HL Deb 09 March 1885 vol 295 cc405-20

, in rising to call the attention of the House to the subject of Railway Rates, and to move for copy of the judgments of the Railway Commission with respect to terminals, said, it might be bold of him to bring such an important question before their Lordships, particularly as he had as great an objection to making or hearing long speeches as no doubt their Lordships had. However, he would endeavour to place what he had to say as shortly and clearly before the House as he could. He thought he need hardly dwell on the importance of this question both to agriculture and trade. The very fact of its being so warmly discussed by practical men was sufficient to show this; it would be enough for him to say that in some cases the facilities given by a railway in any particular locality might make or destroy an industry, and that it was acknowledged that, as they had been told, 1d. per ton for rates and charges for a certain distance might make the whole difference between buyer and seller in a market. One word as to the appeal made to him by the Government to postpone his Notice. He might be taking some responsibility in not doing as he was asked, and he might be told hereafter that the negotiations with the Railway Companies had failed in consequence of his action. However, as he said the other day, he was not acting independently, although he was prepared to take the whole responsibility of what he said on himself. It would be wrong for him to pledge the able and experienced gentlemen who were acting with him by any blunders his own inferior experience and want of knowledge of the subject might lead him into. If the negotiations were to be carried on on lines which were entirely opposed to the general feeling of the country, it was far better that they should fail, for they would come to no good; and he thought he challenged the Government fairly when he said he would only withdraw if they would undertake that the negotiations should be carried on strictly on the basis that whatever was agreed upon should be dealt with in a measure brought in by the Government and not by private legislation. If there was one thing more than another on which traders were determined, it was that a great change in railway legislation should not be accomplished by Private Bills, and, as it were, by a side-wind. To negotiate on any other basis, therefore, was mere waste of time. If the negotiations failed, he thought the blame rested with the Government; for what possible object could there be in secrecy in domestic affairs of this kind? By such an appeal they were taken out of the region of a question in which both traders and Railway Companies were mutually interested, and where plain and open speaking was best, and conveyed into one of difficult and delicate negotiations with a Foreign Power. He could assure their Lordships, too, that it was very far from his desire, or that of those who acted with him, to say anything vindictive against the Railway Companies, for they knew full well how much they owed to them in many ways. All they wished to do was to obtain fair and just terms for those engaged in trade and agriculture, and he believed that if they did this it would be as much a gain to the Companies as to anyone else. The discussion on railway rates was not of recent origin. He remembered years ago being associated with others in the county in which he lived in a demand for lower rates, as he mentioned in that House last year. Lately this question had become one of much greater interest. He presided in January at a large and representative meeting in London of the Railway and Canal Traders' Association. This was followed by a meeting of the Birmingham Traders' Association, by action all over the country of the Chambers of Agriculture affiliated to the Central Chamber, by the Corporation of London, by a large meeting at Manchester of Corporations representing a population of 1,681,235, and by Chambers of Commerce, who were all unanimous in their opinions on the subject. On this a Committee was formed of Members of their Lordships' House, of the House of Commons, and representatives of all branches of trade and agriculture. He was Chairman of this Committee, and what he desired to do was to place as well as he could their general opinion on the question before the House. He would only go back to the Committee of the House of Commons of 1881–2. The argument of the Railway Companies in favour of the changes they sought to make was based on the fact that they were following the recommendations of that Committee. No doubt, some of those recommendations were good; but the Railway interest was very strongly represented on the Committee, and he had heard one Member of the Committee say publicly that the representatives of railways were always found voting together, whereas the other Members of the Committee were not so cohesive and not so regular in attendance. He merely mentioned this, as under these circumstances the recommendations could hardly be taken as completely representing both sides of the question. One recommendation, in fact, was from the first condemned by traders, which was the proposal to allow railways to charge terminals outside their maximum rates. That was the chief point he wished to call their Lordships' attention to. The Government brought in a measure last year which contained many good provisions, and contained a clause dealing with terminals; but he must remark that, although the clause permitted the companies to make a reasonable charge for terminals beyond what was now, generally speaking, allowed, it not only provided for the sanction of the Railway Commissioners in case of dispute, but that, before such a charge could be made, the Railway Companies in question must provide a revised classification of rates and a revised schedule of maximum rates to be laid before Parliament and approved. That Bill came to nothing. Since that the power of Railway Companies to charge for terminals had been challenged, before the Railway Commission. Terminals were laid down in some Bills; but in the past these terminal charges had been, generally speaking, what are called "handling terminals," not a charge for stations and so on, and, as a rule, all such charges had been included in maximum rates. The Commissioners had decided against the Companies as to charges beyond the maximum rates. Mr. Price, one of the Commissioners, had stated that he considered Parliament always intended that terminals should be charged; but, surely, if so, the charge made must depend on the maximum rates, which should be carefully considered in coming to any conclusion, and he might have been influenced by the Report of the Select Committee of the House of Commons. However, the law was that, as a rule, maximum rates should include terminals—in fact, the Commissioners had made the Companies give information to traders as to what part of their rates was charged for terminals. What happened then? The Government encouraged a dealing with this question of principle by Private Bills. He had the authority of the noble Lord the Chairman of the Great Northern Railway (Lord Colville of Culross), who stated this in his speech the other day to the shareholders. Others had said the same, and he had spoken quite openly himself with an important official of a Railway Company. There was no secret about it, and he thought the Railway Companies had reason to complain that the responsibility was placed on them. It rather savoured of some other transactions of the Government in other matters, where, instead of taking the responsibility they were bound to take, they shifted it on to other shoulders. To show the evil of such a principle, he would say that, encouraged by the action of the Board of Trade, he supposed, he found that a small Railway Bill in that House affecting a very short distance—say, two or three miles—contained the obnoxious clause. The question was one of national importance, and it was left to small Companies to carry out the policy laid down by Her Majesty's Government. The principle might creep in everywhere, and be referred to as a precedent for the future. The proposal of the Government last year was not the same as that now made. The Companies were to charge a reasonable sum for terminals now, and those who objected were to go before the Commission. What did this mean? It meant that the Companies were to charge what they pleased, and that the trader was to go to the expense of making an appeal to the Commission, which he would not do as a rule, and that the law as to terminals was to be a Judge-made law, not a laid-down principle by a Government measure dealing fairly with all concerned. If Mr. Price was right, let his opinion be taken, with due regard to the schedule of maximum rates. Now, they had the decisions of the Commission; but they wanted to give them instructions almost to reverse all their decisions without any adequate arrangement as to rates. Uncertainty was to be the word, and uncertainty in trade matters meant a great deal. "Reasonable" was the word used. What would be considered reasonable? In the Government measure of last year, what Parliament thought reasonable; in these Bills, what the Railway Commissioners thought right. Did their Lordships suppose that it would be possible for traders and others to go to the expense of going before the Commission? It had been shown to the contrary. The Commission had been in existence for years, and it was not available to everyone. It ought to be more available. However, private individuals and small combinations were not in a position at present to cope fairly with these great Companies. It was said that if terminals were granted to Railway Companies it would add from £1 68. to 108. a ton. He thought he was under rather than over the mark. But no one knew. It was to be a reasonable charge, and that was a point they had to deal with. He had something more to say on this point, and then he would pass on shortly to other subjects. There was a distinct principle in this question of terminals. It ought to be dealt with in a Government measure. Perhaps their Lordships would consider a moment what the result of dealing with a question of this kind would be by private legislation. The Bill in question would go before a Committee upstairs; it would contain all sorts of other provisions as to rates, and so on; the opposition would be carried on with great difficulty, owing to the limited purse of the opponents as contrasted with the unlimited means of the Railway Companies. The railways would be beaten on some small point, but would be ready to wait to carry the main point; they would exhaust the resources of traders and private individuals and drop the Bill. What would be the result? The Bill would be brought in the next Session, and, the resources of the trader being exhausted, a new principle in railway legislation would be established, a precedent not to be overruled. He was one of those who thought that it was wise that there should be such a deterrent to factious opposition to Private Bills; but it was not quite fair that Railway Companies, who possessed the greatest monopoly in the country, should be allowed so to deal with a question of principle that it was almost impossible for traders to avoid being beaten in detail. If such measures were passed, it would amount to a Trades Union of the worst kind among Railway Companies. The badly managed Companies would be able to compete with well-managed Companies, and by putting on unknown terminal charges make up for their blunders and mistakes. That was a point which, he thought, required attention; and he thought that agriculture and trade had a right to claim the introduction of a Government measure, which, if it did not meet their views, would, at all events, give them a chance of dealing on fair terms with the Railway Companies through their Representatives in Parliament, instead of being forced into a Committee Room, only to be defeated by the force of unlimited means; a battle which, in the long run, they must lose. To turn to the question of rates. It was no doubt desirable to have a fresh classification of rates. There were hundreds and hundreds of Acts of Parliament which it took an expert to understand; but if there were a re-classification of rates it should be on a system. So the Committee advised. It was quite impossible for a Government Department to do this. Why not, therefore, refer the whole question to a Commission? The Companies had gone into the matter and could give every information. Surely some fair tribunal could be arranged which could advise the Board of Trade. Their Report would furnish a basis for a settlement sanctioned by a Government measure. Now the Companies were to be allowed not only to deal with a principle in railway legislation, but were to be allowed so to deal with their rates that they altered principles laid down in the past which might wisely be followed for the future. The Companies said—"We are pressed by (he traders for a re-classification"—he was told so by a high official of one of the great Companies—and they say—"We are told by the Board of Trade to bring in our own measure. Why blame us? We are quite contented with the present rates." His answer to this would be—"Why increase your maximum rates? You say you do not charge your maximum rates now. Why, then, increase your maximum, and add terminals of an unknown quantity besides? It is obvious, if you do not want an increase, it is useless to complicate matters in this way." It was of no use the Railway Companies saying that the new rates would not increase the charges; they did, and particularly on short distances. This—the short-distance rate—was more important to agriculture than to any other interest, and to trade in many ways. Of course, the whole question was more or less guess-work, and he would rather trust to the calculation of experienced traders than to any other calculation he could make. It was said by Mr. Nicholls at Manchester the other day that the material and provender coming in and going out of that city by railway last year amounted to 321,717 tons, and that the proposed new rates would add an amount to the rates on this of £32,841. Their Lordships would understand that these statistics could best be gathered locally, as the question of terminals was so uncertain. Then it was stated by the Secretary of the Railway and Canal Traders' Association that on one line, which was only 85 miles long, the present rate for live poultry and fresh butter would be increased from 208. to 368. 6d. a ton for 60 miles, and that the rate for hops for the same distance would be increased from 10s. to 36s. 6d. a ton. This was, of course, in the long distance table, and short distances came off much worse. But while he touched on these one or two points statistically, he wanted to know why the railways should choose this particu- lar moment to raise their rates? The other day, at a meeting of the London and North-Western Railway, the Chairman lamented that he could not declare a dividend of more than 7½per cent. This was owing to depression in trade and agriculture. His noble Friend the Chairman of the Great Northern Bail-way was able to declare a dividend of 6 per cent only, owing to depression. This was terrible work, no doubt; but more terrible work had been done with agriculture and trade. It would be lucky if they could make both ends meet in many cases, and yet this was the time the Railway Companies chose to increase their rates. Surely it was a shortsighted policy. What was wanted was to encourage enterprize, not to drive trade away. The position of Railway Companies did not show any immediate necessity for meeting expenditure with a larger draw on the public, and it appeared that in depressed times the only result would be to do harm both to trade and the railways themselves. The cost of various articles was less to the Companies now. Steel rails—which lasted longer than the old rails—were at a low price. Coals were never much lower, and money could be raised at a cheap rate. It seemed hard on the traders of the country that this particular time should be chosen to raise rates. He hoped the Companies would see the question from a public-spirited point of view, and that some arrangement might be come to which would secure a proper classification of rates, and deal fairly with the trade and agriculture of the country. They never wanted help more than now, and if the railways were not careful they might find themselves with a very fine scale of rates, and terminals with very few able or willing to pay them. One more point he wished to mention—that was "undue preference." This was said to be necessary by the Companies, for if they did not give preference to foreign countries, the trade would be lost altogether. Why, if they could carry at a profit from foreign countries, could they not carry home produce at the same rate? No one knew except themseves, but everyone knew that traders here were hurt by it. This subject had been considered by the Commission on Agriculture; but things were worse than they were then, and still the railways went on giving preferential rates to foreign produce. To show what other countries did, he might say that butter in Belgium was carried at 4s. 10d. a-ton, for a given distance, while English butter cost 10s. 1 d. per ton; pig-iron in Belgium was carried for 5s. a-ton, while English iron cost 15s. to send the same distance. America reduced its rates by half, and yet American beef came to London from Liverpool at half the price of home-grown mutton. Hops were sent from Flushing right through. Kent for 20s. a ton to London, while Kentish hops to London paid a rate of 37s. 6d. a ton; American cheese was brought through Cheshire at 25s. a ton, while Cheshire cheese was charged at the rate of 42s. 6d. a ton from Liverpool to London. When they saw these rates charged, it might well be said, why go into the question of Free Trade? The noble Earl on the Cross Benches (the Earl of Dunraven) might be able to reply to this question; but, meanwhile, he would point to the fact that a practical man—Mr. Bowlandson—had said as follows:— I have gone into the question of the difference of rates in the home and foreign agricultural produce, and taking the difference in those rates on my stock and corn, I find from those statistics that there is a tax to me of very nearly £100 upon my outgoings—I simply take the corn, cattle, and sheep—and that is a tax of Is. 6d. per acre upon me. If I take it upon the carriage of foreign corn, it is a tax of 5s. per acre upon the growth of all my barley. When you come to take that over the whole agricultural area of the country, that is a very severe tax upon the farmers of this country. We hare heard that it will he very much better to look carefully into those questions which press most heavily upon us at the present time, rather than grumble that we cannot do better for ourselves, and call upon Parliament to impose some tax upon foreign corn. I have gone into the question as to what would be the effect to me supposing there was a tax of 5s. imposed upon foreign corn in this country, and supposing I would get the full benefit of the 6s. per quarter, which has been proposed by some gentlemen in this country, the equalization of the foreign and home rates on agricultural produce on the basis of the foreign rates would be nearly as great a benefit to me as any good I should receive from the imposition of a duty of 5s. per quarter on foreign. It was he (Lord Henniker) who spoke at the meeting in question of setting things right themselves before applying to Parliament for redress; and he thought this quotation alone justified him in his opinion, and that the attack on Free Trade, and the idea that foreign competition ruined the country, might be tempered with a consideration of these facts, put even more strongly by others than by himself, and that their Lordships would see that Free Trade did not do all the mischief. Their Lordships might depend upon it that these preferential rates would hurt the trade of the country, and that the rates now paid by traders were all if not more than they could fairly bear. The question was one which required much consideration, and was of national importance. He ventured to lay down the following propositions:—That in dealing with a great question of this kind—a question of principle—a responsible Government should take the initiative; that in doing so the danger of unlimited control of the Railway Companies over rates should not be left out of consideration, for the present terminal proposal was practically that; that maximum rates, if they did not include terminals, should be fixed accordingly; that the question of re-classification of rates should be left to Parliament to decide finally; that the undue preference at present in force should be carefully considered, and that the Railway Commission should be made more easily and economically approachable. Let them cast the recommendations of the Committee on one side, cast these small negotiations with the railways on one side, and appoint a Commission to consider the classification of rates, when the Government could bring in a Bill of its own dealing generally with the questions of principle involved. If Parliament thought fit to reverse the policy of the past let it do so; but that this should be done by private legislation was hardly fair to those chiefly concerned outside the railways. He expected no answer from the noble Lord opposite (Lord Sudeley), for he said that he could not enter into the discussion; but he hoped he had said nothing which could prejudice the important negotiations which were going on, and that this most important question might soon be brought to a satisfactory settlement.

Moved, "That there be laid before this House copy of the judgments of the Railway Commission with respect to terminals; and also of the judgment of the House of Lords in the case of the Lancashire and Yorkshire Railway Company v. Gidlow."—(The Lord Henniker.)


said, that there could be no doubt that the subject brought forward by the noble Lord was one of the greatest importance to the mercantile interest of this country; but his speech placed him in a somewhat difficult position, because negotiations were going on between the Board of Trade and the Railway Companies and the various interests concerned, and discussion might very likely prejudice what was being done. Under these circumstances, it was quite impossible for him to state fully and exactly the views of the Board of Trade. On Friday last he appealed to the noble Lord to postpone his Motion; but he did not see his way to do so without certain pledges being made, which the Government could not give. He informed the noble Lord that the Board of Trade were negotiating with the traders on the one side and the Railway Companies on the other, and that there was considerable danger lest the discussion should jeopardize these communications. The noble Lord stated that he did not see how it could be necessary to postpone the discussion of a subject of domestic policy, as no possible advantage could arise from keeping such a matter secret. He would, in reply, merely say that when a Department were carrying on negotiations, surely they were the best authorities for deciding whether discussion was likely or not to interfere with the negotiations. The noble Lord had traced down the historical position of that question, and had stated fully and frankly the views of the traders. There was, however, another side of the case—namely, that of the great Railway Companies, who naturally looked upon the whole matter under a very different aspect. As had been stated, this question was very fully gone into by the Select Committee in 1881 and 1882. Very grave charges and complaints against the Railway Companies were made before the Committee as to rates being excessive, preventing the development of traffic. It was shown clearly that the classification of goods was most imperfect, and that it was extremely difficult for traders to discover the maximum legal rate for any particular kind of goods. As much had been said against the railways, it must be remembered that the Committee in their Report distinctly stated— That they acquitted the Railway Companies of any grave dereliction of their duty to the public. The Committee, among other things, recommended that there should be one uniform classification of goods over the whole railway system, and that the Railway Companies should consolidate their special Acts so far as they affected rates and charges. They also recommended that terminal charges should be recognized, subject to publication, and, in case of challenge, to sanction of Railway Commissioners. He thought that what was required was that the Report of the Select Committee should be carried out in a manner satisfactory to the great interests concerned both of the Railway Companies and the traders. The present position was simply this. Last year the Board of Trade had brought in a Bill dealing with the subject; but the difficulties raised by both sides were so great, that taken together with the position of Public Business at the time, it was considered hopeless to proceed with the Bill. In that Bill it had been found utterly impossible to deal with the question of classification by means of a schedule, as the basis of revision, the Railway Clearing House classification, contained no less than 2,300 different articles. The Bill, however, contained the following clause, throwing upon the Railway Companies the onus of bringing in Bills to provide the new classification of maximum rates, and such revision of rates as might be necessary:— (3.) The provisions contained in this section with respect to terminals shall not apply to any railway company until such company has submitted to Parliament a revised classification of rates and a revised schedule of maximum rates, nor until such revised classification and schedule have been approved by Parliament. This classification of rates was nothing more or less than simplification, but as it dealt with 2,300 articles, it was, notwithstanding, most difficult to arrange. Acting upon the clause in the proposed Bill of last year and on the Report of the Committee, the Railway Companies had brought forward Bills now before the other House dealing with the subject. The second reading of these Bills was postponed until after Easter. Unfortunately, however, whether it was that the proposals of the Railway Companies were misunderstood, whether it was owing to the maximum rates being regarded as likely to be the actual rate, or whether it was the inherent difficulties of arranging such a classification as would reconcile all interests, undoubtedly it was the fact that these Bills of the Railway Companies had excited serious opposition on all sides. This Bill would not be proceeded with until after Easter, and it was hoped that during the interval some arrangement would be arrived at. The view of the Board of Trade was that it was to the interest of all parties that this question of classification and division of rates should be settled; and, therefore, both parties should agree to an inquiry by a competent authority, by which a basis of settlement could be arrived at. The Board of Trade were now endeavouring by negotiation to arrive at some understanding on this point. They were of opinion that if these statutory rates and provisions were to be revised at all, the revision must be complete, and it must be a revision in the interests of the Railway Companies as well as in the interests of the public. The noble Lord was anxious that it should be laid down that legislation on the result of this inquiry should be brought forward and carried out by the Government. This it was impossible, at the present time, to pledge the Government to do; but surely it was not very material how legislation should be carried when all parties were agreed. The Board of Trade did not see their way, in the present state of Public Business, to bring in a Bill similar to the one they had introduced last year; but their Lordships would see that the first matter to get settled by some competent tribunal was the question of the classification and revision of rates. There would be no objection to granting the Return asked for; but, as the judgments would be presented to Parliament in the usual manner at the end of the year, he hoped the noble Lord would consider that sufficient.


said, the matter had already been inquired into and reported upon sufficiently; and he was surprised to hear a suggestion of a Royal Commission coming from the Board of Trade.


said, he had not said it was intended to appoint a Royal Commission, as he had carefully guarded himself from saying so; but it was one of the suggestions made by the noble Lord who brought forward the subject, and, no doubt, it was one possible solution.


said, he regretted he had misunderstood the noble Lord. There was a unanimous feeling throughout the country that these Bills were as monstrous proposals as had ever been submitted to Parliament. The injury done to English trade by the preference given to foreign goods as compared with home goods passing over the railways was very great. As an instance of the injustice that was caused in this way, he might instance the experience of a firm of English piano manufacturers, who found that American pianos were carried on the railways at 25s. per ton, while English-made pianos were charged 50s. per ton; and the explanation given was that the English goods were so much more valuable. He held that it was the duty of the Board of Trade, on behalf of the Government, to protect the trade of this country; and it was their duty at once to bring in a satisfactory Bill to settle the question of rates in the interest of trade and agriculture.


said, he wished to add his voice to that of the noble Marquess who had just sat down, in urging on the Government the extreme importance of this question, and the deep impression it had made on the minds of the agriculturists and traders of this country. The scheme of the Railway Companies appeared to him to be open to considerable objection. It had the effect of lowering the rates for long distances and raising them for short distances, thus inevitably favouring large operators as against small, and injuring most of all the farmers and small dealers in country places. There was, however, another grievance which was felt to be intolerable—namely, the protection given to foreign industry by the Railway Companies charging rates enormously disproportionate in favour of the foreign importer as against the native producer. His noble Friend who had brought forward that matter with so much ability had given them a case in which cheese, butter, and other products were conveyed from Liverpool to London at a far lower rate than from that part of Cheshire through which the line passed. It was inconceivable that such a system, whatever arguments might be used to justify it, would be endured much longer by the traders and agriculturists of this country. He rather regretted that the discussion on terminals and general rates, although important, had rather obscured the questions raised by the Duke of Richmond and Gordon's Commission. He hoped that something would be done to insist that in dealing with foreign and English traders at least the foreigner should not be preferred to the Englishman.


said, he must protest against what was a practical bounty given to the employment of English capital abroad in the establishment or enlargement of manufactories in foreign countries; for, to the hurt of England, they thus were enabled to undersell British traders with goods which were not produced cheaper, but were brought into the market cheaper in consequence of the lower railway rates charged upon them not only abroad, but also by a most unjust preference in England. There was a similar bounty on foreign corn and live-stock. Our heavy railway charges, in short, were practically levying import and export duties of a most discouraging and oppressive kind on English products and manufactures for the benefit of the foreign producer and the foreign manufacturer; and none the less invidiously because the proceeds went, not to the relief of the taxpayers, but to the profit of the railway shareholders.


said, that perhaps he would be allowed to make a remark on that subject. He was a producer and a trader in the very centre of England; and, therefore, their Lordships might imagine what his interest was on that question. The fact of his interest being entirely on one side made him extremely reluctant to take any unnecessary part in that discussion; and he flattered himself that when the matter came before the Government for decision he would entirely divest himself of any bias that he had, and would consider it in a fair way. But he thought it must be obvious to everyone that the prosperity of the railways and of the producers of the country must really be the same. The railways were necessary to the producers, and the producers to the railways; and it appeared to him im- possible if the subject could be calmly considered—whatever exact mode they might adopt for arriving at the end—but that that end should be common to both interests, which should not be treated as antagonistic to one another.


said, it was all very well to classify goods; but it seemed to him that the same charge should be made for goods so classified. It was absurd to say that pianos were to be put in a certain class if an English piano was to be made to pay more than a foreign piano. There must be the same charge for everyone. If they did that they would act fairly towards all parties; but if they left it open for the Railway Companies, after goods were classified, to charge less for corn from America than for corn from England, where was the use of the classification?


said, he must press for the Return, for such judgments were lost in the pages of a Blue Book; and he wished them to be placed before their Lordships in a convenient form. For the same reason he expressed a hope that the noble Lord would allow to be added to the Return which he had asked for, the judgment of the House of Lords in the case of the Lancashire and Yorkshire Railway v. Gidlow.


said, he was willing to assent to the request of the noble Lord.

Motion amended, and agreed to.