§ Mr. HOBHOUSE
The return of the working of the State telephone system in the year 1912–13 (v. H. of C. Paper No. 94) was 4.85 per cent., namely, 3.38 per cent. interest on capital and 1.47 per cent. net contribution to the Exchequer. The dividend of the National Telephone Company was between 5 and 6 per cent.; in the last five years of their operations the average return on their capital was 5.13 per cent., or about a ¼ per cent. higher than that of the Post Office. This comparison does not take into account on one side the reduced charges to the State telephone undertaking in respect of royalties, Income Tax, and certain wayleaves, and on the other side the vastly increased charges for pay and pensions which are imposed by the State on the undertaking.