HL Deb 14 March 1887 vol 312 cc125-68

Order of the Day for the Second Reading read.


, in moving that the Bill be now read a second time, said: My Lords, the subject has more than once been brought before Parliament in "another place;" but, owing to certain circumstances this year, it was thought that it would perhaps be an advantage to introduce the Bill this time in your Lordships' House, and to have a certain amount of discussion upon the proposals made, in order to see what is necessary to be done, and what modification may become advisable, and whether any further application may be made for the safety and welfare of the community. As this is the first time the subject has been introduced into this House, I will ask your Lordships' permission to refer to the legislation that has taken place with regard to it in past times. I think, in connection with this subject, it is important to remember that the starting point of Railway legislation was somewhat different from the point of view in which we regard it now. Railway legislation started upon the assumption that the Railway was a common highway for the public, and that it replaced and represented the ordinary high road; and Railway Companies were therefore regarded rather as owners than carriers, and they were dealt with in that respect. But they gradually acquired the whole of the carrying way, as well as the ownership; and, therefore, legislation has to deal with them in the double capacity—first, as owners of the road; and, secondly, as carriers on their own lines. I believe that, by Common Law, it was the duty of a carrier to accept and carry all goods offered, according to a particular agreement and for reasonable compensation; but he might carry for payment passengers at a low rate, or even gratis. In fact, there was nothing whatever to pre vent him from adopting a preferential tariff. Therefore, when Railways superseded other modes of transit, we had to consider how far restrictions should be made beyond those imposed by Common Law on persons who had come to be regarded as common carriers. Consequently, it was first done by the insertion of special clauses in any now Act. Next, the Chairman of Committees in this House required clauses to be inserted in every Bill, giving the names of the carriers, and in 1845, the Railway Clauses Consolidation Act embodied in a general Act the clauses it was thought expedient to retain in all Railway Acts passed by Parliament. In order to show the spirit in which these Acts deal with the Companies, I may refer to the 86th clause of the Act of 1815, which shows clearly the double capacity in which the Railway Companies at that time acted, and which after empowering the Companies to use locomotive engines, and to acquire carriages and waggons to be propelled thereby, and so forth, further empowered them to make such reasonable charges as they might determine in respect of them, not exceeding the toll authorized by their special Act. Railway legislation may be broadly divided into two parts—first, that of construction; and, secondly, that of combination; and the dividing line may be drawn be- tween the years 1845 and 1818. Between those years various Committees sat, and one of them led to the Bill which was introduced in 1854, and which really forms, to all intents and purposes, the starting point of Railway legislation. That dealt with two matters—namely, it endeavoured to prevent undue preference, and to facilitate the forwarding of traffic. That Act continued in operation from 1851 to 18G7, during which there was no general legislation, and, so far as I understand, no inquiry. Various charges and complaints having been made, the Railway Commission was appointed in 1865, tunder the Presidency of the Duke of Devonshire. That Commission wont in great detail into the various matters that came before it, and it specially addressed itself to the inequality of the rates and fares, and the inequality of treatment under similar circumstances; and, especially, it considered the question of the restrictions which might be necessary or advisable to impose on the Railway Companies in respect of faros. The Commission found themselves face to face with a problem that was one of great difficulty, as to how far the inequality of rates and fares established under the Railway Act affected the Rail-way Companies on the one hand, and the lights of the public on the other. There was no doubt that the carrying trade brought the Railway Companies into competition with carriers by water and on the high roads, and frequently Companies had to reduce their rates below what they wore obliged by their Acts to do, in order to bring the traffic on their own lines. The Commission reported, and the effect of their Report was that they did not consider it would be expedient, even if practicable, to adopt an legislation that would abolish the freedom Railway Companies enjoyed, to charge what rates and fares scorned expedient to them. In 1872, a strong Joint Committee was appointed of the Members of both Houses. They made a voluminous and interesting Report, and one of the chief results of that Committee was the Bill introduced, under which the present Railway Commission was appointed. That Commission, it is right to say, has, under great difficulties, discharged its duties thoroughly well; and, so far as I am aware, in all the proposals that were made in regard to Railway legislation, no proposal has ever been made to abolish the Commissioners in the sense of doing away with their duties. So far, up to the present time, the Act of 1872 is amply justified. The next time when the question of Railway legislation was brought before Parliament was in "another place," be-fore the Committee presided over by Mr. Evelyn Ashley. That Committee sat in 1881 and 1882, and made numerous recommendations, many of which your Lordships will find embodied in the present Bill. I perhaps ought not, in this short review of Railway legislation, to pass by a Bill, introduced also in "another place" by Mr. Chamberlain, founded on somewhat more ambitious lines than those which preceded it, and which was withdrawn for reasons which it is not necessary here to specify; but I am bound to say of that Bill that it was carefully considered, that it was a bold attempt to arrive at a solution of the subject, and perhaps it was the fact of the dimensions of the Bill that somewhat prejudiced its passing in "another place." That Bill dropped, and the following year the Railway Companies introduced Bills of their own regulating the charges and rates, and dealing with the general question of traffic again; but there was a general feeling on the part of the House of Commons that that was not work which should be done by Private Bills, but that it should rather be done by a general and comprehensive Bill introduced on the authority of the Government in power. I come, then, to the Bill which was introduced in "another place" by my immediate Predecessor in my present officio (Mr. Mundella). Though that Bill mot, on the whole, with a favourable reception, and was read a second time, events of which we are all aware prevented its further progress, and the subject up to the present time has remained undetermined. In presenting this Bill I cannot, but acknowledge the assistance which I have received in the discussions that have taken place, and the negotiations between the various parties concerned. Whatever may be difficult or unsatisfactory, in connection with the subject, it is at least satisfactory to feel that there practically have been no difficulties of Party and no other consideration, save an earnest desire to arrive at an honest opinion in regard to the various provisions of the Bill; and that the same general policy: appears to have been underlying the: proposed action in all the Bills proposed, though it may have differed in detail, i and to a certain extent in degree. I have said that the Commission of 1873 has worked well. I believe that is the general opinion. On the whole, it has done good service, and has been productive of good. It has checked a good many evils, and it has also, I believe, in some respect acted as a deterrent to extreme measures. The decisions have, in the main, given satisfaction to the trading community; and if it has not done all that was expected, that was because, in the first place, its jurisdiction has been limited by the Courts of Law acting by certiorari, or by prohibition, and it has been extremely difficult for the Commissioners to follow any fixed line of construction upon which the various Courts have acted. In the Bill which I ask your Lordships now to read a second time, though the constitution of the Commission will be somewhat altered, we propose to renew it, and we hope to strengthen it. The Bill differs in many essential details from the Bill introduced in "another place" last year; but it follows the same subject, and, together with that Bill, it follows the principle of excluding questions connected with safety, or with passenger traffic We think, on the whole, if the Bill is to pass through Parliament at present, it is perhaps wise to limit its provisions to the establishment of a Commission, and to the question of rates and other similar matters, and to postpone, or at all events to put aside at the present time, any idea of the larger questions relating to passenger traffic, which I am afraid are thorny enough in themselves. As I have said, we renew the Commission, though we slightly alter its constitution. The Bill introduced by my Predecessor established a Commission, consisting of one Judge of the High Court in each country—that is, in England, Scotland, and Ireland—who was to act as the President of the Commission, and who was to be assisted by two permanent Commissioners. It had been suggested that the Commission should be established with two Commissioners, and with the Chief Commissioner having legal experience. There was much said for that proposal; but the arguments on the other hand were not without weight. There were those who held that the Chief Commissioner, even though technically of legal experience, might not have sufficient weight to define questions of law which might be far-reaching in their effect, and which might vitally affect the Railway legislation and the general legislation of the country. We thought there was weight in these objections. On the other hand, I did not feel that the greater portion of the work of the Railway Commission would be such as would justify and render it desirable for us to use the power of one of the Judges of the High Court on matters which, in some cases, might be almost administrative. We thought we should best moot, on the one hand, the desire that there should be the power of dealing with matters on the spot, and regulating any small detail; and, on the other hand, we thought we should best meet the arguments of these who urged, as we felt very truly, the necessity of bringing in the power of a Judge in the larger cases, by constituting the Commission as we have constituted it in the present Bill, and thus to a certain extent getting the advantage of both views. Your Lordships will therefore observe that the Bill abolishes the existing Railway Commission, and establishes in its place a now Commission, to sit in England, or, if the case require it, in Scotland or Ireland. There will be three permanently-appointed Commissioners and three ex officio Commissioners. The three appointed Commissioners will consist of a Chief Commissioner, to be appointed on the recommendation of the Lord Chancellor, who is to be a lawyer of experience, and two lay Members, to be appointed on the recommendation of the President of the Board of Trade, one of whom, at least, is to be experienced in Railway business and management. Of the ex officio Members, one is to be for England, one for Scotland, and one for Ireland, and these are to be Judges of the Superior Courts of the respective countries. Whenever a case of importance is to be heard, one of the ex officio Commissioners for the country in which the case is being heard is to attend and preside. I hope it will not be out of place if, in passing, I express my regret that the qualifications that will be required of the new Head of the Commission are unfortunately not possessed by the present Chief Com-missioner. During all the troublous times that the Railway Commission has had to deal with, I think it cannot be said too strongly that Sir Frederick Peel, the Chief Commissioner under the Act of 1873, has exhibited a great amount of painstaking care, a desire to acquaint himself thoroughly with the duties he has to perform, and an earnest wish to do justice between the parties which, valuable as these may be in any public servant, have been of double value in the position which Sir Frederick Peel occupied. Though, naturally, his decisions, like decisions of other Judges, have not passed unchallenged, it has, I believe, been felt, even by those who differed from him, that his decisions have been characterized by a spirit of fairness and impartiality. With regard to the Commission itself, I need say very little in addition to directing attention to the provisions of the Bill; but I wish to point out this, and to emphasize it, that it is the duty of the Commissioners to request that the ex officio Member—that is the Judge—shall attend the hearing of any case in which his attendance is expedient for the bettor performance of their duty, and that that shall be necessary at the hearing of any case where it appears that the determination of it shall involve points of law. I have been asked whether it might not be found expedient to allow the ex officio Commissioner to attend at the wish of any of the parties who are concerned. That matter was carefully considered, and, on the whole, we came to the conclusion that it was bettor to leave the question in the hands of the Commissioners, and we feel certain that, acting on their responsibility, if an appeal was made to them by the parties to whom they thought they ought in justice to have regard, they would act in a way that would give satisfaction; and we considered it was better to leave the matter in the hands of the Commissioners than with the parties. We have also given power to the Commissioners to award to the complaining party who is aggrieved, such damages as they think just. I believe that, up to the present time, a curious anomaly has existed—that a complaint may be brought before the Commissioners, that it may be shown that it was perfectly well established, that the practice complained of might have to be discontinued, and an order given by the Commissioners that it would be discontinued; but, not- withstanding all that, in respect to any damage which accrued there was no remedy before the Commissioners, and the party aggrieved had to go and seek a remedy elsewhere. That we have now remedied. With respect to the question of appeals, we have thought, on the whole, that it was best that no appeal should lie from the Commissioners on questions of fact or questions of locus standi; but, subject to that qualification, there is to be an appeal direct to the Court of Appeal of the county in which the case is heard, with the further right of appeal by leave to the House of Lords. I know there are some who are against allowing frequency of appeal. It is thought that victory may rest with those who have the longest purse, rather than with those who may have right upon their side. But I believe that a great change of opinion in that respect has taken place in the minds of many of the trading community, formerly most opposed to those frequent appeals. Whether there is not an advantage on one side as well as the other, I am not prepared to say; but I believe that this provision is freely accepted by the public at largo. I now pass to another part of the Bill, which more directly affects our Parliamentary procedure Clause 24 deals with revised classification of traffic and preferential rates. It provides that every Railway Company, 12 months after the commencement of this Act, shall submit to the Board of Trade a revised classification of traffic and Schedule of proposed maximum rates and charges. When the scheme has been submitted to the Board of Trade, and made public in such a way as may be directed, the Board of Trade will then consider that classification and the maximum rates of charge, and any objections thereto which they may receive. If, after hearing all the parties, the Board of Trade come to a satisfactory agreement with the Railway Company as to the classification and Schedule, they are to embody the classification and Schedule in a Provisional Order, and make a Report thereon to Parliament; and as soon as possible after making the Provisional Order, they are to take care that a Bill is introduced into either House of Parliament, and this Provi- sional Order will, if approved by Parliament, pass into law without any further opposition. Up to this point my Predecessor and myself are agreed; but as I found matters as they were left in the draft of the Bill and in the amended Bill, if the Railway Companies and the Board of Trade did not come to an agreement as to the Company's classification and Schedules, the Board of Trade will determine what, in their opinion, should be the classification and Schedule, and will make a Report to be submitted to Parliament on the subject. I submit to your Lordships that that is a position of affairs which does not appear to be very satisfactory. It was thought that public opinion would have sufficient weight to make the Railway Companies come to an agreement with the Board of Trade; but I am bound to say that it seems a procedure derogatory to the dignity of Parliament that a dilatory or recalcitrant Railway Company should have power to bring matters to a deadlock by avoiding a duty which Parliament has put upon them. I am by no means anxious, if it can be avoided, that the Board of Trade should take the initiative in this matter; and as far as possible it has been our object that the initiative should be taken by the Railway Company; but as some one must act, it is bettor that the initiative should be taken by that Department than that it shall be a matter of uncertainty. The Bill provides that after the lapse of one Session, during which the Board of Trade Report will have been before the public, it will be open to the Railway Company to apply to the Board of Trade to embody the scheme proposed by the Board of Trade in a Provisional Order; or if the Railway Company did not take action in the matter, the Board of Trade may embody the scheme prepared by them in a Provisional Order, which, when introduced into Parliament, will be referred to a Select Committee, before whom the Railway Company or any objectors will be able to appear in order to oppose, as in the case of a Private Bill. In any case, the classification and Schedule ultimately approved by Parliament will become the classification and Schedule of the Railway Company in place of its existing rates and charges. One word to remove a misinterpretation which has come to my knowledge, and that, is, that it has been supposed that from time to time the Railway Company would be subjected to a re-classification of rates. This is not the way in which we view this Bill. We think, and it is provided in the Bill, that the rates and Schedules might be proposed on the assumption that it is a fixed classification and a fixed maximum, until, at all events, Parliamentary powers are given to supersede them. Now comes a clause—25—on which I am afraid a great deal of discussion will necessarily take place, and that is with regard to the question of what constitutes undue preference. We have provided in that clause, that inequalities of charges to different traders and districts, and difference in treatment of goods forwarded on the goods being British or foreign, are to constitute primâ facie an undue preference and to be prohibited; but the tribunal which deals with any such case is to have power, in addition to other circumstances which are now held to justify inequality, to take into consideration whether the preferential rates and charges, or the difference in treatment, are necessary to secure traffic. I am aware that we are introducing a vexed question when we admit the words—"preferential rates in order to secure traffic." I am aware that, from the one side, it will be pressed upon us that this should be omitted from the Bill; and, on the other hand, that it will be held that Railway Companies should have the greatest possible freedom in carrying on preferential rates. I may, however, point out that there are not only the producers and the Railway Companies to be considered, but that there is a third and more vital interest than either—namely, the interest of the consumers, and we have, at all events, endeavonred to provide that, as far as possible, there shall be similar rates in similar circumstances. Practically, however, it is satisfactory to observe that on the representations made on this subject on the part of the trading community, a great deal has been dropped, and there seems on all sides to be a spirit of conciliation which I think augurs well for the success of this Bill. Equality of mileage is no longer pressed. It also seems to be tacitly admitted that there must be different terms for wholesale and retail goods. In other words, a person forwarding, or agreeing to forward, 1,000 tons, or 600 tons, for a lengthened period, or under particular circumstances, or on a particular line, has a fair claim to be placed on a preferential footing to those who, though they might send their traffic on the same line, do so in small quantities and at irregular intervals. This is in the interest of the consumers, which must not necessarily be left on one side; and I therefore think it is only right to allow the Commissioners to take such matters into their consideration. We also think that preferential rates, in order to secure traffic, is a matter which, in the interests of the consumer, cannot be left out of sight. It must not be forgotten that in this country there is hardly a Railway which is not, in one form or another, subject to the severest competition by sea. If we are not to allow this competitional sea-rate to be taken into consideration, two things would follow. In the first place, the Railways in many cases would not allow such through traffic; they would not, in fact, be enabled to carry the traffic; and, therefore, that important channel of communication between the producer and the consumer would be blocked up; while, on the other hand, the sea traffic, in the absence of competing lines, would be left to increase its charges. Practically, the consumer would, in either case, be placed in a worse position for receiving his goods than at the present time. Similarly, the producer, at a great distance, would find himself utterly excluded from a market where he now, at all events, competes on fair terms of equality, to the general advantage. It must be granted that in some of these instances there is a great appearance of hardship. When people see through traffic carried at a special rate, which is not granted to them, naturally there is a feeling of hardship produced in reference to the granting of special rates, and the Government have thought it right to give the Commissioners under the Bill a discretionary power. There can be no doubt that the first consideration in this matter is to be given to the interests of the general public; and if the words I am here dealing with are thought, when the Bill is in Committee, not to be sufficiently clear or strong to define this object or interest, I shall be ready to adopt any suggestion to make them clearer. The next clause to which I wish to refer is the Arbitration Clause, the effect of which will be that any officer, or number of officers, of a Railway Company, if they feel aggrieved, may complain to the Board of Trade; that the Board of Trade will make a representation to the Company, and the Company will give a public explanation, and in that way an effort will be made to bring about an amicable settlement of the grievance. This system has been found to work satisfactorily in America and elsewhere, and I believe it will be beneficial in this country. I must, however, point out that the Bill differs in one respect from that which was introduced in "another place" last year. In dealing with the traffic of the country, the Government feel that they cannot leave out the question of Canal traffic; and, therefore, clauses have been introduced into the Bill dealing with various questions affecting that traffic and Canal Companies. In some places in the country Canal traffic has fallen of through special circumstances, and cannot be revived; but there are many other places were it may be revived and encouraged, and where, with proper facilities, Canals may be made to servo the public interests much more than at present, especially in parts of the country which are not now adequately served by the Railway Companies, That was also the view of the strong Joint Committee which sat in 1873, and the object of this part of the Bill is to give facilities for the development of Canal traffic where it can be revived in the public interest. Many of the Canals are held by Railway Companies, and it is an evil which must be guarded against. The Railway Companies have not felt themselves prohibited by the existing law from acquiring such a predominating interest in the Canal Companies as practically to place the Canals under the control of the Railways. Therefore, we have introduced a clause on the subject providing that no Director or officer of a Railway Company shall, without authority, use, or permit the use, of any part of the Company's funds for the purpose of acquiring any Canal interest, &c. As regards the provisions of the Bill, I cannot think that much objection will be made to them as to matters of principle. One argument which, however, may be used against the Bill is that the introduction of such a measure is an act of confiscation—that it is dealing with property which ought to be held entirely sacred. It is argued that Railways derive their rates and Schedules as concessions, on the faith of which they have invested their money, and that, therefore, it will amount to confiscation in altering them adversely. On the same grounds, it maybe said that any Bill affecting the interests of a Railway Company is one of confiscation; but your Lordships will hardly think it necessary that I should, either on behalf of myself, or those who sit near mo. disclaim and repudiate any intention of that kind, or deny that the Bill before us has been introduced with any such object. It is simply based upon an earnest desire to remedy a state of affairs which has grown up, and which the Government does not think should be continued. It can hardly be supposed, for a moment, that the Government, in the infancy of the Railways, before traffic was developed in the slightest degree—before it was known or thought to what this great interest should grow—that, under those circumstances, the Government could hand over the whole traffic of the country to private persons, blind to the general interests, without any power of alteration whatever hereafter. Further than that, there has been taken, in almost every Private Bill that comes before Parliament, powers that nothing contained in that Bill shall all the provisions of any general Act. If I want further evidence, I might cite the Standing Order of this House, which provides that no Company shall alter its maximum rates until a Report of the Board of Trade thereupon has been laid on the Table of this House. Assuming that that Import is not meant to be entirely valueless, it is clop that there is intended to preserve to Parliament that general controlling power which I contend Parliament has never in any way given up. But there is another argument. It may be said that these powers having once been granted ought to be regarded as unalterable. But how can Railway Companies make use of that argument if they come to Parliament and ask that their maximum rates should be increased? Several Railway Companies—for instance, the London and North "Western, the Midland, and two smaller ones—have come to Parliament with that request. Surely, those who have made such claims upon Parliament cannot, in any way, conscientiously ob- ject to corresponding claims being put forward by traders upon equitable grounds to a judicial tribunal. The Bill, therefore, is not founded upon the principle of confiscation; but it has been framed with an earnest desire to remedy, and a belief that it will remedy, an unsatisfactory state of affairs that has grown up, and that it will terminate a controversy between the trading and agricultural classes on the one hand, and the Railway Companies on the other. We hope that by passing this Bill, or passing a measure in this direction, that Parliament will put an end to a state of affairs that cannot continue longer with advantage. One word of caution, by way of conclusion, I would give to the great Companies concerned. These are not days in which any direct powers—any great monopoly can go unquestioned; and certainly the changes that have taken place of late years have been such that Representatives in "another place" are brought more distinctly and clearly into contact with the wishes and desires of these they represent. In such a state of affairs it does not seem wise that this controversy should be prolonged. I believe, at the present time, there are many favourable causes which contribute to render the passage of this Bill more probable, more sure, than would be the case at any other time; and I cannot but feel that I am speaking in the interests of the great Companies who believe they are affected by this Kill, when I say they would be wisely persuaded to use the opportunity offered them at the present moment for a fair settlement founded on justice, and calculated to conduce to the prosperity of the country. The Bill is not the measure of one Party or the other; it raises no question of political controversy Its general principles have been adopted by both sides of the House, and in "another place" it has been accepted with little more than perfunctory opposition from the Railway Companies. It is true that it is the first measure of the kind that has been initiated in your Lordships' House; but circumstances seem to render it desirable that it should be so introduced, there being an earnest desire at present to legislate on this matter on the principle of equity and justice; and, therefore, I hope this Bill may receive a second reading, and, after full and careful consideration, that it may emerge as a measure which will be at once sound in principle, and one that may be worked so as to promote the benefit and prosperity of the country.

Moved, "That the Bill be now read 2a—(The Lord Stanley of Preston.)


said, he had been asked by gentlemen who represented a large proportion of the Railway capital invested in this country to state their views upon this Bill. He accepted with gratitude, on behalf of the Railway Companies, the word of caution which had just been addressed to them; and he could assure their Lordships that there was no desire on the part of any one in the Railway world to discuss this question in anything but a conciliatory tone, with a view to arriving at a friendly settlement of the disputed points. He was happy to think that after what had just been said it would not be his duty to disabuse their Lordships' minds of an idea, which seemed to prevail in some quarters out of doors, that the Railway Companies were the natural enemies of the public. He imagined that few would disagree with him when he said that Railway Companies might be fairly considered as bodies which had supplied a great public want, and that by means of private expenditure they had relieved this country of a large amount of public taxation. If we had applied public funds to the construction of railways, it could hardly be doubted that during the last half-century a great weight of additional taxation must have been laid upon the people. In that case no one could have questioned the legal and moral right of Parliament to regulate and control all matters of Railway traffic and regulation. But when Parliament deliberately determined to trust to private subscription and to private enterprise for the creation of a Railway system; it followed that legal rights wore acquired by those who subscribed the capital and promoted the enterprise; and Parliament became bound to uphold and support the rights it had itself created, and upon the faith of which capital had been subscribed and works of great public utility constructed, he did not deny the power of Parliament to legislate upon the lines of this Bill; but he would urge that in considering the details of legislation they were bound to keep three things specially in view. The first was that, however much we might cry down Railway investors as people who would not have obtained the privileges they had if things had been originally as they wore now, we wore dealing with men who held capital which had been subscribed on the faith of Acts of Parliament, and who had acquired definite legal rights. The second was that the average of Railway dividends had scarcely reached 4 per cent, and therefore it could not be contended that railway investors had made enormous profits, or that they had obtained under their Private Acts anything which had of unfair advantage to themselves or which had been unduly burdensome to the public. The third thing to keep in view was that it was the direct interest of every Railway Company to carry the largest possible amount of remunerative traffic, and that any Company which by a prohibitory tariff excluded traffic or offended customers must be acting contrary to its own interests. The remarks he desired to make upon the Bill might be classified under three heads. These were—the constitution of the Court it was proposed to establish; the parties who were to have the right to appear before the Court; and the manner in which Railway Companies were to be dealt with by the Court. The Bill professed to abolish the present Commission, but so far as he could see there was nothing to prevent the re-appointment of the same Commissioners the day after the Bill passed. One of them was a gentleman "experienced in the Law;" another had at one period of his life "experience in Railway matters;" and the third was not qualified by any clause in the Bill. Moreover, the ex officio Commissioners, who were to be judges, were only to be summoned when required by the appointed Commissioners, so that Railway cases would still be left to the discretion of hon. Gentlemen, of whom only one need be learned in the Law. Why, he would ask, wore Railway Companies to be the only bodies in this country who were to have a special tribunal appointed to see that they obeyed the law? If the cases in which they were concerned were of special importance, why not appoint two Judges to try thorn as was done in the case of election petitions? The Railway Companies were desirous of having nothing better, and were entitled to have nothing less, than the highest legal tribunals to decide whether they were acting legally; and as to the limitation of appeal to questions of law, the fact was that in those cases questions of law and of fact were so inextricably mixed up that it was almost impossible to separate them. There was no reason why the disputes in which Railway Companies were concerned should be settled by any inferior tribunal or with more limited appeal than were the disputes of the rest of the community. As to the parties who wore to have a right to appear before the Court, it was an old maxim of English law that a man must have a personal grievance before he could summon another into a Court of Law. But this clause directly controverted that maxim and expressly declared that the complaining authority need not have been aggrieved. The only protection which the Bill gave to a Company was that of a certificate of the Board of Trade that the body making a complaint was a proper body to make such complaint. This was quite an illusory protection. Under the present law the Board of Trade had to give a certificate that the case was a proper case to be brought before the Commissioners; but under this clause they would discover some objection to the constitution or character of the body which brought the complaint; and this, of course, they would never do. Then these authorities would sometimes have rates to expend to which the Railway Companies had largely contributed, so that they would be fought with their own money. In other cases the authorities had no funds. The only fair way in which to put this clause was to provide: first, that the complaining authority should be bound to prove that it, or those whom it represented, bad been aggrieved by the action of the Railway Company; and, secondly, that it should give security for its share of the costs of the hearing and determination of the complaint. There was much more to be said on this point, but he would leave others to deal with the legal aspects of the case. Now, he came to the manner in which the Companies were to be de-alt with before the Court and otherwise under the Bill, and he wished first to call their Lordships' attention to the Report of the Committee which sat in 1882—a Committee which made a very exhaustive inquiry. That Committee was composed of 27 members, of whom, he believed, only seven were Railway Directors. It could not, therefore, be said that the Railway interest was over-represented, and especially since two draft reports were presented; and that which the Railway representatives supported was rejected. But when the other and more hostile report had been considered and thoroughly thrashed out, let their Lordships mark what happened. On the general issue, the Committee returned a verdict acquitting the Companies of "any grave dereliction of duty towards the public." Then, as regarded the particular contentions urged against the Companies, the most important of them broke down and came to nothing. One great contention had been in favour of equal mileage rates. The Committee pointed out that, as regards the interests of the public no less than in that of the Companies, equal mileage was impracticable, and its very principle was destroyed by the exceptions which its supporters allowed to be necessary. As regards terminal charges, which were stated to be unjust and illegal, the Committee reported that, subject to publication by the Companies, terminal charges ought to be recognized. As to preferential rates, the Committee-reported that they were sometimes to the advantage and not the disadvantage of the public; that they were only illegal when unjust, and when unjust the law already provided a remedy. He (Lord Brabourne) could go at much greater length into all these points, but he mentioned them now only to show that as the complaints upon which legislation was demanded before the appointment of the Committee of 1882 were proved before that Committee to have been greatly exaggerated or altogether unfounded; so the defects which were sought to be remedied by the present Bill might turn out, on investigation, to be either no defects at all or such as might be remedied under the existing law. Therefore he submitted that the proper course to pursue would be to refer the Bill to a Select Committee. As to the clauses, he would mention the 9th, which, taken with the 17th Clause, constituted the Commission solo judge on all points contained in the special Acts of the Companies. The Commission would sit as judge and jury, just as the Judges sat in the Courts of Equity. Why was the Commission not to be subject to appeal similar to the appeals against the decisions of the Judges? No doubt the Commission was one of an extraordinary character. It cost the country about £10,000 a-year in salaries, and the average was 18 cases a-year. If it were to be a really strong Court, and composed of Judges of the High Court, he should not object to the limitation of the right of appeal; but two out of the three Commissioners were to be lay men; and, therefore, he hold that it would be a monstrous thing to limit the right of appeal. The amount of property placed under the control of this Commission was enormous, and he thought the Commission ought to be a really strong Court in legal knowledge and ability, or else the widest right of appeal should be given. He came next to the 24th clause, which was the most important in the Bill. This clause proposed calmly to set aside all the Companies' special Acts under which they had heretofore classified their traffic and settled their rates. As far as he could read the clause, the Board of Trade had the power to reduce the maximum rates just as it pleased. The special Acts wore the charters of the Railway Companies, on the strength of which their capital had been subscribed. He did not wish to say one word against the Board of Trade. In the debate in the House of Commons last year there was a speaker who had said that the Board of Trade was a most incompetent tribunal to deal with those questions. That speaker was Sir E. Assheton Cross. He (Lord Brabourne) did not agree with that estimate of the Board of Trade. In his official experience he had known much excellent work done by permanent officials, and he had no reason to doubt that those of the Board of Trade were as good as any others. Nor did he believe that any President of the Board of Trade would seek popularity by urging his subordinates to a reduction of Railway rates. He was ready to believe both the political and permanent element in the Board of Trade to be perfectly immaculate and entirely capable. But had their Lordships any idea of the work which this clause would impose upon the Board of Trade? Many of the Companies had some millions of rates, and he work of classification and arrangement of rates was one of enormous labour. He did not seek to appeal to anything so obsolete as the observance of Parliamentary faith, but to the practical difficulties before them. The rates were settled and determined by skilled men, the whole of whose time was given to their classification. They had no possible motive for injuring the public, and competition had shown them that they must cut their rates as low as they could in order to carry the traffic consistently with the traffic being remunerative. Interference with those men was very dangerous, and could not be successful. He did not say there was not room for improvement, both in the classification and the rates; but if by an arbitrary interference with managers of Railways their Lordships altered rates sanctioned by Acts of Parliament so as to make traffic un remunerative, they would go very near to the ugly word confiscation. It was absolutely impossible that the officers of the Board of Trade, in addition to all their other work, could do this work in the same efficient way in which it was now done by specially trained men, who devoted their whole time to its performance. But even if they could do so, there was an enormous difficulty behind. Upon what principle were they to proceed? Was it upon that of equal mileage rates? That had been condemned by the Committee of 1882. Was it with regard to the cost of service? Was it with reference to the value of the articles carried? Was the existence or non-existence of competition to be taken into account? No principle was indicated in the clause, because, in truth, there was no one principle of universal application in the matter. One principle alone could be applied, and that was the principle of elasticity, the application of which was absolutely necessary to the successful administration of Railway traffic, and which could only be applied by leaving a wide margin of discretion to those most capable men who now acted as Railway managers. He would point out, moreover, that not only did Railway Companies very rarely charge their maximum rates, but the whole tendency of recent years had been towards reduction—competition with other Companies and with water traffic having secured to the public the advantage of low rates. Any action of the Board of Trade which would make traffic unre- munerative would recoil upon the public. In Section 7 of Clause 24 it was provided that when the Railway Companies and the Board of Trade had failed to come to an agreement, a report should be made to Parliament, and the Board of Trade might bring forward a Provisional Order to force their views upon the Railway Company. The Railway Companies would very much prefer that matters should not be brought to that pitch, be cause, in the case of a Provisional Order brought forward by a Government Department, there would he very little chance of resistance. He (Lord Brabourne) believed that if the Railway Companies were given time and opportunity, very few of these questions would remain unsettled. He did not wish to deprecate the friendly interference of the Board of Trade, but arbitrary interference would only lead to misfortune and confusion. By Clause 27, any person who fancied himself oppressed or treated unreasonably, might complain to the Board of Trade. There were a great many unreasonable persons who fancied themselves oppressed, and who now came to the Railway Companies and had their grievances settled in a quiet way. But now it was proposed that the Board of Trade should hear their complaints, and, what was worse, might appoint and pay any other person to receive communications upon the matter. The Board of Trade was but human after all, and there would always be plenty of people anxious for such a job, whom they would be urged to appoint. He thought that nothing but mischief would result from such a provision, and the trouble which would be given to the Railway Companies by this clause could hardly be conceived by those who were unacquainted with the practical working of those Companies. All that the Railway Companies desired was to be allowed to settle their own differences with their own customers; and, if they acted illegally, those customers had their remedy at law. As to the complaint that individuals could not contend against the long purse of a corporation such as a Railway Company, that would apply to all other corporate bodies, and. there could be no reason why Railway Companies should be subjected to a special law more than any other bodies of the same nature. Clause 28 provided for what was practically an unlimited power to order returns from the Railway Companies. The returns now asked for by the Board of Trade imposed a great deal of labour on the staff of the Companies, and this further demand would be attended with great inconvenience. Clause 29 contained Provisions of a most extraordinary character; it provided that at every station of every Company there should be placed certain lists of their rates. There was one Company, whoso terminus was in. London, which required no less than 1,500 books to keep its various rates. The effect of this clause would be that at each of the 670 stations on this Railway there would have to be a copy of its books, and upwards of 1,000,000 books would be required, to comply with this clause, the information contained in which would never be of the slightest use to anyone. The Railway Companies were at present compelled to supply all persons desiring to use the railway with the information they required, and, on proper notice, to show how their rates were divided, and what was the proportion which was a "terminal charge." With regard to the general objects and nature of the Bill, it appeared to him that the principle underlying it was the interference by the State with one of the greatest industrial undertakings of the country. No such interference could take place without running grave and serious risks. If their Lordships impeded commerce, fettered trade, and imposed shackles upon industrial enterprise, they struck at the root of that freedom of action which was the life and soul of industrial success. As regarded success in an industrial enterprise, whether it was the maintenance and management of a Railway, the business of a shipowner, or that of a merchant, success was more likely to be achieved by the free action of those men who were trained to the business, and whose interest lay in its development, than by the hard-and-fast rule of Government regulations or the restrictive supervision of a Government Department. But here there was something more in question than mere commercial success. The power of State interference was one which their Lordships would always regard with jealousy; but their jealousy would be increased when that interference took the form of encroachment upon legal; rights. That was a dangerous principle, which might lead to grave and serious results. Up to the present time, whenever any sound commercial undertaking had been projected in this country, there had been no want of capital to carry it out. This had been the case because the public had confidence—they believed that Parliamentary faith would be kept; they had had some rude lessons in recent years as to Parliamentary faith and the reliance to be placed upon Parliamentary enactments. But if these lessons were to be carried further: if people were taught that the conditions on which they were to subscribe, and those upon which they had subscribed their capital, were to be set aside at the first convenient opportunity, for the sake of gaining popularity, the supply of capital might be considerably diminished. Moreover, if they impeded trade enterprise by restrictive legislation, it would not be long before those classes who lived by manual labour would rise up against that class of legislation which restricted the supply of one great class of employment, they would have to reckon with other classes also. If by that legislation the railway interest was going to be attacked, he wanted to know whether their Lordships were going to give any consideration to the claims of the Railway shareholders. It always seemed to be forgotten that it was not the well-paid chairman, or the holders of debenture and guaranteed stock, but the holders of ordinary stock, who suffered from any diminution in the earnings of the Railway—and they had a right to complain if their legal security was diminished, and if they were robbed by legislation of the dividends which they would otherwise have received. It should be remembered that out of £800,000,000 of money invested in Rail-ways, something less than £300,000,000 was in the hands of ordinary shareholders, upon whom the diminution in profits would exclusively fall. There remained yet another and still more important class with whom they would have to reckon. If any noble Lord would look into the complaints made against Railway Companies, he would find that they were not of overcharges upon the persons complaining, but they wore made, for the most part, by traders, because they alleged the charge upon the goods of somebody else was too low, and that, this somebody else was thus enabled to compete with them on equal terms in the market. There was another aspect to this question. If they were going to tamper with Railway rates in the interest, or supposed interest, of traders, they would limit competition and restrict the area from which supplies were brought into the market, and it would not be long before consumers lifted up their voices against the rise of prices which would ensue. A great deal was said about the Railway Companies enjoying a monopoly. They were monopolists only in the sense that they had provided a better, more convenient, and a cheaper method of transit than others, and had thus driven other carriers out of the field as far as long routes were concerned. Their very excellence was now used as a weapon against them. Moreover, there was scarcely a line anywhere at the present moment to which there was not some competition either by another line or by water. Railway Companies frequently incurred a large expenditure, and then in a few years Parliament let in a competing company which rendered all their expenditure unproductive. Therefore Railway Companies had no real monopoly—only a restricted monopoly, regulated by Act of Parliament, and used in the interest and for the advantage of the public. It might be said that because he had criticized some of the details of this measure he ought to move its rejection. That by no means followed. Railway Companies had no quarrel with traders, and as sensible men only desired to see this subject dealt with in a sensible manner. Still less had they any quarrel with the public, whose servants they were and whom they desired to please. They knew that there had been a demand from the public for Railway legislation, and they could not shut their eyes to the fact that three Governments had proposed legislation. Railway Companies were perfectly ready to remedy any complaints that might be well founded and to use their best endeavours to satisfy the public. There were remedies for certain defects which the Companies were anxious fur. That they readily admitted. The classification of goods was, in a great measure, obscure and obsolete, and Railway Companies were as desirous as anyone else for its revision. The uniformity of rates was, no doubt, a delicate and difficult subject, but, wherever possible, Com- panics had no objection, in all cases where it could be done without sacrifice of their shareholders' rights, to rates being dealt with. The consolidation of statutes was also desirable, and the Companies were most willing to promote it. Moreover, as to terminal charges, they were ready to simplify the matter and make it as clear as possible to the public. There were many points in the Bill which would be much better discussed before a Select Committee than in the Whole House. He believed it would be found that those who represented Railway Companies were most anxious and desirous to give every possible assistance in the promotion of the legislative settlement of all disputed points. What the Railway Companies did object to was that they should be continually harassed by unfounded complaints and prejudiced by extravagant statements which had been again and again refuted. They asked, within the limits given them by the Acts of Parliament controlling them, to be allowed the freedom to act as they chose and not to be interfered with in the management of their own business; above all, they asked not to be continually exposed to harassing legislation and vexatious enactments, which would have no other effect in the long run than that of retarding the development of the industry and resources and of restricting the prosperity of the country; while at the same time they inflicted undeserved injury on men who had subscribed their money to carry out these great undertakings in full reliance on the good faith, honour and justice of the British Parliament.


said, he had taken a great interest in this question, and for some time had been Chairman of a Committee which represented all sides of politics. This was no Party question. The Committee consisted of Members of their Lordships' House, Members of the House of Commons, and agriculturists and traders from all parts of the country. He believed that all the important Corporations, the Chambers of Agriculture and Commerce, and Trade Societies were represented upon it. He, therefore, thought he might claim to speak with more authority than his own individual opinion could possibly command. The policy of the Committee had been through-out in no way to be vindictive against the Railway Companies, as they were fully aware of all the country owed them, and not to ask for anything which they did not consider reasonable and right. He was glad to find his noble Friend (Lord Brabourne) had spoken in a way which showed he was quite ready to deal with the question in a conciliatory spirit. He could assure him that his Committee fully reciprocated this feeling. It was the policy of some people to ask for a great deal more than they wanted. This practice his Committee had thrown aside. They thought the question one of great importance, and they were prepared to stick to their proposals as far as they were able. First of all, he (Lord Henniker) must thank the Government for their attempt to deal with this question, and particularly his noble Friend the President of the Board of Trade (Lord Stanley of Preston). A measure brought in by a responsible Government was what was wanted; and he personally hoped his noble Friend might be successful in passing a measure which was much needed, and would, in these distressed times, be welcomed by agriculturists and traders, and, he hoped, would be for the benefit of the Railway Companies. He (Lord Henniker) would not attempt to go into the details of the Bill, but he would touch merely on some of the main points. He hoped the Bill would pass a second reading, and details could then be gone into in Committee. The first point he wished to call attention to was the composition of the Railway Commission. The great point here was that its composition should be strong, and easily available to suitors. As to the strength of the proposed Commission, he hoped it would be strong, as it stood in the Bill. Last year the traders thought—and he agreed with them—that the appointment of a Judge as Chief Commissioner would not be desirable, but that the present Court, with more power, would be best. However, the proposal made in this year's Bill was not at all the same, and he had no objection to make to the composition of the Court. The Railway Companies, no doubt, wished for a Judge as First Commissioner. In the proposal made in the Bill, the Railway Companies had all they wished for in every important case, and the Committee had no objection to make to this. As to the Commission being easily available, he had been always anxious that, whatever the law was, it should be as little as possible Judge-made law, with proper latitude—not tying down the Commission too much—that certain rules should be laid down, as far as they could be, for the guidance of the Commission and the Court of Appeal. When in Committee on the Bill, this could be considered. His noble Friend (Lord Brabourne) asked why the Railway Companies should have a special Court at all, and not be dealt with like other litigants. He might remind him that the Act of 1873 was brought in because the ordinary Courts were unable to deal with these Railway questions satisfactorily. The Railway Companies prided themselves on the fact that very few cases came before the Commissioners; but was not this often from the fact that the Court, as at present constituted, was not easily available? The Railway Companies held the purse strings, here as well as in appeals, and traders wore too much handicapped to be able to hold their own. For this reason he hoped Sub-sections 3, 4, and 5 of Clause 17 would be altered. This Clause gave an appeal from the Commissioners to a higher Court, and, by leave, from the higher Court to the House of Lords. Surely if the Commission Court was a strong one, one appeal—of course, on questions of law only, and that by leave of the Commission—would be quite sufficient. There was already a Judge on important occasions, and to multiply appeals was only to cause unnecessary expense, and, he thought, unnecessary pressure on traders. Again, he hoped there would be only one Court of Appeal for the whole country. If they had one decision in England, one in Scotland, and one in Ireland, there would be no uniformity in railway policy. What he had said as to the traders being handicapped by the superior power of the Railway Companies would apply to sub-Section 8 of Clause 24, where there was a reference to a Select Committee. This proposal was popular even in a more extended form in some quarters. His noble Friend who had spoken last had suggested the reference of this Bill itself to a Select Committee; but the traders were often greatly handicapped on Select Committees. Railway experts were the witnesses, and many of their Lordships knew what this meant. He would pass on to Clause 24, which was the point of controversy last year. The Railway Companies talked of confiscation of their property then, and they did the same now, saying they relied on their old Acts. At all events, the Committee over which he presided were not in favour of anything of the kind. They were many of them shareholders in railways, and they would hardly wish to confiscate their own property. However, he would pass this rather unfair contention by. Clause 24—it was Clause 24 of the Bill of last year too—was improved as far as the Railway Companies were concerned, and for the traders as well. Uncertainty must ruin every trade. In last year's Bill the question of classification could have been re-opened at any time. This point he held to be one of great importance, both for the Railways and the traders. They wanted as much certainty as possible in any arrangement made, but if Clause 24 was looked at this year, what prospect was there of any immediate settlement? A year was to be first given to the Railway Companies to send in their proposals as to classification; then a clear Session if there was no agreement. The Railway Companies looked on the clause as confiscatory. Surely this position would hardly lead to a satisfactory or a speedy solution of the question. The Railway Companies prepared a schedule of rates in 1885; there was all the help to be given by Government experts, traders, by the guide of the Clearing House rates, and so on, at once available. In fact, there was no insurmountable difficulty in coming to an immediate settlement of the classification of rates. He held strongly to the opinion which he had often expressed, that a small Commission would deal far more satisfactorily with this question than it could be dealt with in any other way. The Committee over which he presided were of this opinion, and he pressed this upon Mr. Mundella last year, The Commission could be formed more or less of experts; and he thought if Clause 24 were taken out and a Commission appointed, with a provision that a Bill should be brought in within a year to carry out their Report, that the question would be settled without much difficulty, or delay, or half the trouble which the 24th Clause as it stood would cause. Last year his hon. Friend (Mr. Barclay) proposed that the Commissioners should deal with classification, with assessors. He confessed he objected to this now, as he should like to see a general Bill passed, and the Commission get to work at once to make the Act really effective. To give them the work of classification of rates as well as their own duties would delay thorn in carrying out the general Act. Should the small Commission he suggested be appointed, it could set to work at once, and they would have some prospect of a speedy solution of the question, as well as a prospect of the general Act being put into working order without delay. There was no reason to delay the Bill for classification. This could be done afterwards as well as now, if there was a guarantee in the Bill that classification would follow. Should he (Lord Henniker) find his views supported, he should be prepared to move the omission of Clause 24, and to bring up an Amendment to carry out the proposal he made for the consideration of the House. It would perhaps be convenient to touch hero on the question of terminals, although the definition to which he wished to refer was in Clause 43. This definition was the same as in the Bill of last year, and the Committee strongly objected to this. The Committee thought it too wide. This point—that of terminal charges not being included in maximum rates—was one of the greatest grievances they had; and the position on this part of the question was far more strained than it was two years ago when he brought the question before the House. There were then nine Bills brought in by the Railway Companies, which gave a now classification of rates; there was strong opposition to them, and they wore withdrawn. The Railways then went to a Court of Law, and in June, 1885, obtained a decision in their favour—that was, to charge terminals over and above the maximum rates. The Railway Companies talked of their old Acts, which to alter was confiscation; but they did not doubt about going to a Court of Law to upset the whole of the railway legislation which had hitherto prevailed, and against every decision which had been given by the Railway Commission and every other Court of Law, that terminals should be included in the maximum rates with very few exceptions. The position was therefore far more unsatisfactory than it was, par- ticularly as the last decision made it impossible to appeal, reversing all former decisions—as the Judicature Act of 1873 was passed on August 5 of that year, and came into force at once. Whereas the Railway Regulation Act of the same year was passed on July 21, and did not come into force till September. To make the matter clear, the operation of the Judicature Act was postponed till November 1, 1875, but became an Act of Parliament on August 5, 1873. The 45th clause allowed an appeal from the inferior Courts then existing. The Railway Commission was not in legal existence till September, 1873, so although one Court was at work before the other, the result was that an appeal—which the Judges of the Divisional Court said they would gladly grant if they could—was impossible, and this was about the only instance in which an appeal could not be given. This might be thought inconsistent after what he had said about appeals; but their Lordships must recollect that he was dealing with the existing law, and what was fair for one side was fair for the other. The Railways had the advantage hero. Under these circumstances, he should have been glad of some more distinct dealing with the question, and a better definition of terminals in a Government mea- sure. A Railway could not work its line without stations, and so on; and again, the present maximum rates were fixed, as a rule, on the understanding that they should include terminals. If this was correct, as he thought it was; if terminals were to be charged extra for the first time in Railway legislation, the whole question of maximum rates should be reconsidered, and probably reduced rather than increased, as was proposed in nearly every instance in the nine Bills of 1885. The Railways said they did not ever charge their maximum rates. Why, then, raise them? They thought this question one of great importance, and it was one which he hoped his noble Friend would again consider most carefully. As to preference rates, he was aware this was a difficult and delicate matter. It was quite unnecessary to quote instances of this; how to deal with it was the question. His Committee strongly objected to Sub- section 2 of Clause 25, which laid down that Railways might be allowed to plead that they could only secure traffic by giving preference rates. This was the only way in which Railways could justify preference rates, and this sub-section would toll most strongly to prevent a satisfactory settlement if it remained in the Bill. Although a settlement was much desired, he felt sure that those interested would rather have no Bill passed than one with this provision in it. Why should a rule be laid down in favour of the Railway Companies and no rules in favour of the trader? The traders had many points on which they could complain; but at the outset the one point most clearly laid down was the only one on which the Railways could rely. It might be said that the traders had their protection in Subsection 1; but the traders were the weaker party, and such a provision must tell against them. He hoped this part of the question would be reconsidered by his noble Friend, and that, at all events, Sub-section 2 of Clause 25 would be omitted. Clause 26 his Committee thought unnecessary, and likely to mislead. He had touched on some of the important points in the Bill; but although his remarks were in the nature of strong criticisms, he trusted his noble Friend would understand that he was anxious to give him any support he could personally in the difficult task he had undertaken; that there was a great deal in the Bill for which he had nothing but praise, and that he was sure the Committee over which he presided had but one wish, and that was to bring this question, if possible, to a satisfactory conclusion, and to give any assistance they could in that direction.


said, he did not intend to oppose the second reading—in the first place, because it would be perfectly useless, as their Lordships would no doubt read it a second time; and in the next place, because it was a Bill with many miscellaneous provisions, some of which might be good; and it was brought in under auspices and introduced in such a way as to disarm opposition. There was one matter on which, though they would have an opportunity of referring to it in Committee, he should like to say a few words, especially after the argument which had been used in relation to it. The shareholders of this country had subscribed £800,000,000 for making Railways, and they had done so upon the faith of a bargain made with the State, made with the public, made, at least, with Parliament, that they should have the right to make certain charges. It was now proposed to take this right from them, not in so many words, because they were at liberty to diminish their own rates. But if the rates they proposed were not sanctioned by the Board of Trade, the Board of Trade might suggest other rates which certainly would not be larger—and which might be considerably smaller—and then the Board of Trade would bring their proposition to Parliament, and if sanctioned by Parliament the rates which the Companies had at present would be taken from them. He did not deny the power of Parliament to do this. Parliament was omnipotent; it might take an acre from every ton their Lordships held, and reduce 3 per cents to 2½. But he entirely denied that Parliament had reserved to itself as part of the bargain the right to do so. He wholly denied the validity of the argument presented in support of such alleged right. That argument was that in modern Railway Acts there was a clause that nothing therein contained should be deemed to exempt railways from the provisions of any general Railway Act now in force, or which might hereafter be passed, or from any revision of rates and charges authorized by such Acts. But what the Railway Companies relied on was nothing in the particular Act which contained that clause, but upon the Act which gave them the right originally to make those charges. That clause, in modern Acts, came into existence by virtue of their Lordships' Standing Order, and the first time this Standing Order appeared was in 1841. From that time down to the present this clause had always been introduced into Acts of Parliament which gave power to Companies to make branches. By an Act of 1844 it was provided that when any future Company—not one of the old Companies—was earning more than 10 per cent there might be a reduced rate of tolls, but that that reduction should be accompanied with a guarantee that if that reduced rate did not produce 10 per cent the Treasury should make up the difference. It was further provided that such reduced scale should not be again revised otherwise than with the consent of the Railway Company for 21 years. That was thought to he the fair and legitimate way of dealing with Railway Companies at that time. He had no doubt that it was to prevent now Companies saying they were not within this Act of Parliament because they came into existence after it was passed, and therefore their new Act being subsequent to the general Act, repealed it. It was to preclude such an argument as this, doubtless, that the Standing Order was made which provided that every Railway Bill passed after that date should contain the clause that nothing in the Act should exclude a revision of the maximum tolls. But the clause did not bear the interpretation which the noble Lord (Lord Stanley of Preston) had put upon it; he said so confidently, speaking as a lawyer. The Bill introduced by the noble Lord was a proposal to interfere with rights for which the Railway Companies had bargained, and for which the shareholders had subscribed their money. Was it conceivable that those people would have been foolish enough to subscribe the amount they did if they had known that the tolls which they bargained for could be reduced? The matter was one of great importance not only to the Railway Companies and the shareholders, but generally. He was not going to talk of plunder or confiscation, for he was sure there was no such idea in the mind of the noble Lord who introduced the Bill. An expression was very often used in the present day that "there was plunder in the air;" and he would ask their Lordships not to set an example of lightly taking away from people rights to which they were clearly entitled. Land was to be nationalized; leaseholds were to be enfranchised; copyholds were to be enfranchised; or the landlord was to forfeit his interest. The Tithe Question was to be settled again, and other rights were to be interfered with; and he (Lord Bramwell) would ask their Lordships carefully to consider whether they would not by this Bill be taking away from the Railway shareholders that which they had purchased, which unquestionably belonged to them. He had been told by one, than whom there was no higher authority, that the difficulty in raising capital was on account of the general distrust that existed. There was scarcely a thing or an interest which was not now assailed with the object of taking from it rights that the law had given. Their Lordships might suppose that he had some interest in the matter. Yes, he was a Railway shareholder, though only a small one. His personal interest in the question was small; he was provided for as long as he lived; and before this scheme was brought into operation he should porabably be provided for in another way He was chiefly interested in the matter in the way that thousands of other persons were; he and they wished to make safe provision for those who came after them; but this Bill made railway property unsafe. He believed the Bill to be an unjustifiable attack on the rights of Railway shareholders. There were many other observations he might make on the Bill. For instance, why should the Railway Companies be referred by the Bill to a tribunal inferior to those which existed for other matters. The magnitude of the questions which arose was an argument in favour of having the best possible tribunal. Why, if there was a mistaken decision on matter of fact, should it be as it is in the ordinary Courts of Law the subject of any appeal. He believed, however, it was impossible that a Committee of the Whole House could properly deal with all the questions that wore raised by the Bill, and, therefore, that it must be considered by a Select Committee.


said, it was not convenient to discuss the details of the Bill at the present stage; but he desired to criticize one or two alterations which had been made in the Bill since last year, and which it was desirable should be more fully explained than they had been. As to the argument of his noble and learned Friend (Lord Bramwell) that the Railways did not possess a monopoly, it appeared to him that they did possess a considerable monopoly, because the Railways had been constructed under special facilities which were given to the Companies, and which were not given to any other of Her Majesty's subjects. In the compulsory taking of land for the making of lines, no one could compote with the Companies. Parliament had therefore given them a monopoly, and that monopoly could be destroyed only by allow- ing anyone else to do what they had done, which was not a practicable remedy. In those circumstances there might be interferences with the Rail- way Companies in the carrying on of their business which would be justifiable, while they would not be justifiable in the case of those upon whom Parliament had conferred no special rights. On the other hand, it would be unjust that money had been subscribed for the construction of railways on the faith that Companies had power to take certain tolls. These could not be revised simply in the interest of the traders without involving that confiscation which the traders themselves did not desire. He objected to the change in the constitution of the Court, and though that change had been supported by the noble Lord opposite who represented the traders (Lord Henniker), he did not regard it as in any sense a change for the better. He could understand a desire on the part of traders to have a tribunal which should disregard law altogether and determine questions on abstract principles of justice, and against whoso decisions there should be no appeal. That would be an intelligible proceeding. But if questions of law were to be determined upon legal principles, he should have supposed that a tribunal presided over by the best lawyer available, would be even better for the traders than it would be for the Railway Companies. The better the tribunal from which you started the less likely was it that there would be appeals. He was at a loss to understand why a Court should be preferred that was presided over by a presumably inferior lawyer. As the Railway Commissioners had sat only from 20 to 30 days a year, there was apparently no room for the separation of the more important from the less important cases. If the opinion of the legal Commissioner was to be set aside by the opinions of two laymen, nothing could be more likely to provoke a number of appeals against the decisions of the Commissioners. On the whole, he thought a better tribunal would be obtained by reverting to the proposals of the Bill of last year, for they would only by the present proposal be multiplying appeals and giving general dissatisfaction. As to Clause 21, he thought there was something in the drafting of it that rendered it unintelligible; certainly it was obscure. It bad been suggested that the Bill should be referred to a Select Committee; but he hoped it would be a Joint Committee of both Houses, so that there might be only one Inquiry. There was, he noticed, a considerable change in the Bill as to undue preference, and he wished to have an explanation as to the omission of the word "mileage." The Bill gave the Commission considerable powers, which the Commission, he had no doubt, would use with advantage to the parties concerned, and that was the spirit in which the matter ought to be dealt with.


said, he wished to supplement the argument of his noble and learned Friend (Lord Bramwell) about this Act and the Standing Order of 1844. The Act provided that the State might buy future railways for 25 times the average profits of three years, and might reduce rates when those profits had readied 10 per cent, but must guarantee the Companies against any loss thereby. The Standing Order guarded against future Railway Companies thereafter slipping any words into their special Acts to interfere with that revision. And now we are asked to believe that Parliament was so absurd as to pass an Act for revision with a guarantee on reaching 10 per cent, and, at the same time, to provide for revision without a guarantee while the average dividend is not half of 10 per cent; and also to believe that shareholders have been such fools as to go on finding money all these years with an unlimited power of reducing rates hanging over their heads. He had road in some newspaper last year that some Board of Trade official said that he had always intended the revising words to have the effect the noble Lord (Lord Stanley of Preston) now said they had. If he did he had played a trick not unknown to lawyers—namely, trying to get an ad-vantage by putting in vague words not calculated to excite alarm; which trick almost always failed, because Judges held that rights and property are not to be taken away by obscure words. There had been complaints against the Railway Companies as long as he could remember—cortainly since 1846. There was a Committee in 1853 which produced the Card-well Act, and then there was a Committee in 1865–6–7, and there was a Joint Committee of both Houses in 1872. After that was the Committee to which his noble Friend (Lord Brabourne) referred, which produced a great volume of evidence. The grievances of 69 witnesses against the Railway Companies wore heard, and six witnesses on the part of the Railway Companies gave evidence. If anybody in the world might be expected to suggest a Bill of this nature, giving the Board of Trade power to reduce rates, surely it would be a Committee who had been so engaged. But that Committee said not a word to that effect. The Duke of Devonshire's Commission of 1865–6–7 was specially appointed to consider the question of the purchase of Railways. If they could have found the means of purchasing the Railways cheaper than on the terms prescribed in 1814, they were the Commission to do it; but if anybody would take the trouble to read their Report he would find that they said it was impossible to do so, because of the terms of the Act of 1814; in other words, it said that the Railway shareholders who found the money knew that it could not be taken away except by mere confiscation, contrary to the Act and Standing Order of 1844 the fact was that from 1844 down to last year no one ever dreamt that Parliament had a right to revise rates. Not oven Mr. Chamberlain's Bill did that. The noble Lord therefore had to make out that it was good faith to reverse the understanding of 42 years and the Report of Mr. Gladstone, who introduced the Act of 1844, and used the most solemn words about the importance of doing nothing that would even have the appearance of a broach of Parliamentary faith. the noble Lord might be a clever man, but he was not clover enough to do that. The Joint Committee of 1872 had the same thing to deal with; but the Act of 1844 stood in the way again, and this happened over and over again. By Clause 11 of the Bill, the Board of Trade, through the Railway Commissioners, or the Board of Trade without the Railway Commissioners, might order any Company to spend any sum of money which they like to pronounce necessary for the public convenience and interests. This extraordinary power was now proposed to be given for the first time, and he asked their Lordships to consider to what this might lead. They might order Companies to spend hundreds of thousands of pounds without a penny of profit for it. And that is not even a question of law, on which alone the Bill allows an appeal. Anything more ruinous to shareholders could not be imagined. Parliament had but to revise Railway rates with the object of reducing them to such a point that the State might acquire the Railways at an almost nominal price. Were their Lordships aware of the amount of money that some of the Railway Companies had spout on their stations? He had a station in his mind whore there was considerable) inconvenience owing to a level crossing. It was a station used by eight Railway Companies. The problem of getting rid of the level crossing had never been solved yet, because of the enormous cost which would be required. It could not be done without the waste of an unknown sum of money, and yet the Railway Commissioners might order this expense saying it was extremely convenient for the public to make the alteration. A Commission of three gentlemen—containing a gentleman of legal experience, another of railway experience, and another of no experience—might order a Railway Company to spend that money. The net profits of Railway Companies, taking off working expenses, were only 47 per cent of the gross earnings. The ordinary shareholders held 37 per cent of the whole capital, and the net income was 0.47 of the gross. If they multiplied the 0.37 by the 0.47 they would find that every penny they took off the gross income of the Company, to give it to their customers, as the Duke of Devonshire's Commission said, as near as possible sixpence was taken off the ordinary shareholders. As to the Commission, the common pickpockets and burglars have a right to be tried by the best Judge in England, and a woman with an action for breach of promise) could appeal through all the Courts on points of law. By the Bill the Railway Companies were treated throughout as hostes humani generis. It had been said that a strong Court was wanted. Yes; one strong enough to override law and justice, and do whatever they think will be popular, or which the customers of Railways are pleased to think fair, as the noble Lord (Lord Henniker) said. In this Bill every possible presumption was made against the Railway Companies. His noble Friend (Lord Brabourne) had spoken on behalf of the Directors; he (Lord Grimthorpe) was afraid that the brevity of his remarks might not be altogether satisfactory to the Railway Defence Association, of which he was made President some years ago. That Association was called into existence because the shareholders generally found that they could not trust the Directors to act for them collectively. Each Chairman and each Manager—who generally managed the Chairman, and had a fixed salary for it—looked after his own interest. If they could so go to the Board of Trade and get some nice little thing for their own Company they would sacrifice everybody else. This was not his opinion only, because the Committee of 1872 said just the same thing. They said that Railway shareholders were practically sheep, without any real control over their managers, to whoso speculations, ambition, and passions the Committee attributed a great deal of the past misfortunes of shareholders. At that late hour he would say no more, but hoped that the remarks of his two noble Friends (Lords Brabourne and Bram-well), if not his own, would make a duo impression on the Government, and show them the real nature of this Bill.


said, he could not agree that the Railway Companies ought to be regarded as ordinary traders, because they undoubtedly possessed monopolies, and it was therefore necessary from time to time to inquire into their proceedings. With regard to the jurisdiction of the Commission, when he first read Clause 27 of the Bill, he was a little in doubt as to whether it would not be desirable to transfer the arbitration which was rendered possible under that Clause to the Commissioners, rather than to the Board of Trade. he felt that it was desirable to make that Commission as strong as possible, and he thought also that, dealing as they did with matters of litigation, they would be the best persons to deal also with arbitration. On further consideration, however, he thought it would be bettor to leave it to the Board of Trade, because the Commissioners would have to sit as Judges, and it would therefore be very difficult for them, having acted as arbiters in the first instance, to be called in as Judges to settle matters which they had failed to settle as arbiters. The Board of Trade also had in Parliament a responsible Member of the Government, and, therefore the Railway Companies had a better means of sifting any alleged injustice on the part of the Board of Trade, and of obtaining an appeal against their decisions, than they would have if this matter were committed to the Commissioners. With regard to revision of the rates, it was by no means certain that a revision of the maximum rates would necessarily moan a diminution of the ordinary rates charged by Railway Companies. Respecting short distances—a very important part of their traffic—it should be borne in mind that revision might load to an increase in the charges. With respect to terminals, express recognition was for the first time given to them by this Bill. So far, it was a concession to the Railway Companies. As to Clause 25, he should postpone his remarks. One matter to be considered in Committee would be, the objection taken by producers that Railways—which annihilated distance—had artificially cheapened goods brought from certain portions of the United Kingdom and from abroad, at the expense of goods produced in the localities less favourably placed. That was the strangest argument that could be put forward for a charge of that character, as if the consumer were the only person interested. Moreover, the consumer, if benefitted by goods being carried cheaply for long distances, would also be benefitted by lower charges for goods carried a short distance.


said, he hoped that there would be no objection to the Chairman of the new Commission being a Judge. It could not be for the interests of anyone connected with trade or agriculture that any injustice should be done to the Railway Companies. As to the revision of the classification of goods, that was desired both by the Companies and the traders. In his opinion, if the Companies were to take advantage of the Clearing House classification, they would be able to review their rates much more quickly than in any other way. He did not believe, however, that the terminals definition in the Bill would meet with the assent of either the agricultural or the commercial classes. He was sure that what had fallen from the noble Lord the President of the Board of Trade (Lord Stanley of Preston) on one point, would be received with great regret by all traders; for the noble Lord indicated that he had given up the home producer in favour of the foreigner. In his opinion, it was impossible to suppose that any settlement of the question of preferential rates would be satisfactory to the homo producer as long as the foreign producer received a bounty in the shape of lower Railway rates than had to be paid by the producer at homo. As to the Appellate Court, he thought that there ought to be no objection to only one appeal, and he hoped that the measure would become law this Session, and that it would be of advantage to the country.


said, that what the Railway Companies desired, as regarded the constitution of the Court for dealing with preferential rates, was that it should be a strong Court. According to the proposal of the Bill, the Court would sometimes be strong and at other times weak; sometimes an inferior Court, and at other times a superior Court. It was most undesirable that Parliament should leave it an open question whether a Judge was to be called in or not. The Commission itself would be unwilling to show their inferiority in dealing with matters of law and fact by sending for a Judge. The proper thing was to constitute a Court under the presidency of a Judge. He thought that the Conciliation Clauses of the Bill would, in certain cases, develop a most mischievous kind of litigation, inasmuch as they provided no protection for the Railway Companies against harassing claims of all descriptions. He should prefer a strong fixed Commission to an oscillating one, which would be sometimes strong and sometimes weak, so that it might give a promise of consistency and continuity in its decisions. The clauses relating to the revision of rates appeared to give the Board of Trade unlimited powers of revising rates in such a manner that they might practically extinguish the property of the Railway shareholders. He thought that the Bill ought to contain some instruction to the Board of Trade that in revising rates they should have duo regard to the legal and equitable rights of all parties interested. With regard to the clauses dealing with undue preference it should be remembered that three-fifths of the whole rates of Railway Companies were practically ruled by the keen competition of shipping interest and the Steamship Companies, and that the greater part of the remaining two-fifths wore determined by Railway competition. It was said that this Bill legalized terminals for the first time, but he pointed out that this was not so. He hoped that their Lordships, if they read this Bill a second time, would not ignore the fact that whatever injured the Railway interest would injure the country at large, and that it was much more probable that they would get low rates and efficient service from rich and prosperous Railway Companies than from poor and struggling ones hampered by unwise legislation.


said, one part of the community that had not been represented in the debate was the consumer. In fixing their rates the Railway Companies had been doing their best in the interests of the consumer as of any others, their object having been to bring food within the reach of the consumer as cheaply as possible. Taken as a whole, Railway arrangements had been very fairly carried out. It must be remembered that it had been intended originally that Railway rates should be revised only when the shareholders were receiving a 10 per cent dividend, whereas the average dividend now paid was only 4¼ per cent. If the noble Lord (Lord Stanley of Preston) and the Board of Trade should pass this Bill they would have taken a great responsibility off the shoulders of the Railway Companies and put it upon their own, which would not be able to bear it, and deal with the work properly.

LORD STANLEY OF PRESTON, in reply, said, he would postpone to another, time much that he had to say. "With regard to the argument of the noble and learned Lord (Lord Bram-well), he must observe that, however honourable the intentions of the Railway Companies, their claims, on grounds of public policy, could not be admitted to the full extent. As to the constitution of the Court, the noble and learned Lord (Lord Herschell) asked a good many questions about points which were rather matters for Committee, than for dealing with at that stage of the Bill. He quite admitted that the stronger the Court the loss likelihood there was of appeals. He had been asked what the position would he if the legal Commissioner and the Judge took one view, and the two lay Commissioners another? He believed the usual course was, if the Court was equally divided, that the junior withdrew his judgment, and that, in point of fact, no difficulty was found in adjusting a matter which at first sight might seem to present some. He believed that after some questions were decided, the right of appeal would be rarely exorcised. Parliament had, in many cases, recognized the necessity for classification; and he did not believe that the great difficulties which some noble Lords anticipated would be likely to arise. He fully acknowledged that Hallways in this country wore well managed, and that we had not much to learn from foreigners on that subject; and he believed that in dealing with the question of classification, the Board of Trade, with the assistance of the Railway Companies, and something like the Clearing House classification to guide thorn, would not find the task so difficult as the noble Lord scorned to suppose. A noble Lord had spoken of the second part of the 25th clause as offering a bounty in favour of the foreigner. But the foreigner had really nothing to do with the matter. With reference to the Conciliation or Arbitration Clause of the Bill, a noble Lord opposite had spoken of it in sarcastic tones; but he (Lord Stanley of Preston) was quite ready to discuss the clause on its merits, believing that if grievances could be adjusted without recourse to litigation, it would be an advantage to all parties interested. He thanked their Lordships for the spirit in which they had received the measure, and earnestly trusted the Bill would lead to useful legislation. There were some points of difference between them which were merely nominal; but he recognized that there were others of principle for which he feared there was no half-way house, and in regard to which they must agree to differ. Still, speaking of the Bill as a whole, and not of particular provisions, he was glad to find that there were important points in it on which they were all agreed; and, bearing in mind the spirit in which the Bill was framed and introduced, he strongly hoped that it would lead to the passing of a useful and satisfactory measure.

Motion agreed to; Bill read 2a accordingly, and committed to a Committee of the Whole House on Tuesday the 29th instant.