HC Deb 08 June 1903 vol 123 cc277-90

1. £2,549,430, to complete the sum for Post Office Telegraphs.


, proceeding with his speech, referred to a widespread impression that existed that the Post Office had been some what ungenerous in its treatment of Mr. Marconi. So far as the public could gather the treatment of the Post Office had neither been encouraging nor helpful, which was quite contrary to the attitude of the Admiralty, who had promptly availed themselves to a large extent of Mr. Marconi's invention. His system had been employed on between 100 and 200 vessels in the Navy, and had been much appreciated. He would be glad to have information from the Postmaster-General as to anything that had been done in the way of facilitating the transmission of Marconi messages from the sea through the ordinary post offices on shore. He desired also to know what progress had been made in facilitating communication between the lightships on the coast and the shore lighthouses, so that in the event of shipwreck instant communication could be obtained with the coastguard and lifeboat services. He also asked what progress had been made with the laying of underground telegraph wires with a view to the avoidance of those serious interruptions of telegraphic communication with Scotland by the blowing down of wires in high winds, or their breakage by snowstorms. Perhaps, also, the Postmaster-General would give some information respecting the proceedings of the International Conference. He complimented the Postmaster-General, in conclusion, on his able discharge of the duties of his office, and disclaimed any desire to reflect upon his administration or do otherwise than assist him in Post Office reforms by the suggestions he made.


thanked the hon. Member for the way in which he had spoken of him personally, and said he had to acknowledge that he had received nothing but kindness and consideration from both sides of the House in the discharge of his official duties. A number of questions had been put to him of varying interest, which were all worthy of a few words in reply, and as briefly as he could he would deal with those questions. He was not yet able to make any further announcement as to the Committee on rates of wages to Post Office employees. The Committee would see that it would take some time to form a Committee of that kind, composed of the persons they all desired to see serving upon it, but that was less unfortunate than otherwise would be the case, because the officials of the staff interested would require some time to collect and frame the information they would desire to place before its members. The hon. Member for Hoxton had asked when the Report would be issued. Such a question was altogether premature. The time likely to be occupied by the inquiry must depend on the method employed by the members of the staff in presenting their cases. He hoped they would select people competent to speak on their behalf and to put their case within reasonable limits and without unduly prolonging discussion, so that there would be a Report before any long period had elapsed. At the same time he thought it was more important that the work should be well done, and that the inquiry should result in securing a satisfactory judgment, than that matters should be hastened so as to obtain any Report at a very early stage. The discussion this evening had been chiefly concerned with the interests and grievances of the public. These were too often omitted from their debates on the postal and telegraph services, but they did deserve some attention. After all, the Post Office existed for the service of the public; and, whilst their desire was that employees of the State should be well treated and that its service should be a good service, the raison d'être of the Post Office was that it should be of service to the public.

The hon. Member for Canterbury called attention to the annual loss which was incurred upon the telegraph service as distinct from the postal service, and invited him to give to the Committee detailed reasons for the loss. The deficit was due to a variety of causes. He thought, in the first place, that the State paid an exorbitant sum when it originally bought the telegraphs. The Government of this country were more tender in regard to private interests than most other Governments were, and the result was that, when the State decided to take over the telegraphs, it had to pay a sum which not only forestalled future profits, but, he thought, exceeded any profits which could be fairly taken into account at that time. In the next place, in recent years there had been two streams of public opinion constantly washing against the Post Office and producing their effect upon its policy. One was the demand, admirably represented by his hon. friend the Member for Canterbury, for greater facilities for the public in every respect. The other was the demand, represented on both sides of the House, for higher pay to the servants of the State in whatever position they served. If, during a period of years, they had a steady increase in the cost of labour and a steady reduction in the price at which they supplied their finished product or gave their service to the public, he was afraid the result was bound to be what they said in regard to the telegraphs—a deficit instead of a profit. But the House of Commons was master in these matters. It had to decide, in the last resort, whether it was satisfied with the treatment of the employees; and it must decide also whether the public ought to get increased benefits as senders of telegrams or whether they were to get; increased benefits as the owners of the telegraph system of the country. They could not have it both ways. They could not raise wages and increase the services rendered to the public and at the same time decrease the loss or turn the loss into a profit. The endeavour of his predecessors and himself had been to hold the balance fairly between these conflicting claims—to see that the State was not a discreditable employer of labour, to give to that section of the public which were their customers such facilities as they fairly could, and then to come to the House of Commons to support them when they refused, in the interests of the public at large, to confer extravagant benefits on particular individuals or classes.


I am sorry to interrupt my right hon. friend, but I do desire that he will tell the Committee the amount of money expended on the employees and the amount of concession given to the public. I can tell the Committee in a moment. It is £600,000 to the employees and about £20,000 to the public.


said his hon. friend had been good enough to save him the necessity of replying to the question.


asked if the £600,000 was for telegraph employees alone.


replied that the sum referred to was for postal employés generally. He thought that in some directions there were signs of improvement in their telegraph service. They were now embarking more and more largely on the telephone system, which he hoped would be a remunerative investment. He did not want the State to make an exaggerated profit out of the business it conducted; but, on the other hand, he held that if they gave up the idea of profit altogether they probably gave up also sound business management and the best incentive to economy and efficiency. He did not think they ought to supply to what was only a section of the public, after all, a great service at the cost of the public as a whole, or without making a reasonable return on the capital which the public as a whole had put into the business. If he was right in his expectations that their telephone service would prove to be remunerative, and he would do his best to make it so, the telephone being part of the monopoly of the Postmaster-General, that would come in to reduce the deficit on the telegraph service. It was true that already a reduction was made in the deficit by the telephone system, for they drew in royalties from the National Telephone Company something like £ 150,000 a year in aid of their revenue. He did not think that with the telegraph service in its present condition the Committee should expect that the Treasury, or even the Postmaster-General, should be willing to launch out in large fresh concessions involving greatly increased expenditure without commensurate return. His hon. friend had said they were collecting a revenue of something like £60,000 a year from those who registered telegraph addresses—a rather mean way of obtaining revenue, he thought—and that they ought to give it up and allow twenty words without addresses, or a less number of words including addresses. He had found many difficulties arising out of the present arrangement, but he thought that nearly every difficulty he had to confront arose out of some concession made to the public demand by one of his predecessors. And when those officials, to whom he was so greatly indebted, and to whom his hon. friend did scant justice when he spoke of their efforts to serve the public, came to him with criticisms or with objections to suggestions which he made, it was only to save him from the fate of having added to the difficulties of his successors, as he was sometimes inclined to reproach his predecessors past and gone for having landed him in these difficulties. There was the £60,000 with which his hon. friend taunted him. He should be glad to drop that sum tomorrow if he could give up the registered addresses with it, and he should consider it the best stroke of business that any Postmaster-General had done for a long time. But he could not give up the registered addresses. It had got too firm a hold on the public. Even if he could do away with it for domestic purposes, he could not do it for foreign and colonial messages. But if his hon. friend thought that the £60,000 paid the Post Office for the trouble, the inconvenience, and the interruption of working which were caused by the system of registered addresses he made a great mistake. He should be very glad to get rid of registered addresses if he could.

There had been recently introduced by the engineers of the telegraph service of the Post Office a switch-board something like the switch-board which was in operation in the telephone system throughout the country. The system hitherto had been that practically every branch office in London wishing to communicate with another district office had to telegraph into the Central Telegraph Office in London, the message had to be read off, written out, carried to another operator in the same building, and again telegraphed. That system was cumbersome, slow, and gave an added risk of mistakes; but there had not been business enough to enable them to run a wire between the offices. They had now, however, got this arrangement of a switchboard by which, say, Kensington, could be switched straight through to Chelsea, thus saving the operation at the Central Telegraph Office. There had been difficulties in the way, but the engineers had successfully overcome them, and the system was working very satisfactorily in a great number of offices with a great saving of time in the delivery of messages and a certain saving of labour. As to the registration of addresses, he had looked very carefully into the matter. It must be borne in mind that there were thousands of them in London alone; a register had to be compiled and kept up to date in every office, and there were alterations to be made and circulated daily. If he could have seen his way to giving a free address with a slightly reduced number of words to the message, he would have done so gladly; but there were obstacles in the way, and he was quite sure he should have the whole commercial community against him in regard to such a change.

He hoped he might be able to announce before very long some further reduction in certain of the rates to foreign countries. But it was not quite so simple a matter as his hon. friend the Member for Canterbury in his enthusiasm seemed to think; it was a matter of negotiation with foreign countries and cable companies. Very complex interests had sometimes to be dealt with. There were many things which he was prepared to do and to which he believed he could secure the assent of the Treasury without much difficulty; but the assent of foreign countries was also necessary. They must also bear in mind that the strategic and other interests of this country in the great cable system of the world must be considered. We were the pioneers of that system, and in that regard English enterprise, industry, and capital had no doubt done magnificent work. He should lose no opportunity that offered of securing a reduction In passing he must say that his hon. friend was over-sanguine as to the results of reductions, cable traffic did not respond rapidly to reductions in rates. The Australian traffic had made no great progress since the great reductions that had taken place, and the South African traffic was perhaps the one instance to the contrary. They must also remember that while 3s. 6d. or 10s. 6d. per word seemed a monstrous rate to pay, yet that word, thanks to the use of codes and ciphers, generally conveyed a whole sentence, or as much as an ordinary Parliamentary report gave of five minutes' talk — and, if they considered it as a rate for information conveyed, the charges were by no means so monstrous as they appeared to be at first sight. Lord Balfour's Committee came to the conclusion that, speaking generally, the rates were not exorbitant. There were some exceptions, and to these he had been giving his attention. He could not at present give the Committee any further information; but he hoped, in connection with the International Telegraph Conference, that they might arrive at some further reductions. More than that he could not say.

As to the other questions raised by his hon. friend, he did not propose at the present time to adopt the policy of purchase in regard to the Spanish cable. They were in communication with the company as to the terms on which the rates might be renewed, and would do their best to serve the public. As to the rates between mermany and Spain, it must be re-Gembered that the German Government subsidised their cable. With regard to wireless telegraphy, his hon. friend seemed to have rather inconsistent ideas. If he were quite as certain of the possibilities of the future of wireless telegraphy as his hon. friend was, this would not be the moment at which he should press upon his friends the claims of investments in cable shares. He did not think those who owned cable shares had any occasion to become frightened about their investments; but he did not know that it was a moment for launching out in great cable speculation. Before doing so he thought they might well watch the progress of Mr. Marconi's system. He was bound to say that scant justice had been done to the Post Office in this matter by various speakers. Long before the inventions of Mr. Marconi had reached their present point he received such facilities as the Post Office could give for his experiments. The Post Office did everything they could to assist what they thought might be a great progress in civilisation, and they had neither shown any disposition to strangle the invention at its birth nor to prevent its development and success.


Then why the long delay with the communication at Poldhu?


said he would deal with that point later on: he was now on the general question. The Post Office had had no desire to strangle the invention or prevent its full development, but they had, however, desired not to bind themselves to give away the rights of the Postmaster-General in the same way in which they were given away in regard to telephones, before the importance of telephones was seen. For that action his predecessors and himself had never ceased to be criticised, and the Post Office had still to bear the burden. At present they knew very little about wireless telegraphy. We knew very little of the conditions under which wireless telegraphy would have to be worked. In most countries the Post Office was in the position of a monopolist; but in this country the monopoly of the Postmaster-General did not cover communications with a foreign shore or outside the three-mile limit. The Post Office, therefore, could not strangle the invention even if it wanted to. Their business communications had not been with Mr. Marconi, though personally his relations with that gentleman had been most friendly. They had been dealing with the company which possessed the inventor's rights. The company did not ask merely for what the cable companies had. They asked for an exclusive right to work wireless telegraphy in this country, and they asked for permanence. He could not give them either. He said he would give them a private wire at Poldhu; and when they applied for it they had that private wire, and they had had it for some time past. There was no difficulty at any time about the company's having their private wire on ordinary terms, or obtaining delivery of any messages sent to them from any point in this country, or having messages received at Poldhu put on the Post Office wires. But they asked the Post Office to become their agents for the collection of messages to be transmitted by their wireless system in the same way that anybody could hand in a message at any post office to be transmitted by the cable companies. He wrote explaining generally the terms on which he was prepared to act, and laid down certain conditions he would have to enforce in order to prevent interference with the Admiralty for strategic reasons and to safeguard national interests. He further said they must satisfy his technical officers of what was disputed by him—namely, that the company were in a position to carry on their business and transmit messages from one side of the Atlantic to the other. That letter was written on March 31st last, and he was still waiting for a reply. He did not complain of the delay in the least; but he did complain that the delay should Le attributed to the Post Office. When they were in a position to write him to send down his technical officers, and when he was satisfied that the company were in a position to carry on the business, he would be prepared to meet them, but he was not prepared to collect money from the public until he was satisfied that the company could do its share of the work. The Committee would see that the conditions he had laid down were such as were necessary to safeguard the national interests, as well as the strategic interests, of this country. There was nothing to prevent the Board of Trade using the Marconi apparatus: indeed, he believed his right hon. friend the head of the Department was in communication with the company on the subject.

As regarded the progress of underground wires to the North, in a statement he made to the Scotch Chambers of Commerce early in the year he explained what progress had been made in the past year and the programme for this year, which he believed would be fulfilled before the end of the year. He thought the Post Office deserved great credit for the constant progress that had been made in the scientific development of these underground cables. The sum provided for I this purpose during the last two years was £30,000 a year, and the Chancellor of the Exchequer had provided this year £130,000, and the fact that they were making rapid progress with this work in part accounted for the increased expenditure to which attention had been drawn. Another part of the increase was due to the extension of the telephone system in London. Information had been asked for with regard to the progress of the London telephone system. Considerable difficulties had had to be overcome in connection with local authorities, and so forth, but he had had a good many interviews with local authorities, and was glad to say that the relations of the Post Office with those bodies were now on a much better footing than they had been hitherto, and he hoped that in the future there would be less friction than in the past. They had laid about 1,000 miles of pipes under the streets of London to carry the cables, and into those pipes they had already drawn over 100,000 miles of wires. The net result was that during the last six months there bad been a most rapid increase in the number of telephone subscribers and in the number of calls. Of course he had had complaints, but the friction had mostly been between the Post Office exchanges and the Telephone Company, and not in consequence of bad working on the part of the Post Office system itself. He regretted that the Post Office monopoly in this matter had ever been made the subject of licences to any private company at all. This was not a suitable matter for competition. It was one of those cases in which the public could only lose by competition and could only gain by a monopoly, and if there was a monopoly it ought to be in the hands of a public authority. In a great part of the country the licence of the Telephone Company came to an end in 1911; and he could not conceive that after that period any Postmaster-General would ever allow the system to pass out of his hands again. The Post Office were steadily extending their system in various directions. The Central London Exchange was, he thought, already the biggest exchange in the world, and they were looking forward to an enormous development in a few years.

One other matter had been mentioned, viz., the International Telegraph Conference. That Conference was mainly concerned with the details of telegraph administration. These details had their interest for the public, as on them depended the smooth working and efficiency of the international telegraph system, but at the same time they were matters of detail and not suited for discussion in this House. With regard to the question of the reduction of charge, they might obtain some advantage, but he could not say more at present. Then there was the question of the compulsory adoption of the Berne vocabulary for all codes. He had instructed the British delegates to oppose the compulsory adoption of that vocabulary. He could not say what the decision of the Conference would be; but he felt strongly that the disadvantages to the commercial community which would result from its adoption would far outweigh any possible advantages which it might have from an administrative point of view, and he hoped the Conference would come to the same view.


pointed out that under the main heads of the Vote the money asked for was required for both telegraphic and telephonic purposes, so that it was impossible to tell the actual cost of either service. He hoped that next year the right hon. Gentleman would endeavour to frame the Estimate in such a way as to separate the telegraph from the telephone charges.


said he would be very glad if he could do as the hon. Member suggested, but in point of law telephones were telegraphs, and it was by virtue of that fact the Postmaster-General enjoyed his present monopoly. Consequently the telephone service had always been treated as part of the telegraph system, and it would be impossible now to unravel the accounts which had been kept conjointly for so many years past. As far as the London system was concerned, however, he proposed to keep the charges separate, so as to be able to judge whether the charges made were fair, and whether they resulted in a profit or a loss.


urged that more liberality should be shown in encouraging the establishment of telegraphic offices in villages. He believed that if that were done the necessary guarantees would gladly be given.

MR. DALZIEL (Kirkcaldy Burghs)

said he hoped that the Government would do nothing to identify themselves with the Marconi system of telegraphy as against other systems which had been more successful but not so well advertised. He submitted that the time had not arrived when the Government should identify themselves with any particular system; and he hoped that the House would be given an opportunity of considering the question before any large expenditure was incurred.


thought the statement of the Postmaster-General was an extraordinary one. Did the Department really not know what profit was made on the telegraph system, and what on the telephone system? There ought to be a profit and loss account of each service, otherwise the concern was not being carried on on sound business principles.


suggested that the sender of a telegram should be allowed to insert in the form the time at which he handed in the message according to the post-office clock. He had had personal experience of the delay caused in the offices, a telegram which he had sent having been post-timed twenty minutes by the clerk. He desired to refer also to the giving of a contract to a firm in which a Member of the House had a direct pecuniary interest. By a statute of George III. Members were forbidden to have any such interest in Government contracts. This particular contract was for a number of telephone cabinets, most of which had had to be returned for alterations. He asked the right hon. Gentleman to state what were the prices quoted by private contractors as against those of Messrs. Maple and Co. As to the telephone charges, he believed the charge for a three-minutes conversation with Dublin was 5s. or 6s. This he thought was exorbitant, and ought to be reduced.


referred to the establishment of telephone call-offices in public-houses. Such an arrangement was exceedingly awkward, as persons desiring to use the telephone had to push their way through perhaps a dozen people in the bar before they could get to the instrument. The public interest would be better served by other places, equally convenient, being secured for the purpose.


said he entirely agreed with the hon. Member, and he would never establish a telephone call-office in a public-house if other suitable premises could be secured. But anybody in the London area could have a telephone at the message rate, and allow it to be used by the public.


asked whether they could charge on the penny-in-the-slot system.


said they could, and many tradesmen, especially in the suburbs, found it a great convenience and benefit to have a telephone and allow their customers to use it. He could not make a special law to prevent publicans doing the same as other people, but he could assure the hon. Member that no action had been taken by the Post Office to make publicans their agents in this matter. The points mentioned by the hon. Member for South Armagh had already been brought before his notice by Questions across the floor of the House, and he had already told the hon. Member that the cabinets had previously been made not by private firms, but in the Post Office factory, and that it would not be to the public interest to state the prices quoted by the different firms. The Act to which the hon. Member had referred had no bearing whatever on the case. As to the remarks of the hon. Member for the Mansfield Division, as he had already stated, it would be impossible to analyse past expenditure, and say how much had been spent on the separate services, although he quite agreed that the more they could find out how much each service cost the better it would be.

Vote agreed to.

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