereas under the present system one through ticket
+would be purchased and would appear in the official
+returns as one journey only.</p>
+
+<p>3. In practice nearly every single journey undertaken
+means <i>a return journey home</i>, so that an increase of
+250,000,000 more passenger journeys does not involve
+a greater increase in the movement of the population
+than is represented by, say, 150,000,000 passengers.</p>
+
+<p>4. If the number of passengers carried by the railways is
+compared with the population it may be noted that
+the total number of passengers carried last year in
+the Tube and Suburban Railways of London, with a
+population of between six and seven millions, was
+about 500,000,000 in addition to about the same number
+carried by omnibuses, and a further similar number
+by tramways. A similar proportion of railway passengers
+to the population of the United Kingdom of nearly
+50 millions would be over 4,000,000,000 per annum,
+so that an actual total of 1,850,000,000 would undoubtedly
+be much less than may reasonably be anticipated.</p>
+
+<p>5. It is not only the increased number of people who would
+travel to and from all parts of the country who now
+cannot or will not do so on account of the expense,
+but also the increase in the number of journeys undertaken
+by existing travellers. Parents living in remote
+parts of the country whose children work in large
+towns and who, on account of high fares, cannot visit
+each other, business men and commercial travellers
+who will multiply their long distance journeys for business
+purposes if they can do for 2s. what now costs
+10 or 20 times as much, are a few among many classes
+who will swell the number. It will be remembered that
+by far the greater proportion of the population are
+those in receipt of an income of less than £3 per week
+to whom any fares of 10s. or over are prohibitive
+except in extreme cases.</p>
+
+</div>
+
+<p><span class="pagenum"><a name="Page_50" id="Page_50">[50]</a></span></p>
+
+<p>Let me give one very homely illustration which has come
+under my notice. A domestic servant in London had a serious
+illness, necessitating an operation at one of the hospitals. Her
+parents lived in humble circumstances in a Cornish village. The
+mother came to London and had to pay £2 for a return ticket.
+Her daughter had to remain about two months in the hospital
+while the mother had to return home without being able to afford
+the luxury of another return journey to London. But during the
+whole of that time trains were going to and from the same place
+every day and night with plenty of room for the old lady, who
+could, of course, have been carried any number of times without
+any appreciable cost to the company.</p>
+
+<p>Now, suppose the uniform fare of 1s. each way had come into
+operation, she or some other member of the family would, no
+doubt, have come up at least once a week, and instead of one
+return ticket which cost £2, and would be included in the Board
+of Trade returns as two passenger journeys, the family would
+have only paid 16s. for the eight double journeys, the extra cost
+to the Government would be nil and the increase in the number
+of passenger journeys would be 14.</p>
+
+<p>It is not unusual to see long distance trains arrive in London
+with not more than 15 or 20 passengers.</p>
+
+<h4>(<i>b</i>) As to goods traffic.</h4>
+
+<p>For the purposes of the estimates of goods traffic there must
+be added to existing total receipts from goods train traffic the
+amount included in the official returns under the head of “passenger
+traffic” of £10,000,000 received for mails, luggage,
+and other goods carried by passenger trains, making the total
+revenue for goods at present of £74,000,000. There is no official
+Return as to the tonnage of goods carried by passenger trains, but
+assuming that the present average rate for goods carried by
+passenger trains is £2 per ton, this would represent a further
+tonnage, irrespective of passengers’ luggage, of 20,000,000 tons.</p>
+
+<p>The figures under the new scheme, if there should be no increase
+in the tonnage carried, and assuming that goods by fast
+service should be no more than the amount now estimated per
+passenger train, would thus be as follows:—</p>
+
+<table summary="Figures under the new scheme">
+ <tr>
+ <td>By slow service</td>
+ <td class="tdr">524,000,000</td>
+ <td>tons</td>
+ <td>at</td>
+ <td class="tdr">1/6</td>
+ <td class="tdr">£39,300,000</td>
+ </tr>
+ <tr>
+ <td>By fast service</td>
+ <td class="tdr">20,000,000</td>
+ <td class="tdc">”</td>
+ <td class="tdc">”</td>
+ <td class="tdr">10/-</td>
+ <td class="tdr">10,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="5">Live Stock, as now</td>
+ <td class="tdr">1,500,000</td>
+ </tr>
+ <tr>
+ <td colspan="5"></td>
+ <td class="tdr total">£50,800,000</td>
+ </tr>
+ <tr>
+ <td colspan="5">Thus showing a deficiency of about</td>
+ <td class="tdr">23,200,000</td>
+ </tr>
+ <tr>
+ <td colspan="5">as against the present total of</td>
+ <td class="tdr total bb">£74,000,000</td>
+ </tr>
+</table>
+
+<p><span class="pagenum"><a name="Page_51" id="Page_51">[51]</a></span></p>
+
+<p>Following the analogy of the passenger traffic, I will only
+estimate for an increased traffic by fast trains, and for this
+purpose there will be required:—</p>
+
+<div class="blockquote">
+
+<p>48,000,000 tons, which at 10s. equals £24,000,000, and will
+bring the total to £800,000 more than the present total receipts
+from goods, by both passenger and goods trains.</p>
+
+</div>
+
+<p>This increased tonnage it will be seen is <b>an increase of under
+10 per cent.</b> on the present total of 550,000,000 tons. It is
+probable that with a reduction of freight per fast train to the
+uniform rate of 10s. per ton, a considerable proportion of existing
+goods train traffic would be transferred to fast trains, so that the
+same figure might be arrived at with much less increase in tonnage.
+This fact may also be taken into account when adjusting any
+mistake in the official figures of the total tonnage carried.</p>
+
+<p>As in the case of passenger traffic, this percentage is surely
+not only a reasonable estimate, but one which may reasonably be
+anticipated, and, further, the increase will be progressive.</p>
+
+<p>The following among other reasons may be adduced:—</p>
+
+<div class="blockquote-list">
+
+<p>1. The <b>example of the Post Office</b> is the best precedent
+that can be given of the result of the adoption of a
+minimum uniform rate. In the year before the introduction
+of Penny Post the number of letters per head
+of population was only three. This number is now
+72, irrespective of postcards and parcels, and it is
+still increasing. The number of letters carried in 1838
+was 70,000,000. In the first complete year after the
+Penny Post was established this number was doubled.
+In 1863 it had multiplied by eight times, and since
+then it has been doubled in about every period of 20
+years.</p>
+
+<p>2. The large amount of <b>goods sent now by road</b>, especially
+in recent years by motors and steam tractors on account
+not only of the heavy railway rates but also the cost
+of loading and unloading, would with uniform rates
+be sent by rail. In this connection it may be mentioned
+that a very considerable increase of carriage by trolley
+trucks of loaded carts and pantechnicons, or of the
+“containers” advocated by the New Transport Company,
+Limited, thus avoiding both shunting and the
+double expense of packing and unpacking, may reasonably
+be anticipated.</p>
+
+<p>3. A still greater increase in fast train traffic may be expected
+in <b>perishable articles</b>, such as fruit, fish,
+milk and dairy produce. The so-called reduced rates
+now in force for instance for carriage of fresh fruit
+vary from 1s. 6d. per cwt. (equals £1 10s. per ton),<span class="pagenum"><a name="Page_52" id="Page_52">[52]</a></span>
+from Hampshire to London up to as much as 8s. per
+cwt. (equals £8 per ton), from Hampshire to Scotland,
+these rates being “reduced” on account of the
+large amount of fruit (strawberries), requiring in the
+season special trains carrying nothing but fruit. The
+rates for the same goods from other parts where the
+quantity is not so considerable are in some cases more
+than double, so that the farmers cannot afford to send
+the goods. The rates for fish are similar, and the
+same considerations apply, so that very little is consigned
+to town except from fishing centres like Grimsby
+where large quantities are available.</p>
+
+<p>4. <b>With a regular service</b> from every station, village stations
+as well as the large towns, and <b>similar to the
+present postal service</b>, in fact forming an extension to
+all goods of the present Parcels Post service, no one
+can doubt that the total increase will be considerably
+more than the 10 per cent. estimated for.</p>
+
+</div>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_53" id="Page_53">[53]</a></span></p>
+
+<h2 id="CHAPTER_VI">CHAPTER VI.<br />
+WORKING EXPENSES.</h2>
+
+<p>Most critics will contend that the increased traffic will lead
+to an enormous increase of working expenses.</p>
+
+<p>In the first place allowance must be made for the several
+economies in management occasioned by the amalgamation of the
+whole railway systems in one and with the Post Office as already
+mentioned, and of which the following is a brief list, viz.:—</p>
+
+<p>Abolition of,</p>
+
+<div class="blockquote-list">
+
+<p>(<i>a</i>) The Clearing House,</p>
+
+<p>(<i>b</i>) Separate boards of directors and clerical staffs,</p>
+
+<p>(<i>c</i>) Legal and Parliamentary expenses,</p>
+
+<p>(<i>d</i>) Advertisements,</p>
+
+<p>(<i>e</i>) Book-keeping, printing and booking clerks now required
+for differential fares and rates.</p>
+
+</div>
+
+<p>Economies by avoiding,</p>
+
+<div class="blockquote-list">
+
+<p>(<i>a</i>) Competing Receiving Offices, Post Offices or stations
+in same localities,</p>
+
+<p>(<i>b</i>) Competing trains,</p>
+
+<p>(<i>c</i>) The waste of rolling stock now occasioned by the ownership
+of different companies, instead of being used
+according to the requirements of traffic.</p>
+
+</div>
+
+<p>The latter has already been referred to in Chapter II.
+A further proof of a practical nature was given by Mr.
+Oliver Bury, the retiring General Manager of the Great
+Northern Railway in 1912, who then said that after the working
+arrangement with the Great Central Railway had been entered
+into, although there had been an increase of 4,000,000 tons of
+merchandise carried, this additional traffic had actually been
+worked with a decrease in the goods train mileage of 1,000,000.</p>
+
+<p>Apart from all these economies, <b>the working expenses
+cannot increase proportionately with the increase of traffic</b>.
+Most of the long distance passenger trains now running,
+except on special occasions or holiday time, could easily<span class="pagenum"><a name="Page_54" id="Page_54">[54]</a></span>
+hold twice the number of passengers with but little, if any,
+appreciable increase in the cost of haulage. It must be remembered
+that a sufficiently powerful locomotive and sufficient coal
+must be provided for every passenger train, on the assumption
+that it will be full, whether it leaves with a full complement of
+passengers or not. Therefore, even though the number of passengers
+now carried were to be doubled in the case of all Main line
+trains very little increase in the working expenses would result,
+certainly not so much as the saving effected by the various economies
+mentioned. So far as goods traffic is concerned, an increase
+of 10 per cent. only, as estimated in the tonnage would certainly
+not cause any great increase in the expenditure. If, on the other
+hand, the increase of traffic should be very much more than the
+percentages mentioned (as may very likely be the case), then the
+revenue derived will be more than sufficient to provide whatever
+additional working expenses there may be. The expenses of the
+important items (which constitute probably 50 per cent. of working
+expenses) of permanent ways, stations, signal boxes, and
+general establishment charges would not be seriously affected by
+increase of traffic, only the rolling stock, coal, and part of the
+staff.</p>
+
+<p>In addition to these economies, and others set out more fully
+in Chapter II., there will also be great economy in the working
+expenses of the Post Office itself, including the telegraph and
+telephone services. The actual effect of the amalgamation of the
+two services of railways and Post Office on the total working
+expenses of the combined services cannot be estimated with any
+degree of accuracy, but there can be no doubt that it will result
+in large economies. The working expenses of both, must, of
+course, be lumped together. No advantage can possibly be gained
+by attempting to separate the expenses of various branches of one
+State Department. This has actually been attempted in the case
+of the telegraph service, one of the numerous branches of the
+Post Office. It has been continually asserted that this service
+has been, and is being, carried on at a loss, especially since the
+introduction of the sixpenny rate. This assertion has always been
+an enigma to me, for how any proper apportionment of the working
+expenses of over 20,000 Post Offices throughout the United
+Kingdom can be made, in order to ascertain what proportion is
+to be attributed to the telegraph service alone, passes comprehension!</p>
+
+<p>That this impossible task has been attempted, and apparently
+carried out to the satisfaction of some persons in authority, does
+not prove that the alleged loss has actually been made, but only
+that a large amount of time and expense has been lost in elaborate
+and costly calculations, which can be of no possible advantage to
+the service or the Country! It is to be hoped that this attempt
+will not be continued with the telephone service.</p>
+
+<p><span class="pagenum"><a name="Page_55" id="Page_55">[55]</a></span></p>
+
+<p>If, and when, the scheme proposed in this pamphlet for combining
+railways with the General Post Office is carried into effect,
+I trust that no such expensive and useless task will be attempted
+as to endeavour to ascertain what proportions respectively of the
+expenses of running the Royal Railways are to be attributed to
+carrying His Majesty’s Mails on the one hand, or His Majesty’s
+subjects and their goods on the other!</p>
+
+<p>It is quite evident that on the two services being combined a
+portion of the present working expenses of the Post Office,
+namely, those which now consist of amounts paid to the Railway
+Companies for carriage of mails, for rents of telegraph and telephone
+wires, and other services rendered, will be swallowed up
+in the general working expenses, just as the gross receipts of the
+Post Office will swell the total revenue of the combined services.</p>
+
+<p>For the purposes, however, of ascertaining what increase of
+traffic will be required to produce (<i>a</i>) the same net revenue as
+under the present system of railways, and (<i>b</i>) a sufficient revenue
+to purchase the present system, I have taken no account of the
+decrease of Postal expenses nor of the normal increase of the
+Postal Revenue. I also am assuming that notwithstanding all
+the economies referred to, the working expenses of railways will
+remain the same, or even increase, owing to higher prices of
+goods and materials and higher wages, to the round sum of
+£85,000,000.</p>
+
+<p>It will thus be apparent that ample margin has been allowed
+for any increase in working expenses that is likely to take place,
+and that allowance has been made for the whole of the existing
+staffs to be retained, whether now employed in services which
+may then be discarded or not.</p>
+
+<p>P.S.—While revising the final proofs of this pamphlet during
+the Christmas Holidays, I have noticed in the “Daily Telegraph,”
+of 24th December, 1913, a long letter signed “G.P.O.,” referring
+to an article in the same well-known newspaper of the
+previous day. The letter is printed in prominent type under the
+following heading:—</p>
+
+<p class="center">“<span class="smcap">Prehistoric Methods of Post Office Finance—Telegraph
+Service ‘Loss.’</span>”</p>
+
+<p>The correspondent, who evidently has expert knowledge of the
+subject, refers to the “alleged great loss” of the telegraph service
+as “a polite fiction.”</p>
+
+<p>His letter completely confirms the views expressed above as
+to the folly of attempting to apportion expenses of one branch of
+the service, and he places the cost of the accounts at “hundreds
+of thousands of pounds a year!”</p>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_56" id="Page_56">[56]</a></span></p>
+
+<h2 id="CHAPTER_VII">CHAPTER VII.<br />
+TERMS OF PURCHASE.</h2>
+
+<p>If the railway system be purchased by the nation it
+will be in contemplation as <b>a business proposition</b> to repay the
+capital expended in the purchase, and this means, therefore, that
+if this scheme is a practicable one <b>the shareholders and stockholders
+of the present companies will be able to receive back
+their capital</b>, although, under existing conditions, this appears
+absolutely hopeless. It is therefore now proposed to consider
+upon what terms the railways can be purchased and how the
+purchase money can be provided.</p>
+
+<p>1. By the Railway Act of 1844 the Government is empowered
+to purchase every railway company formed after that date. The
+price fixed is the equivalent of 25 years’ purchase of the average
+annual divisible profits for three years before such purchase,
+subject to the proviso that any company whose divisible profits
+are less than 10 per cent. on its capital is at liberty to have the
+terms of purchase fixed by arbitration. At the date of this Act
+most of the Trunk lines, to the extent of about 2,300 miles had
+already been constructed and are not therefore subject to the
+provisions of this Act, but as the total length of lines open in
+1911 was 23,417 miles, it will be observed that the Act applies to
+90 per cent. of the whole railway system.</p>
+
+<p>Notwithstanding this, there are undoubted difficulties in
+estimating the actual purchase price, having regard to the fact
+that the majority of the smaller companies, including the modern
+Tube Railways with their large prospective profits, and probably
+the whole of the Irish railways, pay less than 10 per cent. and
+would, therefore, be entitled to arbitration.</p>
+
+<p>There is, however, another precedent, viz., (2) The Indian
+State Railways, which have been actually purchased by the
+Government from the private companies by whom they were
+owned.</p>
+
+<p>The dates and terms of purchase of these railways are included
+in an official return of railways acquired by the Government.
+This return was issued by the Board of Trade in 1908, pursuant
+to an order of the House of Commons.<a name="FNanchor_17" id="FNanchor_17"></a><a href="#Footnote_17" class="fnanchor">[17]</a> In India the railway<span class="pagenum"><a name="Page_57" id="Page_57">[57]</a></span>
+undertakings of 16 separate companies were acquired by the State
+between the years 1868 and 1906. Of these companies six were
+purchased at a price mutually agreed upon between the Government
+and the companies, these being small companies, and the
+purchase moneys varying from £30,000 to £300,000. Three companies
+were acquired at a purchase price equal to the share capital.
+The remaining seven companies were purchased for a sum equal
+to the value of the shares calculated at the mean market price
+during the three years preceding the date on which notice of
+purchase was given. In addition to payment of the purchase price
+the Government assumed the liabilities of the company in respect
+of debentures and debenture stock. Four of these companies (the
+larger ones) were, under an option reserved by the contracts, paid
+by annuities spread over 73 or 74 years. One of these, the East
+Indian Company, was purchased in 1879 at the price, calculated
+on the above basis, of £32,750,000, payable by an annuity of
+£1,473,750 for the term of 73 years from 1880. This amounts
+exactly to 4¼ per cent. on the purchase money, and will cease to
+be payable after the year 1953.</p>
+
+<p>In addition to this annuity, interest is paid on the debentures
+and loans amounting altogether to about £16,500,000, the interest
+whereon is about £500,000 or a little over 3 per cent.</p>
+
+<p>If the Act of 1844 were now applicable to the whole of the
+companies in the United Kingdom, and if we assume that by the
+time when the option to purchase is exercised the net profits of
+£48,000,000 in 1911 shall have risen to £50,000,000, the purchase
+money would be 25 times that sum, viz., £1,250,000,000.</p>
+
+<p>This sum is really slightly more than the total paid-up capital
+of the railways after allowing for “watered” stock.</p>
+
+<p>The following were the figures in 1911:—</p>
+
+<table summary="1911 figures">
+ <tr>
+ <td>Ordinary Stock</td>
+ <td class="tdr">£493,484,151</td>
+ </tr>
+ <tr>
+ <td>Preference and Guaranteed Stock</td>
+ <td class="tdr">473,073,163</td>
+ </tr>
+ <tr>
+ <td>Loans and Debentures</td>
+ <td class="tdr">357,461,047</td>
+ </tr>
+ <tr>
+ <td><b>Total paid-up Capital</b></td>
+ <td class="tdr total bb">£1,324,018,361</td>
+ </tr>
+</table>
+
+<p>There is included in this total, stock to the nominal value of
+£198,000,000, or approximately 15 per cent., which represents
+nominal additions made on consolidations and divisions of stock,
+and commonly known as “watered” stock.</p>
+
+<p>It will be noticed that the present net revenue of £48,000,000
+only represents an average of about 3½ per cent. on this total
+paid-up capital. The total paid-up capital in the returns recently
+published for 1912 is £1,334,963,518.</p>
+
+<p>The Railway Nationalisation Society has prepared heads of a
+Bill in Parliament, providing that the price to be paid for the
+whole of the railways shall be calculated on the basis of the<span class="pagenum"><a name="Page_58" id="Page_58">[58]</a></span>
+Act of 1844. No doubt this would be opposed by holders
+of railway stocks and shares, having regard to the fact that the
+result might be in effect to merely return the capital, no account
+being taken of profits. If the purchase of the railways is to be
+considered as “a business proposition” it will be necessary to look
+fairly at both sides of the question, and endeavour if possible
+to arrange terms which will not prove an injustice to the present
+owners, and at the same time will be such as can be provided
+for out of the ordinary revenue of the railways without financial
+loss to the nation.</p>
+
+<p>It must be remembered that shareholders or their predecessors
+invested their money with the reasonable and proper expectation
+of having an adequate return for it. No doubt they put down
+their capital with the primary, possibly the sole, object of benefiting
+themselves, but the fact remains that their capital has been
+the means of providing the splendid net-work of British Railways
+now available for the nation to purchase.</p>
+
+<p>On the other hand, railway stock and shareholders must
+recognise that their position under the present system is by no
+means an enviable one. Many of them have for years been in
+receipt of no dividend whatever. In no case has there been any
+attempt at repayment of capital moneys, nor does there seem
+any prospect of it. The average net annual receipts now earned
+by the whole of the companies is only a fraction over 3½ per
+cent., and this percentage (which is less than before the year
+1870) has for the last few years been practically stationary.
+The working expenses have been increasing to such an extent by
+reason of the increase of wages and price of materials that last
+year the companies decided on an all-round increase in fares and
+rates. According to the latest returns this has already been to
+a large extent counteracted by a decrease in traffic.</p>
+
+<p>If, therefore, an offer were made by the Government to purchase
+the whole of the railways upon similar terms to those on
+which the East Indian Railway was acquired, namely for a sum
+equal to the mean market price of the shares during the three
+years preceding the year in which the Act to acquire the railways
+is introduced, it is submitted that there could be no effective
+opposition to the proposal. In effect this would mean a purchase
+at a price which is the value the public to-day put upon each line
+of railway. The only practical difficulty of this proposal will
+be to ascertain the market value of the shares of some of the
+smaller companies, many of which are held by the larger companies.</p>
+
+<p>In order, however, to avoid under-estimating the amount required,
+I suggest for the purposes of my argument that the
+Government and the companies mutually agree on a total sum of
+£1,350,000,000 as the purchase price of all the undertakings of<span class="pagenum"><a name="Page_59" id="Page_59">[59]</a></span>
+the companies, subject to the existing liabilities for loans and
+debenture stock, now amounting to £357,500,000, which would
+be assumed by the Government. This would make a total in
+round figures of £1,700,000,000, or nearly £400,000,000 more than
+the total of the ordinary preference and guaranteed stock. Surely
+this would be an outside figure. Indeed, it might be suggested
+that the nation would be paying an excessive amount.</p>
+
+<p>Mr. E. A. Pratt gives various estimates of what the purchase
+price would probably be.<a name="FNanchor_18" id="FNanchor_18"></a><a href="#Footnote_18" class="fnanchor">[18]</a> These vary from £1,052,000,000 up to
+£1,769,847,000, an estimate of “The Railway News,” confirmed
+by the “Financier and Bullionist,” of September 7th,
+1912. “The Financial News” in 1912 suggested £1,941,865,000
+in 2½ per cent. Stock in order to yield the present annual income
+of £48,546,000.</p>
+
+<p>Taking the precedent of the East Indian Railway as a
+mode of payment and without making any allowance for better
+terms of interest which the Imperial Government might well obtain,
+it will be seen that the annual amount required to provide
+a purchase money of £1,350,000,000 and meet the above liabilities
+would be as follows:—</p>
+
+<p>Annuities at the rate of:—</p>
+
+<table summary="Annuities required">
+ <tr>
+ <td>4¼ per cent. on £1,350,000,000</td>
+ <td class="tdr">£57,375,000</td>
+ </tr>
+ <tr>
+ <td>Interest at 3 per cent. on Debentures of £360,000,000</td>
+ <td class="tdr">10,800,000</td>
+ </tr>
+ <tr>
+ <td class="tdr">Total</td>
+ <td class="tdr total bb">£68,175,000</td>
+ </tr>
+</table>
+
+<p>According to the estimates set out in Chapter V. (if no further
+increase of traffic is secured than is required for producing the
+present revenue), there would be available toward this annual
+sum required for purchase the following:—</p>
+
+<table summary="Consequences of the estimates">
+ <tr>
+ <td>Passengers</td>
+ <td class="tdr">46,750,000</td>
+ </tr>
+ <tr>
+ <td>Goods</td>
+ <td class="tdr">74,800,000</td>
+ </tr>
+ <tr>
+ <td>Miscellaneous, as now</td>
+ <td class="tdr">10,000,000</td>
+ </tr>
+ <tr>
+ <td class="tdr">Total</td>
+ <td class="tdr total">£131,550,000</td>
+ </tr>
+ <tr>
+ <td>Deduct for working expenses, as above</td>
+ <td class="tdr">85,000,000</td>
+ </tr>
+ <tr>
+ <td class="tdr">Net revenue</td>
+ <td class="tdr total">£46,550,000</td>
+ </tr>
+ <tr>
+ <td>This shows a deficiency to be made good of</td>
+ <td class="tdr">21,625,000</td>
+ </tr>
+ <tr>
+ <td>In order to make up the annual sum of</td>
+ <td class="tdr total bb">£68,175,000</td>
+ </tr>
+</table>
+
+<p><span class="pagenum"><a name="Page_60" id="Page_60">[60]</a></span></p>
+
+<p>This annual amount could be provided by the following further
+increase in passenger and goods traffic respectively, viz.:—</p>
+
+<table summary="Required further increase">
+ <tr>
+ <td class="tdr">100,000,000</td>
+ <td>passengers</td>
+ <td>at</td>
+ <td class="tdr">1/-</td>
+ <td class="tdr">£5,000,000</td>
+ </tr>
+ <tr>
+ <td class="tdr">10,000,000</td>
+ <td><span class="ditto1">”</span></td>
+ <td class="tdc">”</td>
+ <td class="tdr">4/-</td>
+ <td class="tdr">2,000,000</td>
+ </tr>
+ <tr>
+ <td class="tdr">30,000,000</td>
+ <td>tons</td>
+ <td class="tdc">”</td>
+ <td class="tdr">10/-</td>
+ <td class="tdr">15,000,000</td>
+ </tr>
+ <tr>
+ <td colspan="4" class="tdr">Total</td>
+ <td class="tdr total bb">£22,000,000</td>
+ </tr>
+</table>
+
+<p>In these estimates no account has been taken of the increased
+revenue of the Post Office, nor the increase in Local passengers
+and slow goods traffic respectively, which is sure to be realised,
+and the receipts for which would probably cover any increase in
+working expenditure. It will be noticed that if the above increase
+should be obtained the total estimated increase of passengers
+over the present totals would be as follows:—</p>
+
+<table summary="Estimated increase">
+ <tr>
+ <td>Passengers</td>
+ <td class="tdr">350,000,000 or about 21%</td>
+ </tr>
+ <tr>
+ <td>Goods</td>
+ <td class="tdr">78,000,000 or about 15%</td>
+ </tr>
+</table>
+
+<p>It is, of course, not essential to the success of the scheme
+that the whole of the increase here estimated should be obtained
+in the first year after nationalisation has been carried out, although
+it is considered that even in that short period, according
+to all precedents, so small a percentage of profits may fairly be
+anticipated. It would probably be necessary for the Government
+to raise a temporary loan for initiating the scheme, but in
+any case it appears essential that the purchase of the whole of the
+existing undertakings of the United Kingdom should be completed
+as <b>at one and the same date</b>.</p>
+
+<p>Other advocates of railway nationalisation suggest that the
+purchase should be carried out gradually, and this course has been
+followed by other nations. It is, however, of the very essence
+of the scheme here proposed that every part of the country shall
+have the benefit of the uniform fares and rates, and this would
+be impracticable unless the whole system be taken over by the
+Government at one time.</p>
+
+<p>The proposal that the price should be fixed by taking the mean
+price of stocks for the three years preceding the year in which the
+Act should be passed, is in order to avoid the market changes which
+might be caused by anticipation of purchase by the State. It is
+suggested that whatever price is taken as the basis of the purchase
+money, such price should include everything, so that the
+whole undertaking would be taken over without the necessity
+for any valuation of stock and plant, a prolific cause of so much
+trouble and expense, as in the case of the purchase of the National
+Telephone Company.</p>
+
+<p><span class="pagenum"><a name="Page_61" id="Page_61">[61]</a></span></p>
+
+<p>It may be said that the figures of the railway systems are so
+vast that it would be impracticable to cope with them in one
+transaction. Enormous as the figures must necessarily be, the
+principle is exactly the same as in other financial transactions.
+Just as the Government acquired the undertaking of the National
+Telephone Company by purchase, which took effect on one day,
+so can this much larger transaction, or series of transactions, be
+carried out. It is assumed that the existing shares and stocks
+of railway companies would be converted into Government Stock,
+all necessary apportionments being made up to a date to be named
+in the Act of Parliament authorising the acquisition of the railways.
+Upon such date the completion of the whole transaction
+will be deemed to be effected.</p>
+
+<div class="footnotes">
+
+<h3>FOOTNOTES</h3>
+
+<div class="footnote">
+
+<p><a name="Footnote_17" id="Footnote_17"></a><a href="#FNanchor_17"><span class="label">[17]</span></a> This was on the initiation of Mr. Chiozza Money, M.P.</p>
+
+</div>
+
+<div class="footnote">
+
+<p><a name="Footnote_18" id="Footnote_18"></a><a href="#FNanchor_18"><span class="label">[18]</span></a> In “The Case against Nationalisation,” page 186.</p>
+
+</div>
+
+</div>
+
+<hr />
+
+<p><span class="pagenum"><a name="Page_62" id="Page_62">[62]</a></span></p>
+
+<h2 id="CHAPTER_VIII">CHAPTER VIII.<br />
+CONCLUSION.</h2>
+
+<p>All reforms meet with opposition, mainly from persons whose
+interests may be prejudiced by the proposed change—also in many
+cases by experts. As to the latter, one remembers the story of
+the expert who, when the first proposal was made to cross the
+Atlantic by steam, wrote a pamphlet conclusively proving, to his
+own satisfaction, that it was a scientific impossibility to construct
+a steamer capable of carrying sufficient coal to do the journey!
+One of the first steamers to cross the Atlantic carried a consignment
+of such pamphlets!</p>
+
+<p>As to the former, as has already been pointed out in considering
+objections to the scheme, there is but a very small section
+whose interests need be prejudiced. Even those few who might
+suffer loss by the reform will recognise that the increased facilities
+of transport, with accompanying decrease of expense, will inevitably
+result in a great increase in and expansion of trade, by reason
+of the opening up of markets which have hitherto been practically
+inaccessible.</p>
+
+<p>Nor is there any reason why this opening up of new markets
+should be confined to the United Kingdom, for if other nations
+find that a system of small uniform fares and rates is not only
+practicable but remunerative here, they will surely follow our
+example, as in the case of Penny Postage, and the day will not
+be far distant, after the system has once been adopted in this
+country, when it will be possible to travel all over Europe at the
+cost of a few shillings, and to transmit and receive goods at
+correspondingly low rates.</p>
+
+<p>It is impossible to foresee all the social and political as well
+as financial effects which may be produced by such a revolution.
+The advantages of travel, which have hitherto been restricted to
+the wealthy, will be thrown open to all, whatever their means.</p>
+
+<p>Another important result may be anticipated and hoped for,
+namely, that the intermingling of the people of the various races
+and nations will tend to remove the prejudices, misconceptions
+and misrepresentations which have so often produced disastrous
+wars in the past.</p>
+
+<p>Should this be so, it may be that the reform here proposed
+will bring nations nearer to the desired haven of Peace.</p>
+
+<hr />
+
+<div class="figcenter red" style="width: 331px;">
+
+<p class="center"><i><span class="larger">A QUESTION</span><br />
+for to-day and to-morrow</i></p>
+
+<p class="titlepage">The Case for<br />
+<span class="larger">LAND<br />
+NATIONALISATION</span></p>
+
+<p class="center"><span class="smaller">BY</span><br />
+JOSEPH HYDER</p>
+
+<p class="center smaller">(<i>Secretary to the Land Nationalisation Society</i>).</p>
+
+<p>It deals with every aspect of the
+land question in a thorough and
+comprehensive manner.</p>
+
+<p>Full of facts, figures and cases
+which every land reformer ought to
+know. It gives numerous illustrations
+of the abuses which spring from
+treating land as private property.</p>
+
+<p class="center larger"><b>2s. 6d. net.</b></p>
+
+<img src="images/cover-back.jpg" width="331" height="600" alt="Image of the back cover" />
+
+</div>
+
+
+
+
+
+
+
+
+<pre>
+
+
+
+
+
+End of the Project Gutenberg EBook of Royal Railways with Uniform Rates, by
+Whately C. Arnold
+
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+</pre>
+
+</body>
+</html>
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