§ Order for Second Reading read.
§ Motion made, and Question proposed, "That the Bill be now read a second time."—(Sir Charles Forster.)
§ MR. HOULDSWORTH (Manchester, N.W.)
I rise to support the second reading of this Bill; and I will venture to state very shortly what its objects and provisions are. I think I may say that its principal object is, in one word, to give effect to an Act which was passed during last Session for the construction of a Ship Canal between Manchester and the sea. I may say at once that it is felt by the promoters—it has always been felt by the promoters— 234 that the powers which are asked for in this Bill were necessary in order to carry out the construction of the works which were sanctioned by Parliament last year. The Bill itself is a very simple measure. It provides for the payment of interest during the construction of the Canal at 4 per cent per annum. It provides that such interest shall only be paid in respect of the time authorized by the Act of 1885 for the completion of the works thereby authorized, or such less time as the Directors may determine. It also provides that no such interest shall accrue in favour of any shareholders for any time during which any call on any of his shares is in arrear; that the aggregate amount to be so paid for interest shall not exceed the sum of £752,000; that the total amount of money which the Company are by the Act of 1885 authorized to borrow shall be reduced by an amount equal to one-fourth of the sum expended in the payment of such interest, and that such reduction shall be made from the last instalment of £500,000 by the said Act authorized to be borrowed; that every prospectus, advertisement, or other document of the Company inviting subscriptions for shares in the undertaking and every certificate of such shares shall contain a notice that the Company has power so to pay interest or dividend; and that the half-yearly accounts of the Company shall show the amount of capital on which and the rate at which such interest or dividend has been paid. I may say that the various provisions of the Bill which I have read to the House are all in accordance with the Standing Orders of the House in reference to this question. It may be very properly asked why the powers sought for by the Bill were not asked for in the Bill of last Session before it became an Act? My answer is that they were asked for, and they have always been asked for. Probably hon. Members are aware that the Manchester Ship Canal has been before Parliament during the last three years, and in every Bill introduced by the promoters this clause was contained. The first Bill was referred to a Select Committee of this House. On the second occasion the investigation commenced in the House of Lords, and there the Earl of Redesdale allowed the clause to go through the Committee, although, I believe, he had a personal objection to 235 it; and it was passed by that Committee of the House of Lords on the one condition that the Earl of Redesdale should withdraw his opposition. When the Bill came before the House the Earl of Redesdale did not withdraw his opposition, and the Bill was ultimately lost. On the third occasion on which the Manchester Ship Canal Bill was introduced the Earl of Redesdale objected to the clause being put into the Bill, or if it were put into the Bill he proposed to enter such an objection to it that it would be fatal to the measure. As a matter of fact, when the Bill came before a Select Committee of the House of Commons there was no power to reinsert the clause, and the promoters were perfectly helpless in the matter. The object and intention of the promoters last year was, on the consideration of the Report in this House, to propose and ask for the power we are now asking for; but it will be apparent when I say that the Bill only came down to this House just before the close of the Session; that it only passed through the Select Committee on the 30th of July last year; and that it was impossible to ask the House, with any chance of passing the Bill, for powers which might be fatal to the entire Bill. The promoters, therefore, preferred to have half a loaf rather than no bread. That is the simple explanation why we appear this year in this form, when we should infinitely have preferred to have dealt with the matter in the clauses of the Bill of last year. We have always endeavoured to do so, and it was only owing to the peculiar circumstances of the case that we were not able to carry out our intentions. The assertion has been made that the promoters of the Bill have failed to raise the necessary capital; but I venture to say that that is not the case. It never was supposed for one moment that they would be able to raise the capital with the disability they now labour under, by the absence of the powers now asked for in the provisions of this Bill. References have been made on more than one occasion to the promises which were given when the Bill passed through Committee—to the strong assurances which are stated to have been given that the capital would be raised. Now I venture to say that there is no proof, and that no proof can be brought, that those promises were 236 made on any other assumption than that these powers would ultimately be obtained by the promoters. I believe that the conditions under which it is expected that this capital will be raised will be the ordinary conditions—the conditions under which every Company, with few exceptions, is able to raise its capital. The fact is that there has been no large undertaking in this country ever started which, in some way or other, did not pay interest during construction, and it will be admitted that all existing Companies are able to pay interest during any extension. I do not think that will be denied. I could bring forward many instances to prove the truth of the statement I make; but I will only mention one—namely, the case of the Great Western Railway Company. It was stated at the last yearly meeting of that Company that they were paying a dividend of one and three-fourths of a million of money which the Severn Tunnel cost them, although that tunnel is not yet increasing the receipts of the Company in any way. Then there is the case of Limited Liability Companies. Limited Liability Companies are all of them able to pay interest during the construction of works, if they are so pleased. Then there is also the case of various Indian Railways. Indian Railways I believe, without exception, pay interest during the construction of works. All enterprizes abroad pay interest in a similar way, and there is no prohibition whatever. In point of fact, it is quite the reverse; for in France Companies are actually bound to provide capital for the payment of interest during the construction of works. Then we come to another instance which, I think, with Parliament ought to have a considerable amount of weight—that is the practice of getting contractors to finance works, and paying interest during construction. I would also refer to a precedent which Parliament itself established last year in the case of the Hull and Barnsley Railway Bill, which was specially introduced, and received the sanction of Parliament, for the payment of interest out of capital during the construction of the works. I think these are instances which should induce the House to permit the relaxation of the ordinary Rules. It cannot be expected for one moment that capitalists will come forward to provide capital for this great 237 undertaking, especially when we consider the large amount which it is necessary to raise on an important undertaking like this, without they have some return for the money they advance, seeing that the Bill allows seven years to the promoters for the completion of the scheme. I do not think, when you come to consider all these exceptions which Parliament has made in one form or another, that you could expect the capitalists of Lancashire and Yorkshire to forego, in the promotion of a great work of this kind, the interest on capital which they are realizing in other directions, for a period of seven years. That is my answer to the charge that we are attempting to defeat the Rule of Parliament that interest on capital shall not be paid during construction of works. I now come to another point, and that is that it is asserted that a bargain or settlement was come to when the Bill was before the Select Committee of the House of Commons, and that we are attempting to get behind that settlement and bargain by the present Bill. That is the allegation which is made by our opponents; and it is stated that the provisions which were contained in the Bill of last year were not enforced by the Committee, but were voluntarily offered by the promoters of the Bill. The condition under which the Bill was passed is said to be that £7,000,000 should be raised before any works were undertaken or began with regard to the construction of the Canal. That is said by our opponents to have been a condition imposed upon us as a substantial test of the financial merits of the scheme. Now, I venture to deny that proposition altogether. It was not imposed as a substantial test of the financial merits of the scheme. I do not think that Parliament had anything to do with the question whether the capital could be raised for this undertaking or not. Certainly, Parliament ought to see whether the scheme was a substantial or a bogus one; and the Committee would have been very ill-informed if they had only sanctioned the scheme on the hypothesis that the works would ultimately be carried out. No doubt, there are many schemes which have received the sanction of Parliament which capitalists have not ultimately supported; but the real reason of the present opposition to the Bill is not that there is any desire to protect the capitalists, 238 but to protect a great interest which it is thought would be interfered with by the action of the promoters of the Bill. The object of Parliament has been to prevent the public from sub-scribing to undertakings unless there was a fair prospect of the whole capital being subscribed. The desire was to prevent a small amount of capital being raised and works begun when, after all, the works thus commenced would never be finally carried out, and the money embarked in them would be entirely lost. It was to protect the public from embarking in undertakings of that kind that this condition was imposed. We are told by our opponents that we are breaking the guarantee which we gave when we obtained the Act of last year; but if we get the powers we are now asking for, and facilities to pay interest out of capital during the construction of works, I maintain that we shall give a greater guarantee for the success of the Canal, or, at any rate, for its completion, than we have ever been able to give before. I observe from the Notice Paper that the question of how this matter is to be dealt with in this House is to be raised by my noble Friend the Member for Liverpool (Lord Claud Hamilton); and it would appear that our opponents are not seriously going to discuss the question on its merits on the second reading, but are going to suggest that the Bill should be referred to a Select Committee. I believe that a complaint is made by them which they feel themselves debarred from raising in the ordinary way, and therefore they ask to be heard in an unusual and an unfair manner. All I can say is that, in the first place, our opponents are here to-day, and they can raise any objection to this Bill which they please. But, more than that, we have taken no step whatever to debar them from going before a Select Committee if the ordinary Rules and Regulations of the House will permit them to do so. We are perfectly prepared, if they have a right to be heard against the Bill which we now ask the House to read a second time, to meet them before a Select Committee; but we do not think that we have any right in justice to ourselves, after the large amount of money we have already spent, and the great delay which took place before we were able to obtain the sanction of Parliament to our Bill, to increase 239 that amount of cost and that delay, in I order to place them in a position to be heard. Parliament has laid down certain Standing Orders which guide the practice of the House in questions such as this. If the interests of any Petitioner against the Bill are affected by the measure they will obtain a locus standi before a Committee; and if they are not affected by the Bill, I want to know why they should be heard? Now, I believe there is a great impression abroad that, in the introduction of this Bill, we are pressing a principle which is opposed to sound finance, and altogether contrary to the principles of what is called financial morality, and that we are endeavouring to make an exception from the principle already laid down by Parliament. I am not going to argue the question whether that principle has already been laid down by Parliament or not. I merely state my own opinion that I believe the prohibition to pay interest during the construction of the works has never been laid down absolutely by Parliament. The exceptions are so numerous in every direction that, certainly, it is a principle which the House may be fairly asked on a special occasion to give way upon. Nor has the principle been consistently applied. In the first place, borrowed capital on all these undertakings has always received interest, and that interest is paid during the construction of works, although no profit has been earned by the Company undertaking the works. Then, again, interest is paid on calls made in advance, and in that case Parliament has given its permission to payments being made out of capital as a return to those who pay their calls in advance. Once more, there are the Limited Liability Companies, every one of which, although the provisions of the Companies' Clauses Act are against this power, can at once take advantage of the power; and they have always received the authority of the Board of Trade as a matter of course. In the next place, there are great evasions of the prohibition, if such prohibition exists, by contractors and others, which I must admit are very prejudicial to the economy of most of our great undertakings. I may now be allowed for a moment to refer to the reasons why I urge upon the House the desirability of passing the second reading of this Bill on this occasion. The 240 Act of 1885, which was passed after a three years' struggle carried on at enormous expense, will, I believe, be perfectly inoperative if this Bill does not receive the sanction of Parliament. I need scarcely say that this is not a bogus Company—that it is not a Company created by what are usually called promoters, however estimable promoters may be. I am not offering any opinion with regard to promoters at all; nor am I saying a word about them in a sinister sense; I am only saying that this Company was not got up by promoters. The Company may be more truly described as a great effort on the part of a great community to relieve themselves of difficulties of transit, and of the cost of that transit, which they feel to be very oppressive on the whole trade of the district. I do not mean to say a word against railways which have served the district well in the past, and which may serve the district well in the future; nor have I anything to say against the Port of Liverpool. There, again, Manchester has been very much indebted to Liverpool; but I do object that in these times of great depression and difficulty the people of the district should not have a right to come to Parliament, and, if they can, to suggest a mode whereby their productions can be sent to the consumers at a cheaper rate than that which at present exists, so that their trade may be improved, with a due regard, not only to the railway interests, but with due regard also to the interests of Liverpool. I think, on the contrary, that it is their right to come to Parliament and ask Parliament to give their sanction to such an undertaking; and I will venture to add that it seems to me that there is another claim on the House of Commons. And it is this. At the present moment, if there is one subject which is exciting the minds of commercial men and those engaged in industrial pursuits more than another, it is the great loss sustained in the country by allowing the waterways to be taken up and employed by Companies, so that, to a great extent, they are destroyed as a means of transit. Not only should we endeavour to open out new waterways, but, what is of more importance, we should endeavour to utilize and extend the advantages of a natural waterway which we have at present from Manchester to the sea; and I cannot help feeling that, in looking 241 to the future, the efforts which are now made to reduce the cost of production and the cost of transit as one of the items in that cost are efforts which Parliament will be led to entertain and support. That every effort should be made to endeavour to extend and utilize the waterways of the country is important, because it is a well-known fact, patent to everyone, that when we have waterways once laid down the natural cost of their maintenance must be considerably less—probably one-half of what it would cost to maintain railways. Now, I venture to say that this is a Bill that has not been smuggled through Parliament. It has been three years before Parliament and before the country. I do not suppose that there is a single constituency in the whole of Lancashire and Yorkshire who do not know everything about it. Therefore, although Parliament ought to be truly jealous of giving its sanction to schemes of a bogus character, I do not think that any imputation can be thrown on the Manchester Ship Canal Company for anything that has hitherto taken place in regard to this scheme. After the criticisms and examination which the Bill received from six Select Committees, and the opposition it received in every stage, I think there is no danger, in the House of Commons passing this Bill, that any investment, however small, will be made under any misapprehension of the objects which the promoters have in view. I am in a position to say that if this Bill is passed, the capitalists, not only of Lancashire and Yorkshire, but of other parts of the country, will come forward and find the capital for the undertaking. I may mention many cases that I know of myself of individuals who have given small sums of £2,000, £3,000, and £4,000 for the purpose of putting them in this Canal as the result of what the opponents of the Bill have called a vigorous canvass. That vigorous canvass was nothing more than the employment of agents who were sent round to those who subscribed to the original expense of getting the Bill, asking them to subscribe further sums of money. The fact of the matter is that we went about the matter in a different way. We knew that we had a large sum of money to raise; we made our arrangements to ascertain how we could raise the capital; and our desire was to induce those who had given small 242 subscriptions to pay the expenses which attended the promotion of the Bill to say what further amounts they were prepared to subscribe. There are, no doubt, many gentlemen in Manchester who have subscribed small amounts who are prepared to go to a much more considerable expense if this Bill is passed. I may mention the remarkable case of the Wholesale Co-operative Society, which has taken about £10,000 worth of shares; and I hope the House will allow me to mention what that Society is. I think the House will be surprised to hear that this Wholesale Co-operative Society of Manchester has a turnover of £3,000,000 a-year, and a turnover in its banking department of £16,000,000; and this Co-operative Society has already taken £10,000 worth of shares. It advanced 5 per cent upon its share capital; and the Directors naturally say—"Until we can offer to those for whom we act some similar interest during the time of construction we cannot take more shares or lock up more capital in this undertaking, which must be un-remunerative during the time of construction." I may mention another interesting fact—that the Salford Corporation have promoted a Bill in order to enable them to take shares in this undertaking to the amount of £250,000. They have just taken a poll of the ratepayers of Salford in order to ascertain their feelings in the matter, and the result was only announced the other day, when, out of 19,000 votes which were recorded, 16,653 were given in favour, against 2,440. Now, I venture to think that this is not a question which affects Lancashire and Yorkshire only. Our opponents have tried to make out that there was a bargain made before the Committee which passed the Bill, and that we made promises that the capital should be raised in Lancashire and Yorkshire. No such idea was ever in the minds of the promoters. The fact is, that those interested in the Ship Canal are very many more than those who inhabit the counties of Lancashire and Yorkshire. We believe that Ireland is very much interested in the success of this Canal; and it is interested materially in the transit of articles of a perishable nature by means of this Canal. They will be able to bring their productions rapidly to Manchester; and the same remark applies to every part of 243 England which will show their appreciation of this scheme by taking shares in the Canal if this Bill is passed. I have only one word more to say with regard to the proposal that the Bill should be referred to a Select Committee; and I will say at once that the reason why we resist that proposal is not because we are not anxious that our opponents should have fair play, but we think that they have had fair play. The Bill does not refer to those fiery questions we have had in regard to this Ship Canal; but the only reason why we approve this proposal is, that there has already been a large amount of money spent, and a considerable delay in commencing the important work we have in hand. I do not know whether the House is aware of the fact that no less than £250,000 has been spent in the preliminary stages of prosecuting the Act of 1885, and that no less than 175 days, or six months, were spent in proceedings upstairs, where, I am sure, our opponents had every opportunity of stating all the arguments they could bring to bear against the scheme. I do think, under these circumstances, that the time has now arrived when full effect should be given to the Act of Parliament passed last Session. If our opponents have a locus standi, they will have a right to be heard in opposition to the Bill; but I cannot consent to a new departure being opened to them, which will only result in materially adding to the cost and delay which will attend the carrying out of this scheme.
§ LORD CLAUD HAMILTON (Liverpool, West Derby)
I rise with some regret to move the rejection of this Bill. I do so not only in the interest of those whom I represent, but also in support of the independence of Private Bill Committees in this House, and also in support of their decisions. My hon. Friend the Member for Manchester (Mr. Houldsworth) stated that the Bill was introduced for the purpose of giving effect to the Act of last Session; but, as far as I can read the Bill, it was introduced not for the purpose of giving effect to the Act of last Session, but for the purpose of upsetting and reversing the provisions which that Act contains. Now, my constituents, the people of Liverpool, have opposed this scheme since its first introduction on one ground only. They are not afraid of competition in 244 trade. They do not think that if the Canal were made it would have any considerable effect on the great trade of Liverpool; but what they fear is that if the Canal were made it would so interfere with the navigation of the estuary of the Mersey as to destroy the commerce of the port, and so cause ruin to hundreds and thousands who gain a livelihood by that commerce. I do not, on this occasion, propose to go into the engineering or the commercial merits of the undertaking. They were fully dealt with by the Committee, and it would not be right or proper to take up the time of the House in dealing with them now. What I wish to address myself to mainly is, the point of agreement arrived at by the Committee of last year at the instance of the promoters of the Bill, and the alteration in the capital powers now contemplated by the provisions of the present Bill. My hon. Friend says that the Bill of 1883 was introduced into the House of Commons and passed by this House without the clauses relating to the payment of interest out of capital being expunged. That is perfectly true; but when the Preamble was passed by the Committee upstairs, the opponents of the Bill withdrew their opposition for the purpose of carrying it to "another place." The Bill went to the House of Lords with the clauses which it contained untouched, and that House rejected the measure on its merits. In 1884 a fresh Bill was introduced in the House of Lords; and, as those who were in Parliament at the time are aware, the provisions providing for the payment of interest out of capital were struck out in that House, and the Bill was ultimately lost before a Committee of the House of Commons. In 1885 the Bill was introduced again in the House of Lords, and it contained a clause asking for permission to pay interest out of capital. That clause was struck out before the Bill went into Committee, and the Bill, after it received the sanction of the House of Lords, came down to the House of Commons and was discussed here; but no question was raised on the subject of the payment of interest out of capital. During the whole consideration of the Bill that question was never raised by the promoters, nor was it, directly or indirectly, alluded to by them. The investigations of both Committees of last Session were of a most 245 painstaking character. The Bill occupied a large amount of attention, and what mainly struck the Committees of both Houses was this—the continued assertions of the promoters of the Bill that if the scheme were passed by Parliament they would be able without the slightest difficulty to raise in Manchester and the district the amount of money that might be required for carrying out the undertaking. Indeed, it was stated that Manchester itself would not only raise the capital required under the Bill, but a great deal more if necessary. I must, therefore, take exception to what foil from my hon. Friend in regard to that matter. I have a copy of the speeches delivered in Committee, and also the evidence of the chief witnesses called in support of the Bill. Now, what was it that Mr. Pember, the counsel for the promoters of the Bill, said? He said—I am not afraid that you will get any doubtful answer on the matter. The men who spent £1,000,000 on the Town Hall, upon a splendid toy, so to speak, merely to be the pride and boast of their city, are not likely to hesitate about finding six times or nine times the amount necessary for the construction of an artery which is to carry their commercial life-blood and provide for the development of their trade.Then, again, he said, before the Lords' Committee—Do you suppose that we shall not find the money? Do you suppose that a population which has invested £100,000,000 of money in one industry alone, which is the case of the cotton trade, would not find £7,000,000 or £8,000,000 or £9,000,000 or £10,000,000 or £12,000,000 of money if it were wanted, which, after all, only comes to 10 per cent upon the capital to preserve an industry which £100,000,000 represents? Of course they would.He said, further—Are you going to disbelieve these people, and to say that the caste which they represent, and in a measure who are worth hundreds of millions of money, invested in businesses which they see stagnating or pining, and they believe conscientiously to be in a decline, cannot find a tenth or a twentieth part of the money invested to save what they have already invested? The notion to me is too absurd for argument.Let me turn now to the evidence of Mr. Adamson, the chief promoter of the Bill. Being asked if the promoters would be able to raise the capital, he said—I should be very much disappointed if a large excess of the capital required is not raised.That was his evidence before the Committee 246 of the House of Commons. In the Lords' Committee in 1883 I find, these Questions and Answers in his evidence—You say that you are certain that you will be able to raise the capital? Answer—That is my impression.—Question—Then I suppose, as you would be able to do so, you would not see any objection to being compelled to do so?—Answer—Not to raise a very large portion of it I am quite sure.When the Bill was before the Committee of the House of Commons in 1884 Mr. Adamson was asked—Do you think that there will be any difficulty, if this Bill passes, in raising the necessary capital to commence and complete these Canal works?His reply was—No; I think with Sir William Forwood, when speaking in Liverpool about a fortnight ago, that there will be no difficulty; and my own private impressions are that if the capital was £20,000,000, and Lancashire saw that there was a prospect of a reasonable remuneration, she would find the money for this great project.Then he was further asked—You have not the least doubt of raising the capital if the Bill is passed through Parliament?and he replied—Not the slightest doubt.Evidence to a similar effect to that of Mr. Adamson was given by the Mayor of Manchester, the Town Clerk, and others. Last year Mr. Adamson was asked—Have you any doubt that if the Committee see fit to authorize this scheme the capital will be forthcoming?His reply was—I have not indeed, or I would not have given my time and my money annually to the support of this scheme; and I think when the Committee have before them the fact that the great Corporations of Manchester, of Salford, and of Warrington, and all the other boroughs that are interested in this matter are supporting us, there can be no question of finding the money from 7,000,000 of people.There can be no doubt that the statement was distinctly made that the people of Manchester were so largely interested in the undertaking that the general public would not be asked to subscribe a farthing. That statement materially influenced the Committee both in the Lords and Commons. The feeling was that it would not be right, when Lancashire or so large a portion of Lancashire was unanimous in asking for 247 these powers, to reject the Bill; and it was, therefore, decided to pass the measure. At the same time, it was passed in a manner which is worthy of the attention of the House. It must be remembered that the objections to the Bill were urged in three successive years; and the various Committees to which the Bill was submitted were so much struck with the force of those objections that in passing the Bill they imposed on the promoters very stringent provisions, such as I do not recollect to have ever seen inserted before in an Act of Parliament. I may add that they were simply inserted for the protection of the opponents of the Bill. I rather think that it was at the invitation of the promoters, in the first instance, that a provision was inserted to require that £5,000,000 should be subscribed within two years of the passing of the Act before one sod of earth was turned; and that was exclusive of the sum of £1,710,000 which it was necessary to raise for the purchase of the Bridge-water Canal, which sum was also to be subscribed within the period of two years. The original deposit of £276,000, instead of being released on the passing of the Bill, was impounded, and it was actually to be impounded for three years after the passing of the Bill. Engineering works were also required to be carried out, not at the instance of the Port of Liverpool, but of other Petitioners. These stringent provisions were all accepted without demur by the promoters of the Bill; they accepted them gladly, and raised no objection to them. I have no doubt that the Committee thought they were prepared to abide by them; and, as I have said before, not one word was said about the payment of interest out of capital. On the contrary, the promoters assured the Committee that the capital proposed to be raised under the powers given by the Bill would be raised without any further clause to provide for payment of interest out of capital. What took place when the Bill passed? There was great rejoicing in Manchester; there was a magnificent pageant through the streets of Manchester. Champagne flowed, and there was a good deal of tall talk indulged in. "When everyone had been raised to the proper pitch of excitement, then Mr. Adamson commenced his canvass in order to raise the capital. The response was something 248 magnificent. Out of a capital of £8,000,000 the promoters of the Bill actually succeeded in raising £750,000—rather less than one-eighth of the whole sum. Now, what was the reason of that? Was it an admission that Manchester is poor and impoverished? Poor impoverished Manchester! I am sure that Liverpool looks upon her with the greatest possible commiseration. Here is a work which we are told is necessary to save her existence; to protect her trade from stagnation and ruin—here was a measure in which there was at once to be invested millions of the capital of Lancashire, and which the people of Lancashire would freely support in order to save the money they had already invested; but when the time comes, and an appeal is made to impoverished Manchester, they only raise a sum of £750,000. But are they really impoverished? Does my hon. Friend the Member for Manchester (Mr. Houldsworth) look like an impoverished man? Does the hon. Member for Manchester, who supports the Bill on the other side of the House, look as if he was going through a period of privation and starvation? No, Sir; the reason why the money was not raised was very apparent to every man who has been behind the scenes in this matter; and I will briefly and graphically describe what it is. A short time ago a respectable artizan of Manchester called upon the Secretary of the Liverpool Dock Board, and he said that he would like to renew a Dock-bond he held, and which was falling due. "Ah," said the Secretary, "why not take them out and invest them in the Manchester Ship Canal?" With a knowing wink, the artizan replied—"No, Sir; I shouts for the Canal, but they see's none of my brass." That, Sir, is the whole question. My hon. Friend the Member for Manchester "shouts for the Canal." My right hon. Friend who represents Blackburn (Sir Robert Peel), who appears to be so itching to speak, is about to shout for the Canal; but the Canal will see none, or very little, of their brass. The people of Manchester are a long-headed, a cute, and astute people; they know that this undertaking is unsound; and, knowing that, they will not invest their capital in it. What do they propose to do? They appear to be acting upon a maxim which has now become somewhat 249 celebrated—that the people who have money and no brains were made for the people who have brains and no money. They come now to Parliament for power to pay interest out of capital, and then to go to the general public in order to induce them, under specious promises of paying interest out of capital, to invest their money in this undertaking, to which the people of Lancashire decline to subscribe. Now, I maintain that the principle of paying interest out of capital is unsound, in itself; but that is not the question which I wish to raise at the present moment. What I want to point out is that this is a breach of the solemn agreement come to between the promoters of the Bill and the Committee of the House of Commons. "What were the proposals in regard to the capital to be raised under these different Bills? In 1883 the capital was to be £8,000,000, and in the Bill of that year the promoters inserted a power to pay interest out of capital; but the payment of interest out of capital was over and beyond the share capital of £8,000,000. In 1884 they repented that provision; but in 1885, in addition to the £8,000,000, power was asked to raise additional capital, which would add £2 to every share, with the intention of devoting that sum to the payment of interest out of capital, the sum itself amounting to something like £600,000—that was beyond the £8,000,000 of share capital which the promoters declared to be necessary for the construction of the works, and which was admitted by the witnesses to be necessary. What does the present Bill propose to do? It proposes to pay interest out of the existing capital of £8,000,000 to the extent of £752,000, and to reduce the borrowing powers by £188,000; so that the promoters reduce the capital of £8,000,000 by £940,000, or, roughly speaking, by £1,000,000 sterling. Now, how can they come with an honest face to the House of Commons and ask for a reduction of share capital, when only last year, before a Committee of the House of Lords, they stated that the total sum of £8,000,000 was absolutely necessary for the due construction of the works? I think I have given some reasons why the Bill, on its merits, should be rejected on the second reading; but if the House in its wisdom thinks fit to pass the Bill, I 250 would ask that we be allowed to be heard before the Select Committee. Had the promoters proposed before the Committee of last year that they should have the power of paying interest out of capital, we, the Petitioners, would have been before that Committee, and would have had our own locus standi. Since that time the promises held out to the Committee have been ignored, and the House has been cruelly deceived. What are we to do under existing circumstances? Are we, the Petitioners, with such enormous interests at stake, to be deprived of the advantage of being heard by counsel before the Select Committee? I do not believe for a moment that the House will perpetrate such an injustice, or impose such a manifest hardship upon us. We want to hear from the Chairman of Committees personally what his views are on this subject. We have already seen a Report, which comes from the Board of Trade, on the general proposal of the Bill, and I wish to make one observation in respect to that most remarkable Paper. The right hon. Gentleman the President of the Board of Trade received a deputation representing the promoters of the Bill, to which he very properly replied that he could give no opinion as to the Bill, but that he would do whatever was right. Subsequently he received a deputation from the Petitioners, and he received them, as the right hon. Gentleman always does, with the greatest courtesy. Having heard the statements of the deputation, the right hon. Gentleman said he would give due weight to what had been urged, but that he could not pledge himself to a particular course. But before the right hon. Gentleman heard that deputation what had happened? Why, it appears that that irresponsible authority—that Bismarck of Whitehall—Sir Thomas Farrer, had sent a document to the newspapers in support of the Bill. [Mr. MUNDELLA: No.] Surely it cannot be denied that before the right hon. Gentleman made his statement to the deputation on Friday last the document to which I refer was already in the hands of the Press! I make no charge against the right hon. Gentleman, but merely against Sir Thomas Farrer, who has adopted a course almost without precedent in regard to this Bill. I hope that the House of Commons, if they do not see fit to 251 reject the Bill, will see that the Petitioners against it have a due locus standi, and that they are not placed in a worse position than they would have been if they had been heard upon this point before a Select Committee last year. Our Committees are proverbial for the impartiality with which they act in a judicial character; and I, for one, would never question the impartiality and integrity of the Members who discharge the onerous duties imposed upon them by the House; but I say that when, after three years, an undertaking was come to, after a protracted and painstaking inquiry, an undertaking was given by the promoters of the Bill, it is a monstrous thing for the same promoters, within four months of the passage of the Bill, to come to the House of Commons with a new measure asking us to upset the decision arrived at, and to introduce an entirely new principle, foreign, I am happy to say, to a great extent, to the Legislature of this country, in an attempt to raise money for the prosecution of a scheme which I believe to be ridiculous, and one which will never be carried out, and which is opposed to the interests of a large and important body of the community.
§ SIR HENRY MEYSEY-THOMPSON (Lincolnshire, Brigg)
In rising to second the Motion of my noble Friend, that this Bill be read a second time on this day six months, I wish to say that I have no hostility whatever to the Manchester Ship Canal itself as an undertaking. My opposition is confined entirely to the payment of interest out of capital; and I shall heartily oppose any Bill, whether it is a Railway Bill, a Canal Bill, or a Dock Bill, which sanctions the payment of interest out of capital, and which is a payment of no interest at all, but simply a return to the investors of a portion of their own capital. I listened with great attention to the speech of the hon. Member (Mr. Houldsworth), in the hope of finding out whether he had any arguments to offer in favour of the Bill; but I fail to find any argument at all. According to his account, all I could gather was that the House last year had sanctioned a Bill, and had sanctioned an appeal to the public to raise £8,000,000 in order to carry out the undertaking, but that the public have declined to find that £8,000,000. Naturally, that is extremely annoying to those who hoped to 252 benefit by the expenditure of that sum of money; and, therefore, the promoters of the Bill now come to the House and ask to be allowed to offer new inducements, new baits, and new supposed advantages to the public, in order to make them find the money. Now, what are the inducements which the House is asked to sanction? What are their character? Are they such as would induce any sensible man to put his money into this undertaking, and would he feel inclined to do so without such inducements? Are they inducements of such a character as would enable a man of intelligence to look upon this undertaking as a good investment? Would they convert, if granted, a bad investment into a good one? What can any investor gain from the undertaking? It confers no pecuniary advantage on the investor. There is no glory or honour to be obtained in holding shares in the Manchester Ship Canal Company. If any man wishes to put £100 into this undertaking, would he be a richer man if this Bill is passed or not? It is a mere question, as the Americans say, of whether there is money in it. If there is money in it, I grant that this advantage must make the investor a richer man; but is it a genuine thing? If the inducement held out to him will not make the investor richer, then, I say, it is not a genuine thing, and it ought to be unhesitatingly condemned by the House. There are two considerations involved in this question. The first is—ought a Company to be allowed to return to an investor his own capital and call it interest? The second is—ought they to be allowed to increase the nominal amount of their capital by the payment of a further amount on account of interest? By this Bill the House is asked to do both of these things. We are asked to allow the Company to spend £750,000 in the shape of interest on capital during the construction of works, and to add that sum to the capital of the Company. If they are to add £750,000 to the capital so long as a shareholder holds his shares, it is a matter of no moment to him what the amount of the capital is nominally; but when he sells his shares he has an advantage in having marked on a piece of paper that a share for which he has only paid £90 is worth £95. But the ordinary public do not like to pay a premium for their 253 shares; and, therefore, if only £90 is to be spent instead of £95, why should we give the investor a piece of paper on which £95 is to be marked? We are asked to allow this Company to pay interest out of capital during the construction of works, so that the shareholder who is induced to put his money into the concern should receive interest on an amount of each share which it did not really represent. It is not fair to put that before the public, because if it is done the public would see too plainly what the real issue was. They would understand that they were paying themselves interest on an amount of capital which had not been subscribed. The hon. Member (Mr. Houldsworth) said that the investors in Yorkshire could not afford to forego their interest for so long a time. Well, I have heard that very often before—that the investor cannot stand out of his money for such a long period as that which it will require to complete this undertaking. But in what way is he to receive his money under the system proposed in this Bill, and what advantage does he derive if he hands over his money to a Company and the Company pays it back to him? If this House were to order that for every £100 made up annually by the investors of this Company there should be handed in at the same time a signed and sealed packet containing four sovereigns, and that the Company should retain these four sovereigns without breaking the packet for a period and then pay them back in the shape of interest, everyone would see in a moment what a miserable farce it is. But that is not proposed. The Company are not proposing to do that. This is what they desire to do—to return a man his own money in another form. No money can be returned to a man but his own. The Company are earning none; they have no other funds; and I ask the House is there anything to induce an investor, if he is a sensible man, to put his money into an undertaking of this kind? Is there anything in the privilege promised him that he shall be paid 4 per cent interest out of capital? Is there anything in the privilege that out of the money he has solemnly paid in January and June he shall receive something back in June and January? Yet we are told that this privilege of paying money with one hand and receiving 254 money with the other is so valued by investors that the public will find £8,000,000 on these terms for the construction of this Canal if they are allowed to do it, but that they will subscribe none if this privilege is not permitted them. I ask is the House willing that this arrangement should be allowed, and that this temptation should be held out to the public to subscribe their money? It is evident that the public misunderstand the nature of the operation. Is it right, I ask, that the House should allow these tempting advantages to be held out to the public when we know perfectly well that they are not advantages at all, but are arrangements which will tend to the disadvantage of the investors by causing a certain amount of their money to be wasted—by causing a certain amount to be distributed to them half-yearly, nothing being done in the meantime to earn money to supply its place? Several hon. Members have asked me why I have interested myself in this question. I will tell the House why I am interested in it. I have availed myself of the first opportunity of opposing the principle of paying interest out of capital while the undertakings are being carried out, because when I first had a seat in this House, in 1880, I spent a great many days in a Committee Room listening to the proceedings in connection with the Hull and Barnsley Railway and Dock Bill. I there heard it stated that the cost of the undertaking was so great as compared with any possible profits that it was extremely unlikely that any investor would ever receive 1d. of his money in the shape of interest. The conclusion arrived at then was that the capital would not be subscribed for the carrying out of that undertaking; but, to my great surprise, before very long I found that the money had been subscribed two or three times over, and I found, to my still greater surprise, that several of my own friends, whom I had always considered to be men of great intelligence in the ordinary affairs of life, had been foolish enough to invest their money in this undertaking. I made inquiries as to what could have been the inducement to these people to identify themselves with this scheme, and I found that it was the fact that interest at the rate of 5 per cent had been promised them during the construction 255 of the works. I found that they had no real idea in their minds that this 5 per cent was, as a known fact, returned to them out of their own money. It was advertised that the dividends would be paid by the contractor, and the investors had some crazy idea that the advertisements set forth the real fact, and that this money would in some way be advanced by the contractor. They thought he must be gaining some advantage from the undertaking which enabled him to pay this interest. But that was an entirely mistaken idea. The contractor was paid by measurements—the engineer certified as to the amount of work done, and the contractor got the money for it; but it was not a fact that the contractor reaped any advantage which would enable him to pay interest out of capital to the investors. If these gentlemen understood that really the 5 per cent was their own money, and that the capital of the Company was paying compound interest in consequence, they would have thought twice before they put their names to such an undertaking. Many of my own constituents took shares in this Railway. The amount of money invested in the concern by investors from the district I refer to was something enormous. I do not know whether it was mentioned to the House before; but some hon. Members may have read the interesting pamphlet published by the hon. Gentleman the Member for South Durham, in which it was shown that in 1881, in the way I have described, £20,000 was withdrawn from the money subscribed for the construction of the Hull and Barnsley Railway. Probably the money paid in this way would represent £100,000. When we see a number of working men, who, under ordinary circumstances, would put their money into the Savings Bank, subscribing money to an undertaking of this kind and losing it simply on account of the inducement held out to them that they would receive 5 per cent interest during the course of the construction—the interest received in the Savings Bank being no more than 2½ per cent—and when we hear Gentlemen speaking so glibly about the great amount of employment to be given to working men by this Bill, I quite understand that so long as you look upon an investor as a person walking about with a great deal more money in his pocket than he knows 256 what to do with, you may regard his subscribing money under the circumstances I have pointed out with great philosophy; but when you see your friends, the working men who have painfully accumulated money by dint of great self-denial, putting the whole of their savings into undertakings of this kind, and being misled into these transactions in the way I have desbribed, you cannot look upon it with such philosophy. I, for one, feel very indignant that such misleading baits should be permitted to be held out to the public. If we have come to such a pass in England that labour can only be found for working men at the sacrifice of the savings of other working men by putting them into undertakings of this kind, I think we have come to a very bad pass indeed. I must apologize to the House for having detained it for so long upon this question; but I hope hon. Members will admit that, feeling as strongly as I do upon this matter, I could not very well have avoided rising to protest against a principle that I think has misled investors in the past, and which, if this Bill is passed, will inevitably do the same in the future.
§ Amendment proposed, to leave out the word "now," and at the end of the Question to add the words "upon this day six months."—(Lord Claud Hamilton.)
§ Question proposed, "That the word 'now' stand part of the Question."
§ THE PRESIDENT OF THE BOARD OF TRADE (Mr. MUNDELLA) (Sheffield, Brightside)
I think it right that I should, at as early a period as possible, attempt to state the view the Government entertain on this question. The noble Lord the Member for Liverpool (Lord Claud Hamilton), at the conclusion of his speech, complained of the Report which was presented to this House, and which he attributed to Sir Thomas Farrer. He spoke of Sir Thomas Farrer in language of complaint as the Bismarck of the Board of Trade. [Lord CLAUD HAMILTON: No; of Whitehall.] Well, as the Bismarck of Whitehall. Let me inform the noble Lord that we are not accustomed to lay any blame for any act done by any Department on the permanent officials. I take the entire responsibility for that Report on myself. It is quite true that last Tuesday that 257 Report was sent to the Press. A rough revise of it, with my corrections, was obtained before bringing it under the notice of the House. But late on Tuesday night the noble Lord came to me, and asked if I would see a few Members of the House on the question of the Manchester Ship Canal Bill. It was decided upon at his request, and on Wednesday I telegraphed to him at the House that I would meet them on Friday. From the moment I made that appointment I suspended the Report, and it was not until after I had met the deputation which the noble Lord brought to me on Friday that the Report was considered by myself and the officials of the Department, and resolved on and placed in the hands of the Clerks at the Table at the latest moment it was possible that they could comply with the Forms of this House. There was nothing to complain of.
§ MR. MUNDELLA
If anyone is to blame it is myself. I think, however, I did everything that is fair and courteous to the noble Lord. I withheld the Report to the last moment. I may say, further, that several of the gentlemen who came on that deputation on Friday had been with me a fortnight before, and had expressed the same views almost in the same detail. I had their printed statement before me before I decided on the Report; so that, in any case, there has been no haste in deciding on a question so important as that before us. Well, now, I should like to tell the House why we are of opinion that this Bill ought to receive the assent of Parliament. The promoters of the Bill appeared before this House in 1883, and the measure passed in that year—that is to say, it passed a Committee of this House with this clause in, and it was rejected in the other House. Next year it was brought in in the House of Lords, and then the Chairman of Committees objected to the clause, and in deference to him it was omitted. He opposed it as objectionable in principle, and substituted the clause (Section 214) which it is now sought to repeal. That clause inserted by the House of Lords applies in the general law to Railways, and not to Canals at all; and it is a hard thing on the Manchester Ship Canal Company 258 to force this clause on them. I may point out that the clause of the Lords' Standing Orders to which I refer read thus—A clause shall be inserted in every Railway Bill prohibiting the payment of any interest out of capital,and so on. This, as I say, was inserted in the House of Lords at the instance of the Earl of Redesdale. The Manchester Ship Canal Company now ask us to relax the clause inserted in the measure, which properly only belongs to Railway Bills. What are the objections to this course? I have heard something about engineering and the navigation of the estuary of the Mersey. But we have nothing to do with those things. These questions have been settled once for all by Committees of this House. The noble Lord says—"Send it to a Select Committee; give us a locus standi before that Committee, and let us have counsel to plead before that Committee." But I would point out that the question is one for the promoters of the Bill and this House. I do not see what the London and North-Western Railway Company, from whose office these statements have emanated, have to do with the question at all. It is a question whether the House of Commons is willing to relax the clause and to bring the undertaking under another Standing Order, which is a very large relaxation, and one that has been recommended to be applied by a Committee of this House. It is said—"If you do these things great harm is likely to result." But there is a great deal of difference on that point. I think I can quote an eminent authority to show that great harm can result from the Standing Order. This Standing Order, if allowed to operate upon Bills of this kind, will have the effect of restricting enterprize in this country. It has done very much to help monopolies in this House. Surely the Railway Companies in this country have sufficient control over the waterways at the present moment, and they should not have that control extended. The hon. Member who has just sat down speaks with great emotion about the working men whose savings are invested. I give the hon. Gentleman all credit for consideration in the interests of the working men; but let me say this—I say the leaders of the working men; I say those who take a leading part in the co-operative movement 259 in Manchester who are subscribing largely to this undertaking; I undertake to say that these co-operative working men are as shrewd a set of men as any in this House. They manage co-operative mills as well as many of their masters could do; and no doubt if they had railways to manage they would be able to manage them quite as well as many people in the country. I want to know why the House should enforce this harsh measure against this Canal Company? Railway Companies make their lines in sections, so that when one section of railway is complete, without respect to the remainder of the line, it can be worked, and can commence earning income; whereas in the case of this Company every farthing of capital must be expended—the whole undertaking must be completed—before any income can be earned. With regard to the statement that the rich men of Manchester have put £8,000,000 into the undertaking in consequence of their belief in the scheme, I would say that this is not a time when men are prepared to lock up their capital for seven years before they can begin to earn a farthing. The House must remember that the whole Standing Order is itself a matter of doubtful utility. It exists in no other country in the world. In France, it is necessary that the promoters of a scheme shall pay 4 per cent interest out of capital, and add it to the cost of the undertaking, because it is practically part of the cost. I want to ask what is the effect of this enterprize, so far as it has gone? It is impossible to deny that coincident with, and subsequent to, the introduction of this Bill, the railway rates for the conveyance of traffic in Manchester and Liverpool and the district have been reduced 25 per cent by three reductions, and now it is said—"Oh, that would have been done if the scheme had never been broached." Well, for my part, I think it is very clear that it was the broaching of this scheme that very much helped the Liverpool Chamber of Commerce in their efforts to get the first reduction, and more especially in getting the subsequent reductions. There have been three measures brought through this House, I think last year and the year before, in which this Standing Order was relaxed. I would refer the House to a speech made by the late Prime Minister 260 (the Marquess of Salisbury) as recently as July 7 last, on the subject of allowing the Regent's Canal (City and Docks' Railway) Bill to pay interest out of capital. He said—There was no doubt that this Rule discouraged the employment of capital, and that but for its existence work would go on which it now stopped. The Standing Order must justify itself. It was supposed to protect foolish investors, and to prevent persons from investing in any enterprize which would not yield them a good interest on their money. If he were asked which of two things he would choose, whether he would refuse to protect investors from the result of their own incaution, and set up an obstacle to the expenditure of capital, in order that men might be able to invest their money without inquiring into the real character of the enterprize in which they placed it, or whether, on the other hand, he would incur the inconvenience of stopping the expenditure of money in support of labour at a time of extreme and almost unprecedented calamity and distress, he confessed that he would feel that the consciousness that he was sustaining a Standing Order of their Lordships' House would be no satisfaction to him when he reflected that, by doing so, he was preventing many an honest man from getting his living. He would go a step further. He did not believe in the system of protecting the foolish investor at all. In his opinion, all of their Standing Order legislation erred grievously in that direction."—(3 Hansard,  1800.)Again he said—It was the business of investors to protect themselves, and to examine for themselves the soundness of the enterprizes in which they embarked. If they failed to do so, they were generally in a condition of life in which they might fairly be expected to take the consequences. It was wholly unreasonable to provide securities for investors at the cost of stopping the flow of that capital by which alone the life and prosperity of industry could be maintained. It was a general error in the Standing Orders of both Houses of Parliament that they had bound industry up too tight in order that improvident and careless investors should be protected. It might be said that, whatever the General Rule might be, it ought not to be relaxed in any case when the Rule itself had not yet been taken up for the purpose of alteration. He believed that the General Rule ought to be altered."—(Ibid. 1801.)I would refer, further, to an answer given by the noble Marquess the other day to a deputation of the unemployed, which waited upon him. He said—He believed that if the attention of the working classes was directed to efforts towards inducing Parliament to be more generous in giving facilities for the investment of capital, of which there was an abundance in the country, for the purpose of starting works of private enterprize which would give work to large 261 numbers of people, that, to some extent, would meet the existing difficulty. He had done something last year to effect this in the case of the Regent's Canal Docks and Railway Bill, and the Northfleet Docks Bill. But in this matter they had had strong vested interests to contend against.The noble Marquess seemed to think that one of the obstacles to enterprize in this country, and the development of new enterprizes, was the Standing Orders, which were altogether too much on the side of the capitalist. He was of opinion that, whenever anything had to be done for the labouring classes, there was a stiff battle to be fought with the vested interests. I think there is much to be said on this side of the question, and the Government believe the House will do well to relax the Standing Order and allow the Bill to pass. With regard to the suggestion that the Bill should be sent to a Select Committee, I would really ask the House to consider whether there has not been enough money wasted on inquiries before the Select Committee? I would like to ask the House whether it is fair that a Company, like the Canal Company, starting to work upon what is deemed to be an enterprize of great public utility, shall have to pit itself against rich Companies, like the London and North-Western Railway, who can give their £500 or 500 guinea briefs to gentlemen of the Long Robe? Is there, I ask, to be any more money wasted in this way? I trust the House will agree that this Bill shall pass, and that the House will not lay itself open to the condemnation of the noble Lord the Member for Paddington (Lord Randolph Churchill), who, when last the House rejected the Bill, went straight to Manchester, and, in the presence of the right hon. Gentleman opposite the late Chancellor of the Exchequer (Sir Michael Hicks-Beach), said—It was an incompetent House of Commons that rejected the Manchester Ship Canal, and it is because of the incompetence of the House of Commons that we demand an appeal to the people.I hope the House will pass the second reading of this Bill.
§ SIR ROBERT PEEL (Blackburn)
I am sure, after the speech of the right hon. Gentleman the President of the Board of Trade, it is hardly necessary for me to prolong this discussion. I am sure that everybody in Lancashire interested 262 in the great undertaking that we are now discussing will feel grateful to the right hon. Gentleman for the manner in which he has broached the question to-day. It is quite clear that one of the motives of the hon. Gentleman—the noble Lord (Lord Claud Hamilton), I think, in the observations he has addressed to the House—was, that the Bill should be now read a second time and sent to a Select Committee. But the right hon. Gentleman opposite clearly pointed out that we have had enough Committees on this question. My noble Friend near me said that the Committee sat last year to consider it in the most praiseworthy manner. Well, I would remind him that there were not two Committees, but six, that sat upon this Bill; and if the Members who sat upon the Committee which considered the Bill are not here to speak in favour of the Motion which is now before us it is because the right hon. Gentleman who was Chairman of the Committee (Mr. W. E. Forster) was half killed by the labour of the inquiry, and because three other Members who served have none of them been re-elected to seats in this House. The speech of the right hon. Gentleman (Mr. Mundella) will, I hope, satisfy the House that this Bill ought to be passed. The hon. Baronet opposite below the Gangway the Member for the Brigg Division of Lincolnshire (Sir Henry Meysey-Thompson) says he puts his name down as an opponent of the Bill upon the highest motives. He says they ought not to pay interest out of capital during the progress of the works, and he endeavours to persuade the House that this is a novel principle. My noble Friend who sits near me (Lord Claud Hamilton) went further, for he made this statement. He said that the payment of interest out of capital was foreign to the legislation of this country. I should like to point out to the House, however, that it is very far from being foreign to the legislation of this country—as a matter of fact, it has almost always been the practice that interest should be paid out of capital during the progress of the works. All the great works in this country, not to mention foreign countries—as has been done—have been contracted and carried on on the principle of paying interest out of capital during the course of construction. There are the great railways of 263 the country; and we hear the statement that the Mersey Docks and Harbour Board, whose costly works in Liverpool are also connected with the new undertaking, have all been carried out under the principle of the payment of interest out of capital. I think I am justified in making these statements when I am told that it is unsound in principle to allow the payment of interest out of capital. I will only further allude to those works carried on by the Metropolitan Board of Works. Every work carried out by that Board is carried out under the principle held by those who support this Bill. I may say, also, that all the railways of India pay interest on their shares from the day of the commencement of their works. I will not detain the House longer, because I hope, after the speech of the right hon. Gentleman the President of the Board of Trade, the House will be prepared to accept the second reading of the Bill. If we do agree to the second reading, I entreat the House not to yield to the suggestion of my noble Friend (Lord Claud Hamilton), and allow the Bill to go again before a Select Committee—before a Select Committee where the right hon. Gentleman the President of the Board of Trade (Mr. Mundella) so well and clearly pointed out the rich Companies—the Railway Companies—with their 500 guinea fees, will be able to throw every obstacle in the way of a work which, I firmly believe, if it is carried out, as I expect it will be, will prove of immense advantage to the great City of Manchester.
§ MR. BRAND (Gloucester, Stroud)
I do not often trouble the House of Commons, and I think I have some claim to say a few words upon this particular question. I was a Member of the Committee of the House of Commons to which the question of the application of Standing Order 167 was referred in 1882, and three of the Members of that small Committee are now no longer Members of the House—Mr. Baxter was the Chairman of the Committee, Mr. Salt was on the Committee, as was also Mr. Shaw. Now, at that time the Board of Trade were of the opinion that interest might be paid out of capital during the construction of the works; and I believe that the Board of Trade are still of that opinion; certainly my right hon. Friend (Mr. Mundella) has expressed himself in no 264 undecided language upon that point. The question, however, was not so clear to the Committee as it was to the Board of Trade. The Committee considered that there were a great many points to be urged on both sides. Roughly speaking, there are two contentions in the matter. One contention is, that it is necessary that Parliament should protect people who desire to make investments—protect people against their own acts; that it is desirable, in fact, that Parliament should interfere to protect persons from the consequences of their own folly; and the other contention is, that the public are well able to take care of themselves; that investors must depend upon their own judgment; and that the most natural course—and the course which will lead to the best development of the country—is to allow speculation to find its own natural level. Well, Sir, upon these contentions the Committee came to a compromise, recommending that exceptions should be made in particular cases, and that each case should be decided by the House on its own merits. I promised the House I would not detain them long; and, therefore, I will, in a very few words, give the House my reasons why they should, at least, accept the second reading of this Bill. We have heard the case of the Manchester Ship Canal. I will not enter into the merits of the question, but simply say that this much is clear—that the Manchester Ship Canal Bill is not a small one; the undertaking is not a small one; but is, on the contrary, a very large and stupendous undertaking. It has been discussed all over the country; it has been thrashed out by two or three Select Committees of this House and of "another place;" and the consequence is that every man in the country—every individual who wishes or who is likely to invest his money in the concern—must have had every possible opportunity of acquiring some knowledge of its probable success or otherwise. For these reasons, I say that this Bill ought to be passed; but I will give a third reason, and it is this—that this undertaking, if it is successful, will prove of great advantage to Manchester and the surrounding district. Well, now, Sir, there is one point upon which I disagree with my right hon. Friend (Mr. Mundella). As I have said, this Bill ought to be read a second time; but I think 265 that it ought then to be referred to a Private Bill Committee. My reason for this is, that if you give this Company the right, which the former Private Bill Committees did not give it, to pay interest out of capital, you will affect the amount of capital which the Company ought to raise. It may be a proper question for a Private Bill Committee upstairs to consider whether a Company having obtained leave to pay interest during the construction of the works ought not to increase its own capital. It is on this point I think the Bill, after having been read a second time, should be referred to a Private Bill Committee. I hope the House will read the Bill a second time, because I think this House ought not to put any obstacles in the way of the promoters of the Company obtaining the capital which they now seek.
§ MR. GIBSON (Liverpool, Walton)
Sir, I do not intend to trespass very long on the indulgence of the House; but I do desire to make a few observations upon this matter, which vitally affects the interests of my constituents. I am glad that upon the first occasion on which I rise to address the House of Commons I should be required to speak upon a subject which is entirely free from any Party complexion. Now, I do not think that hon. Members will be likely, in the decision they arrive at, to be influenced very much by the remark of the right hon. Baronet the Member for Blackburn (Sir Robert Peel) that if this Bill goes to a Select Committee the labours of the Committee will probably result in injury to the health of its Members, or in injury to their future political success. It appears to me that the matter upon which the House is called upon to arrive at a decision is one of a simple enough character. I do not intend to go into any questions of a technical nature, nor do I intend to consider whether or not it is right, or prudent, or justifiable to pay interest at all during the construction of the works of a Company like this. But, Sir, the modest proposition I have to submit to the House—a proposition which, I think, will commend itself to the judgment of hon. Members—is this—that where a Select Committee of the House, after two or three years' contest, have given a Bill to promoters upon certain terms, this House ought not to take upon itself the 266 very serious responsibility, without an examination of witnesses, without hearing counsel, without any financial investigation, of saying that those terms should be varied, and that £1,000,000 of the capital which the Select Committee thought was essential to the completion of the enterprize should be taken away. That, Sir, I submit, is a matter pre-eminently for the consideration of a Select Committee; and I wish to correct now, in the very few words I am going to make, a very serious mistake into which my hon. Friend the Member for Manchester (Mr. Houldsworth) has fallen, and to which the right hon. Gentleman the President of the Board of Trade (Mr. Mundella) appeared, to some extent, to be a party. I may inform hon. Members, though possibly it may already be within their recollection, that the capital which was sanctioned by the Committee of last year for the construction of these works was £8,000,000 in share capital, and £2,000,000 in loan capital. In the Bill which was brought before that Committee the proposal made with regard to the payment of interest was nothing like the proposal which is made in the Bill now under consideration—it was a proposal to provide interest in a wholly different way. By the Bill introduced in 1885 interest was to be paid by adding £2 to each £10 share—the capital of £8,000,000 was to be raised in shares of £10 each; and that £2, which was called added capital, and not permanent capital, was, I think, to last for seven years during the period of construction. It was to receive no interest and no profit, and it itself was to form a fund to pay the interest, and the moment the seven years were up that £2 disappeared. You will observe, Mr. Speaker, and hon. Members will observe, that that interest fund, so provided by the promoters in their plan of 1885, amounted to £1,600,000. That was in addition to the £8,000,000 share capital, and the £2,000,000 loan capital. By the Bill which is now before the House, and which the House is asked to adopt, it is proposed that the £2, a share mentioned in the Bill of 1885, and which disappeared in the Select Committee, should be omitted. The consequence is that the present existing capital of this Company is £8,000,000 share capital; and £2,000,000 loan capital, 267 and what is proposed to be done by this Bill is that £752,000 is to be taken away from the existing share capital for the purpose of founding an interest fund. The loan capital is reduced by £188,000; and, as the noble Lord (Lord Claud Hamilton) who moved the rejection of the Bill to-night told the House, the result of these figures is to reduce the capital of this concern, this gigantic concern, which it is so important should succeed in the future, and which, if carried out, may grievously affect the great Port of Liverpool—the effect of the operation proposed to-night is to reduce the capital of this Company by the sum of £940,000, nearly £1,000,000 sterling. But let me call the attention of the House to some other charges which also bring the sum alarmingly under the estimate put upon it by the Select Committee. When the Bill was before the Select Committee, and you know it ran the gauntlet for three successive years, it was very fully discussed, and I am glad to think that the counsel for the promoters had some advantage, and that the heavy briefs were not altogether on the side of the Railway Companies, for I observe, with a certain amount of professional interest and enthusiasm, that the fees in the case amounted to the enormous sum of £150,000. That has to be added; and then, if in addition you have to float this Company on the London Stock Exchange, and not locally in Liverpool, you will have to pay the London financier something for his countenance and support. Now let us see what is proposed to be done by the House of Commons to-night. I have to submit to the better judgment of the House, and I think it is not an unreasonable thing to put to the fair play of hon. Members, that where a Bill has been remitted to the proper tribunal—namely, a Select Committee, where a Bill has been discussed with counsel and witnesses before that Committee, it is a very inconvenient thing afterwards for the House, without hearing witnesses, without the action of a Select Committee, to vary the terms at which the Committee arrived. When the matter was before the Select Committee last year, we all knew that there were strong arguments put forward that it would be difficult to work this Company successfully as a financial speculation; and it was 268 suggested, and the suggestion had great weight with the Committee, as is shown by the alterations they made in the Bill—it was required by the Committee that stringent measures to prevent any injurious effect to the Port of Liverpool should be adopted. It was felt to be a dangerous thing that, in order to create a new Port, they should destroy or seriously injure the finest Port in the Kingdom, and, accordingly, the most stringent financial precautions were taken by the Committee. These precautions required that £5,000,000 of the capital should be subscribed in two years; and it does occur to some of us as a most extraordinary thing that a proposition should now be made that that precaution should be abandoned. ["Divide."] I thank the House very much for their kindness in listening to my remarks. I do not think I have trespassed at any unreasonable length upon the patience of hon. Members, and I am sure I am not going to show my ingratitude by trespassing on their attention any longer.
§ THE CHAIRMAN OF COMMITTEES (Mr. COURTNEY) (Cornwall, Bodmin)
Although we have had very interesting and valuable speaking in the course of this debate, I am not unwilling that it should close without begging the House to allow me to offer a few remarks on the course which I think the House would be well advised to take, from the point of view of one who is neither concerned in Manchester or Liverpool, but who is simply desirous, as far as possible, of helping the House to come to a decision in accordance with its well-known principles of action. I am one of those who are most strongly in favour of jealously guarding freedom in regard to investments, and I altogether dissent from the opinion that we are able or that we can wisely take care of the investments of other people; and, therefore, I should go further, if called upon to do so, than the Standing Order. I should like to remind the House that the Standing Order is much more restrictive than some hon. Members appear to think. The Standing Order, which refers to Railways only and not to Canals, provides against the payment of interest on works, except such interest, if any, as the Committee to which the Bill was referred, might, according to the circumstances of the case, think fit to allow. So that the allowance of the 269 payment of interest out of capital is, according to our Standing Order, a question to be decided by the Committee. Therefore, I am wholly averse to the notion that this Bill should be rejected now. There appears to be no reason why it should be rejected, and I cannot assent to the position taken up by the noble Lord opposite (Lord Claud Hamilton) that there was any broach of faith on the part of the promoters of this Bill in coming here and asking to have the action of last year set aside. The promoters may have gone the length of saying that they hoped to raise the capital without these powers; but there is no reason, having found that they could not raise it without, why they should not come to the House again, and ask that that provision prohibiting resort to these powers should be struck out. But the chief point which occurs to me is this—that a scheme for making this Canal as a certain financial basis was agreed upon by the House last year, having passed through Committee, and now it is proposed that that financial basis should be materially altered. The question is whether we ought to remit the question of the alteration of the financial basis to a Committee in the ordinary way — such Committee restricting their attention entirely to the alteration. Now, as it happens, this question of the financial basis of the Manchester Ship Canal has never been considered by a Committee of this House. That is a remarkable fact—it has never been considered by a Committee of this House. The first Bill which was brought into this House was passed on the Preamble, and this special clause was never considered by the Committee to which the Bill was referred. Last year it came down from the other House with this clause prohibiting the payment of interest out of capital in it; and the promoters of the Bill, feeling very eager to save their Bill, took it as it stood, running, perhaps, the chance of coming here again this year. Therefore it is that the financial basis of this case has never been considered by a Committee of the House at all. The question arises under the special circumstances of the Bill coming before us now with an altered financial basis. I confess I think that the House will be well advised if it agrees to refer the question to a Committee, carefully restricting the 270 Reference to the financial basis; and if the noble Lord's Motion is defeated or withdrawn, I shall be prepared, if necessary, to move this proposition—That the Manchester Ship Canal Bill be referred to a Committee to be nominated by the Committee of Selection; that all Petitioners who have presented Petitions against the Bill within the time limited by the Standing Orders have leave to be heard by their Counsel, Agents, and Witnesses before the Committee, against so much of the Preamble and Clauses of the said Bill as relate to the payment of interest out of capital; and Counsel heard in favour of the Bill against such Petitions.I think that if this Resolution were agreed to, it would be in conformity with the spirit of the Standing Order.
§ SIR JOHN R. MOWBRAY (Oxford University)
I only wish to offer one observation with reference to the remarks of the Chairman of Committees (Mr. Courtney). No doubt the question which the hon. Gentleman has raised is a very difficult one. It is said the financial basis has never been considered by a Committee of this House. It was not considered by the Committee appointed in 1883, because the opponents withdrew. It may be well that the question should be considered by a Committee; but I hope my hon. Friend the Chairman of Committees will consider whether it is not possible to settle the point without the very long discussion which took place upon the proposal to construct this Ship Canal being re-opened. The consideration of the Bill extended over a period of 175 days, and my hon. Friend now suggests that everyone who presented Petitions against the Bill should be allowed to be heard before a Select Committee. [Mr. COURTNEY: Only on the financial question.] I do not see how, if everyone who has presented a Petition is to be heard again, we are to prevent the inconvenience we experienced before. I know something more about the difficulty of constructing Committees than most hon. Members. We had extreme difficulty in 1883, 1884, and 1885 in the construction of the Committee to try this case; and my right hon. Friend the Member for Blackburn (Sir Robert Peel) did not exaggerate the case when he said that the unfortunate illness which had befallen my right hon. Friend the Member for Bradford (Mr. W. E. Forster) is in a great degree attributable to the overpowering labours of that Committee 271 during the month of July last. Do not let us at present make any special order for reference of this Bill to a Committee. It is very well known that no work is better done in this House than that which is done on unopposed Bills by the Chairman of Committees, assisted by two experienced Members of the House. Unopposed Bills are, under the present system, most carefully watched in all their details; and I think, if this financial question is the one question to be raised, it could very properly be left to the judgment of my hon. Friend (Mr. Courtney) and two other hon. Members. If we refer the Bill to a Select Committee, we shall find that an appearance is put in by a large number of Petitioners, every one of whom would demand another long inquiry.
§ MR. L. L. COHEN (Paddington, N.)
I hope the House will allow me to say a few words. I belong neither to one district nor the other; but it appears to me there are positive and evident grounds for not accepting the proposition of the hon. Gentleman the Chairman of Committees (Mr. Courtney). All that the House desires to do now is to determine the narrow point whether interest should or should not be paid out of capital during the construction of the works; and I venture to submit that that is a question which the House is quite competent to decide for itself, and that we require no information from a Committee upon such an extremely narrow point. There can be no question that the promoters of the opposition to this Bill would be in no way prejudiced by not referring the Bill to a Committee. They have no locus standi upon this particular question. This is a question as between the House and the promoters of the Bill; and the opponents of the Bill have no particular right to be heard upon it. They have a right to be heard upon questions which affect their particular interests, such as an interference with the estuary of the Mersey; but they have no claim whatever to be heard upon this matter. With respect to the general question, I would point out, from long experience, that if you do not allow the payment of interest out of capital, you will cause the promoters to resort to very undesirable measures; and indirect arrangements for attaining the same end are practicable under the present law, but are very 272 costly. There are, Mr. Speaker, other and more important reasons why every inducement should be offered to the promoters of this Canal to proceed as soon as possible with this work; and one is that there is, at the present time, a great deficiency in the employment of labour. Every month's delay in the commencement of this work prevents the employment of thousands of men in the construction of this Canal. The opponents of this measure allege too much for their own case; if, as they say, the undertaking will be un-remunerative, we ought to be grateful to those who, at such a time as the present, undertake a difficult and hazardous enterprize, which will certainly materially add to the amount of available work. But I am much more sanguine of the ultimate result; and, personally, I think we ought, on all grounds, to feel very much indebted to the promoters of this undertaking, and that no impediment whatever ought to be put in the way of its accomplishment.
§ LORD CLAUD HAMILTON (Liverpool, West Derby)
With the leave of the House, I will make a suggestion which I hope will meet the views of hon. Members. If we are allowed a Committee, as proposed by the hon. Gentleman the Chairman of Committees (Mr. Courtney), I would agree, on behalf of the Petitioners, to exclude from the Reference both the commercial and the engineering question, limiting the Reference to finance. I would also undertake, on behalf of the Mersey Dock Board and the Corporation of Liverpool, to merge their oppositions into one opposition, thus leaving only two oppositions—namely, that of the Corporation and Dock Board merged, and that of the London and North-Western Railway Company.
§ THE CHANCELLOR OF THE EXCHEQUER (Sir WILLIAM HARCOURT) (Derby)
I hope the House will not entertain this proposal. I quite agree with my hon. Friend the Chairman of Committees that the Standing Orders to which reference has been made have no application to the facts of this case. We have been asked to remit this question to the Committee. Now, we cannot remit the question to the Committee; the Committee is extinct, and many of its Members may be so also, as far as I know. You cannot 273 remit this question to the Committee on the Bill, and that is what the Standing Order states. You may, of course, create a new Committee; but it would not be the Committee on the Bill to consider the question of finance. The simple question of finance is whether you are to authorize interest to be paid out of capital; and whether you are to constitute a Committee for that purpose appears to me to be a question for the House to determine. As a general principle, the House ought to declare its own opinion; and this certainly appears to be simply an obstructive procedure to send the question to a Committee at all. Perhaps I ought not to object to this as part of the lawful gains of the Profession to which I have the honour to belong; and I can understand the advantage, in that sense, of multiplying these Committees; but a Committee, as I understand it, is appointed to inquire into questions of disputed fact, and there is no question of disputed fact to be referred to a Committee at all; and therefore I hope the House will decide upon the Motion itself, and not consent to refer the Bill to a Committee.
§ MR. SCLATER-BOOTH (Hants, Basingstoke)
I have only one word to say in regard to this Bill, and it has reference to the observations of the right hon. Gentleman who has just addressed the House. He seems to be unaware that all Bills go to a Committee; and the only question we have to decide now is what this Committee shall be—whether the proposition of the Chairman of Ways and Means should be adopted, or that which has been submitted to the House by the noble Lord the Member for Liverpool (Lord Claud Hamilton). The Bill must, under any circumstances, go to a Committee; and the only objection I have to the ordinary course being adopted on this occasion is that we have no security that a very important question as to the relaxation of our Rule in regard to the payment of interest out of capital would be fairly fought out by the promoters of the Bill. If the proposal of the noble Lord is accepted, then all parties would have an opportunity of being heard; but we have no security that the case would be fairly argued unless the parties interested on both sides are heard upon the question. It seems to me that the 274 House ought to allow the matter to be decided in the only way in which it can properly be decided; and the question is whether it should be decided in camerâ, by a Committee presided over by the Chairman of Ways and Means, or be fought out by counsel before a Select Committee.
§ MR. FORWOOD (Lancashire, Ormskirk)
I shall not interfere between the House and a division for more than a few minutes; but I wish to call the attention of the House to some remarks made by one of its most distinguished Members, whose absence we all very much regret to-day—I mean the senior Member for Bradford (Mr. W. E. Forster). I wish to quote just three lines from his remarks which I think go directly in support of the proposition which has been made by the Chairman of Ways and Means. The question has been raised whether the Ship Canal Bill came technically within the Standing Orders applicable to Railway Bills. The right hon. Gentleman's (Mr. W. E. Forster's) words were these—I think we all of us feel that whatever were the grounds on which Parliament has made this concession to Railways, certainly, if they had foreseen such a Canal as this, they would have made the same restrictions for that Canal. It is clear it must be fought out on its merits, as a question going pari passu with railways.These were the remarks made by the right hon. Gentleman on one of the inquiries before a Committee of this House; and all that is now asked by the opponents of the Bill is that they may be put in the same position this Session as they would have been had the promoters introduced these provisions into the Bill of last Session. If you do not grant the Petitioners that modicum of fair play, you will be doing this—the House will be placing a premium on promoters to come to this House one year with clauses in a measure drawn in a certain way, and then coming again next year, as in this case, to cancel some of those clauses, when their opponents cannot be heard in reply. This matter, as was well pointed out by the Chairman of Committees, involves a serious inroad on the capital authorized by the Bill. The sum to be deducted from capital is £750,000, with something like £80,000 in the shape of commission to the Messrs. Rothschilds. I submit to the House that it is only fair 275 that the opponents and the promoters of the Bill as well should be offered an opportunity of having this matter discussed in Committee on the question of the Standing Orders, as well as to the financial position of the Company itself.
§ MR. SEXTON (Sligo, S.)
I wish to submit a question of Order to you, Sir, before the division is taken. I have here a list of 15 Members who have a personal interest in this question. One of them is a Director of the London and North Western Railway Company; six are Directors of the Lancashire and Yorkshire Railway Company; four are Directors of the Manchester, Sheffield and Lancashire Railway Company; and four are Directors of the Midland Railway Company. Considering the nature of the Standing Orders of the House as to the pecuniary interest of Members in questions which may be brought before us, and also the fact that this is a proposal which is to facilitate the construction of a Canal which may affect the financial position of the Companies I have enumerated, and the dividends which the shareholders of those Companies may receive, I wish to ask you, Sir, if these 15 Members are entitled to vote in the division?
§ MR. SPEAKER
That is entirely a matter for the consideration of the individual Members concerned, having regard to the directness of their interest.
§ MR. SEXTON
I beg to give Notice that if any Member who is in the position I have named takes part in the division I shall call attention to the matter again.
§ Question put, and agreed to.
§ Bill read a second time.
§ LORD CLAUD HAMILTON (Liverpool, West Derby)
Sir, I now beg to move the Resolution of which I have given Notice:—That the Manchester Ship Canal Bill be referred to a Committee to be nominated by the Committee of Selection.That all Petitions against the said Bill already presented, or which may be presented not later than three clear days before the sitting of the Committee, be referred to the Committee; and that such of the Petitioners as pray to be heard by themselves, their Counsel, Agents, and Witnesses, be heard upon their Petitions, if they think fit, and Counsel heard in favour of the Bill against such Petitions.I am quite willing to exclude from the Reference to the Committee all questions 276 relating to commercial and engineering matters; and that being so, I do not believe that the deliberations of the Committee would last more than two or three days. The Petitions, in point of fact, would be confined to two or three which have already been presented, and even in regard to them I believe that two will be merged into one. I therefore hope that, in accordance with the custom generally observed in this House, the House will not refuse to refer the Bill to the Committee which I propose.
Motion made, and Question proposed,
That the Bill be referred to a Committee to be nominated by the Committee of Selection."—(Lord Claud Hamilton.)
§ SIR JAMES FERGUSSON (Manchester, N.E.)
I hope the House will not agree to this proposal. It seems to me it runs altogether counter to the spirit of the decision we have unanimously arrived at in favour of the second reading of the Bill. The Standing Orders require that the Committee on the Bill shall, in such exceptional cases, fix the rate of interest to be paid during construction, and the time during which it shall be allowed. I may be under a misconception on this point, but it may be that these matters might be settled by the Committee of the Whole House; but if a Select Committee is to be nominated, certainly all questions which were debated at such length and deemed to be finally decided by the Committee which sat on the Bill last year ought to be excluded. I do not wish to repeat anything that has been said before in the course of this debate; but, on the part of the promoters, I want to say that it is not the case that any more capital would be required if a provision is made for payment of interest out of capital during the construction of works. I must point out that the amount of capital for that purpose has already been provided in the Bill which has been submitted to the House; and although the clause for the payment of interest out of capital was struck out, the amount was still left in; and, therefore, with all necessary deductions, the amount of £750,000 is still available, and sufficient to provide interest during the construction of the works. That is a matter for the consideration of the tribunal to which the 277 Bill may be referred. I beg to move, as an Amendment to the Motion of the noble Lord, to insert, after the words "referred to a Committee," the words—That it be an Instruction to the Committee to consider and determine only what rate of interest shall be allowed under Clause 3 of the Bill, and the time during which such interest shall be paid, according to sub-sections 1 and 2 of Standing Order 167.The conditions attaching to the relaxations which may be given in certain cases in regard to Railway Bills are in most respects fixed; but in two subsections they are elastic; and they relate to questions as to the rate of interest to be paid, and the arrangement of the time during which the interest shall be paid. I beg to submit to the House that the Order of Reference should be strictly limited to these two subjects.
§ MR. SPEAKER
The right hon. Baronet proposes to move this Amendment after the House has decided to refer the Bill to a Committee; but the Question now before the House is that the Bill be referred to a Committee to be nominated by the Committee of Selection. The Amendment of the right hon. Baronet, therefore, would come in after the Motion of the noble Lord.
§ SIR JOHN R. MOWBRAY (Oxford University)
I am only desirous of saying one word, and that is on behalf of the Committee of Selection. We have no wish to shrink from any duty that may be cast upon us by the House; but I think it will be very unwise for the House to pass any Resolution of this kind. Leave this Bill, like any other Bill, to take the ordinary course. If there are parties affected by the Bill, they are entitled, by the Rules of the House, to become Petitioners; they will present their Petition, and such Petition will be heard in due course. In the first place, it would have to be proved that they have a locus standi; and if it should turn out that the Petitioners have no locus standi, then the Bill will become an unopposed Bill, and will be considered by the Committee presided over by the Chairman of Ways and Means. In that case the House will have sanctioned, by reading the Bill a second time, the principle of paying interest out of capital; and the one question to be decided will be the amount of capital on which interest is to be paid, and the rate of the interest itself. My right hon. Friend 278 the Member for Hampshire (Mr. Sclater-Booth) says there must be a Committee, in accordance with the ordinary Rules of the House. No doubt there will be a Committee; but a Committee on an unopposed Bill consists of the Chairman of Ways and Means, with two Members called in to assist him; and I must say that most of these Bills, and the clauses which they contain, are more carefully scrutinized as unopposed Bills than they would otherwise be. With regard to the present Bill, I am quite sure that my hon. Friend the Chairman of Ways and Means is fully competent to deal with it, with the advice of the Speaker's counsel and two Members of the House.
§ THE SECRETARY TO THE ADMIRALTY (Mr. HIBBERT) (Oldham)
As representing a constituency which is greatly interested in the Bill, I should like to say a word or two in support of what has fallen from my right hon. Friend opposite. When we look at the Bill, and the noble Lord from whom the opposition comes, and who proposes to refer the matter to a Select Committee, we know that the proposition proceeds from those who are decidedly hostile to the measure. I can only regard the object which hon. Members who support this Resolution have in view, and I cannot conceal from myself that it has been suggested with a view, if possible, of smothering the Bill altogether. On that ground I trust the House will not agree to refer the Bill to a Select Committee, as proposed by the noble Lord. I do not see why we should give up any powers we have in order to allow it to go to any four Gentlemen to be nominated by the Committee of Selection. If it is not referred to a Select Committee, it will go naturally before the Chairman of Ways and Means as an unopposed Bill, and no one will have any further interest in opposing the Bill, except those who have a fair and proper locus standi.
§ Question put.
§ The House divided:—Ayes 61; Noes 375: Majority 314.282
|Agg-Gardner, J. T.||Blundell, Col. H. B. H.|
|Baden-Powell, G. S.||Bolton, J. C.|
|Baily, L. R.||Brand, hon. H. R.|
|Beach, W. W. B.||Brocklehurst, W. C.|
|Bentinck, rt. hn. G. C.||Brown, A. H.|
|Bethell, Commander||Connolly, L.|
|Birkbeck, Sir E.||Corry, Sir J. P.|
|Cotton, Capt. E. T. D.||O'Brien, P.|
|Courtney, L. H.||O'Connor, T. P.|
|Cranborne, Viscount||Pearce, W.|
|Dillwyn, L. L.||Pease, Sir J. W.|
|Duncan, D.||Percy, Lord A. M.|
|Ewing, Sir A. O.||Plunket, rt. hon. D. R.|
|Fairbairn, Sir A.||Powell, F. S.|
|Finlayson, J.||Ramsay, J.|
|Fowler, Sir R. N.||Rathbone, W.|
|Gent-Davis, R.||Roberts, J. (Flnt. Bgs.)|
|Gibson, J. G.||Russell, E. R.|
|Hamilton, right hon. Lord G. F.||Sclater-Booth, rt. hn. G.|
|Sturgis, H. P.|
|Hamilton, Lord E.||Tennant, Sir C.|
|Hamilton, Col. C. E.||Thompson, Sir H. M.|
|Herbert, hon. S.||Tipping, W.|
|Hill, A. S.||Tomlinson, W. E. M.|
|Howard, J.||Trotter, H. J.|
|Lawrence, W. F.||Vivian, Sir H. H.|
|Lowther, hon. W.||Walrond, Col. W. H.|
|Makins, Colonel W. T.||Watson, J.|
|March, Earl of||Whitley, E.|
|Mills, hon. C. W.|
|Muntz, P. A.||Forwood, A. B.|
|Nolan, J.||Hamilton, Lord C. J.|
|Abraham, W. (Glam.)||Brookfield, Col. A. M.|
|Abraham, W. (Limerick, W.)||Bruce, hon. R. P.|
|Brunner, J. T.|
|Acland, A. H. D.||Buchanan, T. R.|
|Acland, C. T. D.||Buckley, A.|
|Addison, J. E. W.||Burdett-Coutts, W. L. Ash.-B.|
|Ainslie, W. G.||Burghley, Lord|
|Allen, H. G.||Burt, T.|
|Allison, R. A.||Buxton, E. N.|
|Ambrose, W.||Byrne, G. M.|
|Amherst, W. A. T.||Cameron, C.|
|Armitage, B.||Cameron, J. M.|
|Asher, A.||Campbell, Sir A.|
|Ashmead-Bartlett, E.||Campbell, H.|
|Ashton, T. G.||Campbell, J. A.|
|Atherley-Jones, L.||Campbell, R. F. F.|
|Baggallay, E.||Campbell-Bannerman, right hon. H.|
|Baker, L. J.|
|Balfour, rt. hon. A. J.||Carbutt, E. H.|
|Balfour, rt. hon. J. B.||Carew, J. L.|
|Barbour, W. B.||Cavendish, Lord E.|
|Barclay, J. W.||Chamberlain, rt. hn. J.|
|Barnes, A.||Chance, P. A.|
|Barttelot, Sir W. B.||Channing, F. A.|
|Bass, Sir A.||Charrington, S.|
|Baumann, A. A.||Churchill, rt. hn. Lord R. H. S.|
|Beadel, W. J.|
|Beaumont, H. F.||Clancy, J. J.|
|Beith, G.||Clark, Dr. G. B.|
|Bickersteth, R.||Clarke, E. G.|
|Biddulph, M.||Cobb, H. P.|
|Blake, J. A.||Cobbold, F. T.|
|Blake, T.||Cohen, L. L.|
|Bolton, T. H.||Coleridge, hon. B.|
|Boord, T. W.||Commerell, Adml. Sir J.|
|Bridgeman, Col. hon. F. C.||Compton, Lord W. G.|
|Condon, T. J.|
|Bright, right hon. J.||Conway, M.|
|Bristowe, T. L.||Conybeare, C. A. V.|
|Broadhurst, H.||Cook, E. R.|
|Brodrick, hon. W. St. J. F.||Coote, T.|
|Corbet, W. J.|
|Corbett, A. C.||Grafton, F. W.|
|Cossham, H.||Greenall, Sir G.|
|Cowen, J.||Gregory, G. B.|
|Craven, J.||Grey, Sir E.|
|Crawford, D.||Grimston, Viscount|
|Crawford, W.||Grove, Sir T. F.|
|Cremer, W. R.||Gunter, Col. R.|
|Crilly, D.||Gurdon, R. T.|
|Crompton, C.||Hall, C.|
|Cross, H. S.||Hamilton, Lord F. S.|
|Crossley, Sir S. B.||Hanbury, R. W.|
|Crossley, E.||Harcourt, rt. hn. Sir W. G. V. V.|
|Cubitt, right hon. G.|
|Curzon, Viscount||Hardcastle, E.|
|Davies, D.||Hardcastle, F.|
|Davies, R.||Harker, W.|
|Davies, W.||Harrington, E.|
|Dawson, E.||Harris, M.|
|Deasy, J.||Hartington, Marq. of|
|De Cobain, E. S. W.||Havelock-Allan, Sir H. M.|
|Denison, E. W.|
|Dilke, rt. hn. Sir C. W.||Hayne, C. Seale-|
|Dillon, J.||Heaton, J. H.|
|Dimsdale, Baron R.||Heneage, right hon. E.|
|Dixon, G.||Henry, M.|
|Douglas, A. Akers-||Hervey, Lord F.|
|Duckham, T.||Hibbert, rt. hon. J. T.|
|Duff, R. W.||Hickman, A.|
|Duncan, Colonel F.||Hill, Lord A. W.|
|Duncombe, A.||Hobhouse, H.|
|Dyke, rt. hn. Sir W. H.||Holden, A.|
|Eaton, H. W.||Howell, G.|
|Egerton, hn. A. J. F.||Hoyle, I.|
|Egerton, Admiral hon. F.||Hunt, F. S.|
|Hunter, W. A.|
|Egerton, hon. A. de T.||Hutton, J. F.|
|Elliot, hon. A. R. D.||Illingworth, A.|
|Ellis, Sir J. W.||Ingram, W. J.|
|Ellis, J. E.||Jacks, W.|
|Esslemont, P.||Jackson, W. L.|
|Everett, R. L.||James, rt. hon. Sir H.|
|Farquharson, Dr. R.||James, hon. W. H.|
|Feilden, Lt.-Gen. R. J.||James, C.|
|Fellowes, W. H.||Jenkins, D. J.|
|Ferguson, R.||Jennings, L. J.|
|Field, Captain E.||Johns, J. W.|
|Finch, G. H.||Johnson-Ferguson, J. E.|
|Fitzgerald, R. U. P.||Johnston, W.|
|Fitz-Wygram, Sir F.||Joicey, J.|
|Fletcher, Sir H.||Jones, P.|
|Fletcher, B.||Jones-Parry, L.|
|Flynn, J. C.||Jordan, J.|
|Folkestone, Viscount||Kelly, B.|
|Forster, Sir C.||Kennaway, Sir J. H.|
|Foster, Dr. B.||Kenny, C. S.|
|Fowler, H. H.||Kenny, M. J.|
|Fox, Dr. J. F.||Kenrick, W.|
|Fraser, General C. C.||Kenyon, hon. G. T.|
|Fry, T.||Kilcoursie, right hon. Viscount|
|Fuller, G. P.|
|Gaskell, C. G. Milnes-||Kimber, H.|
|Gathorne-Hardy, hon. J. S.||King, H. S.|
|Knatchbull-Hugessen, hon. H. T.|
|Gibb, T. E.|
|Giles, A.||Labouchere, H.|
|Gilhooly, J.||Lalor, R.|
|Gladstone, H. J.||Lane, W. J.|
|Goldsmid, Sir J.||Lawrance, J. C.|
|Goldsworthy, Major-General W. T.||Lawson, H. L. W.|
|Gower, G. G. L.||Leatham, E. A.|
|Lechmere, Sir E. A. H.||Powell, W. R. H.|
|Leicester, J.||Power, P. J.|
|Leighton, S.||Power, R.|
|Lethbridge, Sir R.||Price, Captain G. E.|
|Llewellyn, E. H.||Price, T. P.|
|Lloyd, W.||Priestly, B.|
|Long, W. H.||Pugh, D.|
|Lubbock, Sir J.||Puleston, J. H.|
|Lyell, L.||Pyne, J. D.|
|Lymington, Viscount||Quilter, W. C.|
|MacInnes, M.||Redmond, J. E.|
|Mackintosh, C. F.||Reed, Sir E. J.|
|Maclean, F. W.||Reid, H. G.|
|Maclean, J. M.||Rendel, S.|
|Macnaghten, E.||Richard, H.|
|M'Arthur, A.||Richardson, T.|
|M'Calmont, Captain J.||Ritchie, C. T.|
|M'Culloch, J.||Roberts, J. B.|
|M'Donald, P.||Robertson, E.|
|M'Donald, Dr. R.||Robertson, H.|
|M'Garel-Hogg, Sir J.||Robertson, J. P. B.|
|M'Kenna, Sir J. N.||Robinson, T.|
|M'Lagan, P.||Rogers, J. E. T.|
|M'Laren, C. B. B.||Roscoe, Sir H. E.|
|Maitland, W. F.||Ross, A. H.|
|Mappin, F. T.||Ruston, J.|
|Marjoribanks, rt. hon. E.||Rylands, P.|
|Salis-Schwabe, Col. G.|
|Maskelyne, M. H. N. Story-||Samuelson, Sir B.|
|Mather, W.||Seely, C.|
|Mellor, rt. hon. J. W.||Sellar, A. C.|
|Menzies, R. S.||Seton-Karr, H.|
|Molloy, B. C.||Sexton, T.|
|Montagu, S.||Shaw, T.|
|More, R. J.||Sheehy, D.|
|Morgan, rt. hon. G. O.||Sheil, E.|
|Morgan, O. V.||Shirley, W. S.|
|Morley, rt. hon. J.||Sidebottom, T. H.|
|Morley, A.||Sidebottom, W.|
|Mount, W. G.||Simon, Serjeant J.|
|Mowbray, rt, hon. Sir J. R.||Sitwell, Sir G. R.|
|Spencer, hon. C. R.|
|Muncaster, Lord||Spensley, H.|
|Mundella, rt. hn. A. J.||Stack, J.|
|Newark, Viscount||Stanhope, rt. hon. E.|
|Newnes, G.||Stansfeld, rt. hon. J.|
|Noel, E.||Stevenson, F. S.|
|Nolan, Colonel J. P.||Stewart, M.|
|Norris, E. S.||Sturrock, P.|
|Norton, R.||Sullivan, D.|
|O'Brien, J. F. X.||Talbot, J. G.|
|O'Brien, P. J.||Tanner, C. K.|
|O'Brien, W.||Taylor, F.|
|O'Connor, A.||Thomas, A.|
|O'Connor, J. (Kerry)||Tottenham, A. L.|
|O'Connor, J. (Tippry.)||Trevelyan, rt. hon. G. O.|
|O'Hanlon, T.||Tuite, J.|
|O'Hea, P.||Tyler, Sir H. W.|
|O'Kelly, J.||Valentine, C. J.|
|Paget, Sir R. H.||Vanderbyl, P.|
|Paget, T. T.||Verney, Captain E. H.|
|Parker, C. S.||Vincent, C. E. H.|
|Paulton, J. M.||Walsh, hon. A. H. J.|
|Peacock, R.||Wardle, H.|
|Pease, H. F.||Warmington, C. M.|
|Peel, right hn. Sir R.||Wason, E.|
|Pelly, Sir L.||Watt, H.|
|Pickersgill, E. H.||Wayman, T.|
|Picton, J. A.||West, Colonel W. C.|
|Playfair, rt. hon. Sir L.||Westlake, J.|
|Weston, J. D.|
|Potter, T. B.||Whitbread, S.|
|White, J. B.||Wolmer, Viscount|
|Wiggin, H.||Woodall, W.|
|Will, J. S.||Woodhead, J.|
|Williams, A.||Wortley, C. B. Stuart-|
|Williams, J. C.||Yeo, A. F.|
|Wilson, H. J.|
|Wilson, J. (Durham)||Fergusson, right hon. Sir J.|
|Wilson, J. (Edinbgh.)|
|Winterbotham, A. B.||Houldsworth, W. H.|
|Wodehouse, E. R.|
Bill read a second time, and committed.
§ MR. SEXTON (Sligo, S.)
I beg leave to move, Sir, that the vote of the right hon. David Plunket in this division be disallowed. He was the only one of the 15 Gentlemen who, after the Question I put to you, Mr. Speaker, about them and your expression of opinion, entered the Division Lobby.
§ MR. TIPPING (Stockport)
Will you allow me to say, Sir, that I had the honour of going into the Division Lobby, and I am a North-Western Railway Director.
§ MR. SEXTON
Will the hon. Member give me his name? Then, Sir, I beg to move that the votes of the right hon. David Plunket and Mr. Tipping in this division be disallowed. Both those Gentlemen are at present Directors of the London and North-Western Railway Company, and in that capacity receive a large pecuniary compensation for their services. That fact alone, I submit, constitutes a conclusive reason why neither of them should intervene in any division in this House concerning the pecuniary interests of that Company. The London and North-Western Railway Company are pecuniarily interested in the matter, for if the Canal is constructed the receipts and the dividends of that Company will be affected; and therefore these two Gentlemen, in addition to being interested as Directors, are interested as shareholders.
§ Motion made, and Question proposed, "That the Votes of the Right honourable David Plunket and Mr. Tipping be disallowed."—(Mr. Sexton.)
§ LORD CLAUD HAMILTON (Liverpool, West Derby)
I am sorry also, Sir, to call attention to the fact that Mr. Houldsworth, Member for Manchester, and a Director of the Manchester Ship Canal, told in the division.
§ MR. PLUNKET (Dublin University)
Of course, Mr. Speaker, I submit myself most humbly to the decision of the 283 House, and I am not going to argue the question at all. I might, perhaps, say that as a Director, whose salary is fixed, this Bill can make no difference to me at all. But, being a Director—I am also a shareholder—and, as far as the hon. Member's (Mr. Sexton's) criticism is a just one, of course it would apply to me on this occasion; but I will only say this much to the House—that if I am an offender on this occasion I am a very old and a very notorious offender, because this precise point was raised against me three years ago by an hon. Member who sits close to the hon. Member for Sligo—I think the hon. Member for South Cork (Mr. J. E. Kenny). I submitted myself to the judgment of the House on that occasion, and a division was taken; and by a majority of 256, I think, against 36, the House, on that occasion, acquitted me. And if the hon. Member should go to a division now I humbly trust the House will acquit me again.
§ MR. TIPPING (Stockport)
I looked upon the observations of the hon. Member below the Gangway (Mr. Sexton) as a threat—if he will allow me to use the word—as a form of "Boycotting," and I thought it was necessary for me to go into the Lobby at once, and I should do so again under such a threat.
§ THE CHANCELLOR OF THE EXCHEQUER (Sir WILLIAM HARCOURT) (Derby)
I will ask the House to hear what the practice has been in this matter. I think it will be well to follow the Rule which certainly, for a great many years, has been followed. I find the following in Sir Thomas Erskine May's work on Parliamentary Practice—On the 16th of June, 1846, objection was taken to the vote of a Member who had voted with the Noes, on the ground that he was a Director and shareholder in the Caledonian Railway Company, and had a direct pecuniary interest in the rejection of the Glasgow, Dumfries, and Carlisle Railway Bill. Whereupon he stated that the sole direct interest that he had in the Caledonian Railway was, being the holder of 20 shares, to qualify him to be a Director in that undertaking; and that he voted against the Glasgow, Dumfries, and Carlisle Railway, conceiving it to be in direct competition with the Caledonian Railway, as decided by the Legislature in the last Session.
§ SIR WILLIAM HARCOURT
Well, I presume he had. At all events, he was a shareholder in the Caledonian Company, and he voted against the 284 Glasgow, Dumfries, and Carlisle Railway Bill. The report goes on to say—A question for disallowing his vote, on the ground of direct pecuniary interest, was negatived. On the second reading of the Birmingham and Gloucester Railway Bill, 15th May, 1845, objection was taken to one of the Tellers for the Noes, as being a landholder, whose property would be injured by the proposed line. A Motion, for disallowing his vote was withdrawn. On the 15th July, 1872, objection was taken to two of the Tellers in a division who had voted against the Birmingham Sewerage Bill,of which the right hon. Gentleman opposite the Member for Blackburn (Sir Robert Peel) will have a lively recollectionon the ground of pecuniary interest, but was not sustained.Then there is the note—And see case of London and North-Western Railway Bill (Mr. Plunket) 8th May, 1883.Well, as far as the records go, these cases seem to be very similar to the present case, and I think it has not been considered by the House that this is the sort of pecuniary interest which is covered by the Rules. As these precedents seem to extend over 40 years I think that we ought to follow them. If the opponents of this measure are to be put under this ban, its supporters ought to be under the same ban. I think, under these circumstances, a truce ought to be declared.
§ Question put.
§ The House divided:—Ayes 81; Noes 291: Majority 210.—(Div. List, No. 22.)
The following is the Entry in the Votes:—
Objection being taken to the Votes of the Right honourable David Plunket, Member for the University of Dublin, and Mr. Tipping, Member for Stockport, who voted with the Ayes, on the ground that they are Directors of the London and North Western Railway Company, and had a direct pecuniary interest in the question before the House:—
Motion made, and Question proposed, "That the Votes of the Right honourable David Plunket and Mr. Tipping be disallowed.
And, the Right honourable David Plunket and Mr. Tipping, being heard in their places, withdrew:—
Question put:—The House divided; Ayes 81, Noes 291.
§ Bill committed.