COMMITTEE MOVED FOR.

HC Deb 07 July 1859 vol 154 cc800-40

THE CHANCELLOR OF THE EXCHEQUER

said, that he did not suppose that it would be the wish of the House that he should enter at any great length into a detail of the considerations which had led the Government to think that it would be wise to invite the special attention of the House of Commons to this subject through the medium of a Select Committee. In the short statement he had to make he should confine himself to reasons which were of a most general character, on the assumption which he had made, that the present would not be a convenient occasion for the discussion of the merits of any particular proceeding or arrangement. These general reasons were of a very simple kind. A considerable number of years ago the practice of granting subsidies for terms of years for what might be called ocean postal service to steam packet companies arose, having at that period in a great degree the character of an experiment, and having in view both the performance of the postal service on a scale then altogether novel, and likewise, as might be in the recollection of many hon. Members, the provision of means, which it was then thought might be found important, in connection with the defence of the country in case of emergency. The demand for the multiplication of these services progressively extended, and a very considerable charge was speedily brought on the Estimates; for, unlike the postal service within the limits of the United Kingdom, which brought a considerable revenue to the State, besides affording a great accommodation to the public, the ocean service not only absorbed the whole of the ocean postage, or postage of letters over the sea, but imposed a very considerable burden on the people of this country. He held in his hand the estimate for the present year for this service, and it amounted to £988,488, or in round numbers to a million of money, of which a considerable portion was not covered by the proceeds of the postage charged for letters. There were very important questions of policy involved in these proceedings, but the first and most obvious proposition he would submit to the notice of the House, and which he thought constituted an ample justification for his Motion, was this, that inasmuch as these proceedings undertaken by the Executive Government had not rested on any system of fixed principles, and, at the same time, as they had been undertaken in anticipation of the judgment of the House, the practical effect, he must say, without intending the slightest censure on any Government (for the censure, if delivered, must fall on almost every Government for the last twelve or fourteen years), had been virtually to oust the House of Commons of its jurisdiction over a very important, extensive, and he might add, a very critical branch of the public expenditure. Then, again, the Government had not only been without the guidance it would have derived from a positive judgment expressed on the part of the House, but it had likewise been without the guidance of a well-ascertained public opinion, and all along the matter had been much controverted among intelligent and well-informed persons, whether subsidy ought to have been resorted to at all, and, more generally, whether the system of subsidy had not been continued for a longer time and extended beyond the limits which necessity and public expediency pointed out. Consequently there were very great jealousies on the part of private traders of various descriptions, who had not enjoyed the benefit of public subvention, and without pretending to assert that these jealousies were well founded, he thought it was obvious that by the institution of a well- selected Committee the House might probably arrive at one or two valuable results—either that these complaints were well-founded, and that subsidies had been needlessly and extravagantly granted; or, on the other hand, if the public advantage and policy had been considered in the measures that had been taken, the examination of the question by a Committee would tend to give general satisfaction, and to remove the doubts that had so extensively prevailed on this question. In 1853, during the Government of the Earl of Aberdeen, the disposition of Parliament and the public with respect to the public expenditure was not then precisely what it now was. The right hon. Member for Carlisle (Sir J. Graham), when he held the office of First Lord of the Admiralty, and himself, filling the same office as he had now the honour to hold, were both somewhat alarmed at the extent to which the charge for these postal services increased—namely, to about £850,000, and the Government at that period appointed a Commission for the purpose of examining into the whole case and making suggestions with respect to the policy of the proceeding. On that Commission they had the advantage of the services of Earl Canning, afterwards Governor General of India, the hon. Member for Stamford (Sir S. Northcote), and the right hon. Member for Hertford (Mr. Cowper). He thought the general effect of the Report of that Commission was that, although the hands of the Government were in a great degree tied from the nature of existing contracts, yet prospectively something might be done towards the reduction of the charge. It was scarcely possible for the Commission to enter at large into a discussion of the details, but the general effect of their Report was undoubtedly to point to a diminution instead of an increase of charge, and he had no doubt that the Report tended to give satisfaction both to the House of Commons and to those parties who had entertained jealous feelings on the subject out of doors. Subsequent experience, however, had not borne out the expectations which that Report was calculated to excite. On the contrary, the charge, which then stood at £850,000, had since increased until it had reached very nearly £1,000,000; nor did even that amount at all represent the maximum expenditure if they were to proceed upon the present system. The House was aware that a contract had recently been concluded with a steam-packet company for a new American service which would involve an annual payment, commencing from next year, of £75,000. Various parties had, in answer to an invitation issued some time ago, though it did not amount to a pledge, submitted tenders to the Government for another and an important line of steamers. Australia, which was at present supplied by the Red Sea route, was desirous of having a line of communication by a regular ocean steam service across the Isthmus of Panama. If such a line should be established, it would lead to another and a very heavy additional charge upon the revenue, although he was unable to state the precise amount of that charge. He would not enter into the question, whether any considerable amount of compensation might be derived from the postage of letters, he certainly was correct in saying that a very heavy additional charge would in the first instance be thrown upon the Exchequer. Nor was this all, for the effect of this policy had undoubtedly been to create all over the world, where there were British establishments, British interests, or British settlements, a sanguine and confident expectation that the purse of the British public would be available to supply a regular and expensive postal communication. This impression was gaining ground from year to year, so that, unless the House of Commons took serious cognizance of the subject, it would be found, if they continued in their present course, that what was now merely an expectation would harden into a principle and an absolute dogma, which no Government, and he might almost say no Parliament, would be able to resist. Under these circumstances he would not say what policy should be pursued; he would not in the least degree attempt to prejudge the general question, but he thought it was plain on every principle that ought to regulate the public expenditure and impress the House of Commons with a jealousy for its privileges, the time bad arrived when this matter should be subjected on the part of the House to systematic, careful, and searching examination. He did not think it necessary to add anything to what he had thus briefly stated as the general reasons for the appointment of the Committee. He could only say that, if the Committee were appointed, it would be the study of the Government—and he hoped they would receive the assistance of others who were qualified to aid them—to select the names of those hon. Members who were to constitute it, with the view of securing as far as possible an impartial and thoroughgoing inquiry. With regard to the scope of the Committee's inquiries, he was desirous that it should be as wide as possible, but he would venture to propose a trivial alteration which would render the Motion somewhat more extensive in its application. As it then stood, he thought the expression "various steampacket companies for the conveyance of the mails beyond the limits of the United Kingdom" was somewhat ambiguous. For those words, therefore, he proposed to substitute the words "by sea." This would serve to clear away the ambiguity, and on looking at the contract for the conveyance of the mails between Holyhead and Kingstown, he found that contract was clearly one that ought to come under review, as it was entered into for ten years, although it had now nearly expired. Of course, it was needless for him to say, that all parties who were interested in this question might rest assured that a Committee of the House of Commons investigating this matter would conduct their inquiries subject to every restraint which could be imposed by considerations of good faith as well as public policy; but at the same time, it would be the duty of the Committee to examine carefully into every transaction which had been concluded, and which might from its nature appear to be illustrative of the general subject, or to suggest particular considerations of importance. He might observe, with reference to a question which had been put the other night, that he had no doubt the contract recently concluded for an ocean service from Galway to St. John's, Newfoundland, would attract the attention of the Committee, inasmuch as the arrangement, although concluded so far as to bind the Government, might still be said to be in some degree in embryo. He must say, however, that this Committee was not proposed with any exclusive or special reference to that subject, and although it would be the duty of the Committee to entertain fully every question relating to that arrangement, it would have been the duty of the Government, from considerations of public interest, to recommend the appointment of this Committee if the steam-packet service between Galway and St. John's had never been established. He did not know that there was anything else on which it was necessary for him to offer further explanation, but he should be ready to give any such explanation if a future discussion should take place, and he would therefore simply submit the Motion with the slight alteration he had suggested.

Motion made, and Question proposed,— That a Select Committee be appointed to inquire into the manner in which Contracts extending over periods of years have from time to time been formed or modified by Her Majesty's Government with various Steam Packet Companies for the conveyance of the Mails by Sea; and likewise into any agreements or other arrangements which have been adopted at the public charge, actual or prospective, for the purposes of telegraphic communications beyond sea, and to report their opinion thereon to the House; together with any Recommendations as to rules to be observed hereafter by the Government in making Contracts for services which have not yet been sanctioned by Parliament, or which extend over a series of years.

MR. H. HERBERT

said, he did not rise to trouble the House with any remarks on the subject generally, but to express an earnest hope that the right hon. Gentleman would not persist in his intention to alter the original words of his Motion. No doubt it was quite proper that a Committee should inquire into the ocean steam-packet service, but the change in the terms of the Motion would reopen a question which had on several occasions been discussed in that House, and which had been already decided by a Committee of the House, and it would occasion the utmost dismay, not only among hon. Gentlemen connected with Ireland, but among the great bulk of the Irish people. He had the honour of being chairman of the Committee on postal communication with Ireland, and while it was sitting he had communications from a vast number of persons connected with Ireland, and he could assure the right hon. Gentleman that the interest felt in the subject in Ireland was most intense. On the other hand, the greatest satisfaction had been manifested by the Irish public when the concessions on this subject, which they had been anticipating for years, were made by the Government, but in proportion to that satisfaction would be the disappointment which would be excited in that country when it was understood that the Government intended to reopen the question. He hoped the right hon. Gentleman would consider that the words of his original Motion were sufficiently comprehensive; but if he persisted in his Amendment, he (Mr. Herbert) would divide the House against it.

SIR STAFFORD NORTHCOTE

said, that he concurred individually, and he had no doubt that every other Member of the late Government also concurred in the proposal to appoint a Committee. He had no indisposition to enter into the fullest discussion of the contracts made by the late Government, but the House would probably think it more convenient now to follow the course proposed by the Chancellor of the Exchequer, and confine itself to the very important Motion before it. The question was one of great difficulty. The right hon. Gentleman had referred to the Committee or Commission of 1853, of which Lord Canning, Mr. Cowper, and he (Sir S. Northcote) were members. At the time that Committee was appointed the estimate for the postal service amounted to £853,000. In their Report they held out a hope that that charge would be reduced. They went generally into the principles upon which the postal service should be conducted, and certain lines of communication be subsidized. Their general view was that the packet service should be carried on by the Government and under a system of contracts rather than by direct Government agency, and that in determining what lines should be started and maintained reference should be had, not merely to postal, but also to social, political, and commercial considerations. They also held that the Government might at first wisely grant subsidies in certain cases beyond the return they might expect in postal advantages, but that, as a general rule, where political considerations were not involved, this system ought not to be continued after the companies had been once fairly established. Several other points bearing upon the subject were also fully considered. Amongst others, whether the packets employed in the service should be made available for purposes of war. It was recommended that the contracts should be so worded as to render the packets available for such purposes if their services were required. A suggestion emanating from the chairman as representing the Post Office was adopted, namely, to alter the whole system of packet service by substituting for contracts for long periods, contracts for short periods, even for single voyages. It was on the possible success of this alteration that the Committee grounded their hope of a permanent reduction in the expenditure on this service. The experiment was tried, and the result was that the cost of the packet service gradually declined from £853,000 to £756,000, effecting thereby a considerable reduction in the Estimates. But in 1857 the system was materially altered under the Government of the noble Lord opposite, for reasons that doubtless appeared satisfactory, but the Estimates for the packet service in one year ran up to £923,000, or thereabouts. What had taken place in the previous interval? They had had experience of the effect of contracts for short periods, particularly in the communications with Australia. That system was considered unsatisfactory, and the colonists objected to it. It was to put an end to that system that the right hon. Gentleman the Vice President of the Board of Trade (Mr. Wilson) thought it necessary to revert in some measure to the old system of lengthened contracts, and contracts were made to establish a regular service to Australia. Since then further additions had been made to the packet Estimates until they arrived at their present amount. But those additions were nothing compared with those made in 1857. He trusted that the Committee of which the right hon. Gentleman had given notice, would inquire into the whole subject, and not confine their investigation to one or two contracts. He thought that they should consider what were the principles illustrated by those contracts. In the Report of the former Committee they had speculated on the possibility of a war. What was then but a mere speculation soon afterwards became a fact. The Crimean war broke out, and they then had practical proof of the great value of the packet service to this country. The contracts with the Peninsular and Oriental Company and with other companies for the transport of stores and of troops had been attended with incalculable advantage, and no doubt this consideration had its influence when the old system of long contracts was revived. Wide as the right hon. Gentleman the Chancellor of the Exchequer now wished to make the reference to the Committee, the words proposed were hardly wide enough. Of course the conduct of different Governments in regard to each particular contract must be sifted, but it was even more important to ascertain what were the principles on which this service ought to be conducted, and he (Sir Stafford Northcote) doubted whether, under the terms of the Motion as it now stood, the Committee would be at liberty to enter into that point. If they laid down the rule that no contracts should be entered into unless where the sums paid to the com- panies were likely to be returned to the country in the shape of postage, he was afraid that, with a single exception, none of the trans-oceanic services would be maintained, for only one of them (if one) repaid the entire outly made upon it. It must not be considered, however, that the whole of the cost of the packet service was lost, for a considerable amount of it came back in the shape of postage. In 1853 the Committee endeavoured to obtain an estimate of the net cost to the public for the packet service; and they found that the service cost the public above the amount of postage received, £325,000. It was not therefore a question of £1,000,000 expenditure, but of £300,000 or £400,000. There was also another point. The right hon. Gentleman the Vice President of the Board of Trade, who had taken great pains in the matter, had laid down the principle that the Colonies should be called on to pay half the expenses of this service. It was true that as yet circumstances had prevented the Government reaping the full advantage of this arrangement, and no money had come in from the Colonies in relation to this matter until very lately. But those anticipated receipts from the Colonies must be taken as another element of the diminution of the large amount of the expense of the packet service. There were many other considerations mixed up with this subject besides the financial one. A question ultimately connected with it was our defences and maritime greatness, in which, of course, the commerce of the country was seriously concerned. As an instance of that fact he might mention the contract entered into with Mr., now Sir, Samuel Cunard, which resulted in the American line of packets being wholly defeated in the race of competition. In relation to this packet service it had been the experience of successive Governments, that there were opposite views taken by two departments. The one was that taken by the Admiralty, the other by the Post Office authorities. Comments had frequently been made upon contracts having been entered into against the advice of the Postmaster General. The view taken by the Post Office authorities was one regarding financial considerations only. The Admiralty, however, suggested other considerations, equally, if not much more, important. The Treasury endeavoured to hold the balance between the two opinions and so reconcile the discrepancies. Now, to go thoroughly into the subject, these views should be fairly con- sidered by the Committee, and then it would be in a position to make a report, which would enable the House to judge what expense it was incurring, for what purpose it was incurred, and what results were likely to be attained. In conclusion, he could assure the right hon. Gentleman the Chancellor of the Exchequer that he would meet with every co-operation from Members on that side of the House in forwarding the objects which he had in view.

MR. MARSH

said, he was of opinion that if the result of the labours of the Committee was to establish that only one line of oceanic postage were desirable, he believed it would greatly increase the efficiency of the service and would likewise have the effect of curtailing the very considerable outlay that was at present necessitated both on the part of this country and of the Colonies. At present considerable diversity of opinion existed with regard to what might be regarded as such a simple matter as the shortest route to Sydney; most persons maintaining that the most direct passage was by way of Panama, though the House might be surprised to hear that the shortest was in reality by North America and Labrador. In a very few months telegraphic messages would be transmitted viâ Aden, in half the time that they would be by way of Panama; and this very route, he maintained, might be made a means of cheapening the postage to Australia; for if packets went merely from Australia to Ceylon they could accomplish this fortnightly instead of monthly as at present, and the Bombay and Calcutta packets could pick up and bring the mails from thence.

MR. CRAWFORD

said, he was sure that the public would be in the highest degree satisfied with the statement of the Chancellor of the Exchequer, as much discontent prevailed at the way in which the system of public contracts had hitherto been carried on. He did not think it was so much a question whether the making of a particular contract was to be charged as aground of censure against this or that Government, or whether one or another Administration was to be praised for exerting itself to forward the public wish with regard to a particular line. But when they saw the documents which had been laid on the table of the House respecting the Galway and Dovor mail contracts, and perused the voluminous mass of correspondence which had been presented in reference to the Mediterranean Telegraph contract, it seemed to be high time that matters should be placed on some footing that would be satisfactory to the Government and acceptable to the country, and which could only be done through the agency of a Committee appointed by that House. It was a matter for congratulation that England was now the postal carrier for the entire world, and he would venture to suggest that as telegraphic communication would supersede, to a great extent, the postal communications hitherto carried on between different countries, it was a subject deserving the attention of the Committee, in what mode telegraphic companies should be assisted by Government, and to what extent Government itself should establish telegraphic communications between our various dependencies and other countries. If the Committee extended its inquiries to this important subject of telegraphic communication they would render great service to the country.

MR. GEORGE

said, that being as an Irish county Member peculiarly interested in the communication between London and Dublin, and in consequence of the especial allusion that had been made to it by the Chancellor of the Exchequer, he was desirous of saying a few words. He wished to remind the House that the contract for the postal service between Dublin and London rested on peculiar grounds. It would be recollected that repeated complaints had been made from time to time with regard to the state of the postal and passenger communication between the two countries, and more especially between the two capitals; Committees again and again reported on the subject, and eventually, in accordance with their recommendations, a special Act of Parliament was passed, enabling, and almost directing, the London and North Western and the Chester and Holyhead Railway Companies, and the City of Dublin Steam Packet Company to enter into a contract for the improvement of the communication between the two countries. Repeated questions were put in consequence of the delay which took place in carrying out that agreement, and an interval of two years elapsed before the matter was brought to a satisfactory conclusion. At the end of last year, however, a solemn contract was entered into and signed by the railway and steam packet companies, by the Lords of the Admiralty, the Post Office authorities, and other parties interested in this subject. It had been spe- cially provided that the large sum of £300,000 should be raised, and four steam packets of unexampled speed and power constructed and put upon that station; and, confiding in the faith of the departments in question, that sum had been raised, and interest was at present payable on a considerable portion of it. Contracts had been entered into with a great Liverpool firm for the building of three of the ships, and with Mr. Samuda, of London, for the fourth. If it were now to be understood that this contract was to be referred to the consideration of a Select Committee, the security of those persons who had lent their money for this object would be materially affected; and the desideratum of improved communication with Ireland would be again indefinitely postponed. To show the public spirit with which the contractors had acted in this case, he might mention that in consequence of an Act of the Legislature recently adopted, which directed that Post Office contracts were to be subject to the annual revision of Parliament, they absolutely signed an agreement putting themselves under that special Act, although they did not consider themselves bound to do so, Under these circumstances he could not but think that the public faith in Government contracts would be very much shaken if the one that had been so deliberately closed between the Government and the companies to whose case he had referred were re-opened by a Committee of that House.

VISCOUNT DUNKELLIN

said, that the Motion itself was unobjectionable, but some of the observations which had fallen from the right hon. Gentleman in introducing it, might, he feared, insensibly bias the tenor of instructions to the Committee, by reason of the high quarter from which these had proceeded. In his view every engagement entered into between the Executive Government and any body of public men, even irrespective of its merits or demerits, became a matter of public faith; and therefore he trusted that, so far as Galway was concerned, which had repeatedly engaged the attention of Parliamentary Committees as an eligible transatlantic packet station, the scope of the inquiry might be narrowed by its omission from the Resolution.

MR. WILSON

said, that whilst the scope of the inquiry would embrace contracts for mail service between different parts of the United Kingdom, he could assure the hon. and learned Member for Wexford (Mr. George) that there was no intention on the part of the Government to interfere with the contract entered into for the postal service between Dublin and London. Indeed the Government was prepared to pledge itself not to reopen or disturb in any manner that contract as it now stood, or to endanger its existence in any way. It was only desired to point the inquiry to such contracts as might hereafter be proposed. With reference to an observation made in the course of the discussion with regard to the large sums of money expended on mail-packet services when he was Secretary to the Treasury, he would remind the House that Lord Jocelyn's Committee, which investigated the question a few years ago, came to a decided opinion in reference to it, which the Government first ought to put in practice, but were eventually obliged to abandon. Subsequently, in making new contracts, the Treasury for the first time laid down the principle that if the distant possessions of this country were to have a postal communication, it was but right that they should contribute a fair proportion of the expenditure. The Australian colonies in this way contributed £90,000 a year, the Cape £20,000, and the Indian Government £50,000. These sums, taken together, would go far to account for the increased expenditure.

MR. HENLEY

said, he wished to express his satisfaction that this subject, involving, as it did, so large an expenditure of public money, was about to be submitted to a thorough investigation. He hoped the inquiry would not be narrowed down in the manner suggested by some hon. Members. As he took it, the object of appointing the Committee was not the reopening of public contracts; but it was very important that the public should be put in a position to judge whether a better arrangement than that which at present existed might not be adopted in respect of the mode of making those contracts. For himself, he was not very sanguine that the Committee would make a very early report. Some years ago he sat upon a Committee to inquire into a contract in which the Peninsular and Oriental Company were concerned, and that inquiry lasted a long time. The present Committee were going to travel all over the world, and their labours would not, he feared, be very speedily concluded.

MR. BOUVERIE

said, that there was one matter connected with this subject upon which nothing had as yet been said, in a debate which had lasted an hour and a half, but on which he should like to come to a clearer understanding—he meant the contract for the conveyance of the mails between Galway and the United States. That contract, no doubt, was the cause of the present Motion, and without prejudging the Report of the Committee, but judging from the papers before the House, a more reckless, more hasty, and more inconsiderate, waste of public money never was made. He doubted whether the terms of the reference made by the Chancellor of the Exchequer would enable the Committee to go into that particular case, for he considered that no actual contract had been entered into with the company, but that merely the basis of a contract had been agreed to. If this were so, he should move an Amendment which would include it in the matter referred to the Committee. [Mr. WILSON: There is a contract.] Then the case would, of course, come before the Committee. It seemed to him, firstly, that the late Government had made a reckless and inconsiderate contract for the public interests, and, secondly, that they had been guilty of conduct to a particular company, of which he had no knowledge, but which was, he believed, a powerful, respectable company at Liverpool, which no one would be guilty of in his private affairs. The late Secretary for the Treasury had expressed his pleasure at the manner in which the Chancellor of the Exchequer proposed to deal with the subject. He (Mr. Bouverie) did not wonder at it, because by the proposed arrangement the Galway contract would be glossed over. It would not do, however, to tell the House of Commons that they must wait twelve months for the Report of the Committee, when the matter would be dead and buried, before they expressed an opinion upon these transactions. What were the facts as they appeared in the correspondence before the House? A company—the Atlantic Steam Navigation Company—which, from the statement of the Secretary of the Treasury the other night, was apparently something like a bubble company, applied to the Government of Newfoundland for a contract for carrying the mails from Ireland to Newfoundland, and so on to New York and Boston. The Government at home were asked to go shares with the Government of Newfoundland in subsidizing that company, and after a good deal of previous negotiation a Minute of the Treasury, dated October 7, 1858, authorized an ad- vance upon the terms agreed to by the previous Government from £3,000 to £4,500 a year, in addition to the subsidy which the Newfoundland Colonial Government were willing to give the company for carrying on the packet service from Ireland to Newfoundland, The Treasury Minute of October 7, 1858, ran as follows:— The late Board of Treasury declined making any advance beyond the sum of £3,000; nevertheless, my Lords being desirous of meeting what may be the views and wishes of the Colony, and being duly sensible of the great advantage of expediting the communication with Newfoundland and the North American Colonies generally, are disposed to authorize an advance on the Imperial contribution from £3,000 to £4,000, or £4,500 as a maximum, if Sir Edward Bulwer Lytton shall be of opinion that such an advance will be expedient, and provided an advance at least equal to that of the Imperial Government beyond the £7,000 now offered by the Colony shall be made from the colonial resources, and that the service shall be in other respects, excepting as regards the port of embarcation, as complete as that proposed upon the former occasion. My Lords are desirous, however, to have it understood that it will be for the Colony to determine whether it will be for their interest to enter into the proposed arrangement with the company represented by Lord Bury, or to throw the service open to public competition, or to deal with the present contractor, Mr. Cunard, subject, of course, to the eventful approval of Her Majesty's Government. In the same month Viscount Bury, as the agent of the company, went out, and on the 21st of October he arrived at St. John's, Newfoundland. he saw the Executive Council there, and on the 22nd a contract was concluded for a service from Newfoundland to Galway for a year. The Home Government had a veto reserved to them upon it, but the contract came home and was approved by them for twelve months, so that for the year 1859 the Governments of Great Britain and Newfoundland agreed to subsidize the Atlantic company. It appeared that the Liverpool company got wind of this arrangement, for on the 25th of October, three days after the contract was signed at St. John's, they wrote to the Government at home to say, that they had carried on an independent service with America, greatly to the public convenience, for which they received no subsidy, nothing in short beyond the usual sum paid for ocean postage, and they prayed that in the event of any extension of the postal service they might be allowed to tender. He was sorry that the hon. Member for Liverpool (Mr. Horsfall) had not thought fit to stand up for a company, which appeared to him to have been very ill-used. On the 9th of November Sir Charles Trevelyan replied to their application as follows:— I am desired by the Lords Commissioners of Her Majesty's Treasury to inform you, in reply to the letter addressed by you to this Board on behalf of the Liverpool, New York, and Philadelphia Steamship Company, that when a new postal service is about to be established by Government, it is the practice of their Lordships to invite tenders by public advertisements, thereby affording to all parties the opportunity of competing for such services, provided they conform to the required conditions. This answer was given, it was to be remembered, after the Government had parted, by their minute of October 7, with the power of advertising for tenders for the current year. They had handed that power over to the Newfoundland Government. In the beginning of January, the Atlantic Royal Mail Steam Navigation Company offered to conduct a Government postal service from Galway to America upon the conditions they specified, namely, that the contract should be for seven years, the terms being £3,000 for the passage out and home, which, on a fortnightly service, would amount to about £72,000 a year. The Treasury very properly referred the matter to the General Post Office for their opinion on the desirability of the contract. This offer was sent in on the 18th of January, and on the 12th of February the Postmaster General made a report, condemning any such contract in the strongest terms, and setting forth with great and convincing force the objections to it. Yet, a few days afterwards, on the 22nd of February, a Treasury minute was made, declaring without any reasons alleged for this course, that the Government were prepared to enter into a contract upon the terms condemned by the Postmaster General. The hon. Baronet (Sir Stafford Northcote) had reminded the House that he was a Member of a Treasury Committee which had reported strongly that contracts for ocean steamers ought only to be made for short periods, under the impression that the time had almost arrived when these services ought to be executed, not for large subsidies for long periods, but in consideration of the receipt of the ocean postage of the letters they carried. It was true, the hon. Baronet had added, that the Government which had preceded his own, had disregarded that Report. Now, that might be a reason why he should complain of the Government to which he had referred. But it could be no reason why the hon. Gentleman should himself fly in the face of his own Report. He came now to a matter he could not understand. It appeared that on the 22nd of February the Treasury agreed to the proposal for a contract, and it was a singular part of the history that upon that very day in the House of Lords, a question on the subject was asked of the Earl of Derby, by Lord Stanley of Alderley, and the noble Earl was represented by Hansard to have said: Her Majesty's Government had not at present entered into any definitive contract for making Galway the port of departure for the mails. A proposition, however, had been submitted to the Treasury by one of the Atlantic steam companies for a regular fortnightly service from Galway to some port in North America. That proposition was under consideration upon the terms submitted by the company, but the Lords of the Treasury had, of course, reserved to themselves the power, before any arrangement was concluded, of making the fullest inquiry as to the extent of the benefit to be obtained from such communication, and the solvency of the company. Security would also be required for the carrying out of the conditions of the contract in the adequate manner in which it was now performed by the Cunard Company."—[3 Hansard, clii. 679.] Thus, at the moment that the Earl of Derby was saying that the matter was under consideration, the Treasury had entered into an agreement for a contract. Upon the 23rd of February the Liverpool Company, which seemed like most Liverpool merchants, to be pretty much alive to its own interests, seeing this report in the papers, wrote to their Member, expressing alarm about the Galway contract, referring to the statement previously made to them that all tenders would be open, and wishing to know how the matter really stood. In April, two months afterwards, the Treasury—after having distinctly stated to the company that it was their practice, "when a new postal service was about to be established, to invite tenders by public advertisement, thereby affording to all parties the opportunity of competing for the public service"—wrote to the Liverpool Company to this effect:— My Lords admit the expediency, as a general rule, of inviting tenders by public competition when new postal services are about to be established, under circumstances in which the principle of competition is properly applicable; but the case referred to in your letter is quite exceptional. The treatment of this Company by the Treasury, he repeated, was treatment such as no gentleman would use towards any man of business with whom he had transactions. He had had no communications with the Company; he did not know one of them; his opinion was formed solely from reading the papers and comparing dates. What was the first fact with which the House and the Committee would have to deal? In the face of a lengthened and reasoned report from the Postmaster-General, alleging grounds which were perfectly conclusive why the contract should not be entered into, the Treasury, without giving any reasons whatever upon paper, had thought fit to enter into this contract for seven years, which would saddle the public with a payment of about £72,000 a year. They said, "My Lords cannot regard this as a mere postal contract; it comprises considerations of a more extended character." No doubt it was not a mere postal contract—it did comprise considerations of a more extended character. Whether those considerations had been received or not, it was not for him to say. Upon the papers as they appeared, the whole proceeding displayed a most reckless and inconsiderate dealing with a great question. It was stated in the course of the correspondence that it was very desirable to encourage this great Irish line. He would not enter into the question whether this was the case or not, or whether the route viâ Galway was a good or a bad one, but he complained of the mode in which the question had been dealt with by the late Government. If it was a good line there was a different way of opening it. One instance of the improvident haste with which these arrangements had been concluded. It was said it was not a simple postal contract, but it was intended to open a route to Irish emigrants, in order to relieve them from the necessity of coming to Liverpool on their way to America. Now it happened that there was a clause in the agreement entered into with the Government of Newfoundland exempting the ships of the company from the operation of the Passengers Act, which had been passed by Parliament expressly to protect the poor Irish emigrants from ill-treatment on board of emigrant ships. When the contract was sent to the Postmaster-General and the Admiralty for their consideration that grievous blunder was discovered, and the Treasury were obliged to cobble up an imperfect contrivance, with the help of the Emigration Commissioners, to remedy the difficulty. But he contended that the Treasury had no right to enter into considerations respecting emigration, or to pay public money to promote it. If they wished to promote a line for that purpose they ought to have come to Parliament and obtained specific authority to deal with the question. He thought the debate, so far us it had gone, had not turned upon the real points to which the attention of the public was directed, and therefore he had felt it his duty to call the attention of the House to a few of the facts connected with this matter.

MR. HORSFALL

said, he should not have taken part in this discussion had not the right hon. Member for Kilmarnock laid it to his charge that he had not stood up for his friends, and he only rose for the purpose of showing that the taunt was entirely without foundation. He was afraid the right hon. Member had not been so attentive as he ought to his Parliamentary duties, or he would have remembered that he (Mr. Horsfall) was the first to bring this subject before the House. Hon. Members had on that occasion talked about his being jealous of the interests of Ireland, but he said that he looked upon this as a national question, at the same time that he thought great injustice had been done to his friends in Liverpool. He (Mr. Horsfall) stated the very opinions to which the hon. Member had just given utterance. He read the letter from Sir Charles Trevelyan which the right hon. Member had read; but, feeling this to be a national question, he was quite content to leave the whole question in the hands of Parliament. He approved of the Committee, and had no doubt that the Committee would come to a just decision not only with regard to the Galway line, but with regard to every other line which would be submitted to their discussion.

MR. ELLICE (St. Andrews)

said, that he did not wish to cast imputations on any persons connected with these contracts, but he wished to direct the attention of the House to the injury done to the province of Canada. That province, in order to assist the gentlemen of Liverpool, granted a large subsidy to complete the communication, which now took place once a week between Liverpool and that colony. From personal experience he could say that neither Cunard's vessels nor any other vessels between England and America were better fitted to accomplish the object in view than the vessels employed by the company under the patronage of the Government of Canada. Those vessels carried the letters without the least cost to the public of this country, and when this was the case, and when the communication was so complete that even a large portion of the correspondence from the United States was brought by these packets from Canada, it might have occurred to the Treasury whether the taxpayers of this country might not have been exempted from a heavy contribution. The proposed inquiry could have no practical end. There would be various opinions expressed, just as various opinions had been bandied about from one side of the House; but the subject was one on which the public were amply informed, and on which they had made up their minds. The great object which the House should have in view was, to see whether the postal communication could be maintained without calling on the Exchequer to pay for it. He desired the House to be a little jealous of the quarter from which this proposition emanated, because the President of the Board of Trade had sanctioned the prolongation of the Cunard contract. ["No, no!"] He was glad, then, to hear that his side of the House was not subject to the blame, to which he feared both Governments had been liable. If there were a person more meritorious than another in connection with this matter, it was Sir Samuel Cunard. The enterprising and efficient manner in which he conducted the service entitled him to the thanks of the country, and even to some favour in any arrangement made for carrying on the packet service after the expiration of his contract; but he thought that means should have been taken, before extending the contract, to ascertain whether the service might be carried on in a more economical manner, and, when he knew that other departments of the Government were of the same opinion, he considered it strange that the Treasury should have taken on itself to squander, as he must call it, the public money. It might be said that this last Irish contract was not of much importance; but hon. Gentlemen in that House, night after night, called on the Chancellor of the Exchequer to repeal the paper duty, and others complained of taxation pressing on particular classes; but, if the House continued the habit it had indulged in for the last four or five years of recklessly voting money for any purpose that might be urged, it had no right to call upon the Chancellor of the Exchequer to repeal taxation. With regard to the £73,000 paid to the new company, he must say that it was so much money be- longing to the public actually thrown away. He recommended that the Committee should enter into the merits of this particular contract, and see what security had been obtained from the parties for its fulfilment, and how the service had been hitherto conducted in order that the public might be relieved from the error, if error it were, that this was a great and scandalous job.

MR. VANCE

said, he must express his regret that the discussion had not been conducted in a more temperate manner. In his opinion the late Government not only was free from blame, but deserved commendation for the agreement made with the new company, more especially in reference to the interests of Newfoundland, which place was passed by Cunard's vessels, so that other vessels had to be engaged to bring the passengers and correspondence back again from Halifax. There was an absolute necessity that some other port for the departure and arrival of the mail should be sanctioned besides Liverpool, on account of the detention occasioned by beating through the Channel, and from occasional want of water before the port of Liverpool. It was said that this line was not put up to competition, but neither was Cunard's when first established, and Ireland had a claim to the benefit of a communication with America. It had been alleged that Cunard had been treated with neglect, but it must be horns in mind that his contract had been prolonged, and that he had received a distinguished mark of Royal favour. All the great towns in Ireland sent memorials to the Lord-Lieutenant demanding that there should be a line from Ireland to America, and Galway was fixed upon by all parties, with the exception of a few otherwise interested.

VISCOUNT DUNCAN

said, he wished to ask the Chancellor of the Exchequer whether the Galway contract was actually concluded, and, if so, whether the right hon. Gentleman considered the House pledged a year beforehand to vote the means necessary to carry it out? He should like also to know to what extent the right hon. Gentleman thought the Treasury had power to bind that House beforehand to every profligate piece of expenditure which the Treasury might choose to sanction. He might remind the House that a considerable time must necessarily elapse before the Committee could report, and this was sometimes a very convenient mode of shelving troublesome questions. He hoped that when the subject of the Red Sea Tele- graph was brought before the House, they would hear from the Chancellor of the Exchequer or the Secretary to the Treasury, upon what principles they intended to act with regard to these various contracts. He had read the papers connected with this subject with great surprise, and he thought, from a letter dated March 15th, and stating that the Treasury had written to the Admiralty announcing their determination to enter into the contract, that the noble Lord at the head of the Post Office Department, who seemed to him to have taken a very correct view of this question, had been treated with quite as little ceremony as the House of Commons. He could only express his satisfaction that the matter had been brought under the notice of the House.

MR. DISRAELI

said, that he wished to state on the part of the late Government, that it would have been much more satisfactory to them had the subject of the Galway line been brought specifically under the consideration of the House, although he was quite ready to admit with respect to the subject generally that it was convenient at that time to support the proposition of the Government. He was prepared, however, whenever the opportunity was afforded him to enter fully into the whole of the Galway question. The only condition he would make was one not unusual in that House—namely, that fair notice should be given when the subject would be brought forward. From what he had heard before he entered the House with regard to the intention of the Government, he did not expect to find that particular grant made the subject of discussion. He was, therefore, unprepared with papers, and had no opportunity of refreshing his recollection, and he believed he might say that all his late colleagues in the Government were in the same position. He certainly would have supposed that such a statement as had been made by the right hon. Member for Kilmarnock (Mr. Bouverie) would have been preceded by a formal notice. With regard to the contract which appeared to have excited so much alarm in the mind of the noble Lord who last spoke, it might be satisfactory to him to learn that it would he in the power of the House, when a Vote of money was proposed, to reject it entirely. Formerly, when contracts of this nature were concluded, inasmuch as the expenditure was defrayed from the Post Office revenue, they were not subject to the pleasure of Parliament; but speaking from recollection, he believed that in the present instance it was for the first time specially provided that the contract should depend upon the approval of Parliament, and the House of Commons would therefore have a fair and complete opportunity of expressing its opinion upon the policy recommended by the late Government. He would be unable to do justice to the conduct of the late Government if on this occasion, without the opportunity of referring to a single paper, he entered upon a defence of the course they had pursued, or attempted to answer every allegation made by the right hon. Member for Kilmarnock. He hoped that, although the House might assent to the appointment of this Committee, the right hon. Gentleman would find it consistent with his convenience to bring the question of the Galway grant specifically before the House, and at as early a period as possible. He would only say that, both with regard to the prolongation of Sir Samuel Cunard's contract and the conclusion of the contract for the Galway line the late Government had been influenced by no other consideration than the public advantage, and when the Committee had instituted an inquiry it would be found that "jobs" were neither so flagrant nor so frequent as it was very easy to assume they were in discussions in that House. He felt confident that in both the cases which had been referred to—for which in a great degree and particularly for one of them, the late Government was responsible—it would be found that in advising this disposition of the public money they were influenced by the only feeling which he believed could influence Gentlemen who were placed in the responsible position of Ministers of the Crown in this country—a conviction that the course they recommended was for the public good. He thought it right, before he sat down, to notice one observation which had been made by the right hon. Member for Kilmarnock, because it implied an inconsistency in the conduct of a noble Friend of his in another place, which could not for a moment be sustained. The right hon. Gentleman said that, on the 15th of February—the date of a minute which intimated that the Treasury were prepared to enter into a contract—the Earl of Derby bad stated in the House of Lords, in answer to a question, that the Treasury had not entered into a contract, and the right hon. Gentleman dilated upon the inconsistency between this statement and the fact. Now, there was really no inconsistency whatever. When this inquiry was made the Earl of Derby stated what was precisely the fact—namely, that the Government had not entered into any contract with the Galway Company, although a proposition on the subject was under their consideration. Although he (Mr. Disraeli) believed that on the same day a Treasury minute was agreed to, announcing that the Government were prepared to enter into a contract, that minute intimated at the same time that its adoption was subject to certain conditions being agreed to and fulfilled by the company, and weeks elapsed before those conditions were ascertained and settled. There was, therefore, no inconsistency between the language of the minute and the statement of his noble Friend. He thought it was due to the Earl of Derby that he should make this explanation, and he regretted that the course taken by the right hon. Member for Kilmarnock limited to this point for the present his vindication of the Government. He could only repeat for himself and his late colleagues that they would be perfectly prepared to vindicate the course they had pursued if the right hon. Gentleman would bring the subject of the Galway contract specifically under the consideration of the House, and he entertained the utmost confidence that their conduct would receive the approval of Parliament.

MR. RICH

said, that this question of contracts having been raised, he wished to bring under the notice of the House the proceedings of the Government with regard to another contract, similar in character to that referred to by the right hon. Member for Kilmarnock (Mr. Bouverie). The light hon. Gentleman opposite (Mr. Disraeli) had complained that the right hon. Member for Kilmarnock had introduced this subject without due notice; but if he had brought forward the case of the Galway contract after the whole question had been referred to a Select Committee, the right hon. Member for Bucks would at once have said, "This is a matter which is now under the consideration of a Committee, you should have brought it forward when the Committee was moved for." Now this was precisely what his right hon. Friend has done, and what he himself should now do also. For he (Mr. Rich) would call attention to the case of the Dovor contract. In the year 1854, he believed, a contract was entered into for the conveyance of mails from Dovor to the Continent. In 1855, the contractor asked for some additional conveniences, and the Government, on their part, asked for a reduction of the rate of the contract. The result was that there was no reduction in the amount of the contract, and the indulgences which the contractor required were not granted, but there was a slight extension of the period over which the contract was to extend. In June 1857, the contractor again applied for certain indulgences, and the answer was that in 1855 the whole matter had been investigated and settled. The question remained in this state until January, 1859, when the late Government had been in office nearly a year. An application was then made by the contractor to the Admiralty, who received it rather favourably, and sent it to the Treasury. It was referred by the Treasury to the Post Office, who pointed out certain objections, but after some discussion it was agreed that the extra services the contractor contended he had been obliged to perform, in consequence of increased communication with India, should receive certain additional compensation, and accordingly a Treasury minute of the 3rd of February ordered that a special agreement should be entered into for that purpose. But the Admiralty, instead of obeying this minute, opened on the 11th of February a general communication with the contractor, in consequence of which he sent in proposals for re-opening the contract, and extending its term. The Admiralty again reported favourably to the Treasury on this very questionable proposal. The Treasury having referred the matter to the Post Office, the latter reported that the arrangement was wholly objectionable both in principle and practice. This condemnatory report from the department most cognizant of the matter was dated the 10th of March, and nothing more was heard. But in six weeks' time the aspect of affairs changed in that House, and accordingly on the 15th of April the Treasury, disregarding their minute of the 3rd of February, and the Post Office protest of the 10th of March, proceeded without rhyme or reason to grant all the contractor's demands. And what were they? Why, that he should receive an additional subvention of £2,500 a year, and that his contract, which would have expired in 1863, should be extended to 1870. That is to say that a contract, which had been running for four years, and which had yet four years to run, should, in order to add seven years more to it actually be cancelled by a Government which its own chief had declared was in suspense, was as an officer under arrest. And cancelled in favour of whom? In favour of a contractor, who had in 1853 been mixed up with very questionable electioneering proceedings at Devonport, and who was now at Dovor changing his political creed from opposing to supporting this very Government which was thus opportunely giving way to his demands. And by whom were these proceedings especially promoted? By the Admiralty, that at this very time was endeavouring to coerce a Member of its own Board into standing for Dovor; and, moreover, an Admiralty against whose conduct, in regard to this Dovor election, a petition was now waiting for investigation. And what were the reasons assigned for making these concessions? First, that the contractor had years before bought some old vessels from the Government; second, that while he had carried the mails he had lost two vessels, and had three collisions; and, third, that comparing the existing arrangement with the old exploded system which it had superseded, there was a saving upon this line of several thousands per annum to the country. This heaping together a pack of bad reasons for entering into the contract was a clear indication that there was no good reason for it; no reason that could stand the daylight. He would beg the House to remark the dates of the Carnagie coercion, of the Dovor election, and of the contract, whose terms were refused in 1857 by the then Government; and in the beginning of this year were tantamount to refused by the late Government. [Mr. DISRAELI was understood to dissent.] The right hon. Gentleman might shake his head, but there was the Treasury minute of the 3rd of February directing action in accordance with the existing contract, and the very last paper in that correspondence was the reply of the Postmaster General on the 10th of March, strongly pointing out his objections to the contractor's application for this uncalled for extension. To all appearances it was dead and buried till the 15th of April, when the dissolution of Parliament suddenly brought it to life. No intermediate communication on the subject appeared among the documents. The Dovor contract, then, and the one mentioned by the right hon. Member for Kilmarnock, stood upon special grounds; and what seemed to be the delinquencies of the late Government ought not to be cushioned and smothered by a general inquiry, which would probably last for one or even two years. He hoped it would be understood that these two contracts—the Dovor and the Galway contract—were to be entered into at the earliest moment by the Committee, and if the result was to clear the late Government of any imputation he should rejoice.

MR. LYGON

said, the hon. Gentleman who spoke last had assumed, from the fact that no papers between the 10th of March and the 15th of April had been laid on the table relative to the Dovor contract, that the matter had entirely dropped; and he had led the House to infer that circumstances occurring about that time induced the late Government again to take up the negotiation. To that assertion or inference, whichever it might be, he now gave the most unqualified denial. Between March and April various details connected with this contract were brought under the attention of his department (the Admiralty) almost daily, although they did not assume a form which required them to be printed in the papers. The hon. Gentleman had accused the late Government of delinquency in having increased the money paid to the Dovor contractor. Now, when the matter was investigated, the contractor, instead of being a pecuniary gainer, gained nothing whatever beyond what was to be derived from the extended duration of his contract. The sum of £2,500, which had been alluded to, was paid to the contractor for various special services rendered at the instance of the Government; and though there was a trifling amount this year beyond that of last year for such services, yet the contractor had undertaken to make certain improvements in the conduct of the packet service which would be most advantageous to the public. These questions should be decided alone by the consideration of what was best for the public interest; and therefore the manner in which the service on the Dovor line had been conducted, and the additional exertions which the contractor had made to facilitate the enormous increase in our correspondence with India, were such as entirely to justify the extension of this contract. The absence of documents between the dates above named solely arose from the papers not then being in a form to be laid on the table; but during the whole of March the matter was constantly under the consideration of the Admiralty.

SIR MORTON PETO

said, that a deep feeling existed on the subject of these contracts in Canada. As an instance of the mode in which they were conducted he would mention that a deputation from that province, believing the proper Transatlantic route to be adopted was that of the St. Lawrence, applied to the Government some time ago to know whether it intended to renew the contract with the Cunard Company. The right hon. Member for Devonport (Mr. Wilson), speaking on he-half of the Government of the day, informed the deputation that it had no such intention. The province of Canada, acting under that impression, subsidized a line of their own for a weekly communication between Liverpool and the St. Lawrence at a cost of £100,000; and the people of that colony now complained that a practical injustice had been done them, and that something like a want of that perfect faith and good understanding which ought to subsist between them and the parent State had been shown towards them. When the Legislature of Canada met he had no doubt they would receive some strong protests on the subject.

MR. M'MAHON

said, he regretted to see so much of commercial jealousy towards Ireland imported into this discussion. It was not the fact that the Galway line of packets was the first that had been subsidized by the Government. Government subsidies had been granted for a long series of years to various steam-packet companies, and that not merely for postal purposes, but for the fostering of commerce and the production of large vessels. In fact, upwards of half a million of money, for which the Government received no return, was now yearly granted by the Government in those subsidies. At Liverpool alone the contract for the Cunard line had entailed a net loss of £61,642 a year, that is, beyond the amount of the contract. From the Report of the Committee on steam-packet contracts in 1853, (Appendix C) it appeared that these contracts—Halifax and new York, Bermuda and Newfoundland, and Bermuda and St. Thomas—together involved a net loss of £61,000 a year. To one of the companies running from Southampton to the West Indies we paid £270,000, involving a net loss of £180,000. To the Pacific mail we paid £25,000 for the mail running between Callao and Valparaiso; and the loss was £19,509. Upon all these lines of communication, carried on by steam contracts, not by packets in Her Majesty's service, we lost £378,608 a year. Why, then, should not Ireland, which paid her share, and more than her share, of Imperial taxes, be allowed the small sum of £72,000 out of upwards of £600,000 granted in subsidies every year, as well as any of our Colonies, for the improvement of her commerce and the production of large vessels? What said the Postmaster-General in his Report for the year 1858? He said, "the packet service is for the most part under the superintendence of the Admiralty, and is borne on the expenditure of that department, many of the contracts for this service having been entered into with other objects besides those of postal communication. Indeed, as postal enterprises, few of them could be maintained, the expenses in the large majority of cases far exceeding the earnings." Long as these subsidies had been granted for the improvement of our colonies, the moment that anything was proposed to be given for the improvement of Ireland, up rose hon. Members to talk of the necessity of rigidly adhering to the true principles of political economy, and to denounce the proposition. He had no objection to the entire withdrawal of these grants in every instance, because, so far as related to communication with the West Indies, Newfoundland, Canada, or America, Ireland being nearer to those countries, could beat England any day. Galway had been selected by unbiassed judges as the best and most natural starting point for communication with America, and yet the late Government were denounced as having been influenced by corrupt motives for selecting that point. He thought the late Government were entitled to much credit for their courage and justice in that matter. He presumed that the Chancellor of the Exchequer was still true to his early principles of free trade, and that he desired the proposed inquiry to be guided by those principles. He trusted that if they were to have an inquiry into the Galway contract, they would also inquire into every one of the Government contracts with steam packet companies. He trusted, also, that some of the Irish Members would be placed on the proposed Committee.

MR. BEAMISH

said, that he did not approve the alteration suggested by the Chancellor of the Exchequer, and he should therefore move the re-insertion of the words "beyond the limits of the United Kingdom."

MR. URQUHART

seconded the Amendment.

Amendment proposed, after the words "by sea," to insert the words "beyond the limits of the United Kingdom."

MR. WHITESIDE

said, it was not his intention to speak to the exact form of the Motion, but to say a word or two upon the debate which had taken place. He was somewhat surprised that after the explosion of patriotic indignation right hon. Gentlemen on the Treasury Bench should have vanished. The right hon. Member for Kilmarnock, professing not to wish to prejudge the question, had said everything which a man ought not to have said and very little which he ought to have said. The right hon. Member for Coventry (Mr. Ellice) evidently preferred another line to that of Galway. He (Mr. Whiteside) was not a Galway man, but he knew that the imputations of those right hon. Gentlemen were unjust, and their arguments untenable, and he challenged the Government to a discussion of the question. He was strongly in favour of the Irish contract. It was true that it might be said the arrangement was for the benefit of Ireland. It would be argued upon that principle, and they had a right so to argue it. It was not a new question. It was now ten years since it was first agitated, at a meeting in Dublin in which he took part, and that was a complete answer to the statement of its being suddenly got up, as a job, by the late Government. The right hon. Member for Kilmarnock, as was his custom, assumed everything in his own fashion and then walked out of the House. He begged to ask what was the trade of the North of Ireland? Was it with France? A steamer from Belfast to export linens was tried, but so untaught were the French in our system of political economy that they immediately put a new duty on linens, and would not allow Frenchmen to have clean shirts cheap. Was it with Germany? No. The north of Ireland trade was with America, and, that being so, why were purchasers, bills, money, and advices to be carried past the market for which they were intended to this country, and then sent back again after a delay of a day or two? He wanted to know why Ireland was not to be put upon an equality with England in this respect. It was said that it was a special matter. The hon. Members for Cork and Limerick might, perhaps, prefer those ports, but with those exceptions there was scarcely a town, city, or county in Ireland which had not expressed a strong desire on national and postal grounds in favour of the arrangement which had been made. He would read an extract from the letter of a nobleman not now in the Ministry, and why he was not, of course he could not explain? Since my attention has been directed to this important subject several years ago, I have always been of opinion that the advantages of the geographical position of Galway would not be fully recognized until it was demonstrated that the passage by that route to America could be more quickly performed than by any other. I heartily wish success to the company by which that fact is now established, and I beg to congratulate you upon your connection with an undertaking which promises to be so beneficial to Ireland. That letter was signed "Clarendon." If the noble Lord the Member for Norwich (Viscount Bury) were in his place he could tell the Government how often great steamers passing down Channel had been lost. There was the Great Britain, which blundered in some way into Dundrum Bay; and he was present himself when a steamer, which was afterwards lost, passed Belfast. He did not like to name the vessel, because which of them it was he had forgotten. Captain Washington, whose report fully justified the late Government in the course which they took, understated the value of the Galway route. Captain Washington said that the problem of the quickest passage had been solved, and in the way in which it ought to be solved, by the enterprise of the Lever Transatlantic Company, which had actually run vessels with 300 passengers to and from Galway, and made the passage from Newfoundland by one of them in six days less than the shortest passage on record. It was a mistake to say 300 passengers. It was nearer 600. He would not appeal to political economists on the ground of humanity, but they had heard not long ago of the loss of a vessel from Liverpool, and of 300 bodies washed ashore at Wexford. Independently of the commercial advantages of the Galway line, there were great advantages in favour of a quick passage. It would accommodate in that way second and third class passengers, who would not otherwise obtain it, and it would also promote postal communication between two great countries. He saw that the animus of this debate was directed against a thing done in favour and for the benefit of Ireland; but on that very ground he challenged inquiry. If Ireland were not large enough to be entitled to some little con- sideration let the Government say so. Who were the persons who signed memorials to the Government in favour of the Galway line? The first name was N. Rothschild, the second C. Peabody, and the third, Masterman, Peters, and Co. The memorials were signed by the first mercantile men in London, by a vast number of underwriters at Lloyd's, by the principal merchants in Manchester, Birmingham, and other commercial towns in England, and by almost the whole of the commercial men in Ireland. The line of communication would be completed from north to west, and the upshot would be that linens would pass from Belfast to Galway, and thence to America, and would not go by way of Liverpool. The claim of Ireland was not made by way of solicitation, but as a matter of right, and he knew that discussion would prove it to be just, provided that it was not made by those who had made up their minds to condemn first and inquire afterwards.

MR. COWPER

said, that the right hon. and learned Gentleman had dealt unfairly with his right hon. Friend the Member for Kilmarnock. The right hon. Member for Kilmarnock had, in a very temperate manner—[Cries of "Oh!"]—well, no matter in what manner, whether temperate or not, the right hon. Member for Kilmarnock had quoted chapter and verse for everything which he had asserted. If the right hon. and learned Member had risen at once and answered the speech there would have been no ground for complaint, but he thought it rather hard on his right hon. Friend that the right hon. and learned Gentleman should wait two hours before making his reply, when, in consequence of the understanding that the matter would not he discussed, his right hon. Friend had left the House. He must also complain that the right hon. and learned Gentleman, instead of meeting the real case, had appealed to the patriotic feelings of Irishmen, and tried to represent it as a matter of jealousy between England and Ireland. He had not heard a word in the course of the debate which lent the slightest shadow of accuracy to such a view as that. So far from grudging, he was quite delighted that Ireland had a packet communication of its own. She had not had one before because no sufficient offer had been made to any Government to undertake it. The blame incurred by the late Government was not for adopting Galway as a packet harbour, but for establishing a duplicate line to North America and about the same time that they extended the Cunard contract. If they had wished to deal economically with the finances of the country, instead of extending the Cunard contract, they would have prepared to reduce it and to transfer some portion of the service to the new line from Galway to the United States. The Government were also censured because, while the Secretary to the Treasury had written a letter stating that it was the rule to proceed in these cases by public tenders, the principle thus enunciated was subsequently disregarded and a contract made, not only without any previous competition, but in a manner of which the Liverpool Company had good grounds of complaint. He did not object to the Galway line, because it was an Irish line. To make a charge of hostility to Ireland against those who sat on his (the Ministerial) side of the House was unjust in the extreme. The objection was only to the way in which the contract had been given, and that he hoped would be sifted by the Committee. In the case of the Dovor contract, the Government had shown a similar disregard of the principle of competition, and by renewing the contract while it had four years to run had exposed themselves to suspicion and reproach.

LORD NAAS

said, he was glad to find that the opinion of the right hon. Gentleman the Member for Kilmarnock, to the effect that the establishment of a direct line of communication between Ireland and America was a profligate waste of public money, did not seem to be shared in by the right hon. Gentleman who had just spoken. But what, let him ask, was the course which the late Government had adopted in the matter? They had found a company in Galway actually in possession of the ground, and performing a packet service for the first time between the West Coast of Ireland and America, Great benefit to trade had already occurred thereupon. A contract had been entered into with that company, on the part of the Government, subject to the approval of Parliament, and although it was true that the rule—which he admitted was a salutary one—of putting the line up to competition, had not been followed out, yet the Government had precedent for the course which they took, and that the rule in question was one of by no means an absolute character. The right hon. Member for Kilmarnock had laid great stress on the letter which had been written by Lord Colchester, in which strong objec- tions had been urged against the proposed scheme; but Lord Colchester had stated distinctly that if it could be shown that a great public benefit, by acceleration of the mails, would arise from its being carried into execution he should waive those objections. That noble Lord said that in his opinion the only way in which the end in view could be attained was by making the amount of the remuneration of the contractors wholly dependent on their success. Well, then, that is the principle laid down by the Treasury minute, and the contract is framed on the principle that payment depends upon success; what, he would ask, had been the advantage, leaving Ireland altogether out of the question, which accrued to the postal communication, not only between London and America, but between America and the Continent, as the result of the practical application of that principle in the present instance? A Treasury minute had been issued, which took as a basis for the time to be occupied in the performance of the service, the average number of days which it took the Cunard steamers to accomplish it, deducting therefrom the number of hours which were spent in the transit of the mails from London to Liverpool and placing them on board the steamer, as well as making an additional deduction of twenty-four hours. The result was, that there would be a gain of something like thirty hours in each voyage, or, at the lowest calculation, fifty hours on the trip out and home. The whole question had been very carefully considered by the late Government, the undertaking had received the recommendation of the most eminent authorities, and he believed that when the promoters had an opportunity of setting their case before the Committee, they would be able to show that the scheme would confer great benefits not only on Ireland but on this country and on Europe at large. If direct telegraphic communication with America was not established, the comparative advantages of the Galway route over every other line would be still greater. Rival interests and commercial jealousy had a good deal to do with this opposition. In conclusion he would beg the House to recollect that of the large sums voted for postal services none went to any ocean steamers starting from Ireland.

MR. J. EWART

begged to assure the House that there was not on the part of the people of Liverpool the slightest feeling of jealousy in the matter, inasmuch as they were well aware that whatever conferred a benefit on Ireland must tend also to their advantage. He had, however, felt it to be his duty to denounce the transaction under discussion from the very first, in consequence of the manner in which the contract had been made. He and his hon. Colleague had called on Mr. Hamilton, who was then Secretary to the Treasury, and all that they had asked was, that, if a postal service was to be established between England and Ireland, public tenders for its performance should be invited. They had added that the Liverpool Company possessed large steamers, and that they had conducted the postal service in which they had been engaged in a manner creditable not only to themselves but to England,

COLONEL DUNNE

said, he was glad that the discussion had taken place, as he thought it well that Ireland should be made aware that the first act of the new Government was to endeavour to upset the only scheme for many years from which she had derived any considerable advantage. It was, however, said that Ireland had never sought that that advantage should he conferred upon her; but that was not the fact, for experiments had over and over again been made with a view to the establishment of such a service. It was, indeed, true that one Commission which had proceeded to the west coast of Ireland to examine its capabilities as presenting a suitable point for the formation of a packet station had concluded their labours by reporting in favour of Holyhead. But it was trifling with the question to say that the people of Ireland were indifferent with respect to it, and he trusted that if the proposed Committee were granted Irishmen would not be excluded from it as they were from the present Government.

SIR HENRY WILLOUGHBY

said, he would remind the House that the question before them, which he thought had been for a time lost sight of, was whether it was expedient to appoint a Committee to investigate the manner in which these contracts were made and to consider the best mode of regulating these contracts in future. To him it was quite clear that a necessity had arisen for some inquiry. In the early part of the evening he called the attention of the House to the circumstance of the Lords' Amendments to the Red Sea and India Telegraph Company's Bill, which stood on the paper as a private Bill, though it involved a large outlay of public money, receiving the formal sanction of the House without scarcely attracting its attention. Though he had no objection to the Committee proposed by the Chancellor of the Exchequer, he submitted there was a simpler mode of meeting the evil it was intended to remedy, and that was to make it a condition of every grant of public money for the services in question that the proposal should be introduced to the House by a responsible Minister of the Crown, representing some department of the State, and made the subject of a public Bill. It was only in that way that the House could have any practical control over contracts of that kind. The system of making agreements between the head of a Government, and persona, however respectable, did to a certain degree fetter the judgment of the House, and he did think the proper remedy would be for the House to resolve that in no case whatever should there be a grant of public money unless by statute.

SIR FRANCIS BARING

said, that without entering upon the question of the Galway contract he wished to call attention to the fact that in the Naval Estimates which were about to come under the consideration of the House, that a Vote was to be taken under a new contract, and to submit that if the House voted that money they would become parties to the contract. If, however, the Government proceeded with the contract it would be necessary to grant the money. He would, therefore, suggest that the Vote should be postponed until after the Committee had made their inquiry. He thought the appointment of the proposed Committee would result in great public benefit, for no man could deny that the present practice of dealing with those contracts was most irregular; and it was therefore incumbent on the House to declare the principle on which they were to be regulated in future. With this view he would suggest that a rule should be made requiring that all these contracts should be laid on the table, and not be valid unless they were unobjected to for a certain time after.

MR. MAGUIRE

said, he had expected that the Motion would have been agreed to as a matter of course, as nothing could be more fair or more prudent than the manner in which the Chancellor of the Exchequer had brought it forward; but he regretted to find that a right hon. Gentleman on the other side of the House, from one of the sister countries, carried away by national prejudice, had made an attack upon the late Government for giving en- couragement to one of the most important of modern Irish enterprises. It was the habit in England to twit the Irish people with a want of energy and self-dependence; but now, when the people of Galway had displayed those qualities in an extraordinary and successful manner, so far from their receiving credit, an attempt was made by gentlemen in Liverpool and some parts of Scotland to make that circumstance the ground of local jealousies, and of complaint against the late Government for sanctioning the contract in question. He trusted that the present Government, led away by the whisperings of parties in Liverpool, or by a desire to inflict a blow upon their predecessors, would not be guility of an act of injustice towards Ireland which would justly incur the indignation of that country. For a long time past Irish Members had made demands upon the Imperial Government, and it would shortly be his duty to ask that a larger share of the taxes of the United Kingdom should be spent in Ireland than had hitherto been devoted to Irish objects. Many millions were annually expended upon foolish and un-remunerative enterprises in England, while the great natural advantages of Ireland were neglected, and but for the late Government nothing would have been done to promote the Galway project. Galway was as much a part of the United Kingdom as Chatham, Portsmouth, or Liverpool, and he saw no reason why its harbour should not be made accessible to the largest ship in the Royal Navy. In Ireland the feeling was strongly in favour of the establishment of the line. He was himself an inhabitant of Cork, and he had naturally a strong feeling in its favour. He believed that the Cork harbour was the best in the world; but the success of the Lever undertaking had at least been attended with this benefit to Cork, that it had directed the attention of all parties engaged in Transatlantic communication to its unrivalled natural advantages. The Liverpool steamers now often called at Queens-town, and by that means several hours were saved in the conveyance of the mails between this country and America. But whatever might be his feelings in favour of his native city, he was anxious to give fair play to Galway, and he trusted that the industry and enterprise of its citizens would receive every encouragement from the House of Commons.

LORD JOHN BROWNE

said he had heard with great pain from the right hon. Gentleman that the Galway contract was still in embryo. A sum of about £1,000,000 was annually voted by that House, not only for the conveyance of our foreign and colonial mails, but also to secure the maintenance in good working order of a certain number of first-class steam-ships, suitable to the conveyance of large bodies of troops with speed, with safety, and with due regard to their health and efficiency. England has hitherto enjoyed a monopoly of that grant, and it was not until Galway had been allowed to participate in the advantages of the system that it had become in any quarter the subject of the slightest animadversion. The Government had entered into a contract with the Cunard company, which excited no opposition, by which they bound themselves to make them an annual allowance of £173,000 for a period of eight or nine years; and yet the virtuous indignation of English patriotism now boiled over because a much smaller sum was to be given for the conveyance of a mail from an Irish port. Surely if England had all the rest of the trade, she need not be so greedy or so grasping as to grudge Ireland this one packet station to which her geographical position entitled her. Was Ireland to have only equality of taxation without equality of advantages? Last century they crushed the manufactures of lie-land; let them not no v crush the rising mercantile enterprise of that country. Let the House look for a moment at the advantages offered by the ports of Liverpool and Galway. At Liverpool a Cunard steamer had been known to be detained outside the harbour for a period of eight or nine hours in consequence of the state of the tide. No such inconvenience could occur at Galway. There was a saving of between 300 and 400 miles of sea passage by adopting the Galway route; that space could not be traversed in less time than about a day and a half, and it was precisely in that portion of the voyage that there was the greatest risk of loss from shipwreck or collision. Although there was a greater amount of railway travelling by the Galway line, it ensured a saving of a day in the whole journey between England and America. It was moreover a fact that Irish letters formed a large proportion of the correspondence between this country and America, and the establishment of the Galway route was also attended with this important advantage, that it afforded great facilities for the conveyance of Irish emigrants to America. If the House were to annul either of the two contracts, why should they not select the Liverpool company for that extreme exercise of their power? The fairest mode of proceeding, however, as he believed, would be to allow both contracts to stand, and at their expiration to invite an unlimited competition from England, Ireland, and Scotland, for the conveyance of those mails. Mr. Lever was bound in the strictest terms to perform a certain service; some persons said he would be unable to fulfil his contract; but if that should be the case the loss would fall upon him; and if, upon the other hand, he should carry out his engagement, the voyage between these islands and America would be accomplished in six days, and the public would receive the benefit of his successful enterprize.

THE CHANCELLOR OF THE EXCHEQUER

said, that some points had been raised in the course of that discussion which he felt it his duty briefly to notice. An impression seemed to exist in the minds of some hon. Gentlemen that a portion at least of the English Members were jealous of Irish enterprise. But he was persuaded that no such feeling existed on the part of any of the Members of that House, and that from whatever part of the country they came they all gladly welcomed every indication of prosperity, either in England, in Ireland, or in Scotland. But the suspicion to which he referred was only one of the evils inseparable from the system of granting public subsidies of that description. The inevitable result of such a system was, along with other secondary disadvantages, the introduction of a painful rivalry and a conflict between the claims, or the supposed claims, of different parts of the kingdom. With regard to the order of proceeding in that Committee, he ventured to anticipate that in consequence of the obvious conclusion of the case, and with a full recognition of all the obligations, whatever they might be, the country had contracted, it would be expedient the Committee should inquire at a very early period into the Galway contract. The progress of the debate had clearly shown a general wish to that effect on both sides of the House, and after so much had been said both in condemnation and in defence of the transaction, it was eminently desirable that it should, without any unnecessary delay, be brought under the review of the Committee. At the same time he admitted the force of what had fallen from his right hon. Friend the Member for Portsmouth (Sir Francis Baring) with re- spect to the inexpediency of their making a grant for the Dovor contract until they should have received the opinion of the Committee upon that subject; and it would be well perhaps that the Committee should give their early, possibly even their first, attention to that limited case, and that his noble Friend the Secretary to the Admiralty (Lord Clarence Paget) should, in the meantime, postpone the Vote in the Estimates in respect of that contract if such a course could be adopted without inconvenience to the public service. His right hon. Friend the Member for Kerry (Mr. H. A. Herbert) had expressed an apprehension that the contract which had been entered into for the conveyance of the mails between Kingstown and Holyhead might be made one of the subjects of the inquiries of a Committee, But the Government had not the slightest intention of reopening that question, upon which a Committee of the House, after a full investigation, had already given its decision. The reason why he wished to include all sea contracts was because, as these contracts extended to long periods of years, and tended, therefore, to narrow, or even to exclude the jurisdiction of Parliament, the Government thought it desirable to refer them to the Committee to suggest what rules they might think necessary in concluding such contracts for the future. The object was to secure the rights of the House in these matters, and not in the slightest degree to reopen the question alluded to by his right hon. Friend. His hon. Friend the Member for Stamford (Sir Stafford Northcote) had suggested that the words of the Motion should be so extended as to include an inquiry into the principles upon which that service should be conducted; but it appeared to him (the Chancellor of the Exchequer) that such an alteration of the notice on the paper would be entirely unnecessary, as the proposed Committee would unquestionably have the power, under the Motion as it stood, of inquiring into that subject and all others of a kindred character. Another point to which he wished to allude was the course which the Government would pursue during the time the Committee would be prosecuting its inquiries. He could hardly suppose those inquiries would be brought to a close before the end of a few weeks, but he did not anticipate that they would extend over a number of years. Her Majesty's Government, however, were decidedly of opinion that during the time the House of Commons was investigating that subject, they ought, as far as possible, to hold their hands with reference to any new arrangement of that description, and that they ought not to sanction any contract for a new service unless under very urgent circumstances, or unless it was to be of a purely temporary character. He hoped the House would think that, in adopting that as their general rule of conduct, they would be taking the course which was most consistent with a due respect for the jurisdiction of the House, and which would not, at the same time, be likely to produce any serious injury to the public service.

MR. BEAMISH

said, that after the statement of the right hon. Gentleman he would not press his Amendment.

Amendment by leave withdrawn.

Main Question put and agreed to.

Select Committee appointed.