HL Deb 11 July 1901 vol 97 cc21-31

My Lords, Irise to call attention to the Report of the Transvaal Concessions Commissioners in regard to the Netherlands South African Railway Company, and to their finding that— the company did initiate and organise, before war was declared, elaborate plans, and afterwards effectively carried them out, causing great damage, delay, and loss to the Queen's armies"— to ask what fine or other punishment it is intended to inflict for these belligerent operations conducted by a private company against the Queen; also, to ask whether any representations have been made by any foreign Government in regard to this company; and, if so, whether the Papers can be laid upon the Table. I think I may take it for granted that nearly all your Lordships are acquainted with the Report of the Commissioners who were appointed to inquire into the Transvaal concessions—at least, with that portion of their Report which relates to the Netherlands South African. Railway Company. This company has played a very important part in South African history since it was made, some ten or eleven years ago. Your Lordships will remember that the undertaking was essentially Hollander in character. Its administration was composed of nine or ten commissioners, one half at least of whom were Hollanders resident in Holland. Two out of three of the managing directors had to be, and, in. practice, the whole of them were, Hollanders. The company itself had been intimately connected with the Transvaal Government, even so far as this, that it had been entrusted with the collection of part of the customs of the country. In this war the railway company, as I have said, has played a very important part, and I desire to place before the House briefly an account of what has taken place. I am happy to be able to assure your Lordships that it will not be neces- sary for me to read at length long extracts from the three Blue-books, which, however, are amply deserving of careful consideration and attention from your Lordships. It so happens that in this case the evidence is of a very direct kind. Indeed, all the statements which I shall make—and I shall make some very positive statements—are drawn, without exception, from the diary of M. Van Kretschmar, the directing manager of the railway in the Transvaal, from the evidence of officials of the railway who took part in the war against the British Government, and from other direct sources of that kind.

When the war was in contemplation, and some months before it began—in the month, I think, of July—M. Van Kretschmar, who was a Hollander of the Hollanders, or, rather, I ought to say, a Boer of the Boers, took upon himself to become the direct adviser of the Transvaal Government. He saw at that time that they were not, as he thought, properly prepared for the possible invasion of their territories by British troops through Natal. He accordingly consulted General Joubert, and afterwards had a number of interviews with the Transvaal Executive Committee, the result of which was that he concocted and they accepted a plan for the destruction of the bridge at Standerton, and other bridges of the sort. They had it fixed firmly in their mind that there would be an invasion by railway, possibly by armored trains, and they prepared with the help of M. Van Kretschmar to meet that contingency. I shall ask your Lordships to draw a distinction between M. Van Kretschmar in his private capacity, and in his capacity as director of the railway. In his private capacity, as I have said, he was a Hollander of the Hollanders. He hoped and believed that the result of the war would be a Greater Holland. He wrote that— The fall of England shall be the crown of the end of the 19th century. And he thoroughly believed, as appeared from his letters, that the success of the Boers would be quick and certain. When events took a different course, he undoubtedly went through a great deal of agony of mind. His last words were— Gone are the dreams of greater Holland for ever. We have mistaken our kinsmen, who are tired of us. We are too good for them. There is an end for us of all our illusions about South Africa. M. Van Kretschmar is by no means the only person who would be glad to see the fall of England. No one can prevent him entertaining these opinions in his private capacity. But M. Van Kretschmar had another capacity—that of managing director of a private railway. He acted as the trusted adviser of the Transvaal Executive before the outbreak of the war. He went further. He was anxious to take part in the war himself, and to make the officials of his company take part in it. So he suggested to the Executive Government that they should put in force Article 22 of the original concession, under which he hoped that he might be able to do a great deal for them without running very much risk for his company. He proposed to levy a force for them among the officials of the company. I may say that the Transvaal Executive thought, in the first instance, not being very clever, that it was hardly necessary to put Article 22 in force, because they knew how good M. Van Kretschmar's intentions were; but he showed them that it was in his interests, and with a view of saving the company, that he wished it to be put in force, and eventually they did put it in force. Thereupon M. Van Kretschmar proceeded to issue to his staff certain service orders. In the first, on 7th September he announced that half-pay would be allowed to single men and two-thirds pay to married men who were commandeered; and that volunteers would be given leave of absence, but would not receive salary. The latter proved to be rather unfortunate, because there was very little volunteering, and he then issued a further order which said that— The submitting of names to the committees shall not be considered as voluntary offering of services, and is generally recommended. He never warned those who were serving under him, and who were not burghers, that it was not in the power of the Transvaal Government to force them to serve, and after a time he discharged those who would not volunteer. These men went to their consuls and complained, and this is what M. Van Kretschmar wrote to the consuls on 9th March, 1900— When it appeared that the traffic decreased considerably we had a larger staff than we required, who, under the existing conditions, we were entitled to discharge. We considered, however, that these persons also should participate in the advantage which was granted to, those who were compelled to do military duty. Of which offer many availed themselves. Those who do not like this may, according to the provisions applicable to them, obtain their honorable discharge. That was his way of preserving neutrality. The result was that a large body of men entered the service of the Transvaal Republic; and I may say, further, that they received their pay from the company, who, as they said, "debited it to the Transvaal Republic," whatever that might mean. These men did almost incalculable damage to the British forces and colonies. One lot of them—a bridge-destroying lot—went down into Natal, blew up the bridge at Colenso and other bridges lower down, and when the fortunes of war turned, and they were on the retreat, they blew up every bridge in succession. They destroyed the tunnel at Laing's Nek, and subsequently destroyed and made useless a great portion of their rolling stock. Another lot went down into Cape Colony, blew up bridges there, and did other damage. The main body at Pretoria, under M. Van Kretschmar himself, made ammunition, repaired cannon, and discharged active military services of every kind, all the time receiving pay direct from the railway company. The evidence of Lord Roberts and Sir Percy Girouard before the Commission showed that their attitude was insulting and defiant. They said they would obey the orders of no one except the Transvaal Government, and, to quote the words of Sir Percy Girouard, "they behaved precisely as a belligerent State railway." Let us consider for a moment Section 22 of the Concession. I will read it to your Lordships, because it is upon that section that M. Van Kretschmar and his company rely. The section is as follows— In case of danger of war, in war time, or in case of intestine disturbances the Government may, in the interest of the defense or of the public peace, dispose of the railway and all that is required for the use thereof, and may order the ordinary traffic thereon to cease wholly or in part, and command all such measures to be taken as they may deem necessary. What is the meaning of that section, and what did M. Van Kretschmar take it to mean? M. Van Kretschmar took it that it entitled him to raise a force, even composed of persons belonging to nations which were friendly with the British. Government, to assist the Transvaal. The question was put to him by the Chairman of the Commission— Do you consider that an Article in a commercial concession such as Article 22 would justify you in organizing a force of men belonging to nations friendly to the English Government in an army arrayed against that Government? And M. Van Kretschmar replied— Well, I did organize that force, but I think. that the Government had a right to expect us to organize that force from the men in our employ. He interpreted the Article in his own way without consulting any lawyers. But a strange state of things would prevail if a private company were enabled, by any arrangement with the Government, to evade all principles of international law and aid and abet that Government by military action. The undertaking may be a very good one as between M. Van Kretschmar and the Transvaal Government, but what force has it when applied to other countries? Further, did M. Van Kretschmar or his commissioners really believe that their action was covered by this Article? M. Van Kretschmar destroyed a great many papers, but I cannot understand how he was foolish enough to leave his diary and these incriminating letters behind. This is what happened in the first instance. The commissioners were very pleased with what he had done, and asked him to send the names of some of the members of the staff who had performed these valiant actions in order that they might be inserted in the annual report. But, all of a sudden, the commissioners changed their mind, and in reply to a letter from them in April, 1899, M. Van Kretschmar wrote— Your remarks with regard to strict neutrality are not very refreshing to me. I have, by asking for special orders, tried as much as possible to save the appearance of neutrality. According to your interpretation in your last letter I have not always succeeded in this. M. Van Kretschmar's own words were— I am afraid we have hopelessly compromised ourselves in deed, word, and writing. We have made cannon and ammunition; we have sold material to the Republics; we have blown up bridges on English territory, and have not discharged our staff on commando. I must apologies to your Lordships for going through these occurrences, but I have done so as shortly as I could. And now I come to the point. What is to be done to this company? In the first place, what is the amount of damage that has been done? M. Van Kretschmar was asked in the witness-box whether he could form any estimate of the damage, but he said he had no means of doing so. He quite admits that the damage has been enormous; in fact, it is impossible to deny it. What, then, is to be done? This is not a question as to shareholders and debenture holders; it is the case of a private company which has made war on this country. I submit that the question of fining, or of making some arrangement that would really go home to the company, is the first matter that ought to be considered. The commissioners and managers, and the shareholders who elected those officials, were responsible for the conduct of this company. If the Boers had been successful they would, no doubt, have reaped great advantages which they would not have refused to accept; but matters took a different turn, and the company thought it would be well to write to Mr. Chamberlain. The following is the concluding passage of the letter, which is dated 14th January of this year— In conclusion, we beg to point out that His Majesty's Government is now in possession of the company's railway, and that the share holders and debenture holders have for many months been deprived of all receipts from the line. This state of things is financially very serious, and we trust it will not be prolonged. We have not yet been informed whether it is the intention of His Majesty's Government to exercise the rights and fulfill the obligations of the Government which granted the concession, or what other course is in contemplation. This was signed by M. Vanden Wall Bake and M. J. Van Kretschmar, who set to work and organized the destruction of this very railway, and who now say that it is inconvenient that they are not getting any receipts from it. The annual meeting of the company was held at Amsterdam on 29th June. M. Vanden Wall Bake having spoken, a gentleman who appeared for the French shareholders—Maitre Stuart—asked the directors whether they could furnish any information in reference to the statements in the English Blue-book on the Transvaal concessions. A reply was given on behalf of the board, who declared themselves convinced of having done their whole duty, and added that they would not hesitate to do the same should they find themselves again confronted by the same difficulties. That sounded very well, and Maitre Stuart, in the name of the French shareholders, said he "took note of the correct attitude of the representatives of the company." But, in view of the fact that the French group was not represented on the board, he observed that the French shareholders could not assume responsibility for the board, if there should be any question thereof, since the company had been managed exclusively by the German and Dutch shareholders. Maitre van Nicrop, who, I should judge from his name, must have represented the Dutch shareholders, said he had no desire to criticize the proceedings of the board, but he wished to say that, reservation having been made by a certain group of shareholders, he must at least make a similar reservation on behalf of the shares which he represented. Your Lordships will not be surprised to hear that finally the proposal of the board to adjourn the meeting till October was adopted unanimously. It is to be observed that no one is responsible. The directors and commissioners claim to be covered by Section 22, and the shareholders hold themselves as not responsible when assured by their directors that they have done nothing but what was quite correct. A committee to protect the interests of German shareholders, which is called the Schultz Comite, claim to represent 8,699 shares "all honorably transferred since the war began," but I should like to see those transfers. I was very much struck with an enclosure which was sent to the Government by the German Embassy, in which this committee say:— The acquisition of shares has markedly increased in Germany in proportion to the success of English arms in South Africa. And they go on to say:— If the value depreciates just those shareholders will be affected who bought on the strength of the victory of English arms. There's a compliment to this country! The French and the Dutch have started a committee too, and they write over and say they are responsible for 4,695 shares. They do not say they are transfers, but they state that 4,695 "innocent" shares are held in France and in Amsterdam. According to a Return which was issued eighteen months ago at my request the Transvaal Republic held 5,713 shares out of a total number of 14,000. These two committees say they are responsible for 13,394 shares between them, and I desire to know what has become of the 5,713 shares which were held by the Transvaal Republic.

One word with regard to foreign Governments. If there should be any representation made by a foreign Government, the best reply would be to send them a copy of the Blue-books from which I have quoted, and ask them what in their opinion the board deserves. But this is not a question of shares and debentures. What does it matter to us whether these shares are held by Frenchmen, Dutchmen, or Englishmen? The company must stand or fall by the action of its administration, and indemnity is the first and most important question to which His Majesty's Government should direct attention. What is the damage that has been done? None of us can measure it. The war has cost £1,250,000 per week. How many weeks may we fairly attribute to the officials of this company? Immense has been the amount of damage the company has done to its own property that they might do damage to us, and they have persevered in it to the bitter end. If the war had resulted in favor of the Boers we know perfectly well what would have been the result. M. Van Kretschmar and his Hollander compatriots would have profited largely, and so would the shareholders. Fortunately, the war has not ended in that way, and M. Van Kretschmar sees that all his dreams of greater Holland have vanished. What is to be done now? I do not wish to urge a policy of revenge or anything of that kind, but this is a case for the application of the principles of strict justice. A private company has chosen to act as if it were a belligerent nation, and it must take the consequences of such action. It would be an unfortunate thing, indeed, if this private company were to furnish an example to other com- panies that it is possible to defy all the first principles of international law with comparative impunity.


I am sorry to disappoint my noble friend, but I am afraid I must tell him that the question is not one to which it is possible for us to give an answer at present. We have, it is true, had before us for some weeks the Report of the Transvaal Concessions Commission. That Report, however, deals not only with the Netherlands Railway but with many other South African concessions, numbering twenty-three in all. The questions involved are questions of great difficulty and gravity—questions of international law and of general policy, which it is necessary for us to examine not only with the utmost care, but with a full knowledge of the facts, and also with reference to the arrangements which will have to be made for the future administration of the two late Republics. We cannot, in these circumstances, undertake to state at this moment how we shall deal with the particular concession to which the question refers. But I am able to say that it seems to us that in dealing with the holders of the securities of the company we shall have to draw a distinction between those persons who had acquired an interest in the railway as bona fide investors before the outbreak of the war and those whose interest was acquired subsequently. It is also to be borne in mind that the Proclamation of 19th March, 1900, gave notice that Her Majesty's Government would not recognize as valid or effectual— Any alienations of property, whether of lands, railways, mines, or mining rights, within the territories of the South African Republic or Orange Free State, or any interest therein, of whatsoever nature, or any charges or encumbrances of whatsoever description, upon any such property or interest as aforesaid, effected, declared, charged, or made by the Governments of the South African Republic or Orange Free State subsequently to the date of this proclamation. In order to ascertain how far such a distinction as I have suggested can be established, we propose to invite all holders of the securities of the Netherlands South African Railway Company to supply us with full particulars as to the extent of their holding and the date at which they acquired it. Measures will be taken at once with this object. In reply to the other question of the noble Lord, communications have been received from several foreign governments in regard to the pecuniary interests of their nationals in the Netherlands South African Railway.