HL Deb 14 March 1890 vol 342 cc840-50
THE DUKE OF MARLBOROUGH

My Lords, the question which I have put down upon the Paper has really reference to a Motion which I had the honour to make in your Lordships' House last year, when I asked the question of the Prime Minister what the intentions of the Government were with regard to the development of the telephone in this country, and especially with regard to the action of the Post Office. Really the subject is one which is of very great interest at the present time, because we may say that the telephone as a system hardly exists yet in this country. There have been many causes which have produced difficulty in developing the telephone; but I may say, having myself some personal experience, having largely used the telephone, and having carried out a great many experiments with it, that a more valuable and useful invention has not been produced in this century. Its adoption, however, very much depends for general use upon its being more perfectly developed. I may say that if it were fully developed any of your Lordships might be sitting quietly waiting at your writing tables, and you could have beside you a little box into which you could talk to your friends living at different places all over London, and at much greater distances, thus saving the trouble of correspondence and of sending telegrams, because the telephone is a far preferable mode of communication to the use of either telegrams or of correspondence. In fact, so capable is it of complete development that by means of it you can talk to persons as easily between London and Brighton or between London and any others of the large towns in England, and be as plainly heard as your Lordships can hear me in this House at the present moment. I am quite sure that the public is in favour of my view, that is, that the telephone is one of those valuable inventions which we all ought to have complete and entire facilities in using. That, my Lords, must be my apology for pressing the matter again on the attention of your House. The moment has come when, in the words which I think were used by the Prime Minister last year, it is necessary for us, and when, as I say, it behoves the Legislature to take some steps in the matter, and to consider the action that is to be taken by the Government in reference to it. The valuable patents of Bell and Edison, that is to say several of them, the main patents, expire, I believe, this year, and therefore it is necessary if anything is done that the Government should now either undertake to establish a telephone system in London, or that they should be willing to depute those powers which they possess to public companies who are willing to take up this work. In order to develop a telephone system in London a very large expenditure of capital would be required; I should say that no private company ought to start upon such a work which could not command, £1,000,000 sterling of capital. The expense of laying great main circuits round London, and the expense of establishing main stations and sub-stations, would be very great; the running expenses also would be very large, and I think it would certainly not be safe for a private company to undertake the work under a capital of, say, £1,000,000 sterling. Therefore, my Lords, the question arises whether Her Majesty's Government would be prepared to recommend that an expenditure to so large an amount should be incurred, and thereby, in fact, an organisation established which would be quite as important as that new branch of the Post Office, the Parcels Post, which was established a few years ago; that is to say, whether Her Majesty's Government are prepared to recommend that so large an addition as that should be made to the work of the Post Office or not. That, of course, is a matter for Her Majesty's Government to decide. When I ventured to bring this matter before your Lordships' House last year there were several points which I ventured to touch upon. One was the question of communication; that is to say, overhead wires; and the either was the question of administration. The noble Marquess rather suggested that I had somewhat mixed up two questions which wore entirely separate; but I would venture to point out to him that really the two questions are inseparably connected and combined; because, of course, a telephone system is impossible unless provision is made for wire communication and for its administration. It is therefore absolutely necessary in developing the telephone, to provide for that. In 1885 a Committee of the House of Commons sat upon the whole question of telephones and telephone wires. That Committee heard the evidence of the Post Office officials; it also heard the evidence of the engineer to the Post Office, of the Chairman, solicitor, engineers, and officials of the United Telephone Company, and of the Chairmen of the various sub-Telephone Companies which then existed; and that Committee then came to a conclusion upon the matter and made a Report. If your Lordships will permit me to say a few words about this Committee and their Report, I think it will help to clear up the question in the public mind. The object of the Committee was to find out what were the difficulties which existed with regard to overhead wires, and with regard to establishing communications, and as to what facilities the Post Office might give, and could give, in the matter; and the curious fact was brought out that the law is in a state of very great confusion on the whole question. Now, with regard to the powers which the Postmaster General exercises; he exercises his powers under various Acts of Parliament which were passed between the years 1863 and 1878. He obtains a monopoly by the Act of 1869, and the Act of 1868 gives him further powers with regard to the railways. In a few words, the Postmaster General has, practically, sufficient powers for the purpose of running telegraphic communications. He can, by giving notice to the Highway Boards, lay underground tubes or erect posts for the purpose of carrying wires along the highways; he can also give notice to private individuals and proceed to erect wires over their houses provided he does not approach them within a certain distance, and provided that what is required to be done comes within the powers possessed by the Post Office. There was no complaint made before the Committee that the Post Office were short of powers to do their work. There fore we arrive at this fact: that if Her Majesty's Government are prepared to undertake the establishment of a telephone system themselves, the Postmaster General possesses all the powers necessary for the purpose of carrying out the work. But a curious point arises. Your Lordships are no doubt aware of the fact that when the litigation took place with regard to these matters, and the Post Office Authorities won their suit, licencss were then given by the Post Office Authorities to the United Telephone Company. They gave a licence to the United Telephone Company as a company to make communications for use between individuals and through their Telephone Exchanges, but they gave no running powers. The consequence was that the United Telephone Company, or as they call themselves now, the National Telephone Company, were in the position of any other private individual. They had no powers to break up roads such as were possessed by the Postmaster General, but they had to run their wires as best they could. They had to go and ask the permission of householders to put up their wires. They might or might not get that permission; and when they did get permission, they had to run their wires in and out in every sort of way for the purpose of making communications, and householders had the right even to pull down those wires if they annoyed or troubled them in any way. There is no question, therefore, that the system, such as it was, could hardly have been developed unless very huge powers had been conceded to a company. Now, the question is, would the Government, if not themselves prepared to take up this work, be prepared to recommend that the Postmaster General should concede powers to a company sufficient to enable them to do the work? There was a suit called the Walworth suit, in which the parish authorities tried to stop the United Telephone Company from running wires across the roads. That case was decided against the parish authorities, and it was held, that inasmuch as the roadways are only the property of the public for the purpose of traffic, the public have no right either to the soil under the roads—that is to say, no underground right, nor have they any right overhead—that is to say, towards the sky, except so far as regards anything which may impede the public traffic; and it was held by the Court of Appeal that any individual may run a wire across a roadway, provided it be placed at a sufficient height so as not to impede the traffic. The consequence is that by that lapse of the Legislature, the Telephone Company have been able to get across roads and streets, though, curious to say, the Postmaster General has not those powers, because the Postmaster General can only act within the four corners of the Act of Parliament under which he derives his powers. Your Lordships will see, therefore, there is a confusion in this sense, that as there is no proper law regulating the right of crossing roads, private individuals and companies can act as they choose; whereas the Postmaster General is bound in a way that the companies or private individuals are not. It came out very strongly before the Committee that that was looked upon as a very great blot in the matter, and one which should undoubtedly be speedily remedied. Now, my Lords, the next question which arises is this. I will not trouble your Lordships by reading any portions of the Report, because I know that the matter is one in regard to which, in order to explain it clearly, one would have to go rather fully into it; and I think it is best to state the matter simply in a few words. With regard to the Report, this question occurs: Are Her Majesty's Government satisfied that the information we at present possess was sufficiently brought out by the Report of this Committee; or is it, in their opinion, advisable that a Committee of your Lordships' House should be appointed in order to inquire still further into the questions, first, as to the running of overhead wires, and secondly, what would be the best course to adopt with regard to the Post Office undertaking the telephoning of London? If the noble Marquess and the Government are of opinion that a Committee is not necessary, it might be possible to come to a still more speedy decision in the matter, because undoubtedly the information which this Report contains is, one may say, almost exhaustive as far as the present state of the law goes; and I do not think it has much changed since that period. There are various points which are necessary to be considered. In the first place, undoubtedly, the telephone, to be of any service, should be cheap. At the present time it costs £20 a year to each subscriber; consequently, the development it has assumed is perfectly contemptible in comparison with what it might soon become. I see by a book of the Telephone Company's, which I have here, there are only 11,104 subscribers, as far as I can make out; therefore, your Lordships will see that it really is not worth while, in the opinion of many people, to pay this charge of £20 a year. Most of those people who use it are stockbrokers, merchants, and people in business. No doubt, a broker in the City finds it very useful to be able to telephone to his bankers; but to us at the West-End of London, who could likewise use the telephone for our business purposes as well as for our pleasure, that may be considered too high a charge, and we do not feel sufficient temptation to use it and pay £20 a year for that privilege. That is because there has been no development of the system. For that purpose I think we cannot do without the overhead wires. That was brought out fully in the Report. Surely there can be no objection to them. It is a very small wire that is used for this purpose, weighing about 21bs. to the 100 yards, fine copper wire. There is no danger in running these lines of fine copper wire overhead, and it is simply a question whether we should not, under proper regulations, allow the running of these wires in that way. There is no doubt that you cannot so run them unless you have power to take them over the premises of private individuals (always provided that you do not do them any injury) without their consent. The Postmaster General has that power, though if an owner can prove damage the wire has to be removed. But without that power to enable wires to be run over roofs we cannot have a telephone system in London. There is only one other point which I should like to mention before my question is replied to, and that is, that if the Post Office are going to take up this matter and create a Department for this purpose, the question of power really does not signify; but if there is to be any question of deputing these powers to public companies, two things will have to be considered: first, whether the Postmaster General has the right without going to Parliament to concede the powers he at present possesses to a public company— for at present the Postmaster General has not conceded any of his power; he simply gives a licence to the company to carry on the work; and as that cannot develop the system, the first question is, whether the Postmaster General is prepared, in case the Post Office Authorities do not themselves take up the work, to concede his powers; and, secondly, can he concede them without a Special Act of Parliament? That is a very important question. Then there is also the question whether, if this work is to be given to any public company, it is to be made the subject of competition. If so, there must be some limit to the competition, otherwise you will have numerous lines running side by side. If you are only going to give the power to two companies, well and good; but if you are going to give it to three or more it will not do. Even if you are going to have two companies, you will have one person who is a member of one company and another person who is a member of another company desiring to communicate. There will be no communication between the Exchanges of those two companies, and therefore a man who may want to talk to a person who is subscriber of another company will be unable to do so because that person belongs to a different company. Therefore, your Lordships will see that it is necessary there should not be more than two companies, at any rate, on that ground alone. Then, again, you must have overhead wires, and you must consider what the result will be in that respect. In the City of New York, where for many years they allowed this overhead system to go on unimpeded and unchecked, there were sometimes as many as 300 or 400 wires of various kinds—electric, telephone, and telegraph wires running together overhead. Some of them would, perhaps, be dead, and at last they got into such inextricable difficulty with them altogether—there was so much confusion among the various wires and pipes, that they did not know which of them were dead and which were alive. There were live and dead telegraph wires as well as telephone and electric lighting wires; and the end of it all was that the whole thing had to be taken down and put up anew. If you are not careful to prevent it yon will have the same thing with regard to the telephone; and if more than two companies were to start this work, we should get into a state of hopeless and inextricable confusion. I wish, therefore, to ask Her Majesty's Government, in case they do not propose themselves to undertake this work, whether they would propose to put it up to the competition of more than one company, or whether they would give it to one alone? No doubt, if you give this right to a public company, the operations of that public company will largely interfere with the receipts of the Telegraph Department of the Post Office, but I am sure your Lordships will not think that it would be right for a great invention which would be useful to us all to be burked or stopped in its development because it would interfere with the receipts of a venture which the Government bought and took over many years ago. Large profits, are undoubtedly, to be obtained from working a telephone system. The present Telephone Company began by running up their shares in the market to the amount of 300 per cent; that is to say, the £5 shares went up to very nearly £15, and the shares in the sub-companies also went up considerably. Not long ago they combined together and amalgamated their stock. They took their stock at its market value, as they called it, they called that new capital, and they issued it in the form of new shares. That is to say, they practically watered the capital of that company to the extent of the boom that had been given to it; so that that large amount was practically coming out of the profits of the business. I say, therefore, that as the profits of this business are very large, the Government would be justified in charging a very high royalty in reference to conceding the powers which the Postmaster General possesses; and, on the other hand, they might keep under their own control the main trunk lines between the large towns, so that the Exchanges would have to use the Government lines whenever they wished to communicate between the different Exchanges and different systems. Then, undoubtedly, with regard to the municipal telegraph receipts, the telephone will interfere with the telegraph. It is much easier to make a telephonic communication than it is to send a telegraphic message. It is infinitely more convenient to communicate by telephone than by telegram, because you can get an answer at the same time, so that no doubt the telegraph receipts will be interfered with; but the Government will protect itself in that respect by the royalty it will charge. My Lords, my questions are:—First, whether Her Majesty's Government consider it would be advisable to appoint a Committee to inquire into the question of running overhead wires, and also into the question whether it is advisable that the Post Office should itself adopt and carry out the working of this general telephone system; and, secondly, whether Her Majesty's Government would be prepared, if they decide not to take up the working of it themselves, to grant to public companies the rights which the Postmaster General now possesses; and, thirdly, whether they would refrain from giving those rights to more than, say, two companies, owing to the great state of confusion which would arise there from. I think, my Lords, that covers all the questions I wish to ask, and I have only now to thank your Lordships for the patience you have shown in listening to these remarks.

* THE SECRETARY TO THE BOARD of TRADE (LORD BALFOUR of BURLEIGH)

My Lords, as I have the honour to represent the Post Office in this House, your Lordships will allow me to answer the questions which have been put by the noble Duke. At the outset, I say at once that I am sure your Lordships will all agree in the great importance of the subject which the noble Duke has brought before the House, and I am sure we shall be equally unanimous in our desire that no undue obstacle should be put in the way of the development of telephonic communication in this country for the convenience of the public in any way by which that development can be reasonably brought about. The noble Duke referred to the discussion which took place last year in this House upon a kindred subject. The questions which he then brought forward were somewhat different, involving as they did questions regarding overhead electric lighting wires and other matters of that nature, as well as a certain scheme of amalgamation which occupied a considerable part of the speech he then made. Tour Lordships may recollect that in the Motion last year the concluding part of the Motion which he then made for the appointment of a Select Committee foreshadowed and bore some resemblance to the main part of the Motion on the Paper this evening; and, as to that, the noble Marquess at the head of the Government intimated that he did not think it was a desirable subject of inquiry. Now, my Lords, I have to repeat that expression of opinion, and for what I venture to think at the present time is even a stronger reason. As the noble Duke has said, some patents of great importance will expire at the end of the present year, and I am authorised to say that the relations of the Post Office with, the Telephone Companies are at present under the consideration of the Government. Your Lordships will observe that these are matters involving large questions of private right, and, therefore, it is not very desirable that at this stage they should form the subject of investigation by a Committee. It is, therefore, better that the more usual and proper course should be followed, which would be for the Government to make up its mind with regard to what proposals should be made in these matters, that it should then communicate them to Parliament; and that Parliament should express its opinion upon them. Therefore, I hope that, as regards the latter part of the Motion, the noble Duke will not press his request for an inquiry by a Committee of this House. With regard to the first part of the question, there are, of course, not absolutely the same objections to the inquiry; but, under the circumstances which I have mentioned, and considering the fact that it was inquired into by a Committee of the other House so lately as 1885, I venture to express in a general way the opinion that it is undesirable to re-open the matter at the present time. I am far from saying that the whole question was thoroughly threshed out by that Committee; and undoubtedly, as the noble Duke has said, confusion exists in regard to the exact state of the law in the matter, so that if the noble Duke presses for a Committee of inquiry, and will put the exact terms of the Motion and reference on the Paper, I think we may promise to give the matter the most careful consideration; but, at the same time, unless he has good reasons for pressing for it at the present time, I think it is undesirable that the matter should be gone into during the present Session.

THE DUKE OF MARLBOROUGH

My Lords, with regard to the point as to the difference between the Motion of last year and the present one, I wish to avoid bringing in any question as to the electric lighting wires, because that is rather a question for the Board of Trade authorities, and it comes to a large extent under their functions. With regard to the appointment of a Committee of your Lordships' House, until Her Majesty's Government have expressed their intention with regard to the action of the Post Office Authorities, I quite understand that it would be undesirable to inquire into the development of the telephone itself. But with regard to the question of giving power for running over-head wires, I think your Lordships have got complete information in the Report of the House of Commons Committee. The point I would press on Her Majesty's Government is that it is very desirable that Her Majesty's Government should intimate to the public the line of conduct they mean to adopt as soon as possible, and that we should also know, when they do inform us of it, what they propose to do in regard to taking up the work, whether they mean to give these powers to public companies, and the conditions under which those powers should be given. I, therefore, withdraw the Motion as it stands, and leave it to Her Majesty's Government at some future date, which I hope will not be very late in the Session, to state their intention upon the subject.