END OF THE COACHING ERA
What are known as the "palmy days" of the coaching era began about the year 1820, and lasted until 1836. By 1820 the improvements in road-making of Telford and McAdam had led to quicker travelling and the running of far more coaches, at greater speeds, than had previously been the case. By 1836 it was evident that coaching had reached the climax of its popularity, and could not hope to maintain its position against the competition of the railways which were spreading so rapidly throughout the land.
Over 3000 coaches were then on the road, and half of these began or ended their journeys in London. Some 150,000 horses were employed in running them, and there were about 30,000 coachmen, guards, horse-keepers and hostlers, while many hundreds of taverns, in town or country, prospered on the patronage the coaches brought them. From one London tavern alone there went every day over eighty coaches to destinations in the north. From another there went fifty-three coaches and fifty-one waggons, chiefly to the west of England. Altogether coaches or waggons were going from over one hundred taverns in the City or in the Borough.
Big interests grew up in connection with the coaching enterprise. William Chaplin, who owned five yards in London, had, at one time, nearly 2000 horses, besides many coaches. Out of twenty-seven mail-coaches leaving London every night he "horsed" fourteen. He is said to have made a fortune of half a million of money out of the business; but when he began to realise what the locomotive would do he took his coaches off the road, disposed of his stock before the railways had depreciated it, joined with Benjamin Horne, of the "Golden Cross," Charing Cross, who had himself had a large stock of horses, and founded the carrying firm ofChaplin and Horne, which became exclusive agents for the London and Birmingham Railway. When the London and South-Western Railway Company found themselves faced with serious difficulties he devoted alike his means, his experience and his energies to helping them out of their trouble, rendering services so invaluable to the company that he soon became deputy chairman of the line, and was raised to the chairmanship in 1842. Another coach proprietor, Sherman, who had had a large number of coaches running between London and Birmingham, threw in his lot with the Great Western Railway as soon as it was opened, and did much of the London carrying business in connection with that line.
Other coach proprietors there were who, less far-sighted, or less fortunate, held on to their old enterprises, influenced, it may be, by the views of such authorities as Sir Henry Parnell, who, in the second edition of his "Treatise on Roads" (1838), declared in reference to railways:—
"The experience which has been gained from those already completed, and from the enormous expense incurred on those which are in progress, has led to a general opinion that there is little probability of more than a few of these works affording any ultimate return for the money expended upon them.
"The heavy expense which is proved by experience to be unavailable in keeping the railways and engines in repair, where great speed is the object, will in numerous cases soon make it evident that no dividends can be paid to the shareholders, and the cheaper method of using horse-power will be adopted....
"The attaining of the speed of 25 or 30 miles an hour, at such an enormous expense, cannot be justified on any principle of national utility. The usefulness of communication, in a national point of view, consists principally in rendering the conveyance of all the productions of the soil and of industry as cheap as possible.... But a speed of 10 miles an hour would have accomplished all these purposes, and have been of great benefit to travellers, while it could have been attained at from one half to one third of the expense which has been incurred by the system that has been acted upon. It is no doubt true that travelling at the rate of 25 or 30 miles an hour is very convenient, but how it can be made to act so asto contribute very much to the benefit of the country at large it is not easy to discover. Economy of time in an industrious country is unquestionably of immense importance, but after the means of moving at the rate of ten miles an hour is universally established there seems to be no very great advantage to be derived from going faster."
It is true that an acceleration had been effected in the rates of speed attainable on improved roads, under the stimulus of mail and "flying" coaches. But these results had only been secured with consequences for the unfortunate horses which no one possessed of a spark of humanity could fail to deplore. Several coach proprietors, each owning between 300 and 400 horses, informed a House of Commons Select Committee in 1819 that those of their horses which worked within fifty miles of London lasted only three or four years, in which period the entire stock had to be renewed. Mr Horne, of Charing Cross, who kept 400 horses, said he bought 150 every year. On some roads, it was affirmed, the mortality of the horses, due in part to the bad state of the roads and in part to the accelerated speed, was so great that the average coach-horse lasted only two years. On certain roads around London it was necessary to have six horses attached to a coach in order to drag it through the two feet or so of mud which, in wet weather, was to be found on such roads as the one across Hounslow Heath.
In accounting for an increased demand for coach-horses in 1821, a paragraph from the "Yorkshire Gazette," quoted by the "Morning Chronicle" of December 27 in that year, declared that it arose out of the new regulations of the Post Office, which caused the death of two horses, on an average, in every three journeys of 200 miles. "The Highflyer of this city," the paragraph continued, "lately lost two horses, and it has cost the Manchester and Liverpool coaches seventeen horses since they commenced to cope with the mail and run ten miles an hour in place of seven or eight.... Several horses, in endeavouring to keep time, according to the new Post Office regulations, have had their legs snapped in two on the road, while others have dropped dead from the effort of a ruptured blood-vessel or a heart broken in efforts to obey the whip."
On one of the southern roads a coach was put on whichwas run at the rate of twelve miles an hour; but seven horses died in three weeks, and the pace was then reduced to ten miles an hour. An average speed even of six and a half miles an hour was declared to be scarcely possible on some of the roads. "It tore the horses' hearts out."
One cannot wonder that, when the fact of trains on the Liverpool and Manchester Railway doing an average of fifteen miles an hour with the greatest ease, and attaining to double that speed when necessary, became known, humanitarian considerations were, in themselves, sufficient to win preference for rail over road transport.
There was also a practical as well as a humanitarian side to this appalling death-rate among the coach-horses. Thomas Gray, in the course of his "Observations on a General Iron Rail-way," showed that, reckoning the number of coach and postchaise horses at no more than 100,000, and allowing for renewal of stock every four years, keep and interest on capital expenditure, the outlay would amount in twelve years to £34,700,000; while a like calculation, for the same period, in regard to the 500,000 waggon, coach, and postchaise horses employed on the main turnpike roads of the country, gave a total of no less than £173,500,000.
While, again, fair-weather travellers may have enjoyed the scenery and the poetry of motion when seated on the top of a coach going across country in the summer-time, there were possibilities of great discomforts and dangers having to be faced, as well. Accidents were so frequent that it was usual for the coaches to carry a box of carpenters' tools, supplemented in the winter by a snow shovel. Sometimes the coaches stuck in the mire; sometimes they upset. They passed through flooded roads, they were detained by fog, they got snowed up, or their passengers might run terrible risks from frost. On the arrival of the Bath coach at Chippenham one morning in the month of March, 1812, it was found that two passengers had been frozen to death on their seats, and that a third was dying. In the winter of 1814 there was a prolonged fog, followed by a severe snow-storm which lasted forty-eight hours. In one day thirty-three mail-coaches due at the General Post Office failed to arrive. At Christmas, 1836, there was a snow-storm which lasted nearly a week. On December 26 the Exeter mail had to be dug out of thesnow five times. The following day fourteen mail-coaches were abandoned on different roads.
So, in proportion as the railways spread, the coaching traffic declined. In 1839 a London coach proprietor, Mr E. Sherman, of the "Bull and Mouth," told the Select Committee on Turnpike Trusts that the persons then being carried by coach were mostly timid people who did not like to go by railway, though every day it was found that the timidity was lessening, and that many individuals who formerly would not have travelled by train for any consideration were doing so in preference to going by coach.
The severity of the railway competition with the coaches was, indeed, beyond all question; but the coach proprietors considered that their difficulty in facing it was rendered much worse by the heavy taxation on their enterprise.
The earliest stage-coaches, patronised mostly by the poorer class of travellers, were not taxed at all; but when the "flying coaches" and the "handsome machines with steel springs for the ease of passengers and the conveniency of the country" were put on the road and attracted passengers of a better class, the owners of private conveyances began to complain of the unfairness of their being taxed while the owners of public coaches were not. Wanting more money to meet the heavy expenditure on the American war, North met the complaints of the private-carriage owners by putting a tax on the stage-coaches; and the precedent thus established, in or about the year 1780, was followed by later Chancellors of the Exchequer, the taxation being subsequently extended alike to every class of vehicles used for coach traffic and, in 1832, to all classes of railway passengers.
In 1837 a Select Committee appointed to inquire into the taxation of internal communication reported that the taxes then in force in respect to land travelling by animal power were as follows:—
1. Assessed taxes on carriages and horses kept for private use.2. A post-horse duty.3. A duty on carriages kept to let for hire, being £5 5s. on each carriage with four wheels, and £3 5s. for each carriage with two wheels.4. A license duty paid by each postmaster, being 7s. 6d. per annum.5. Mileage duty on stage-coaches.6. A license duty on stage-coaches, being £5 on each coach kept to run, and 1s. on each supplementary license.7. An assessed tax on coachmen and guards.8. An assessed tax on draught horses.
1. Assessed taxes on carriages and horses kept for private use.
2. A post-horse duty.
3. A duty on carriages kept to let for hire, being £5 5s. on each carriage with four wheels, and £3 5s. for each carriage with two wheels.
4. A license duty paid by each postmaster, being 7s. 6d. per annum.
5. Mileage duty on stage-coaches.
6. A license duty on stage-coaches, being £5 on each coach kept to run, and 1s. on each supplementary license.
7. An assessed tax on coachmen and guards.
8. An assessed tax on draught horses.
There were many variations in the mileage duty on stage-coaches. In 1780 it was one halfpenny for every mile travelled; in 1783 it was raised to a penny; in 1797 it was twopence, while subsequent increases led up to the highest rate of all—one of fivepence halfpenny per mile for coaches licensed to carry more than ten passengers inside. It was, in part, to moderate the pressure of this tax that Shillibeer introduced the omnibus into London,[52]his first conveyance being a huge, unwieldy conveyance which, drawn by three horses, spread the fivepence-halfpenny mileage duty over twenty-two inside passengers.
The yield from the mileage duty was £194,559 in 1814, £223,608 in 1815 (when there was an increase of one halfpenny per mile for every coach) and £480,000 in 1835.
So long as the stage-coaches were well patronised, little or nothing was heard about all this taxation, which was, in effect, passed on to the traveller, who either paid without grumbling or else grumbled and paid. But when the railways began to divert more and more traffic from the roads, the duties in question fell with special severity on the coach proprietors, who then divided their maledictions pretty equally between the railway companies and the tax-gatherers.
The mileage duty was especially burdensome under the new conditions. Being assessed on the number of persons each coach was licensed to carry, and not on the number of passengers actually carried, it remained at the same amount whether the coaches ran full, half full or empty. The fact that the railways, which were depriving the coaches of their patrons, then paid their halfpenny per mile only on every four passengers actually conveyed became a grievance with the coach proprietors, who thought that the railways should be taxed on the same basis as themselves.
That the taxation pressed heavily on a declining business was beyond all possibility of doubt.
A petition drawn up in 1830 by proprietors of stage-coaches employed on the turnpike roads between Liverpool and various Lancashire towns showed that the taxes they paid to the Government worked out for the year as follows:—
In addition to this they had to pay £8005 13s. 4d. a year for turnpike tolls, while their general expenses, including horses (renewed every three years), harness, hostlers, rent of stables, hay, corn and straw, etc., but allowing for value of manure, came to £64,602 13s. 4d., their total annual expenditure thus being as follows:—
W. C. Wimberley, a coach proprietor of Doncaster, who gave evidence before the Select Committee of 1837, said that the Government taxation on a single coach, the "Wellington," running between London and Newcastle, for a period of 364 days, was as follows:—
The coach also paid, in the same period, £2537 7s. 8d. for tolls.
Another coach proprietor, W. B. Thorne, told the same Committee that on five coaches to Dover he paid for mileage duty alone in the previous year a total of £2273. On his coaches to Liverpool, Manchester and Birmingham he paid £7017 in the twelve months, and the total amount of duty he paid for all his coaches in the year was £26,717. He did not think, however, that relief from taxation would save them from being annihilated by the railways, except as regarded certain roads where the railways did not directly operate against them.
Still another coach proprietor, Robert Gray, admitted to the Committee that he did not think it would be possible for the coaches to compete on the Bath road with the Great Western Railway even if all the duty were taken off.
There was no doubt that the coaches could not have held their own permanently against the railways even if they had been relieved of taxation as soon as the success of their rivals became assured. On the other hand, if the coaches could have been afforded such relief that, while not attempting to compete with the railways on main routes where competition was hopeless, they would have been encouraged to cater for business on routes not then served by the railways, an advantage would have been gained, not only by the coach proprietors themselves, but by the public. The early days of the railway undoubtedly brought serious inconvenience to people who found themselves set down at a station ten, fifteen or twenty miles distant from their home, with no chance of their getting a coach because rail competition and Government taxation combined had made it no longer possible to run a coach on that road. If the taxation had not, as was often the case, made all the difference between profit and loss, many of the coaches would probably have held on a few years longer, by which time the railways would have been more generally developed. As it was they were withdrawn in larger numbers, at an earlier period, than would otherwise have been the case, and there were many instances of great hardship to travellers whose means did not allow of their supplementing an incomplete railway journey by hiring a vehicle specially for themselves.
The report presented by the Select Committee of 1837 admitted the inequalities of the taxation on land travelling as between the coaches and the railways; but, instead of recommending, as the coach proprietors had wanted, that the demands on the railways should be increased, the Committee expressed strong disapproval of any tax at all being imposed on internal communication. They said, among other things:—
"Very valuable evidence was submitted to your Committee by Sir Edward Lees, secretary to the Post Office at Edinburgh, as to the increased speed, security and cheapness with which the post might be conveyed over the cross-roads of Scotland by the establishment of mail cars similar to those now in use in Ireland, thereby increasing the Revenue and opening up districts now altogether destitute of any mode of public conveyance; the same remarks would necessarily apply to many cross-roads in England. The grand obstacle, however, to the establishment of these cars is the heavy taxation on travelling, which utterly deters individuals from engaging in such speculations; while in Ireland, where the roads are decidedly inferior, but where none of these taxes exist, cheap and expeditious public conveyances are everywhere to be found."
The ultimate findings and recommendations of the Committee were summed up in the following emphatic declaration:
"Your Committee earnestly recommend the abolition of all taxes on public conveyances and on carriages generally at the earliest period consistent with a due regard to the financial arrangements of the country."
Unfortunately, the financial arrangements of the country never have allowed of this recommendation being carried out, and a further period of thirty-two years was to elapse before even the moribund stage-coach business was relieved altogether of the obligation to pay mileage duty.
The burdensome nature of these duties on internal communication led to the formation of a "Committee for the Abolition of the Present System of Taxation on Stage Carriages in Great Britain"; and in some "Observations on the Injustice, Inequalities and Anomalies of the Present System of Taxation on Stage Carriages," by J. E. Bradfield, issued by this Committee in 1854, a strong case was made out in favour of such abolition. Bradfield based his main arguments on thecontention that by removing restrictions placed upon the freedom of communication the general welfare of nations was promoted. The taxation of the stage-coaches conferred, he said, no advantage on the coaching enterprise, since none of the money raised in this way was expended on road improvement, while the amount of the taxation often formed an abnormally large proportion of the receipts. He mentions the case of one coach-owner in the Lake District, thirty per cent of whose receipts in the winter had to go to the Government for the duties imposed, not on the amount of business he did, but on the seating capacity of his coaches. In another instance the duties paid were forty-five per cent of the takings. Bradfield thought a fair average for the country in general would be fifteen per cent. The existing system of mileage duties enforced, he declared, an average tax of £80 per annum upon every stud of eight horses employed in stage-coaches, as against £30 for the same number used for postchaises, and £11 8s. in the case of those for private carriages.
Bradfield further quotes a Windermere coach-owner as being of opinion that there was "still great scope for coaches as feeders to the railways if only they were given greater relief in the matter of duties." He expresses his own opinion that "coaches are legitimately the streams by which the traffic should be conducted to the railways," and asks, "Why tax the stream more than the river?"
The steady decrease in the yield from the stage-coach duties was in itself sufficiently significant of the changes in travel that were then proceeding. In 1837 the revenue from the duties was £523,856; but it began to decline steadily as the "palmy days" of coaching came to an end, and in 1841 it had fallen to £314,000. In 1853, when, after various modifications, the mileage duty was three-halfpence a mile, the yield was only £212,659. In 1866, after further modifications, the duty was reduced to a farthing; and in 1869 it was repealed altogether; though by that time the locomotive had supplanted the stage-coach except in a comparatively few localities where it still lingered, mainly, however, as a feeder to the railway.
The recent revival of coaching comes under the category of sport or recreation rather than under that of internal transport and communication.
RAILWAY RATES AND CHARGES
The combined result of (1) a vast increase in industrial production; (2) the decline in river, canal and road transport; and (3) the various conditions which checked competition on and between the railways was to increase greatly the need for transportation facilities, and to make traders and the public in general more and more dependent on the one means of consignment and locomotion thus so rapidly becoming paramount. Coupled with the many technical details which, as pioneers of the railway system, the English companies had to work out for themselves, and, also, with the questions arising as to the future relations between the railways and the State, there were the further problems as to (a) the means to be adopted to ensure that the rates and charges were reasonable, and not likely to become unjust or oppressive, and (b) the bases on which the rates and charges should themselves be fixed in order to secure due regard for the public interests, to guarantee the operation of the railways on commercial lines, and to ensure for the railway investors a reasonable return on their investments.
The earliest railway rates of all were simply a toll (as on a turnpike road) at the rate of so much per mile, or so much per ton per mile, for the use of the rails, with an extra charge if the railway owners supplied the waggons. This was the practice in vogue down to the Surrey Rail-way period, the tolls for such use of road being fixed by Parliament because of the railway lines being a monopoly.
The next development came when the Stockton and Darlington Railway Company obtained powers to supply haulage by steam power or steam-engine, and were authorised by Parliament to charge a "locomotive toll," in addition to the road toll, when the trader made use of the company's engines.
There was a further development when the railwaycompanies undertook the functions of carriers, provided waggons, carriages and staff, and were authorised to make a charge for the "conveyance" of goods.
Parliament did not, at first, specify the amounts of the locomotive and conveyance tolls, but simply required that they should be "reasonable," the expectation at that time being that these tolls would be kept to reasonable limits by the competition of the outside carriers. When it was found that the outside carriers would not run their own locomotives on the railway, and that the railways would do their own carrying, the amounts which could be levied as locomotive and conveyance tolls were specified in the special Acts of the companies concerned.
At one time, therefore, the railway companies were authorised by their Acts to impose three separate charges, (1) road tolls, (2) locomotive tolls, and (3) conveyance tolls; but in 1845 a "maximum rates clause" was introduced which grouped these different tolls into a total charge something less than the aggregate of the three.
In proportion as the railway companies themselves performed the duties of carriers, instead of leaving this branch of the transport business to the outside carrying firms, it became necessary for them to provide goods depôts and warehouses, and to have a staff available for a variety of services—loading and unloading, covering and uncovering, etc.—which were necessary in the handling of the traffic. The companies then claimed that for these "station terminals" and "terminal services" they were entitled to make charges in addition to the maximum rates, whereas it was contended on the part of the traders that these services were included in the maximum rates, and that the companies had no right to charge for them separately. After prolonged controversy and much litigation, the dispute was eventually decided in favour of the companies; but Parliament required them to distinguish the charges for conveyance, terminals, and collection and delivery, and, finally, by the Charges Acts of 1891 and 1892, fixed the amounts of the maximum station and service terminals that each company might demand.
In the meantime much trouble had also arisen as the result of the haphazard fashion in which the railways of the country had been called into being.
The original classification of goods for transport was of the most primitive kind. In the canal companies Acts the authorised tolls and charges were generally specified in respect to only about a dozen different articles. The early railway Acts followed the canal precedent in so far that each of them contained a classification of the goods expected to go by rail, the main difference being that the list given in the railway Acts generally comprised from forty to sixty articles, divided into five or six groups.
As the railways extended, and began to deal with the great bulk of the commerce of the country, these original lists were found to be hopelessly crude and inadequate, and one of the duties undertaken by the Railway Clearing House, first set up in 1847 and incorporated by an Act of 1850, was the preparation of what became known as the Clearing House classification—a work required in the interests equally of the railways and of the traders. At the outset the Clearing House classification comprised about 300 articles. By 1852 the number had increased to 700, and in 1864 it had further expanded to 1300.
The Royal Commission of 1865 recommended that the new and improved classification thus compiled and put into operation by the companies themselves should be the basis of the classification imposed by the special railway Acts. The Committee pointed out that the rates authorised by Parliament were no longer necessarily an indication of the charges actually made in practice since these charges depended, not on the classifications in the companies' Acts, but on the Clearing House classification, by reason of which they were often lower than the statutory maxima. The Committee regarded the classification of the private Acts as defective and inharmonious, and they advised that the Clearing House classification should be enacted by some general Act which might be adopted in the private Acts by reference. The Joint Select Committee of 1872 also advised the adoption of a uniform classification; but it was not until the passing of the Railway and Canal Traffic Act of 1888 that the recommendation was carried out.
This Act of 1888 was, in part, the outcome of reasonable dissatisfaction among the traders.
In the absence, from the outset, of any real and effective system for the organisation of railways in accordance withwell-defined general principles, based on the needs of the country as a whole, great uncertainty existed as to the rates and charges to be paid. There were then no fewer than 900 Acts of Parliament which dealt with the charging powers of 976 past or present railway companies, while the only uniform classification was that of the Railway Clearing House, which had almost entirely superseded the primitive classification in the railway companies' Acts but had not yet received legal sanction.
A recommendation to the effect "that one uniform classification be adopted over the whole railway system" had been made by a House of Commons Select Committee in 1882. They considered that the adoption of this course was necessary in view of the imperfection and want of uniformity in the special Act classifications and charges, in which they had failed to discover any general principle. "In some cases," they said, "reference must be had to more than fifty Acts to determine the various rates the company is authorised to charge."
The position in regard to a new and uniform classification thus so persistently recommended was, however, complicated by the fact that the adoption thereof would involve new maximum rates, since the rates charged for the commodities carried naturally depended on the particular "class" to which those commodities had been allotted. Hence when, by the Railway and Canal Traffic Act of 1888, provision was at last made for a revised and uniform classification, each railway company was further required to submit to the Board of Trade, within a period of six months, revised schedules of maximum rates, with a view to these ultimately—after approval by Parliament—taking the place of the schedules in the existing special Acts. The new scales were, also, to include fixed maxima for "station terminals" and "service terminals," the controversy in regard to which, as already spoken of, was thus to be definitely settled.
The railway companies complied with these requirements, the revised classification and schedules of maximum rates being sent in by March, 1889, to the Board of Trade, which appointed two special Commissioners, Lord Balfour of Burleigh and Mr (afterwards Sir) Courtenay Boyle, to hold an inquiry into them on its behalf. The traders were invited tosend in any criticisms they might wish to offer to the companies' proposals, and by June 3rd no fewer than 4000 objections had been received from over 1500 individuals or trading associations.
By this time the formidable nature of the work that had been undertaken began to be more fully appreciated. Not only were there the 900 Railway Acts dealing with rates and charges, but there were about 18,000 railway stations and some 40,000 pairs of stations between which business was actually transacted in regard to one or more of the 2500 articles that, by this time, were included in the Clearing House classification. As for the rates in force, we have the statement of Sir Henry Oakley that on the Great Northern Railway alone they numbered 13,000,000, while Sir Richard Moon estimated that on the London and North-Western Railway the total at this period was no fewer than 20,000,000.
The task thus imposed by Parliament on the Board of Trade in the revision of rates whose total number seemed almost as countless as the stars themselves was, indeed, of stupendous magnitude, apart altogether from the very heavy labours devolving upon each individual company in the preparation of schedules for its own particular lines. The task itself was, however, rendered still more difficult by the fact that, as pointed out by Mr Temple Franks—[53]
"No principles of revision had been laid down for guidance. The Commissioners were not told to regard either the existing statutory maxima or the actual rates then charged. Amendments to this effect had been rejected in Parliament. The Commissioners, therefore, held that the Legislature contemplated a departure from existing maxima, and that it is equitable 'to make a reduction in their present powers and fix rates based to a great extent on existing rates, but with a reasonable margin of profit for possible changes of circumstances injuriously affecting the cost of or return from the carriage of merchandise by railway.' In determining, however, the principles upon which the future maxima were to be governed, they refused to accept the proposition that they shall coverallexisting rates and non-competitive charges."
With regard to a uniform classification, the Commissioners recommended the adoption, with certain slight changes, of the existing Clearing House classification.
There is no need to record here, in detail, the exhaustive nature of the inquiries, protests, rejoinders, discussions and controversies to which the preparation of the new schedules led. Suffice it to say that these and the revised classification were eventually embodied in a series of Railway Rates and Charges Orders Confirmation Acts which, as applying to the different companies, either individually or in groups, were passed in the Sessions of 1891 and 1892, and came into operation on January 1, 1893. Under these Acts the scales of charges are divided into six parts, viz.: (1) goods and minerals, (2) animals, (3) carriages, (4) exceptional, (5) perishable commodities by passenger train, and (6) small parcels by merchandise train. Each rate is made up of two parts—conveyance and terminals. The conveyance scales for all companies are as near alike as circumstances will allow, and the maximum terminals (station terminal at each end and service terminals in respect to loading, unloading, covering and uncovering) are common to all the Confirmation Acts.
Sir Henry Oakley, who was at this time acting as secretary of the Railway Companies' Association, declared concerning the new conditions thus brought about in regard to the bases of railway rates and charges that "practically they amounted to a revolution." The maximum powers were reduced almost universally; the classifications of the companies' own Acts were abolished, and a new and uniform one substituted; various new scales were introduced; the obligation was now for the first time thrown upon the companies of carrying perishables by passenger train; and a new system of calculating rates was established. "It was not," said Sir Henry, "so much per mile for any distance beyond six miles, as it was in the original Acts, but for the first twenty miles a certain rate, for the next thirty miles a certain less rate, and for the next fifty miles a still further reduction, the effect being that, by that mode of calculating, the longer the distance the goods were carried the less the average rate per mile that was to be charged."
Within a very short time, however, of the new rates coming into force, there were louder and more vehement proteststhan ever on the part of the traders. The advantages of a uniform classification were fully realised, and the traders naturally did not object to the fact that (as stated in evidence by Sir Henry Oakley, in 1893), from thirty to forty per cent of the existing rates had been lowered. But they did object most strongly when they found that certain of the rates had been increased.
It was explained by some of the railway companies that, owing to the vast number of the rates involved, and to the short time between the passing of their Rates and Charges Orders Confirmation Act and the 1st of January, 1893, when such Act came in force (the period in question being in some instances not more than about four months), it had been impossible for them to complete the revision of their rate-books by the date mentioned. The class rates were ready, and what had happened was that these had been temporarily substituted for the special rates when time had not allowed of the latter being duly revised.
On the other hand it was alleged against the companies that, apart from any question of shortness of time for their revisions, they had sought to adopt a policy of recoupment, specially low non-competitive rates having been raised to the new maxima with a view to counterbalancing the decreases.
While the plea of the companies in respect to shortness of time was abundantly warranted, the counter-allegation of the traders would appear to have been not without foundation, in view of the fact that the setting of increases against the decreases was defended by the companies on the ground that, being corporations based and operated on commercial principles, they were bound to see that their revenue did not suffer, while, it was further pleaded, they were still charging no more than the rates which, having been expressly sanctioned by Parliament, were, presumably, reasonable. They gave the assurance, however, that the rates were still undergoing revision, and that the increases made were not necessarily final. They further undertook that no increases should be made which would interfere with trade or agriculture, or diminish traffic, and that, unless under exceptional circumstances, there should be no increases at all which exceeded by five per cent the rates in force in 1892.
The undertaking thus given failed to satisfy the Select Committee appointed in 1893 to inquire into these further grievances. The Committee, in their report, expressed the opinion that the course taken by the companies had been "mainly actuated by their determination to recoup themselves to the fullest extent by raising the rates of articles where the maximum rates were above the actual rates." They were of opinion that the rates not reduced by the new maxima should have been left untouched; and they affirmed that "the margin between the old actual rates and the present Parliamentary maxima was not given by Parliament in order that immediate advantage should be taken of it, or that the policy of recoupment should be carried on, but only to meet certain contingencies, such as rises in prices and wages," etc. They also recommended that further steps should be taken to protect traders from any unreasonable raising of rates within the maxima, the Railway and Canal Commission being empowered to deal with such questions as they arose.
The outcome of all this controversy was the passing by Parliament, in the following Session, of the Railway and Canal Traffic Act, 1894, which introduced an entirely new principle in railway operation.
Turnpike trustees had always had full power to reduce and subsequently to advance their tolls, at their own discretion, provided they never sought to exceed the maxima imposed under their special Acts; and down to this time it had been assumed that railway companies had similar powers in regard to maxima which Parliament had already expressly sanctioned in the Act or Acts of each individual company. There was—and still is—no question (except in cases of "undue preference" or "through rates") as to the right of a company toreducea rate, or to transfer a commodity to a lower class, thus effecting the same object; and there was, down to 1894, equally thought to be no question as to their right to increase a rate within the same limitations as those applying to turnpike trustees.
What the Act of 1894 did was to restrict the powers of railway companies to increase their rates even within the range of their statutory maxima. It enacted that in the event of complaints being made of any increase of rates, direct or indirect, since December, 1892 (and under the Act of 1888a railway company had already been required to give public notice of any increase in tolls, rates or charges it proposed to make), "it shall lie on the railway company to prove that the increase is reasonable"; and for this purpose it is not to be "sufficient to show that the charge is within any limit fixed by an Act of Parliament or by any Provisional Order confirmed by Act of Parliament." Complaint is first to be made to the Board of Trade, and, if agreement between the trader and the railway company should not follow thereon, the trader has the right of appeal to the Railway Commissioners, to whom jurisdiction to hear and determine such complaint is given. "So that," as Butterworth remarks in his "Maximum Railway Rates," "the legislation of 1888-1894 presents this remarkable result—that Parliament in 1892, after probably the most protracted inquiry ever held in connection with proposed legislation, decided that certain amounts were to be the charges which railway companies should for the future be entitled to make, and in 1894 apparently accepted the suggestion that many of the charges, sanctioned after so much deliberation, were unreasonable, and enacted that to entitle a company to demand them it should not be sufficient to show" that the charge was within the limit which Parliament itself had previously fixed.
Whether traders have really gained any balance of advantage from this further outcome of legislative policy in the assumed protection of their interests, as against the railway companies, is open to question. On the one hand they have a guarantee against increases that offer even the slightest suggestion of unreasonableness. On the other hand the Act has destroyed the element of elasticity in rate-making, inasmuch as railway managers must needs show extreme caution in granting reduced or "experimental" rates—in the interests of growing industries—when, if the experiment should fail, and the expected traffic not be forthcoming, the company must go through the formality of advertising the "increase" involved in putting the rate back to its former level, and must, also, run the risk of having to "justify" such increase before the Board of Trade or the Railway and Canal Commission. "I know of my own knowledge and my own experience," Sir George Gibb once told a Departmental Committee of the Board of Trade, "that the effect of these sections has been toprevent many reductions of rates that would have been tried experimentally."
When we pass on to consider the principles on which railway rates and charges are based we are met with so many complexities in the solution of transport problems, and with such direct conflict of interests on the part of different groups of traders, that we can in no way be surprised at the controversies and the grievances, real or imaginary, to which the subject has given rise from time to time.
The original idea that railway rates and charges should be fixed on a mileage basis, on the same principle as tolls on turnpike roads and canals, was soon found to be impracticable, and successive Parliamentary Committees have demonstrated its futility; though its advocacy, in one form or another, has not even yet been discarded by those who think that railway rates for any given commodity should be so much per ton per mile for all traders alike, irrespective of distance and all other considerations.
One effect of such a principle of rate-fixing as this would have been to exclude the long-distance trader from any particular market, and to confer an undue advantage on the trader in the immediate neighbourhood, or at a short distance therefrom, who would thus have gained a monopoly of the market, to the disadvantage of other traders and of the local community. Nor would such a system of rate-making have answered for the railway companies themselves, since the discouragement of long-distance traffic would have restricted the area of business, and limited their sources of revenue.
Another once much-favoured theory is that the railways should charge so much for cost of service, plus a reasonable profit for themselves.
Here, in the first place, there is the impossibility of deciding what is the cost of the service rendered in regard to each commodity and each consignment thereof that is carried. No basis exists on which the most expert of railway men could decide the respective costs of transport for each and every article in a train-load of miscellaneous goods, nor could any one apportion the exact amount that each should bear in regard to interest on capital outlay and other standing charges which must needs be covered as well as the proportionate cost of actual operation.