HC Deb 18 March 1879 vol 244 cc1191-9

, in rising to move— That the Contract entered into with the Royal Steam Packet Company for the conveyance of Mails to and from the West Indies Too approved, said, that the existing contract would terminate in 1880. In the middle of last year the Government invited applications for new tenders for that particular service. Six tenders only were received, of which four were for a portion of the route only, while two were for the whole service. One of the latter was made by the Atlas Company, which proposed to convey mails from Queenstown to New York by the ordinary mail steamers, and from New York, for delivery at the different ports, by the steamers of the Atlas Company; and the Company offered to do this for £59,500 a-year. The second tender for the whole route was sent in by the Royal Mail Steam Packet Company, which had the present unexpired contract, which was for £86,750 a-year. For the same sum the Company offered to continue the service, with the option to the Post Office of an addition of one knot to the speed. Besides comparing the proposed subsidies, the Government had to consider the routes and the methods of delivery, and these involved, not only the times of delivery, but also the Imperial question of direct or indirect communication with our own Colonies. The Secretary of State for the Colonies was strongly in favour of direct communication, both on commercial and on political grounds, which greatly influenced the decision of the Treasury. As to times of delivery, while the figures before the House showed a certain gain on the part of the Atlas Company in delivering the mails at Jamaica, there was a loss in respect of almost every other Colony as compared with the times named by the Royal Mail Company, whose tender he asked the House to accept. The delay varied from a certain number of hours to six and seven days at some of the more distant ports; and it was felt, both by the Treasury and the Colonial Office, that this was a most important consideration in deciding which of the two contracts should be accepted. Moreover, it was stated by one of the Governors of the Colonies that the service of the Atlas Company was "anything but satisfactory." It was further found, from evidence of the Board of Trade, that not one of the six vessels of the Atlas Company carried a Board of Trade certificate. They were very good vessels for the purposes for which they were employed; but they could not compare, in speed or in accommodation, with the vessels belonging to the Royal Mail Steam Packet Company. The hon. Member for Birkenhead (Mr. Mac Iver) had proposed to ask the House to postpone the consideration of this contract for a month, and thereby he would keep in suspense the operations of the Company, which, so far as he (Sir Henry Selwin-Ibbetson) understood, that hon. Gentleman considered was a good Company, and one perfectly qualified for this particular service. It had been said it was unfair that the contract should have been re-submitted to the Royal Mail Company for re-consideration, seeing that another Company had made its offer. There had really been no unfairness. The Royal Mail Company had not been compelled to reduce their original contract in consequence of any offer submitted by any other Company. The contract was simply reduced on a representation made by the Treasury and Colonial Office that it was too high. He did not wish to detain the House upon other points of detail; and, having endeavoured to state the reasons which he thought justified the Government in what they had done, he would now ask the House to confirm the contract which they had entered into with the Royal Mail Steam Packet Company for the conveyance of mails to and from the West Indies.

Motion made, and Question proposed, That the Contract entered into with the Royal Mail Steam Packet Company for the conveyance of Mails to and from the West Indies be approved."—(Sir Henry Selwin-Ibbetson.)


said, this was, to some extent, a question between the Royal Mail Company, of Southampton, and the Atlas Steamship Company, of Liverpool, and there was no doubt whatever that the Atlas Company had been somewhat hardly dealt with. The West India Postal service was not one for which there had been any rush of competitors, nor was there any reasonable ground for supposing that the Southampton Company had, in the first instance, demanded any excessive remuneration for the work that was expected of them. That Company was one which, during many long years, had done excellent service, and although thoroughly well managed, it was a Company that did not yield any very large return to the shareholders; and it was no secret that, at the present moment, the stock was quoted at a considerable discount. The Atlas Company, conducted by Messrs. Leech, Harrison, and Forwood, of Liverpool, was also a well-managed concern, but not too remunerative, trading between the United States and the West Indies. They had never, so far as he knew, done any work for the Government; and the fact of their trading between America and the West Indies was the simple explanation of why their steamers did not carry Board of Trade certificates. It was not fair to the Royal Mail Company, and it certainly was not fair to the Atlas Company, merely to use their tender as a means of bringing down the price of those to whom the work had been given. The Royal Mail Company had an opportunity of amending their tender; and by having the Atlas Company played oft' against them had been, as he thought, squeezed down to an unremunerative figure, while the Atlas Company, who were still the cheapest, were left out in the cold. The Post Office had, perhaps, done a sharp thing; but he thought it could not permanently be for the national advantage to have contracts undertaken on terms which did not afford a reasonable remuneration. In the present case, if the question before the Government had simply been in regard to carrying letters, then he thought the Southampton offer should have been put aside and the Atlas Company's offer should have been accepted. The question, at all events, was partially one of letter-carrying; and he urged now that the Post Office should, even in the face of the revenue that might be lost thereby, avail themselves of the proposal of the Atlas Company, in addition to that of the Royal Mail Company. What he (Mr. Mac Iver) wanted was the double service. The facilities to British and Colonial trade, which would be afforded by doubling the existing number of mails, and sending some portion of the correspondence viâ the United States at the cost of the ocean postage, would be worth all the money. He did not ask the House to reject the Southampton contract, but only to postpone its approval, in order that the Post Office might have an opportunity, in the meantime, of making arrangements with the Atlas Company to afford additional postal facilities. It was in order to allow time for the consideration of this question that he had placed on the Paper the Amendment which stood in his name. As regarded the mere conveyance of the mails, he insisted that the Atlas Company's route was the best, especially with respect to the interests of the Islands which were the furthest from England. He could not conclude what he desired to say without pointing out that this contract with the Royal Mail Company of Southampton, which the House was asked to sanction, and which he (Mr. Mac Iver), notwithstanding the Amendment which appeared in his name, was really desirous of supporting, was altogether contrary to the principles of what was called free trade. It was not unworthy of remark that the right hon. Gentleman opposite (Mr. Childers), the Chairman of the Royal Mail Company, who was a very ardent free-trader, ceased to become so the instant a practical application of what were called free trade principles was brought home to himself and his friends. If it was to the interests of the nation that everybody should always go to the cheapest market for everything, then surely the House of Commons ought not to ratify this contract with the Royal Mail Company. It was neither the best nor the cheapest way of carrying the letters; but, on the other hand, the principle involved in this contract had his (Mr. Mac Iver's) complete and hearty approval; and, notwithstanding the inconsistency of free-trading Gentlemen opposite, he hoped that not merely this contract in itself, but also the principle involved, would be equally acceptable to the House of Commons. The service proposed was, in one sense, not a mercantile service at all. The question involved was, whether in years to come our West India Colonies were to remain part of the British Empire or to be handed over to their neighbours across the Atlantic. The ties between the Mother Country and the Colonies generally were worth preserving, and no question could possibly be of more importance than this one at the present time. This, however, was not free trade in the sense in which the right hon. Gentleman on the other side of the House understood it. Free trade—or that which some hon. Gentlemen opposite called free trade—would, if continued long enough, lose us our Colonies. Look at Canada. How long would their loyalty be proof against a fiscal union with the United States, unless we at home could find some means of putting our Canadian fellow-subjects on a more favourable footing as regarded their exports to Great Britain than their competitors in the United States of America? The trade of some of the West India Islands with the United States was already larger than with Great Britain; and so much was that the case that, in the Petition which his hon. Friend the Member for Liverpool (Mr. Rathbone) had presented, it was urged as a reason why we should contract with the Atlas Company rather than with the Royal Mail Company. But if it ever came to be a question as between these two Companies, it would, he believed, be to the interest both of Great Britain and of her Colonies to maintain the communication direct. For the reasons he had stated, he believed that the contract with the Royal Mail Company, which the Secretary to the Treasury asked the House of Commons to approve, was, so far as the policy and principle of it was concerned, a wise one, and ought to receive their sanction. It could not, however, be denied that our West Indian Colonists deserved more consideration in the way of postal facilities than they had received; and he hoped his noble Friend the Postmaster General would be able to see his way to making arrangements with the Atlas Company in addition to those for which approval was now asked in respect of the Royal Mail Company.


did not think that his right hon. Friend (Mr. Childers) was open to the charge of deviating from his free trade principles, when, as Chairman, he made the best bargain he could for his Company. The policy of the Government, however, he could not help thinking, was wasteful and unwise. The parties immediately concerned—the Treasury and the Post Office—were the representatives of the taxpayers of the country, and they had accepted a tender which, in the first instance, was £26,000, and even when reduced was £20,000 in excess of the offer made by another Company. Who was benefited thereby except the Royal Mail Steamship Company? The service required was the carriage of certain mails sent by the inhabitants of this country, and to facilitate the postal communication was the object of the subsidy; yet six-sevenths of the whole amount of the mails would have been carried more rapidly by the Company making the lower offer, because there were not only the Jamaica mails, there were the New Grenada and other islands mails, and not only this, but the cheaper tender included 26 instead of 24 mails during the year, so that by two mails in the year would the convenience of the senders of letters be diminished. Certain Colonies, it had been said, would gain by more rapid communication; but even these Colonies would have gained had the other route been chosen, because there was a large and increasing trade with the United States, and until recently they had paid a considerable subsidy to have letters carried that way. Here, then, those Colonies would gain. If time had been given the Company they could have arranged to amend this contract, and secure that very direct service which had been made the reason for withholding the contract from them. What could be the real reason why the Government had taken the dear contract? The Reports on the subject, which were before the House, showed that the Post Office at once, on the grounds of pecuniary advantage, were prepared to take the Atlas Company's offer; but before accepting it communications were made to the Colonial Office, and then arose the objections, and finally the other offer was accepted on the ground that more direct communication would tend to increase social intercourse with the Colonies. He could not help saying that the Government seemed to have acted upon information as antique as were their commercial principles. They had acted in the spirit of Protection; and they seemed to suppose that if they had given the contract to the Atlas Company instead of to the Royal Mail Company there would have been no direct communication with the West India Islands. They did not seem to be aware that certain Companies had monthly communication with the West Indies, and the mail question, one way or the other, would not prevent there being this direct communication. They seemed to think they lived in a period when there was no steam communication except when subsidized by the Post Office, instead of, as now, having Companies who carried on a large regular trade, independent of the Post Office service. He could not understand how the Government policy could be defended as being in the interests of the Colonies, or even of the idea of keeping up social intercourse between them and this country; and certainly it was no advantage to make a payment out of the not too rich Exchequer of £20,000 more than was necessary. The policy pursued was unwise on another point. If, although they invited tenders, the Post Office practically gave the preference to a certain Company at a higher rate than they could get the work done elsewhere, the end would be that no other Companies would tender at all, and the Post Office would be left bound hand and foot in the hands of this large Company. This was the inevitable consequence of the course the Post Office was adopting in the matter, and of a policy neither economical or wise.


pointed out that the steamers of the Royal Mail Company were more rapid and powerful than those of any rival Company, and that the speed of vessels was a matter of the greatest consequence. As had been stated, to some of the more distant ports of call a saving of seven days was effected by the most powerful boats. This, where large amounts of commercial bills of exchange were carried, was of great advantage to commerce.


said, he did not hesitate to say that the Government, in deciding upon the rival tenders, were mainly actuated by Colonial and Imperial considerations, and not by the mere questions of expense. The present contract was for a less sum, by £6,500 a-year, than the last. Anyone who read the official Papers would see that the Post Office had simply sent on the tenders to the Treasury, with the suggestion that the Treasury should take the opinion of the Secretary of State for the Colonies before they came to a decision. The Treasury naturally adopted that course; and the Colonial Office authorities, after a careful consideration of the whole question, had, in the interest of the Colonies, come to a conclusion favourable to the Royal Mail Company, and the Government then accepted that tender. He thought the Government were more than justified in taking the opinion of the Colonial Office, which was a course suggested in the Report of a Committee presided over, in the first instance, by Mr. Cobden, and, secondly, by Mr. Dunlop.


said, the complaint was that the tender of one Company was used as a lever to pull down that of another Company, without giving that other Company a similar chance of lowering its tender. The result of the policy of the Government would be, he thought, to prevent independent Companies from tendering in future, as they would not submit to having their tenders treated in that unfair way.


said, that the Government had exercised a wise discretion in accepting this contract, because the work would be done better by the Royal Mail Company than by any other; and, as it was, the sum of £6,700 a-year was saved by the present contract. As they had saved this sum, he hoped they would favourably consider the propriety of embarking the outward mails at Plymouth, which the Company would undertake for £2,000 extra. Replies to letters arriving from the West Indies could thus be despatched one day later; and that often meant the saving of 14 days or more as compared with present facilities.

Motion agreed to.