diff options
Diffstat (limited to 'old/55064-0.txt')
| -rw-r--r-- | old/55064-0.txt | 4171 |
1 files changed, 0 insertions, 4171 deletions
diff --git a/old/55064-0.txt b/old/55064-0.txt deleted file mode 100644 index 86fb3de..0000000 --- a/old/55064-0.txt +++ /dev/null @@ -1,4171 +0,0 @@ -The Project Gutenberg EBook of An Abstract of the Proceedings of the -Select Committee of the House of Comm, by Peninsular and Oriental Steam Navigation Company and Great Britain. Parliament. House - -This eBook is for the use of anyone anywhere in the United States and most -other parts of the world at no cost and with almost no restrictions -whatsoever. You may copy it, give it away or re-use it under the terms of -the Project Gutenberg License included with this eBook or online at -www.gutenberg.org. If you are not located in the United States, you'll have -to check the laws of the country where you are located before using this ebook. - - - -Title: An Abstract of the Proceedings of the Select Committee of the House of Commons, Appointed Session, 1849, to Inquire Into the Contract Packet Service - -Author: Peninsular and Oriental Steam Navigation Company - Great Britain. Parliament. House - -Release Date: July 7, 2017 [EBook #55064] - -Language: English - -Character set encoding: UTF-8 - -*** START OF THIS PROJECT GUTENBERG EBOOK CONTRACT PACKET SERVICE *** - - - - -Produced by Brownfox, Adrian Mastronardi, Wayne Hammond, -The Philatelic Digital Library Project at -http://www.tpdlp.net and the Online Distributed Proofreading -Team at http://www.pgdp.net (This book was produced from -scanned images of public domain material from the Google -Books project.) - - - - - - - - - - AN ABSTRACT - OF THE - PROCEEDINGS OF THE SELECT COMMITTEE - OF THE - HOUSE OF COMMONS, - APPOINTED SESSION, 1849, - TO INQUIRE INTO THE CONTRACT PACKET SERVICE; - IN SO FAR AS THE SAME RELATES TO THE - PENINSULAR AND ORIENTAL STEAM - NAVIGATION COMPANY; - WITH AN - INTRODUCTORY STATEMENT AND REMARKS. - - Presented to the Court of Directors. - - ABSTRACTED AND PRINTED FOR THE INFORMATION OF - THE PROPRIETORS OF THE COMPANY. - - _November, 1849._ - - -As the circumstances connected with the origin and progress of the -Peninsular and Oriental Steam Navigation Company, and particularly with -its employment in the Contract Mail Packet Service, are but imperfectly -known to a great proportion of the present Proprietors; for their -better information it has been deemed advisable by the Directors to -authorise the printing and circulation of the following Statement and -Abstract. - -References, it will be found, are occasionally made to parts of the -proceedings of the Select Committee of the House of Commons, which have -not been printed in this pamphlet, because they would have rendered it -too bulky for convenient perusal. But those who may wish to examine -these proceedings at length, can procure the Parliamentary Blue Book at -Hansard’s offices for the sale of Parliamentary Papers. - - - - -AN ABSTRACT, - -_&c., &c._ - - -In their last Report, presented to the Proprietors at the general -meeting held on the 31st of May last, the Directors stated that a -Committee of the House of Commons had been appointed, “to inquire -into the Contract Packet Service;” and expressed “their satisfaction -that such an inquiry had been instituted, feeling, as they did, that -as far as the interests of this Company were concerned, it would have -a beneficial tendency, by eliciting facts connected with the origin -and progress of the Company, and its employment in the Contract Mail -Service, which could not fail to show the important national benefits -which it has been the means of realising, and its consequent claim to -public support.” - -It is no doubt known to some Proprietors of the Company, that for -several years past statements have been made, and circulated with -untiring pertinacity, to the effect, that the Contracts made by the -Government with this Company for the Mail Packet Service had been -obtained through undue favouritism, or corrupt jobbing[1]--that fair -competition had been denied to other parties,--and that the Company -had, in consequence, obtained a much larger remuneration for the -Service than ought to have been given, and were deriving enormous -profits from it. - -Although the Directors were aware that these misstatements had obtained -some attention, even in influential quarters, they probably did not -consider it was consistent with the eminent position which the Company -occupies to take any legal proceedings against, or to enter into any -public controversy with, the parties who had been chiefly instrumental -in propagating them. - -The forbearance of the Directors has led to a highly satisfactory -result. The continued propagation of these misstatements at last -attracted the attention of a member of the House of Commons so far as -to induce that honourable gentleman to move for a Select Committee to -inquire into the Contract Packet Service. - -Although the Committee was moved for and appointed ostensibly to -inquire into the Service generally, its principal object was, as is -sufficiently obvious from its proceedings, to investigate the Contracts -and transactions of the Peninsular and Oriental Company. And the -earlier part of the proceedings of the Committee also show that the -honourable mover and Chairman of it, actuated, no doubt, by a sense -of public duty, entertained, at first, no very friendly views on the -subject in reference to this Company. - -The facts elicited in the course of the inquiry, and the glaring -self-contradictions exhibited by the principal witness, when brought to -the test of an examination before the Committee, as well as the hostile -tone adopted by him towards this Company, appear, however, to have -satisfied the honourable gentleman that, while induced to believe that -he was prosecuting a public object, and undertaking a public duty, he -had been made use of, for the mere gratification of private feeling. - -And the following two first paragraphs of the Committee’s Report, -which was drafted and proposed by the honourable member himself, are a -sufficient refutation of the misstatements which led to the inquiry. - -1. “That so far as the Committee are able to judge, from the evidence -they have taken, it appears that the Mails are conveyed at a less cost -by hired packets than by Her Majesty’s vessels. - -2. “That some of the existing Contracts have been put up to public -tender, and some arranged by private negotiation; and that a very -large sum beyond what is received from postage is paid on some of the -lines; but, considering that at the time these Contracts were arranged -the success of these large undertakings was uncertain, your Committee -see no reason to think better terms could have been obtained for the -public.” - -As the detached and inconsecutive form in which the evidence of the -different officers of the Government departments was given to the -Committee does not afford a very clear view of the history of the -connexion of this Company with the Contract Packet Service--and, in -particular, does not show the important public advantages which have -been derived from the undertaking of these services by the Company--it -is considered expedient, previously to proceeding with the abstract -of the Committee’s proceedings, to give a brief consecutive statement -of the circumstances under which the various branches of the Contract -Packet Service were undertaken by the Company. And first, - - -No. I. - -THE PENINSULAR MAILS. - -Previous to the 4th of September, 1837, the arrangements for the Mail -Packet communication with the Peninsula were as follows:-- - -Mails to Lisbon were conveyed by sailing Post-office Packets, which -departed from Falmouth for Lisbon every week--wind and weather -permitting. Their departures and arrivals were, however, extremely -irregular; and it was no very infrequent occurrence for the Lisbon Mail -to be three weeks’ old on its arrival at Falmouth, instead of being -brought in five days, with an almost mail-coach or railway precision, -as is now the case. - -The communication with Cadiz and Gibraltar was only once a month by a -steam packet. - -The originators and original proprietors of the Peninsular Steam -Company, who had, for upwards of a year previously to the time above -mentioned, been running steam vessels at a considerable loss between -London and the principal Peninsular ports, finding themselves in -a position to effect a great improvement in the arrangements for -transmitting the Mails, applied to the Government of that day on the -subject, but were at first coldly received, and their suggestions -disregarded. They continued, however, to prosecute their enterprise; -and the celerity and regularity with which their steam packets made -their passages soon began to attract the attention of the public. -The merchants began to complain loudly of the inefficiency of the -transmission of the Mails by sailing packets; and it was at last -intimated, from an official quarter, to the Managers of the Peninsular -steamers, that if they had any plan or proposals to submit for an -improvement of the Peninsular Mail Service, the Government was then -prepared to receive and consider the same. - -In consequence of this intimation, a plan and proposal was drawn up for -a weekly transmission of the Mails between Falmouth and Vigo, Oporto, -Lisbon, Cadiz, and Gibraltar, by efficient steam packets, and at a -cost to the public which should be less than that of the then existing -inferior arrangement--namely, sailing packets to and from the Port of -Lisbon, and a steam packet, once a month only, to and from Cadiz and -Gibraltar. - -The plan, after due examination, was considered to embrace advantages -to the public far exceeding what the then existing arrangements -afforded; and its adoption was consequently intimated to the authors -and proposers of it; but, at the same time, they were informed that the -execution of it would be put up to public competition. - -Accordingly, an advertisement was soon afterwards issued, inviting -tenders, from owners of steam vessels, for conveying the Mails between -Falmouth and the Peninsula, in conformity with the plan submitted by -the Peninsular Company; and the Contract for the Service was competed -for against that Company by the proprietors of some steam vessels, -who, under the designation of the British and Foreign Steam Navigation -Company, had a short time previously commenced running two small -steamers to the Peninsula, in opposition to the Peninsular Company’s -vessels. - -This British and Foreign Company, not being able to satisfy the -Admiralty that they had the means of performing the proposed Service, -their tender was rejected. Upon which they addressed the Admiralty, and -requested that the Contract might be postponed, alleging, that if a -month more were given to them, they could provide sufficient vessels. -Their request was granted; and, contrary to all previous practice, -after the tender of the Peninsular Company had been given in, and the -amount of it, in all probability, known to their competitors, the -Contract was again advertised, and a month more given for receiving -tenders. - -The British and Foreign Company again failed to show that they had any -adequate means of performing the Service; and a private negotiation -was then entered into by the Government, with the Peninsular Company, -with a view to reduce the sum required by them. This sum was £30,000 -per annum, being about £5,000 less than the estimated annual cost to -the public of the sailing packets and steam packet previously employed -in conveying the Mails. This sum was ultimately reduced to £29,600,[2] -on which terms the Contract was concluded on the 22nd August, 1837, -and may be considered to have formed the basis upon which one of the -most extensive and successful steam enterprises yet known has been -established. - -These facts, it is submitted, abundantly show, that so far from any -favour being shown, in regard to this Contract, to the originators of -this Company, they obtained it in the face of adverse circumstances, -and solely because they had, by their own enterprise, placed themselves -in a position to effect an important public improvement, combined with -a reduction of the public expenditure. - - -No. II. - - _Contract for an accelerated Conveyance of the India and other - Mails between England and Malta, and Alexandria._ - -COMMENCED SEPTEMBER 1ST, 1840. - -The efficiency with which the Peninsular Mail Packet Service was -performed elicited from the Admiralty repeated testimonials of -approbation; and, proving as it did, that that description of service -could be more advantageously conducted by private enterprise, under -Contract, than by Government vessels and establishments, paved the way -for the subsequent extension of Contract Mail communication which took -place with the West Indies, North America and the East Indies, China, -&c. - -Previous to the 1st of September, 1840, the arrangements for -transmitting the India Mails to and from Egypt, to meet the East India -Company’s steamers plying monthly between Bombay and Suez, were as -follows:-- - -These Malls were forwarded, every fourth Saturday, by the Contract Mail -steamers of the Peninsular Company to Gibraltar, and there transferred -to an Admiralty steam packet, which carried them to Malta. They were -there transferred to another Admiralty packet, which carried them to -Alexandria. The homeward Mails were brought in a similar manner. - -As the Peninsular packets had to call at Vigo, Oporto, Lisbon, and -Cadiz, in their passage to and from Gibraltar, and the Government -packets were of inferior power (about 140 horses) and speed, the -transmission of the India Mails by this route was very tardy, occupying -generally from three weeks to a month in their passage between England -and Alexandria. - -Imperfect as this mode of transmission was, it probably would have been -continued for an indefinite period, had not some circumstances occurred -to render an alteration of it imperative. - -About the middle of the year 1839, the British Government effected a -convention with the French Government, for transmitting letters and -despatches to and from India, &c., overland, through France, _viâ_ -Marseilles, from whence a British Admiralty packet conveyed them to -Malta. From thence this portion of the Mail, and the larger and heavier -portion, forwarded by the Peninsular and Admiralty packets, _viâ_ -Gibraltar, were carried together to Alexandria by another Admiralty -packet. - -The portion of the Mails forwarded through France was despatched from -the Post-office on the 4th of every month, while the main, or heavier -portion, continued to be forwarded from Falmouth, by the Peninsular -packets, every fourth Saturday; this arrangement was found, in the -course of a few months, to work very awkwardly, inasmuch as the portion -of the Mail forwarded, _viâ_ Gibraltar, had become a fortnight or more -in advance of that forwarded _viâ_ Marseilles, and had to wait that -time at Malta for the arrival of the Marseilles packet. - -This irregularity, which every succeeding Mail increased, together with -the suspicion that the British despatches, in their transit through -France, were not altogether safe from being tampered with, rendered the -Government very desirous of establishing a more accelerated means of -transmission, _viâ_ Gibraltar, for the main portion of the India Mails -and the public despatches. - -The Managers of the Peninsular steamers were applied to, to submit -a plan for this object. They proposed to establish a line of large -and powerful steamers, to run direct from England to Alexandria, and -_vice versa_, touching at Gibraltar and Malta only, and, by such an -arrangement, to transmit the Mails in a time that should not exceed -by more than two to three days that occupied by the overland route -through France; and undertook to execute such service, with vessels -of 450-horse power, for a sum which should not exceed the cost to the -public of the small and inefficient Admiralty packets then employed in -the same service. - -The plan was examined and adopted by the Government; but, as in the -case of the Peninsular Contract, the execution of it was put up to -public tender, by advertisement. And, as appears by the evidence of Mr. -T. C. Croker, of the Admiralty (see his answer to question No. 2,033), -no less than four competitors tendered for the Contract, viz.:-- - - Willcox and Anderson for £35,200 per annum. - J. P. Robinson ” 51,000 ” - Macgregor Laird ” 44,000 ” - G. M. Jackson ” 37,950 ” - -The tender of Messrs. Willcox and Anderson who, as Managers of the -Peninsular Company, had furnished the plan, was accepted, _because it -was the lowest_. But Mr. Croker in his evidence (see Report) has made a -slight error in calculation, in stating the sum at £35,200 per annum. -The tender made was as follows:-- - - For the 1st year of the service £37,000 - ” 2nd year ” 35,000 - ” 3rd year ” 34,000 - ” 4th year ” 33,000 - ” 5th year ” 32,000[3] - ------- - Divided by 5) 171,000 - ------- - Gives for the annual cost £34,200 - ======= - -Besides this reduced sum, as compared with the demands of the other -competitors, the tender of Willcox and Anderson afforded further -important advantages to the public, in a reduced rate of passage-money -for officers travelling on the public service, conveyance free of -Admiralty packages, &c. - -The vessels offered by Willcox and Anderson, were the “Oriental,” of -1,600 tons, and 450-horse power, and the “Great Liverpool,” of 1,540 -tons, and 464-horse power, (originally destined for the transatlantic -line of communication, but which were placed at their disposal by the -Managers and Proprietors of that enterprise). They were also bound to -provide a subsidiary vessel, of not less than 250-horse power, besides -a vessel of 140-horse power, for the Malta and Corfu Service. The -estimate made at the Admiralty (see question No. 1411) of the cost of -the Government packets which performed the service, and which were -superseded by this Contract, was £33,912. But as that estimate did -not include any allowance for interest on their first cost, nor for -sea risk, nor for depreciation, the following per centages on these -accounts must be added to it, in order to present a tolerably correct -view of the actual cost to the public of the service so performed. - -The four vessels employed could not have cost the public less than -£100,000. Upon this sum, therefore, must be calculated-- - - Interest at 4 per cent. - Sea Risk 5 ” - Depreciation 5 ” - -- - 14 per cent. per annum £14,000 - - Add Admiralty estimate of wages, victuals, - coals, and repairs, as above 33,912 - ------- - Total annual expense of these Packets 47,912 - - From which deduct proportion of passage-money - for the public account, estimated - not to exceed 3,000 - ------- - Net cost of the Service £44,912 - ======= - -It hence appears that this Service, which cost, in the defective -state of its arrangements, and as carried on by small vessels of -about 140-horse power, £44,912, was undertaken, and has since been -satisfactorily performed, under a greatly improved arrangement, by -large vessels of 450-horse power, for £34,200, realising a financial -saving of about £10,700 per annum to the country. - - -No. III. - - _Contract for conveying Mails between Suez and Aden, Ceylon, - Madras, Calcutta, Penang, Singapore, and Hong Kong._ - -COMMENCED JANUARY 1ST, 1845. - -For several years prior to the arrangement of the Contract with this -Company, for the accelerated transmission of the India Mails to and -from Alexandria, much public solicitude had been manifested for a more -comprehensive system of steam communication with India than that which -had been established by the Government and the East India Company. That -establishment being considered, as, indeed, at its commencement it was -professed to be, merely a preliminary and experimental one--intended to -pave the way for a more comprehensive scheme, that should embrace all -the Presidencies, and not be limited to the port of Bombay only, as the -Government and East India Line was,--and which it was expected private -enterprise would undertake, after the navigation of the Red Sea, and -other important questions connected with such an undertaking, had been -tested by the Imperial and Indian Governments. - -As a proof of the importance which was attached to this extension of -steam communication with British India, the following declarations of -eminent persons connected with the Government of that empire may be -quoted:-- - -The late Lord William Bentinck, then Governor-General of India, stated, -in a public despatch, that so great were the advantages which it would -confer, “that it would be cheaply purchased at any price.” The present -Right Honourable President of the India Board, Sir John Cam Hobhouse, -who then filed the same post, in speaking in the House of Commons of -various ameliorations which the Government he was then connected with -had in view for India, in which improved steam communication formed -an item, said, that “it was calculated to benefit India to an extent -beyond the power of the most ardent imagination to conceive.” And the -present Lord Bishop of Calcutta, in a public address at a meeting in -that city, said, that “the extension of steam navigation with India -would be opening the floodgates of measureless blessings to mankind.” - -Various attempts, however, under the sanction of eminent merchants, -and other influential parties connected with India, to form a Company -and establish the so much-desired scheme having failed, the parties -who had been instrumental in establishing the Peninsular Company, -and the accelerated conveyance for the India Mails to Alexandria, -feeling that they had placed themselves in a position to effect -this important national object, resolved to adopt it as a part of -their enterprise, which they thenceforth designated “The Peninsular -and Oriental Steam Navigation Company.” It was accordingly formed -into a joint-stock Company, and a Charter of Incorporation from the -Crown was applied for, which, after considerable opposition from -other parties, was granted--but subject to the following conditions, -namely, “That the Company should open an improved steam communication -with India throughout, from England, within two years from the date -of the Charter, or it should be null. That all steam vessels to be -constructed by the Company of 400-horse power, and upwards, should be -so strengthened and otherwise arranged as to carry and fire guns of -the largest calibre then used in Her Majesty’s steam vessels of war. -That the Government should have a power of inspection, as to their -being maintained in good and efficient sea-worthy condition, and that -the Company should not sell any of such vessels without giving the -pre-emption of purchase to the Government.” - -The Company under this Charter having obtained the necessary -additional capital, and being joined also by most of the parties who -had previously been endeavouring to effect this object under the -designation of “The East India Steam Navigation Company,” proceeded, -with all practicable speed, to fulfil the conditions, and carry out the -object of their Charter of Incorporation. - -On the 24th September, 1842, their first vessel destined for the -India Sea service, the “Hindostan,” of 1800 tons, and 520-horse -power, constructed at Liverpool, at a cost of £88,000, was despatched -from Southampton for Calcutta, to open the “Comprehensive” line of -communication, by plying between Calcutta, Madras, Ceylon, and Suez. - -The commencement of this communication, by so large and powerful a -vessel, was looked upon as a public event, and the ship was visited by -members of the then Government, Directors of the Honourable East India -Company, and many other eminent individuals. - -It may here be necessary to advert to a circumstance which has been -made the subject of much misrepresentation, and was even attempted, -although without success, to be misrepresented to the Parliamentary -Committee. (See evidence of Mr. Andrew Henderson in the Report, -questions 2200 to 2208, and 2333, and 2334; also, correspondence -between the East India Company and the Peninsular and Oriental Steam -Navigation Company, in the Appendix, page 224 to 227.) - -The circumstance alluded to was this:--The Directors of the East India -Company, seeing that the extension of steam communication with India -was at last in the hands of parties likely to place it on a practical -basis, and desirous to encourage it on public grounds, voluntarily -proposed to the Peninsular and Oriental Company to give them a premium -of £20,000 per annum, and to continue the same for five years, on -certain conditions, which, if the Company should at any time neglect or -decline to fulfil, it was at the option of the East India Company to -withdraw the premium or grant. - -The conditions were:-- - -1st. That the communication with India beyond the Isthmus of Suez -should be opened, and carried on by vessels of not less than 520-horse -power, and 1600 tons burthen. - -2nd. That a communication between Suez and Calcutta should be -established the first year of the grant. - -3rd. That not less than six voyages between Suez and Calcutta should -be performed, in order to entitle the Peninsular and Oriental Steam -Company to the second year’s grant. - -4th. That a monthly communication between those places should be -established, to entitle the Steam Company to the third and subsequent -years’ grants. - -5th. And that in case a contract should be entered into with the Steam -Company for the conveyance of Mails, the grant should cease, and merge -into such sum as might be paid for that service. - - * * * * * - -Such were the principal conditions of an arrangement which was -attempted to be construed into a Contract, binding the Peninsular and -Oriental Company to maintain a Monthly Mail Packet Service between -Suez and India, with vessels of 520-horse power, for five years, for -£20,000 per annum. It is, however, obvious that so far from such being -the true construction, it was perfectly optional to the Peninsular and -Oriental Company to discontinue the arrangement, and relinquish their -claim to the grant, whenever its continuance might be incompatible with -their interests. - -The Company having constructed another vessel of 520-horse power -and 1800 tons, the “Bentinck,” and purchased a third new vessel, of -similar power and tonnage, the “Precursor,” considered that the time -had arrived when they might improve the postal communication with -India, upon the same principle as that upon which they had improved -the Peninsular and Mediterranean Services, namely, by combining an -important public improvement with a reduction of the public expenditure. - -Finding, from a return which had a short time previously been made -by the East India Company to the House of Commons, that the cost of -conveying the India Mails between Bombay and Suez, as then performed -by that Company, with steam packets of an average power of about 200 -horses each, and some of which were of inferior speed, was not less -than £110,000 per annum,--the Peninsular and Oriental Steam Company -made a proposal to the East India Company, to relieve the latter of -that Service, and to undertake it with their vessels of 520-horse power -each; and thereby effect a considerable acceleration in the transit of -the Mails--an improvement in the accommodation, and a reduction in the -charge for passengers--a greater facility for the conveyance of light -valuable goods and parcels--and a reduction of about £30,000 in the -public expenditure, inasmuch as the Peninsular and Oriental Company -offered to do the service for £80,000 per annum. - -The then Court of Directors of the East India Company being opposed to -the relinquishment of the postal service between Bombay and Suez into -the hands of private enterprise this proposal was not entertained; -and, the matter having engaged the attention of her Majesty’s -Government, it was ultimately arranged that the East India Company -should be allowed to retain the Packet Service between Bombay and Suez, -and that the Peninsular and Oriental Company should submit proposals -for the establishment (under Contract with the Admiralty) of a Monthly -Mail Service between Suez, _viâ_ Ceylon, and Madras and Calcutta, with -vessels of 500 horse-power; and, in connection therewith, a monthly -communication between Ceylon, Penang, Singapore, and Hong Kong, with -vessels of 400 horse-power, thus effecting a Mail communication twice a -month with India, and a Monthly Steam Packet communication with China. - -After a lengthened negotiation a Contract was effected, in virtue of -which the Peninsular and Oriental Company were to receive £115,000 per -annum, equal to about 20s. per mile, for the Suez, Ceylon, Madras, and -Calcutta Service; and £45,000 per annum, equal to about 12s. per mile, -for the Ceylon, Penang, Singapore, and China Service. - -This Contract was not put up to public competition, and there are -obvious reasons to show why to have done so would have been useless, -and unjust. It would have been useless, because it was well known that -there were then no vessels in existence capable of performing such an -extensive service, on the plan proposed, except the vessels which had, -in fulfilment of the conditions of their Charter of Incorporation, -been provided by this Company expressly for the East India Steam -Communication; and it would have been unjust to the Peninsular and -Oriental Company, after they had been induced to embark so large an -amount of capital in providing ships of a description adapted to -important national objects, not to have given them the opportunity of -executing the Service on reasonable terms. - -That the terms concluded upon were as reasonable and advantageous to -the public interests as could have been at that time obtained, is -sufficiently confirmed by the Report of the Parliamentary Committee. - -A few facts may, however, serve to further elucidate this point. - -In giving in their proposals for these Services, the Managing Directors -submitted therewith detailed estimates of the expenses and receipts, -to enable the Government to see and examine the grounds upon which the -sums required for the Mail Service were based. And it appears, by the -evidence taken before the Committee of the House of Commons, as well -as before another Committee of the House of Lords, on the Post-office -Service, (Session 1847,) that this part of the question was subjected -to a very close and rigid scrutiny at the Admiralty. Also, that an -estimate was made to ascertain what the proposed Services could be done -for by public vessels; the result of which was, that it would have cost -by such means not less than 42s. 6d. per mile, (less such returns as -might be obtained from the conveyance of passengers.) - -Looking therefore, to this estimate, and the fact that the Bombay -and Suez Service, with vessels of only about 200 horse-power, was -actually costing, under the management of the East India Company, after -deducting the receipts for passage-money, at the rate of 31s. 6d. per -mile, namely, £110,000 for 70,000 miles, the rates received by the -Peninsular and Oriental Company--being about 20s. per mile for the -Suez and Calcutta Service, and 12s. per mile for the Ceylon and China -Service, or if averaged for the two Services together, about 17s. 1d. -per mile--it cannot be considered as exorbitant by any reasonable or -unbiassed mind; but it will rather be admitted that the Company in -this, as in the previous instances, are entitled to take credit for -effecting a great public improvement, at a less cost than what it -could otherwise have been obtained for. - -The following evidence on this subject was given by Mr. Croker, of the -Admiralty. - - * * * * * - -1388. Does there appear to have been any estimate made by the Admiralty -of the expense of doing that service?--Yes. - -1389. When was that made, or when was it sent to the Treasury?--It -appears to have been sent to the India Board. - -1390. At what date?--On the 20th of January, 1844; the points upon -which they gave information were, “The practicability of the proposal -made by the Peninsular and Oriental Steam Navigation Company respecting -the mode of ‘effecting the accelerated transmission of the East India -Mails and Despatches between Bombay and Suez, combining therewith, -for the year 1844, a two-monthly communication with Calcutta and -Madras.’ The sufficiency of the means which the Peninsular and Oriental -Steam Navigation Company proposed to employ, and the propriety of -their demand of £80,000 per annum for performing a service which the -Admiralty understood to be that then performed by the East India -Company, namely, conveying the mails by steam vessels between Suez -and Bombay monthly; and, in addition to this, between Bombay and -Calcutta every second month.” The estimate then goes on in detail: -and “With respect to the propriety of the demand of £80,000 per annum -the Admiralty forwarded a statement from the Accountant-general of -the Navy, showing that the cost of building and equipment of the four -steam vessels required for the service, under the naval regulations -would be about £250,000, including £6,500 which the Admiralty added to -the estimate of their Accountant-general to meet additional fittings -for the necessary accommodation of passengers. The Admiralty, however, -had every reason to believe that to this estimate of the cost, &c., of -the vessels, which they considered to be absolutely necessary for the -satisfactory performance of the Mail Packet Service in the Indian seas, -the outlay of the Peninsular and Oriental Steam Navigation Company -would be increased by an additional sum of nearly £50,000, for what may -be termed the luxurious accommodation now expected by passengers. Upon -this speculation the Company, of course, subjected themselves to a risk -of loss, or corresponding advantage. With respect to the item of coals, -which was omitted in the Accountant-general’s return, the Admiralty, -in the absence of precise knowledge, estimated the cost upon the best -information they could obtain, and their Lordships considered the -Commissioners for the Affairs of India to be competent judges of the -correctness of their assumed estimate, as well as of the assumed cost -of coal depôts, coaling, and other incidental and contingent expenses. -The item of oil, tallow, &c., was also assumed, as the consumption of -these articles depended on the construction of the engine, both as to -principle and manufacture. In explanation of the differences between -the following calculations and the Accountant-general’s statement, -the Admiralty observed, that the interest of the money was not taken -into account in naval expenditure; and that 15 per cent. for wear and -tear, and depreciation of hull and machinery, had been adopted, with -six per cent. for insurance, in compliance with the suggestion of the -India Board, for the purpose of maintaining a comparative uniformity -with the estimate given in their Secretary’s letter of the 24th of -November, founded upon the Parliamentary documents supplied by the East -India Company. The investment the Admiralty were willing to admit for -the first cost and equipment of three first-class and one second-class -steam vessels, being £250,000; this capital, if dealt with as -suggested, would require an annual expenditure, for performing the Mail -Service between Bombay and Suez, in wages and victuals, of £35,000; -for coals (taken at 48s. per ton,) £29,000; for oil, tallow, &c., -£1,500; 15 per cent. on £250,000 for wear and tear, and depreciation -of vessels and machinery, £37,000; six per cent. insurance, £15,000; -four per cent. interest on capital, £10,000; making £128,300. To this -sum of £128,000 must be added the expenses of coal depôts at Bombay, -Aden, and Suez, and the cost of coaling the vessels at these stations, -&c., which, according to the items supplied by the Parliamentary -document, ordered to be printed on 3rd July, 1843, appeared to be, for -coal depôts, £7,644; wages of mechanics and apprentices not attached -to particular vessels, expense of receiving ships, and miscellaneous -charges of the steam department, £8,594, making a total of £16,238; -thus increasing the amount of annual expenditure by upwards of £20,000, -as the Admiralty considered that at least £4,000 difference must exist -between supplying vessels of more than double the horse power and -tonnage of those of the East India Company, making an annual outlay of -£148,000 per annum for performing a distance of 70,080 miles.[4] The -result of this calculation, therefore, exhibited the comparative cost -of the Mail Service on the line between Suez and Bombay as follows: If -performed by the East India Company, in their, comparatively speaking, -small vessels, as shown by their return to Parliament, after deducting -passage-money, £108,000 per annum, which does not appear to include -the cost of coal depôts. If performed by vessels of 500-horse power, -and 1,500 tons, without deducting passage-money, £148,000 per annum. -If performed by contract, by vessels of 500-horse power, and 1,500 -tons, £80,000 per annum. The Admiralty, in conclusion, observed, that -should a mail communication, as suggested by them, extending from -Suez to Calcutta, be determined on, the increase in the item of coals -(calculated at 33s. 6d. per ton) would be £15,000, and three coal -depôts, with the expense of coaling, &c., might be taken at £20,000 per -annum, in round numbers.” - -1391. What is the date of that report you are reading from?--It is the -report from the Select Committee of the House of Lords, ordered to be -printed 21st June, 1847. - -1392. You spoke of vessels of 1,800 tons, and vessels of 1,500 tons; do -you mean to say they were of that number each, or that there were three -vessels 600 tons each?--1,500 tons each, or 1,800 tons each, the larger -class of vessels. - -1393. If I understand you, from what you have stated from that report, -the estimate of the Admiralty for the cost of their vessels, for three -first-class vessels and one second-class vessel, was £148,000?--Yes, -£148,000. - -1394. That makes no allowance for any receipt from passengers?--It is -without deducting passage-money. - -1395. What was the amount of passage-money deducted from the East India -Company’s account, which comes to £108,000?--That will be shown by the -Parliamentary document ordered to be printed on the 3rd of July, 1843, -I presume; It is not stated here. - - -No. IV. - - _Contract for conveying the Bombay Branch of the India Mails - between Southampton and Alexandria._ - -Two Mail Communications per month with India being thus -established,--viz., that by the Peninsular and Oriental Company to -Calcutta, _viâ_ Ceylon, and that by the East India Company’s packets -between Suez and Bombay,--the Mails for the former being despatched -_viâ_ Southampton on the 20th, by the Peninsular and Oriental Company’s -vessels, to meet the same Company’s vessels plying between Suez -and India, China, &c.,--it became necessary to provide a means of -conveyance for the Bombay branch of the India Mail between Southampton -and Alexandria, which had hitherto been conveyed by the Peninsular and -Oriental Company’s vessels, and was despatched from Southampton on the -3rd of every month. The Government required, at first, a continuous -line of steam vessels, of not less than 400-horse power, to ply between -Southampton and Alexandria, similar to that conveying the Calcutta -branch of the India Mails; and the Peninsular and Oriental Company were -called upon to submit proposals for undertaking the Service on that -plan. - -The Managing Directors represented that to undertake the Service upon -that plan would entail a heavy expense upon the public, inasmuch as the -expense of maintaining such a communication, by such vessels, would be -equal to the expense of the Southampton and Alexandria communication -for the Calcutta branch of the Mails, for which the public were then -paying about £30,000 per annum; while the passenger traffic, _viâ_ -Bombay, would be considerably less, in consequence of the obstruction -presented to the conveyance of goods, and the high charge and -inadequate accommodation for passengers by the East India Company’s -packets. In short, that, looking to these circumstances, £40,000 per -annum would scarcely be remunerative for such an undertaking. - -This plan was, therefore, abandoned; and, after some others proposed by -the Government had been also abandoned, on account of the expense, or -being otherwise found impracticable, the Managing Directors submitted a -plan and proposal for transmitting the Bombay branch of the India Mail -between Southampton and Alexandria, _viâ_ Malta, _without causing any -additional expense to the public_. - -This plan was as follows:--They proposed to convey monthly between -Southampton and Malta that branch of the India Mails, by means of steam -vessels which they had recently placed for commercial traffic, to ply -between Southampton, Malta, Constantinople, and ports in the Black -Sea; and to provide a steam vessel to convey the Mails between Malta -and Alexandria, which should run in concert with these Constantinople -steamers, and the East India Company’s steamers conveying the mails -between Suez and Bombay. This plan was adopted by the Government; -and, after some negotiation, the remuneration for this Mail Service -was fixed at £15,535 per annum, or about 4s. 3d. per mile, on an -arrangement for twelve months only, as the Company wished to reserve -to themselves the option of abandoning it, should it prove seriously -unremunerative, or embarrass their commercial traffic. To meet the -expense of this Service, it was proposed to the Government to withdraw -an Admiralty packet which then formed a monthly communication between -Gibraltar and Malta; inasmuch as the steamers of this Company plying to -Constantinople, touched regularly both at Gibraltar and Malta, on their -passages out and home, and would supply the place of that packet, by -which a saving to the public would be effected of from £7,000 to £8,000 -per annum. Also, that as, with the two lines of India Mail steamers per -month touching at Gibraltar, besides the Peninsular Mail steamers every -week, Gibraltar and the south of Spain would have no less than six -Mails per month, the Peninsular Mail Service might be reduced to three -times a month, or every ten days; for which the Company were willing -to make an abatement of £9100 per annum from their contract-money for -that Service. These suggestions were adopted, effecting a saving to the -public of £16,000 to £17,000 per annum; and, consequently, the monthly -conveyance of the Bombay branch of the India Mails between Southampton -and Alexandria was, by this arrangement, obtained not only free of any -additional expense to the public, but with a financial benefit to it by -an increase of the postage revenue. - - -DISCONTINUANCE OF THE ABOVE ARRANGEMENT. - -This arrangement was not remunerative to the Company, inasmuch as the -expense of the steam vessel, which, in consequence of it, the Company -were obliged to run between Malta and Alexandria, was fully equal -to the whole amount of the sum received for the conveyance of the -Mails between Southampton and Alexandria, and it also subjected the -Company to some additional expenses in carrying on their trade with -Constantinople and the Black Sea ports. - -The Directors have on former occasions publicly stated that they -had, notwithstanding, no intention of breaking up the arrangement, -considering it as a link in the chain of extensive postal -communication, from which, as a whole, the Company were deriving a -large portion of their income. - -The Government, however, thought proper to discontinue it, on the -alleged grounds of its being unnecessary, and that a saving of expense -to the public would be effected thereby. The various memorials from -Bombay, praying in urgent terms for its re-establishment, form a -sufficient refutation of the first allegation. And the facts--that -its discontinuance necessitated the employment, by Government, of an -additional packet, to replace this Company’s vessel, which carried the -Mails between Malta and Alexandria, at an expense exceeding the whole -sum previously paid to the Company--and that the breaking off of an -important branch of postal communication could not fail to cause some -diminution in the postage revenue--are sufficient to show, that so far -from the public being financially benefited by the change, it has been -accompanied by a positive loss. - - - _Termination and Renewal of the Contract of 1840, for conveying - the India and China Mails between England and Alexandria._ - -The result of the recent proceedings of the Government, in reference -to this Contract, has been of a most satisfactory character, not only -as regards the interests of this Company, but the interests of other -extensive enterprises employed in the Contract Packet Service. - -A summary of these proceedings will be found in the evidence of Mr. -T. C. Croker, in his answer to question 1306, wherein he read the -following _précis_ of them, furnished by the Admiralty, viz.:-- - - * * * * * - -“On the 6th January, 1848, the Admiralty gave notice to the Peninsular -and Oriental Company, for the termination of the contract, at the -end of twelve months, on the 18th January, 1849. Their object in so -doing was, to ascertain whether the service could not be done at a -cheaper rate. There had previously been correspondence on the subject -between the Admiralty, the Treasury, and the Post-office; and the -Treasury, by a Minute, dated 4th February, and communicated on the -5th, requested the Admiralty to give this notice. On the 27th of March -the Admiralty wrote to the Treasury, proposing that an advertisement -should be issued, calling for tenders for conveyance of mails to -and from Alexandria. On the 5th of April the Treasury approved. The -advertisement appeared in the _Gazette_ of the 21st of April. It -was for the monthly conveyance of the Calcutta and China Mails and -despatches between England and Alexandria, by way of Gibraltar and -Malta, leaving England on the 20th of each month. The contract was to -commence on the 8th of January, 1849, and to last at least three years. -On the 18th of May two tenders were received, one from the Peninsular -and Oriental Company, for the following sums: for the first year of -contract, £27,500; for the second, £27,000; for the third, £26,500; -for the fourth, £26,000; and so on, reducing £500 for each subsequent -year that the contract remained in force, with two vessels of 450-horse -power, and a reserve vessel of 250-horse power. Another tender was -received from the India and Australia Company for £25,650, offering the -‘Minerva,’ of 400-horse power, 627 tons; the ‘Admiral,’ of 400-horse -power, 929 tons; and one spare steam vessel, of 250-horse power. The -Peninsular and Oriental Company accompanied their tender by a letter, -in which, after stating the grounds upon which they considered that -the Government ought not to take away the conveyance of the Mails -from a Company which had embarked so much capital in the undertaking, -and had performed the service satisfactorily, they propose, that if -the contract is continued to them they will submit the accounts of -all their transactions connected with the mail service, from time to -time, to the inspection of such competent persons as the Government -may appoint; and that when the financial position of the Company, -with respect to such mail service, shall be such as, after making the -customary allowance for the repairs, wear and tear, and sea risk of -the vessels and property, a maximum dividend of 10 per cent. can be -realised, any surplus of earnings over and above such maximum dividend -shall be placed at the disposal of the Treasury, for the benefit of -the public. On the 19th of May the Admiralty wrote, that, previous to -coming to a decision upon the tender, they were anxious to ascertain -whether this proposal, if adopted, might be expected to cause any -deduction, and, if so, to what extent, from the account that would -be paid by the public if their tenders were accepted; they therefore -begged to be informed what surplus of profit beyond a dividend of 10 -per cent., after deductions for repairs, wear and tear, sea risks of -vessels and property, might be expected, from the calculations the -Company were able to make; and whether, in case a satisfactory reply -could not be given to this question, two officers deputed by the -Admiralty might at once have access to the accounts, for information on -that point, and previous to a decision being come to on the tenders. -This latter alternative was at once adopted by the Directors of the -Company, and they opened all their accounts to the inspection of -Captain Ellice and Mr. Bond, who made a report on the subject, from -which it appeared that the Shareholders had never received a dividend -of 10 per cent., and that the balance of receipts, after payment of -all expenses and charges, was not then sufficient for a dividend of -that amount; the Admiralty having ascertained that no diminution of the -tenders was likely to accrue from this proposal, and, considering both -tenders too high, declined them both. The Admiralty then made an offer -to the Peninsular and Oriental Company, founded on the mileage rate, -viz., 4s. 6d. paid to them for the Lisbon and Gibraltar Line. This was -not accepted--but after several interviews with the Directors of the -Company, it was signified to the Admiralty that they would be willing -to undertake the service for £24,000 a year, diminishing annually by -£500, until the expiration of the contract, which was not in any case -to cease before the 1st of January, 1853. The India and Australia -Company also made an offer, which was, however, not admissible, for it -required a fourteen years’ contract; it was for a mileage of 5s. 6d. a -mile for the first seven years, and at 4s. 6d. a mile for the remaining -seven years. They afterwards modified the offer as to the duration of -the contract; and the Government, finding that there were competing -offers before them, determined upon affording another opportunity for -public competition; and on the 2nd of November, 1848, tenders were -again sent in, in accordance with a public advertisement, from the same -parties. The tender of the Peninsular and Oriental Company was higher -than their offer made in pursuance of private negotiation, though the -terms were the same. It was for £26,750, with a diminution of £500 -after the first four years, in the event of its being continued, and -£1,000 additional a year, if the port of embarkation were removed to -Plymouth. The India and Australia Company tendered for £18,450, in two -vessels of 400-horse power, and one reserve of 150-horse power; the -same vessel being mentioned in both tenders, as in the former one. The -lowest tender was directed by the Treasury to be accepted, provided -they could furnish satisfactory security for the due performance of -the service they were to undertake. Much inquiry and negotiation then -took place, and the Company were allowed until the sailing of the -last packet provided for under the expiring contract, to prove that -they had capital sufficient for the undertaking,--but they failed in -showing that they possessed sufficient paid-up capital, and they did -not actually possess the vessels mentioned in their tender, so that on -the 20th December, the Board of Admiralty closed that negotiation, and -having obtained the consent of the Peninsular and Oriental Company to -renew their former offer of £24,000, recommended it for the sanction of -the Treasury, and it was adopted in the existing contract.” - - * * * * * - -The result of this transaction has, there is every reason to believe, -satisfied the Government of the correctness of the opinions which were -pressed upon its attention, on behalf of this Company, in the course of -the proceedings above detailed, namely:-- - -1. That fully recognising, as one of the first duties of a Government, -the protection of the public interests, by economising the public -resources, the mode adopted for doing so, by closing at short periods -and re-opening to public tender these large Contracts for the Mail -Service, is neither effective for benefiting the public, nor altogether -equitable as regards the interests of those private parties who had -embarked capital in the formation of the extensive steam navigation -enterprises, by means of which these important postal communications -were first established. - -2. Because experience has amply proved, that capitalists cannot be -induced to embark their money in any extensive steam navigation -enterprise, intended to compete with one previously established. - -3. Because the very act of terminating these Contracts at short -periods, and then putting them up to public competition, increases -the difficulty of obtaining _bonâ fide_ competitors, inasmuch as no -capitalist of ordinary prudence will embark in an enterprise dependent -for its success upon its employment in a public service of so uncertain -or transient a duration. - -4. Because, were it even possible to create a competing Company on -so extensive a scale as would be required to perform efficiently the -Contract Mail Services alluded to, the two Companies would either, one -or both of them, be ruined--or, what is much more probable, for the -protection of their mutual interests would coalesce, and thus establish -a stronger monopoly than could ever be effected by a single Company. - -5. Because it is but just that parties who have embarked so large an -amount of capital in the establishment of such enterprises, and who -have thereby, as has already been shown, been the means of effecting -important public benefits, should have a preference of employment,[5] -so long as they perform the public service efficiently, and are willing -to do so on terms realising to them no more than a fair commercial -profit. - -6. That there is no practical difficulty in protecting the public -interest, without opening these Contracts to public tender, by either -of the following means:-- - -First, By stipulating for a diminishing scale of payments, on the plan -adopted by this Company in their Contract for the Southampton and -Alexandria Mail Service. The public, by this plan, derive a benefit -from any increase of income which, by the progressive development of -their enterprise, the Contractors may obtain from the increase of -commercial traffic. - -Secondly, By stipulating that, at intervening periods of the Contract, -the question of reduction should be submitted to two competent -arbitrators, one to be appointed by the Government, who should -investigate the Contractor’s transactions, and make an award as to -whether any and what reduction ought to be made in the payment for the -Mail Services. - -The Committee of the House of Commons seem to have recognised the -eligibility of the principle of the last mode of proceeding, in the -third and concluding resolution of their Report, namely--“They suggest -that if it be decided to renew the existing Contracts, the most strict -and searching inquiry should be instituted, by some responsible -department of the Government, into the cost of the execution, into the -manner in which the Service has been performed, and into the profits -resulting from the several transactions to the Companies by which they -have been respectively carried on.” - -This suggestion, it has been shown, was anticipated by the Directors -of the Peninsular and Oriental Company, in offering their books and -accounts to the inspection of Government. - - - - -ABSTRACT - -OF - -EVIDENCE TAKEN BEFORE THE COMMITTEE. - - -_Efficiency of Performance of the Mail Service._ - -Extract from Mr. T. C. Croker of the Admiralty’s evidence. - -1115. Has the contract been well performed?--I can speak from a -knowledge of nine years to the manner in which that contract has been -performed, and it has been performed most admirably, and has given -general satisfaction; in fact, the only fault which has been found with -the manner in which it has been performed is, that it has been done too -well. - -1116. Will you explain what you mean by being done too well?--The -vessels arrived sooner than it was calculated they should have done, -which was made matter of public complaint. - -1176. At our last meeting we had brought your examination down to the -period at which the alteration took place in the arrangements between -the Peninsular Company and the Government?--Yes. - -1177. The Committee then understood from you that up to that period -the contract had been carried on, as far as you were aware, in a -satisfactory manner?--Highly so; here are the testimonials of the -Admiralty as to the satisfactory manner in which the contract was -carried on. - -1606. With reference to the Indian part of it, is it within your -knowledge how far that contract has been performed?--It has been well -performed. - -1607. Throughout?--Yes. - - -_No Breaches of Contract committed._ - -Mr. Croker further examined-- - -1152. Would not the Admiralty agent on board those packets be -cognizant of any breach of contract which had occurred?--Certainly. - -1153. Do not they make reports to the Admiralty through the officers -conducting the packet service at Southampton?--Certainly. - -1154. Would not any breach of contract come immediately to the -knowledge of the Admiralty, through the report of the Admiralty -agent?--Certainly. - -1155. Therefore the absence of any such report is direct proof that the -contract has not been broken, provided the Admiralty agent does his -duty?--Certainly. - - -_Complaints made to the Admiralty against the Company._ - -1974. At your last examination you carried down a statement of any -complaints, or in the absence of any complaints, to a certain date, -with respect to the performance of the contracts of which we were then -inquiring, of the vessels of the Oriental Company; have you furnished -yourself since with any further particulars upon that subject?--This is -a _précis_ of the correspondence respecting complaints of the manner in -which the contract mail service in the Indian and China Seas has been -performed. - -1975. At what date does that _précis_ commence?--The 23rd of August, -1846. - -1976. Does that _précis_ come down to the present time?--It does. - -1977. Who is responsible for that being a correct statement of what has -taken place?--Mr. Worth, the head of the packet department. - -1978. Have you sufficiently examined that _précis_ to be able to give -to the Committee a statement of the number of complaints which are -contained in it?--I should say there were three or four complaints; I -have read it through. - -1979. Were any of those complaints on examination found to be just?--I -think the last complaint is at present undergoing investigation. - -1980. What is the date of the last complaint?--October, 1848. - -1981. Will you state the general grounds of the complaints; were -the complaints of the state of accommodation and the conduct of the -officers on board, or of the time that the vessels occupied upon the -voyage, whether beyond the limited time or not?--The first complaint -states that “Lady Mary Wood” was much out of repair. - -1982. What is the date of that?--The 23rd of August, 1846. - -1983. From whom is that complaint?--Captain Ellice, the superintendent -of the packet service at Southampton. - -1984. He is a Government officer?--Yes; the complaint was that in -consequence she exceeded the contract time by nineteen hours. - -1985. By nineteen hours on the whole voyage, or between England and -Suez?--The statement is, that in her last voyage from Hong Kong to -Ceylon she exceeded the contract time by nineteen hours. - -1986. How is it that the Government agent at Southampton makes a -report of the state of a vessel in the Indian Seas; did he transmit -a complaint from somebody else?--He transmitted a letter from the -Admiralty agent on board. - -1987. What was the result of that complaint?--“The contractor was -acquainted that the Board of Admiralty had been informed that the -‘Lady Mary Wood’ was getting exceedingly out of repair, and requested -to be informed when a vessel, such as is required by the contract, -will be substituted for her. The contractors stated in reply that the -information furnished to the Admiralty was exaggerated; this vessel -had no defects but what could be made good on her return to Hong Kong, -defects mostly caused by the severity of the passage from that port to -Point de Galle; and they inclosed a copy of the carpenter’s report, and -extract of the commander’s letter. They further stated, that (as the -Admiralty is, no doubt, aware) in consequence of the recent demand in -engineering and shipwright work, the builders have not possibly been -able to fulfil their contracts in point of time; and the result is, -that of six steam ships of 450-horse power building for them, not one -is yet completed, though contracted to be delivered within the last -year. They fully expect to be able to despatch one of those vessels in -substitution of the ‘Lady Mary Wood,’ in November next, and a second of -the same class and power about three months after, in substitution of -the ‘Braganza.’” - -1988. What is the date of that letter?--The 28th of August. - -1989. What is the date of the complaint?--The 23rd of August. - -1990. What is the date of the complaint transmitted?--That does not -appear from the _précis_. The Admiralty agent employed on the voyage -from Hong Kong to Ceylon writes this complaint, which reaches Captain -Ellice about the 23rd August, 1846. - -1991. What would be the ordinary length of communication between Ceylon -and Southampton?--That is arranged by the contract; as I have had very -little to do with the contracts in the Indian Seas, I am not prepared -to say. - -1992. Is it not about five months?[6]--Yes. - -1993. Taking it at five months preceding this date of the complaint, -they say that another vessel will be ready by November of the same -year?--Yes. - -1994. What was the result of the complaint as to the want of -punctuality in the time?--The contractors were acquainted, on the -23rd of August, with this complaint, and what I have read is their -explanation. - -1995. The explanation which you have read is with reference to the -non-repair of the vessel, it is not with reference to the time at all. -Is there any letter from the Admiralty, either admitting the excuse to -be satisfactory or otherwise?--The Admiralty seem to have admitted the -excuse, for they minute the letter, acknowledging the receipt of it. - -1996. Did the Admiralty officer on board the ship report anything -respecting the improper state of the ship before leaving Hong Kong?--He -stated that the “Lady Mary Wood” was much out of repair in her last -voyage from Hong Kong to Ceylon. - -1997. It was after his arrival in Ceylon that he made that report?--Yes. - -1998. But he does not appear to have made any statement of that sort -previous to the commencement of the voyage from Hong Kong?--There is -nothing in the _précis_ to show that he did. - -1999. What is the next complaint?--“On the 28th of September of the -same year, Captain Ellice sent a copy of a letter from the Admiralty -agent on board the ‘Lady Mary Wood,’ reporting that vessel having -grounded on a bank of sand or mud off the town of Penang, and reporting -the deficiency of night-signals on board her; and he states that the -vessel was got off on the following day, in a fit state to proceed with -the mails, and, it was supposed, would proceed with the mails to China.” - -2000. What is the next complaint?--The next complaint is transmitted by -Captain Ellice, who sends a report of the survey on the “Braganza,” -held at Hong Kong; he sent this on the 21st of June, 1847. - -2001. What is the result of the survey?--“A copy was sent to the -contractors, and the contractors stated, in reply, that they had -transmitted orders, some time ago, to their agent at Bombay, to have -this vessel docked on the first opportunity, and had reason to believe -that this had been done. They also stated that their new steamships -‘Pekin,’ of 1,200 tons and 430-horse power, and ‘Pottinger,’ of 1,400 -tons and 450-horse power, are now stationed on the line between Point -de Galle and China, in performance of the mail contract service.” - -2002. What is the next complaint?--“On the 2nd of October, Captain -Ellice transmitted an extract of a letter from the Admiralty agent on -board the ‘Pekin,’ reporting the unfitness of that vessel for the mail -service.” This forms a part of Lieutenant Waghorn’s complaint, and is -already before the Committee. - -2003. What was the result of that; was the complaint decided to be -well-founded or not?--I think not. - -2004. Was Lieutenant Waghorn a passenger on board that vessel?--I put -in his letter on the last occasion. - -2005. Will you proceed to the next complaint?--“On the 2nd of June, -1848, the Postmaster-general transmitted an extract of a letter from -the post-office agent at Suez, stating that the ‘Haddington’ was -detained at that port, waiting for the arrival of cargo, until one -o’clock A.M. on the 11th ultimo, although the mails were put on board -at ten minutes past five o’clock on the previous morning; and, further, -that some of the packages forming the cargo were of an unnecessarily -cumbersome size.” - -2006. What was the result of that?--The contractors were called upon to -state whether they can account for this delay; and in reply they state -that they are not aware of this delay, but will call upon the agent at -Suez for explanation; that the mails being transmitted by land from -Alexandria to Suez, there is seldom any variation in the time of their -transit, whilst the passengers and baggage, at the period of low Nile -(May and June), are frequently retarded in getting the steamers round -the bends of the river; and they apprehend that the Admiralty must -have been misinformed as to the size of the packages, the weight of -which are, by their regulation, limited to under 100 lbs., four of such -packages forming a camel load for the desert passage. - -2007. Is there any thing further upon that complaint, because the -Company seem to doubt the fact?--Nothing further appears upon the -subject of the complaint. - -2008. Is there any subsequent report from the Company?--No subsequent -report from the Company appears to have been received. - -2009. Is there any subsequent complaint?--“On the 3rd of October, 1848, -another complaint is made: The Indian and Australian Mail Steam Packet -Company complain that the Peninsular and Oriental Steam Packet Company -do not employ steam vessels of the size required by the contract, -between Suez and Calcutta, and between Ceylon and Hong Kong, and offer -to do the service at less expense.” - -2010. What is the result of that?--“They were acquainted that they had -omitted to state in what particulars they considered the contract with -this Company is now infringed, that the Admiralty were not aware that -any requirements of that contract are not now observed, excepting that -the ‘Haddington,’ temporarily employed in the place of another vessel, -is 442-horse power instead of 500-horse power.” - -2011. Have you any other complaint?--There is no other complaint, but -there is another communication from the Indian and Australian Steam -Packet Company. They “enter into further explanation and remarks, -and hope the contract with the Peninsular and Oriental Steam Packet -Companies may be forthwith dissolved.” That is marked as “read.” - -2012. With reference to the complaint to which your attention was -called the last time you were examined, from Admiral Collier, what -is the result of that?--I have here a paper endorsed, “Complaint of -irregularities in the performance of the East India and China contract, -in the case of the ‘Achilles.’” - -2013. Is that the complaint referred to by Admiral Collier?--It is. - -2014. Was there a letter or memorial of the merchants of Hong Kong -transmitted by Admiral Collier to the Admiralty?--There was. - -2015. What was the subject of that memorial or letter?--The merchants -represented to Sir Francis Collier the serious inconvenience which -they, “and, in particular, the Canton community, have suffered, and -continue to suffer, by the frequent late arrival of the steamers -conveying her Majesty’s mails. The delay seems to have arisen from -the steamers being generally unable to keep the time contracted for -by the Admiralty, for the performance of the several distances, as -will be seen, we believe, by the reports sent home by the Admiralty -agents, appointed to the several steamers. The time slowed is very -ample, rendering it seldom necessary to exceed a speed of eight miles -per hour; and had the steamers been the superior class of vessels -contracted for by the Admiralty, and ‘keeping pace with the advanced -state of science,’ no difficulty in performing the passages within the -specified time ought ever to be experienced. An improvement has lately -taken place in the class of boats, by the arrival of other steamers; -but the system adopted, and particularly, of late, of overloading -them, and to such an extent as to render it necessary to carry a -large quantity of coal on deck, tends to perpetrate the evil, and to -create even greater detention than before, while it greatly endangers -the lives of her Majesty’s subjects, and the safety of her Majesty’s -mails. It is our opinion, that on several occasions it may solely be -attributed to unforeseen and fortunate circumstances that the steamers -have been enabled to reach their destination. Considering the large -sum given by her Majesty’s Government for the purpose of carrying -the mails, and also that thereby the Peninsular and Oriental Company -are enabled to have a monopoly of the traffic on this side of Egypt, -we think the mercantile community have reason to expect that, at all -events, the contract shall be faithfully adhered to, and that the -steamers shall not be allowed to carry beyond a certain and safe amount -of cargo;” and they request Sir Francis Collier to call the attention -of the Lords of the Admiralty to the subject. - -2016. Was that transmitted by Admiral Collier?--It was transmitted to -the Admiralty by Admiral Collier. - -2017. What was Sir Francis Collier’s remark or observation when he -transmitted that memorial?--Sir Francis Collier’s letter does not -appear to be in this correspondence, but I presume it can be produced. - -2018. What was done in consequence of the transmission of that -memorial?--“A letter appears to have been written on the 11th of April, -1849, by the Secretary of the Admiralty to the Peninsular and Oriental -Steam Navigation Company, enclosing a copy of the memorial which had -been received from Sir Francis Collier, and the Company were acquainted -that the Board of Admiralty trusted that they had already taken steps -to prevent the recurrence of the delays complained of.” - -2019. Will you read any previous letter on the same subject which was -laid before the Admiralty by the Peninsular and Oriental Steam Packet -Company?--“Admiralty, 6th March, 1849.” (This is from the Secretary of -the Admiralty to the Peninsular and Oriental Steam Packet Company.) -“Gentlemen, it having been represented to my Lords Commissioners of -the Admiralty that the contract steam packet, ‘Achilles,’ was delayed -in her voyage from Point de Galle to Hong Kong, in November last, -she having sailed from the former place on the 29th of that month, -and not arriving at Hong Kong until the 23rd of December; thus being -175 hours beyond the time allowed by the contract; I am commanded by -my Lords Commissioners of the Admiralty to call your attention to -the circumstance, and to acquaint you that it appears that the place -intended for coals on board the ‘Achilles’ was occupied by opium -chests, and the coals placed on deck, and the vessel overloaded; and -that my Lords are informed that her arrival at Hong Kong, 175 hours -after she was due, was owing to the excess of cargo, and to the -negligent and lazy manner in which the vessel was coaled at Singapore.” - -2020. What was the result of that letter?--The secretary of the -Company answered it on the 10th of March, 1849--“I have the honour to -acknowledge the receipt of your letter, dated 6th instant, calling the -attention of the Directors of the Company to a representation which -has been made to the Lords Commissioners of the Admiralty, that the -Company’s contract steamer, ‘Achilles,’ was considerably delayed upon -her voyage from Point de Galle to Hong Kong, in November last, and -that such delay was owing to the excess of cargo, and to negligence -in the coaling at Singapore. In reply, I am instructed to express the -great regret with which the Directors have received this communication, -and to acquaint you, for the information of their Lordships, that a -rumour having already reached them that some representations of the -kind had been addressed to their Lordships, the Directors, by the -mail of the 24th of February, wrote to the Company’s superintendent -at Bombay, calling upon him for full and immediate explanation of the -circumstances. Until the receipt of his report it will be impossible -for the Directors to say how far the allegations in question are well -founded; but, in the meantime, they are anxious to state that their -standing instructions to all the agents and officers of the Company -are, that the punctual performance of the mail service is to be ever -regarded by them as paramount to every other consideration, and that -any departure from that principle will be visited by the Directors with -the utmost severity. The Directors take this opportunity of acquainting -you, for the information of their Lordships, that having found by -experience that no commercial house, however high its respectability, -can represent the Company so efficiently at foreign stations as an -officer of their own, they, by the last steamer, despatched Captain -Sparkes, lately the Company’s superintendent at Southampton, to relieve -the firm at present acting as the Company’s agents at Singapore, in -the superintendence of the Company’s affairs at that port, and they -feel every confidence that he will actively and zealously discharge his -duties at that station. The Directors also think it right to state, -that from such information as they are at present in possession of, -they have reason to consider that the representation which has been -made to their Lordships is exaggerated, both as regards the extent of -the delay of the ‘Achilles,’ and the alleged causes thereof.” - -2021. This letter is of the date of the 10th of March, 1849; what is -the date of the memorial of the merchants of Canton?--The 29th of -December, 1848. - -2022. Was there any corresponding complaint or representation from the -Admiralty officer on board the vessel to the Lords of the Admiralty?--I -cannot state. - -2023. Was not the first letter which you read in consequence of the -official representations made to the Admiralty, through their officer, -as to the delay of the “Achilles,” previous to the reception of the -memorial from Hong Kong?--I have no doubt it was. - -2024. The Company say, in the letter of the 10th of March, that they -can give no answer to the complaint made of misfeasance in the contract -between Ceylon and China, til they shall receive a report from their -agent at Bombay?--They state that they wrote to their superintendent -at Bombay, calling upon him for an immediate explanation of the -circumstances. - -2025. Do you know that the service is now performed from Ceylon to -China by a vessel that starts from Bombay, and picks up the mail -there?--I believe it is so. - -2026. What was the result of those communications; did the Admiralty -come to any decision upon them?--On the 12th of March, the Admiralty -acquainted the Company that they “were gratified to learn that they -had despatched an officer of their own to act as superintendent at -Singapore, and who may be able to prevent the recurrence of the delay -complained of.” - -2027. Nothing was done by the Admiralty but to express their -satisfaction that the Company had sent out an agent to Singapore, as an -answer to that complaint of the Company overloading their vessels, and -being out of time?--The Admiralty subsequently sent forward the letter -I have read from the merchants, stating, “that their Lordships trust -you have already taken steps to prevent the recurrence of the delays -complained of.” The Admiralty appear to have done nothing more; the -matter is still in the course of investigation; it is not yet closed; -the explanation has not yet been received from the Company.[7] - -2028. Have you any other complaints?--No. - - -_Charge of corrupt Jobbing, and Favouritism by the Admiralty towards -the Peninsular and Oriental Company._ - -Examination of Mr. Andrew Henderson-- - -2138. Am I to understand that you make two complaints: first, that -there was no opportunity for tendering; and, secondly, that the price -was too high?--Yes. - -2139. Were you during the period, from the beginning, in 1844, to -the time at which the contract was finally signed, in constant -communication with the Admiralty?--I used to go to the Contract Packet -Office, which was the only place I could go to; I could get no answer -to my letter. - -2140. Did it come before the Board?--It appears not; Mr. Sidney Herbert -told me that he had never heard of it. - -2141. On the 8th of August Mr. Sidney Herbert told you it was open to -you to send in any contract that you wished?--Yes. - -2142. Did you send in a contract, offering to do the service with -efficient vessels for £60,000?--No; I gave this proof that it could be -done; but I made no tender for it, because I had no vessel for it. - -2143. Your opinion was, that £60,000 was an adequate price, and -that the public in general, and you in particular, ought to have an -opportunity of making a tender; did you tender to do the service at -that price?--In reply to that question I may state, that early in -December the representative of the “Precursor,” Sir George Larpent, -and myself, waited upon the President of the Board of Control, and -asked him to take care that our interests should be considered, and we -received an assurance that they should be considered; and in the scheme -for the mails it is particularly stated that those two vessels were -ready, and it was suggested that they should take alternately the mails -with the other two vessels. - -2144. I ask you whether you did or did not offer to do the service -for £60,000?--I can hardly say whether you can call it an offer, but -I submitted a scheme by which it was shown that it could be done for -£60,000; contracts were not advertised for, and therefore we were not -in a position to send in contracts. - -2145. You placed in the hands of Mr. Crofton Croker a lithographic -statement, from which you considered the inference might be drawn that -£60,000 would be sufficient for that service?--Yes. - -2146. Was that statement anonymous, or was it guaranteed by any -name?--It was guaranteed by my own name; and the same thing was stated -in the plan submitted to Government; and that plan has, every bit of -it, been carried out since. - -2147. My only object is to come to an accurate understanding of the -facts; I understand your grievance to be, that the more expensive -tender, from the Peninsular and Oriental Steam Packet Company, was -accepted by the Admiralty, when a cheaper contract might have been had -from other parties, and that, in your judgment, £60,000 a year would -have been ample for that service; is that so?--My complaint is, that -the proposal of the Peninsular and Oriental Steam Packet Company to -undertake the Bombay mails was not accepted, but that they were allowed -to adopt all my plans, and I was refused all participation in it. It -could not be called a contract, it was not the time for a contract; -contracts were never asked for; but there was clear evidence given -that, if we were allowed to take it, it could be done for £60,000. - -2148. You complain that an unfair advantage was allowed to be taken of -you, by the Peninsular and Oriental Steam Packet Company?--Certainly; -I complain that they were allowed to take advantage of my plans and to -adopt them, and that I was not allowed to compete for the contract. - -2149. In your plan, you said it could be done for £60,000?--Yes. - -2150. Your general plan has been adopted by the Peninsular and Oriental -Steam Packet Company?--Yes; my plan was distinctly opposed to theirs. -Their plan was this: the vessels which were bound to go every month to -Bengal, they purposed that those vessels should go to Bombay, and that -once in every two months those vessels should go to Calcutta. That was, -in point of fact, reducing the present communication, from a separate -mail to Bombay and Calcutta, to one mail to Bombay. - -2151. Your complaint was, that you were excluded from the opportunity -of competing for the contract?--Yes; and that my plans were adopted. - -2152. You have put it on record, that on the 6th of August the -Chancellor of the Exchequer stated to you, that he had given no -authority for the conclusion of the contract?--Yes, he said that he had -nothing to do with it. - -2153. On the 8th of August, two days afterwards, you have put it on -record that the Secretary to the Admiralty told you that it was quite -open to you to send in any tender you pleased?--Yes. - -2154. And it was therefore open to the public in general, and to you in -particular, to put in a tender thereupon?--I sent in a distinct tender -for the China mail. - -2155. But we were speaking of the service for which you say £60,000 -was ample; viz. the Suez and Calcutta service. Confining yourself at -present to that, you were told by the Chancellor of the Exchequer, -on the 6th of August, that the contract was not concluded, and you -were told by the Secretary of the Admiralty, on the 8th of August, -that it was open to you, in particular, to send in any tender for the -conveyance of the mail from Suez to Calcutta?--I was engaged in the -other one at the time. - -2156. Then is there any grievance at all as regards your being deprived -of the mail from Suez to Calcutta?--Certainly, a very great grievance. - -2157. Be as good as to explain what that grievance is?--The grievance -is, that the “India” and the “Precursor” were not allowed to -participate in the advantage. - -2158. Then, whether the sum paid for the service was £60,000 or -£170,000, your grievance is, that the “India” and the “Precursor” did -not come in for a share of it?--That is one point; but, on public -grounds, I maintain that the sum given was a great deal too large, and -that that sum was not given to merchants and shipowners in India, but -to a London company. - -2159. To whomever it was given, £60,000 would have been the sum for -which shipowners would have been ready to do the service?--Yes. - -2160. You had a knowledge of the fact, at the time the tender was open -to you, that it could be done for £60,000?--I had not money enough to -do it. - -2161. Were you not in communication with all the principal shipowners -who signed the petition?--Yes. - -2162. Did you get up the petition which was presented on the 8th of -August?--I did. - -2163. Are those parties whose names were signed to it parties who had -capital to compete for a good contract, if it was to be had?--Certainly. - -2164. Did they, or any of them, send in a tender to the Board of -Admiralty to do this service for £60,000?--No; they stated their belief -that it was of no use to send in a tender, as it would not be attended -to; that the contract would be sure to be given to the Peninsular and -Oriental Company, whatever they chose to ask. - -2165. Did you tell Mr. Green, and all the other parties who signed the -petition, that Mr. Sidney Herbert had told you that it was open to you -to send in a tender?--My impression is that it was known to them, but -Mr. Green said, “No, let them alone; they are too strong for us.” - -2166. Then it was known to Mr. Green, and all the other parties who -petitioned, that they had an opportunity to make a tender?--The -expression they used was, that it was taken out of their hands, and -that it was of no use their doing it; but I do not know that I saw Mr. -Green after that time. - -2167. Do you mean to represent that the principal shipowners having -information that the Secretary of the Admiralty had stated that the -contract was open, were nevertheless of opinion, that if they offered -to do the service for £60,000, the Board of Admiralty would still give -the contract to a party who required a much larger sum?--I hardly know -how to answer that question. I cannot say that I saw Mr. Green after -the petition, but his impression was that it was of no use to compete -with that powerful Company. - -2168. Do you mean to represent to the Committee your opinion that while -the Board of Admiralty told you that you might compete if you pleased, -they had in point of fact made up their minds to give the contract -to the Peninsular and Oriental Steam Packet Company at a much higher -price?--That was our firm belief, that they had made up their minds -to give it to them. This I know as a fact, that when the matter was -handed over from the East India Company, and the East India Company -had nothing to do with it, the Peninsular and Oriental Company asked -£170,000, and they had it all their own way; but the East India Company -said that they would not pay more than a certain amount annually; they -were to pay a certain proportion, but they said, “We will do nothing of -the kind; you may do as you like: we will have nothing to do with it -beyond paying a certain amount.” - -2169. Did it occur to you that if so scandalous a spirit of jobbing -as you describe had actuated the Board of Admiralty, you might have -put them completely in the wrong by offering a contract from parties -competent to perform the service for £60,000, which you laid down as -the proper sum?--I can answer the question in this way: it is all very -well to say, “Why did you not send in a contract?” but it is a contract -that required a large capital and great arrangements. It is impossible -to make all those great arrangements in two days; the Peninsular -Company, by obtaining under false pretences £20,000 for the Calcutta -mail, had put all other parties out; and if you say, “Will you make a -contract in a couple of days now for £60,000?” it is impossible; it -requires a large fleet and great capital. Mr. Green has a large fleet, -but they are employed in other parts; and his expression was, “It is of -no use competing with the Peninsular Company, for they are too powerful -for us; their influence is so great.” - -2170. You mean to represent that all the shipowners in London -acquiesced in the opinion that public money to a large amount was -going to be given from favouritism to the Peninsular and Oriental -Steam Packet Company; but that it was of no use, on account of the -secret influence which the Peninsular and Oriental Steam Packet Company -had got at the Admiralty, to contend with them?--That was my own -individual belief, and the petitioners, I think, agreed in that. - -2171. Did you lend a large share in the drawing up of this petition?--I -did. - -2172. Is it your composition?--I do not know that it is. - -2173. In the petition you object not to one contract in particular, -but to the system of contracts altogether?--We object not to the whole -system of contracts, but to the system under which it has been carried -on; in the first place, there are put into the contracts conditions -which are never acted upon; that I consider extremely wrong; it keeps -all honest men away. - -2174. The stringent conditions put into the contracts keep all honest -men away?--That is going too far; I mean to say that you are asked to -agree to very strict conditions, which a man cannot honestly say, “I -agree to.” If the condition says that if I am half an hour behind time -I shall forfeit £500, a man naturally asks himself, “Shall I enter into -the contract? for if those clauses are inserted, I am a ruined man, and -therefore I cannot guarantee that.” - -2175. If you and your friends had tendered this service for £60,000, -you would have required more reasonable conditions?--I should have -no objection to being bound to all reasonable conditions. The late -contract for the mail to the Brazils is as it ought to be; there is no -kind of trap of so many hours; the condition is simply this, the ships -are to be efficient vessels. - -2176. No honest man, in your opinion, would have undertaken such a -contract as that which the Peninsular and Oriental Company undertook, -for £60,000?--What I mean is this, that no honest man would undertake -a thing which he was not competent to perform; for instance, he would -not undertake that the passage shall be a certain number of hours; and -putting in those strict conditions would prevent an honest man from -taking part in it. - -2177. I understood you to say, that no honest man would undertake, -and therefore I presume you would not have recommended anybody to -undertake, so strict a condition as that of which we are speaking?--I -am afraid you are putting a wrong construction upon what I said; I say, -no honest man would undertake a condition which he could not honestly -say he could perform. If I bound myself to go in a certain number of -hours between certain points, an honest man would say, if that was a -great speed, “I cannot bind myself to accomplish that.” - -2178. That would prevent an honest man from complying with the -conditions imposed upon the Peninsular and Oriental Steam Packet -Company?--That is putting it in the other way; I am certain that I -would have taken the contract, because I know that Government would not -exact the penalty. - -2179. You would have taken it, though an honest man would not have -taken it?--I am afraid you are misinterpreting me; you use the words -“honest man” in a different sense from that in which I use them. I mean -to say that an honest man could not honestly undertake to do a thing -which was almost impracticable; but, as I know the Government would not -have exacted the penalty, I would have taken the contract if I had had -an opportunity; but I had no opportunity. - -2180. You would have taken the contract?--Yes, anybody would take the -contract for £170,000 a year; nobody would have refused it. - -2181. You were under the impression that the Peninsular and Oriental -Company were so strong that nobody could compete with them?--Yes, and -that is the impression now. - -2182. That was your impression at the time you lent your aid to the -drawing up of that petition?--Yes, it was. - -2183. It was the impression, you believe, of the parties who signed the -petition?--Yes. - -2184. Is that, in point of fact, one of the allegations of the -petition?--I do not know. - -2185. Are not the allegations of the petition totally of a different -effect; are they not against contracts in general?--Certainly not -against contracts in general; they are against contracts being given -without fair competition; they are not against contracts generally, for -contracts must be had somehow, but they should be fair and open. - -2186. The prayer of the petition is “that public money granted for the -purposes of steam navigation shall be applied, not for the exclusive -advantage of any companies or individuals, but so that all engaged in -shipping may fairly participate therein, or equally compete; therefore -affording to your petitioners the opportunity of showing to your -Honourable House the truth (if doubted) as to facts and principles of -all the statements of this their humble petition.” If you were under -the impression that the Admiralty were actuated by so corrupt a spirit -that it was not of any use for solvent parties to send in tenders, will -you explain to the Committee why it was that you left that out, as one -of the allegations of the petition which you drew up at the time?--I do -not understand the question. - -2187. Your grievance was, that you were shut out from fair competition -by a corrupt predetermination at the Admiralty to exclude you, and to -give the contract, at all hazards, to the other Company?--In answer to -that, I state the fact that I was not allowed to compete with them in -any way. - -2188. You have told me that you did not send in a tender to the -Admiralty, and that you prepared a petition which you presented to -Parliament; that petition contains no allegation of such a corrupt -predetermination on the part of the Admiralty; having, therefore, such -a feeling in your mind at the time, you neither put it to the test by -sending in a tender to the Admiralty, nor did you venture to state that -in the petition to the House of Commons?--The petition will speak for -itself; it is there. - -2189. There is no such allegation in the petition. What information -has come to your knowledge, since you petitioned Parliament, which -justifies you now in making such an improbable statement here, -viz., that there was that corrupt predetermination at the Board of -Admiralty?--I did not use the word “corrupt.” - -2190. Have you learnt anything since you presented the petition, -which justifies you in making a charge now, which you would not have -been equally justified in making then: it appears that the petition -presented on the 8th August, 1844, contains no such charge of -favouritism against the Board of Admiralty; what information have you -received since that time, which you think justifies you in making the -charge now?--I think it is self*-evident that there most have been -favouritism, or the public would have been admitted, and also from the -way in which the contract has been carried out. The Peninsular Company -have several times broken their contract, and no penalties have been -exacted. There was one distinct case of favouritism, which was this: -one of the reasons assigned to me why the China contract was given to -them was, that the Peninsular and Oriental Company had offered to do it -with vessels of 400-horse power for £45,000 a year; apparently at the -same price as our tender. but ours was to be reduced the third year, -and theirs was to continue at the same rate; but their condition was, -that they were to find vessels, from the 1st July, 1846, of 400-horse -power, and they failed to do so; and in consequence of their not -providing those vessels, the vessels were overworked, and the mails -were delayed; but yet the penalty has not been exacted, and that arises -from favouritism. - -2191. Is your impression that it is one part of the duty of the -Admiralty to take care that the parties tendering are in the -possession of efficient vessels, and are men of sufficient property -and respectability to afford a security that the contract will be -performed?--My opinion is, that a contract of that kind is a matter -which ought not to be left to the Admiralty; it is a matter more -concerning the Board of Trade than the Admiralty; and it is all a -mistake for one department of the Board of Admiralty to have the -management of it. - -2192. Be so good as to inform me whether you think the Government, in -making a contract, are bound to foresee, as far as may be possible, -whether the parties will really be able to fulfil it. You have stated -that the Peninsular and Oriental Company have repeatedly broken or -not performed their contract. Do the Committee understand you to mean -that it is one part of the duty of Government to take precautions -beforehand, that the parties who make a contract shall be capable to -perform the contract?--It is their duty, but I believe in that instance -they neglected it. - -2193. Do you think that if they had selected the owners of the steamer -“India,” they would have selected people more competent to perform the -contract?--To perform the China line; and I may state as the reason, -that we gave them a distinct account of the number of ships at work -there; the expense of the ships, and also a description of the seas; -and the very letter which I wrote to them, as to the necessity of -having a peculiar kind of vessel for the China seas, has turned out -perfectly true; and the protest, of which we heard at the last meeting -of the Committee, was in consequence of that. The letter sent in to the -Admiralty stated that the Calcutta Company were in a better position -to do that local service than the Peninsular and Oriental Company, who -have so many interests to look after. - -2194. The reason you did not compete with the Peninsular and Oriental -Company between Suez and Calcutta, was the impression that you had that -there was a determination at the Board of Admiralty to favour them. -Did you make any attempt to compete with them between Ceylon and Hong -Kong?--As to Suez and Calcutta contract, it is like asking a man who -has his hands tied behind his back, to swim; as to Ceylon and Hong Kong -contract, the answer is plain enough on record, that we sent a tender -and got no answer. - -2195. Am I right in understanding you to say, that you abstained -from competing with regard to the service between Suez and Calcutta, -because you thought the Peninsular and Oriental Company too strong for -you?--That was one reason expressed by many persons; but if you ask -my reason for not competing, it was this: when I proposed to tender, -the “Precursor” party were in possession of the “Precursor,” but in -the interim the Peninsular and Oriental Company very advantageously -obtained possession of the “Precursor,” and we had no large vessels, -and it was of no use tendering without them. - -2196. The reasons for not tendering for the contract between Suez -and Calcutta were two-fold; first, because there was favouritism at -the Admiralty, and secondly, you had not the means of making the -tender?--If the tenders were reasonable, I ought to have had the means, -because we ought to have been allowed to build vessels; when they had -bought the “Precursor,” we were not in so good a position as we had -been in before. - -2197. If it was an object with the Government to make the contract -immediately, you would not be in a condition to make a tender?--There -was no necessity for a new contract; there was no necessity for any -change then, but it was got up by the Peninsular and Oriental Company, -by political agitation. - -2198. I understand you to say, that if there was to be a contract -immediately, you were not in a condition to tender for it, as far as -regards Suez and Calcutta?--I was in a position to tender for it, if -reasonable tenders had been allowed. - -2199. By reasonable tenders you mean that the Government, instead of -taking for the service ships that were then ready to do it, should have -waited eighteen months, in order that you might be put in the same -position?--There was no necessity to wait, as the ships were bound to -carry the mails, whether there was a new contract or not. - -2200. Your opinion is, that there was no necessity for a new -contract?--No, not for five years. - -2201. In your opinion there ought to have been no contract at all?--Not -for the Bengal and Suez line, for five years. - -2202. What ships were bound to carry the mails?--The three ships -which were bound to do the service were bound to maintain a monthly -communication. - -2203. By what engagement?--By an engagement with the East India Company -they were bound to make a monthly communication for £20,000 a year. - -2204. Was there any such arrangement with the East India Company?--Yes. -I had ascertained that there was that arrangement by correspondence, -which is the usual way with great companies. - -2205. Did you ever read the correspondence which passed?--No; I know -that certain deputations went; when I came home from India, I found -among the papers of the East Indian Steam Company a document proving -the terms upon which they were to undertake it. - -2206. Was it not an offer of the East India Company to give £20,000 a -year upon certain conditions?--Certainly not; there was no offer of the -East India Company. - -2207. Your impression of the correspondence that you saw was, that it -was a distinct engagement on the part of the East India Company to -give that sum, and a distinct engagement on the part of the Peninsular -and Oriental Steam Packet Company, at all hazards, to perform the -service?--Yes; but I should go farther than that, in explanation. - -2208. Your impression is, that it was an engagement binding upon both -parties; that the East India Company were bound to pay that sum, and -that the other parties were bound to perform the service, whether -they liked it or not?--My answer to that is, that this £20,000 a year -originated in an amalgamation, or at least a pretended amalgamation, -between the East Indian Steam Company and the Peninsular and Oriental -Steam Packet Company, in 1841. But inasmuch as on 14th October, -1839, the East India Company had replied to the East Indian Steam -Company in London, and again in Calcutta, on the 27th of May, 1840, -to the inhabitants of Calcutta generally, “that to any well-devised -measures, by which the established means of communication might be -extended, the Court would be ready to afford due encouragement; but -in the present state of circumstances they are unwilling now to enter -into any arrangement affecting the measures in progress regarding the -communication between Suez and Bombay;” that letter and publication -was considered as an engagement on the part of the East India Company -to support the extension of a line between Calcutta and Suez. The -consequence of that was, that the “Precursor” built for, and the -“India” was employed upon that line, under the supposition that they -would, when they had adopted this measure, be remunerated. A junction -was proposed between the small section of the London shareholders of -the East Indian Steam Company and the Peninsular and Oriental Company; -and what I say is, that they communicated, either by deputation or by -letter, with the East India Company, and proposed that they should -give them a grant of £20,000 a year, holding forth that the three -parties were to be united. This was a long time in abeyance, but some -time in July, as it appears to me, the proposal of the Peninsular and -Oriental Company was accepted by the East India Company; but at the -time it was accepted, it was accepted upon the recorded opinion that -the interests of the “India” and the “Precursor” party were likely -to be amalgamated with those of the Peninsular and Oriental Company -who had made the offer, and that upon certain terms which are there -stated; they were granted the 20,000 a year provided they made four -voyages the first year, six voyages the second year, and maintained a -monthly communication the third, fourth, and fifth year, with vessels -of 500-horse power, between Calcutta and Suez. - -2209. Am I to understand you to state that the proposal or contract to -which you referred the other day, that the steamers should be 500-horse -power, originated with the East India Company?--No, it originated with -the Peninsular and Oriental Steam Packet Company. - -2210. Then that excluded the “India?”--Yes; the conditions are already -in evidence, in answer to question 1819. - -2211. What was the date of that condition which required vessels of -1,600 tons and 500-horse power?--It was a proposal made originally by -the Peninsular and Oriental Company, early in the year. I believe it -was accepted about the middle of July, 1841; but I was not in this -country at the time. - -2212. From that time to the present, the “India” was excluded from the -benefit of the arrangement?--She was excluded in this way---- - -2213. Was she of the requisite horse power?--I was going to state how -it was proved that she was not. - -2214. That arrangement was made in the year 1841?--Yes; the arrangement -was made by the Court of Directors in July 1841. - -2215. Then the “India” was from that time excluded from the benefit -of the arrangement?--Under the clause requiring 500-horse power, the -“India” was excluded; but the Peninsular and Oriental Company proposed -to purchase her, and after a good deal of squabbling they offered us -£23,000---- - -2216. We do not want to go into that matter; but I understood you to -say that by the original conditions imposed by the East India Company, -in 1841, the steamer “India” was excluded from the benefit of the -arrangement?--She was excluded, but the Peninsular and Oriental Company -asked them to accept her. - -2217. In your former examination, in answer to question 1835, you -stated, “The 500-horse power was put in purposely to exclude all but -the Peninsular Company’s vessels.” Will you state upon what grounds you -attribute to the Admiralty, in 1844, a condition which appears to have -been in force against you, by the orders of the East India Company, as -early as 1841?--I had intended to commence the examination by referring -to my statement with respect to that very case. It is so put here that -I really cannot understand it myself, and I must request to be allowed -to make the explanation of horse power; if you will allow me to make -the explanation of what I mean by horse power, I shall be able to make -my answers intelligible. - -2218. Are you a person of experience in nautical matters?--I profess to -know all that a man who has devoted his life to the subject can know of -the building and working of ships. - -2219. And not only sailing ships, but steam vessels?--Yes. - -2220. Are there two meanings to the term “horse power!”--No; “horse -power” has no meaning at all; if you will allow me to give an -explanation I can state what it is. - -2221. Before you give your explanation, allow me to ask this question, -whether you mean to say that the term “horse power” has no meaning?--It -has no meaning as to the capacity of ships for carrying the mails; that -I assert. - -2222. Then when the East India Company, in 1841, put in a clause that -no vessel employed in carrying the mails should be less than 500-horse -power, they put in a clause which had no meaning at all?--The East -India Company never put in the clause at all; it was put in by the -Peninsular and Oriental Company, with the very object of excluding us. - -2223. Whoever put it in, it had no meaning?--No, it has not, to my -knowledge. - -2224. Then, having no meaning, it had no operation or effect?--It had -the effect of excluding any other vessels but their own, so long as it -was allowed to remain. - -2225. How did it have that effect?--The Peninsular and Oriental Company -having vessels of 500-horse power, which no others had got, they of -course obtained the contract. - -2226. You came here, on the previous day, charging the Admiralty with -having, in 1844, made a certain condition for the purpose of excluding -you, and you have now stated that that condition was in force under -the arrangement made by the East India Company as early as 1841. Will -you have the goodness to explain to the Committee how it is that -you attribute that to the Admiralty in 1844, which appears to have -originated with the East India Company in 1841?--I was mistaken if I -said it originated with the East India Company; it originated with the -Peninsular and Oriental Steam Packet Company. The horse power of a -vessel gives no means of knowing what the efficiency of the vessel is. -There is a good deal of the evidence of the former day which is of no -use, unless you allow me to explain what horse power is. Those answers, -as they stand, I cannot understand myself. - -2227. Do you mean to say, that unless you are to be allowed to show -that the ordinary words “horse power,” when introduced into a contract, -render that contract unintelligible, you cannot explain your case?--I -never said that. May I be allowed to state what I do mean; it takes -a little time and a little trouble to explain the meaning of “horse -power.” The putting in the “horse power” had no reference to the -efficiency of the steam vessels. - -2228. Whatever the horse power meant in 1841, it meant in 1844?--Yes; -but you are mistaken in supposing that I attribute it to the East India -Company putting in that condition; I attributed it to the Peninsular -and Oriental Company. - -2229. We have here a contract made in 1844, by the Admiralty on one -side, and the Peninsular and Oriental Company on the other; and you -charge the Admiralty with having introduced a certain condition for -the purpose of excluding you, and of favouring the Peninsular and -Oriental Company?--No; I said that the Peninsular and Oriental Company -introduced the condition as to the 400-horse power. - -2230. How did they introduce it?--Because they proposed it. - -2231. Do you find fault with a competitor for having proposed vessels -of a higher horse power than yourself?--I do; because they did it to -keep all other Companies out. - -2232. What would you have had the Admiralty do?--I would have had the -Admiralty go and ascertain what the vessels were, and not go upon the -nominal horse power. - -2233. You complain of the Admiralty going upon the individual horse -power?---I do; it is a wrong system. - -2234. Why do you complain of the Admiralty having done that in 1844, -which we find was part of the existing arrangement between the East -India Company and the Peninsular and Oriental Company in 1841?--The -question of horse power began with the Peninsular and Oriental Company -in 1840. - -2235. And I to understand from you, that in your opinion the Admiralty -should have laid down no general condition about horse power, but -should have inquired into the capabilities of each particular ship; -is that your view?--Certainly, that is one view; But as you said, -just now, I had stated that the Peninsular and Oriental Company had -originated that condition about horse power; that is the hinge upon -which all the mischief has turned; and I will now, if I may be allowed, -explain how it occurred. - -2236. The hinge upon which all the mischief has turned, has been that -condition about horse power?--Yes. - -2237. Whatever imputations you have made against the Admiralty of -favouritism, have turned upon improperly requiring a compliance with -that condition?--I do not say that; I say the two things are quite -distinct; but if you will allow me to state how it did occur, I can -explain it; I have a statement here to show how it originated, and -another statement to show what “horse power” really means. I beg to -state that the question of horse power originated in 1840, and it was -the proposal of the Peninsular and Oriental Company; it originated with -them, and not with the Admiralty or the East India Company. - -2254. Do you impute corrupt conduct to the Admiralty, in reference to -the ship “India?”--Certainly not; I think the Committee are labouring -under a mistake in that respect. - -2255. If, in any part of your former examination, you have been -understood to impute either to the Board of Admiralty, or to any -other Government department, any favouritism towards the Peninsular -and Oriental Company, to the exclusion of their competitors, you have -been misunderstood?--As far as the facts are on record, I could get no -answer to my tender; I imputed certainly not a corrupt motive, but I -said that all along I believed they were under a mistake, induced by -this nominal “horse power.” - -2256. In answer to question 2216, you stated that in 1841 the steamer -“India” was excluded, by the conditions imposed by the East India -Company, but that the Peninsular and Oriental Company wished them to -accept her?--Yes, that is so. - -2257. It was, therefore, the East India Company, and not the Peninsular -and Oriental Company, who insisted upon the higher amount of horse -power?--The two things are quite distinct. - -2258. Do you adhere to your answer to question 2216?--So far it is -correct that she was excluded, but the Peninsular Company, after they -had bought her, urged the East India Company to accept her, and said -she was an efficient vessel; they had abused her before, but they then -said she was efficient. - -2259. Are you now speaking of 1841?--Yes. - -2260. Whose property was the steamer “India” in the year 1841?--She was -the property of the Comprehensive party, who sent her out; at the time -this negotiation was going on she was in Calcutta; I do not know what -particular month this alludes to. - -2261. It does not signify where she was?--It occurred in this way: we -will say it was in June; two months would alter the matter altogether; -there was a negotiation; the Peninsular and Oriental Company told the -representative of the “India” in this country, Mr. Mackillop, that -they would amalgamate with him; but the moment they got the engagement -signed, they abused the “India” as much as they could; but when they -found they could get her for little or nothing, then they said they -would take her for £23,000, and they said “We will take her if the East -India Company will pay £20,000 for her hire.” And then they write to -the East India Company, and they say, notwithstanding the condition -about the 500-horse power, that she was an efficient vessel. - -2262. That was the opinion of the Peninsular and Oriental -Company?--Yes; after she was theirs. - -2263. But at that time it was not the opinion of the East India -Company, and they refused it?--Yes. If you will allow me to explain, I -will show that there is a wide difference between the mail contract and -the engagement made with the Peninsular Company. - -2264. In your opinion the Admiralty, making the mail contract on behalf -of the public, were bound to accept a vessel that was not good enough -for the East India Company?--I never said so; but perhaps you will -allow me to put in an explanation of the horse power; I have taken -great pains in preparing it. - -2265. This vessel, whatever be her merits, was rejected by the East -India Company in 1841, though tendered by the Peninsular and Oriental -Company at that time?--She was rejected in a different way---- - -2266. She was rejected, whatever the mode of rejection?--The mistake is -this: you fancy me to have said that the nominal horse power was fixed -by the East India Company or by the Government; now that is a mistake; -neither the one nor the other fixed it. - -2267. Can you answer the question whether the vessel was or was not -rejected by the East India Company?--She was rejected because the -Peninsular Company had proposed the condition with regard to 500-horse -power. - -2268. Was the steamer “India” tendered to the East India Company at -the suit of the Peninsular and Oriental Company in the year 1841, and -rejected by the East India Company?--I was not in this country at the -time, but it must be in the records of the Company. - -2269. Do you believe that your answer to question 2216 was a true -answer?--Yes, it was a true answer. - -2270. And your case now against the Admiralty is, that they rejected -in 1844 the same ship which the East India Company had rejected in -1841?--I cannot see that they have any reference to each other. - -2271. Do you complain of the steamer “India” being rejected by the -Admiralty in 1844?--Yes. - -2272. She having been rejected by the East India Company in 1841?--It -was not for the same service, but for a very different service; but she -was, in fact, employed upon the line. - -2273. I understood you to complain, that in the year 1844, the Board of -Admiralty laid down a certain condition with regard to the horse power -of the vessels to be employed in conveying the mails between Suez and -Calcutta, which condition excluded the steamer “India?”--Yes. - -2274. I understood you also to say, that that very same condition as -to the horse power had been previously laid down by the East India -Company, and that in the year 1841 the steamer “India” was pressed upon -the East India Company by the Peninsular and Oriental Company, who had -expected to buy her as a good bargain; and that the East India Company, -being so pressed, refused to accept her?--I can now explain it. - -2275. Is all that true?--Partly so, but not in the way you put it. - -2276. But are the facts true; yes or no. I have collected the facts -from your previous answers, and am putting them to you again; if any -one of them be inaccurate, point out the one which is inaccurate?--You -ask whether she was rejected in 1841; she was. But allow me to give the -reasons. - -2277. Was she rejected for the service between Suez and Calcutta in the -year 1841?--She was refused to be received under a certain engagement. - -2278. Did the East India Company, in the year 1841, refuse to accept -the “India” steamer for the line between Suez and Calcutta?--Yes, but -that had no reference to her capacity as a mail steamer. - -2279. Be so good, then, as to explain the difference between the -two cases?--The difference was this: in 1841 it was the voluntary -proposition of the Peninsular and Oriental Company to undertake the -communication between Suez and Calcutta, with vessels of 520-horse -power; it was not for a mail contract, a mail contract not being -necessary; and they put in the 520-horse power with the intention, I -believe, of shutting out the “India” and other vessels. It was for -a passenger line, not for a mail line, because the same mails were -carried by Government vessels to Bombay, and therefore there was no -necessity for a mail line, or for her service as a mail packet; but it -had been an object of great consideration, both by the Government at -home and the inhabitants of India, to have a passenger communication -with Calcutta the same to which the remuneration had been promised. The -“India” was on the spot, about to establish that, and the “Precursor” -was being prepared to extend it; the Peninsular and Oriental Company -came in with an engagement to do, for, apparently, a very small sum, -what those vessels were then about doing; that was for the purpose of -maintaining the passenger communication between Calcutta and Suez. -They offered to do this with vessels of 520-horse power as a passenger -line, which was, of course, a good deal better than doing it with -vessels of 300-horse power, because the object was the accommodation -of passengers, and, no doubt, a vessel of 520-horse power must have -a great deal more accommodation for passengers than one of 300-horse -power; and therefore, in asking the East India Company to accept a -vessel of 300-horse power, instead of a vessel of 520-horse power, -they were simply asking them to take a very considerable sum off their -engagement. That was a very different thing from carrying the mails, -which the “India” might have done; and, in fact, the experience of one -year has proved that she was capable of doing it. - -2280. You having stated your view of the reasons which influenced the -East India Company, whether you are right in your view of those reasons -or not, the fact was, that the steamer “India,” being pressed upon -the East India Company by the Peninsular and Oriental Company, was -rejected; is that so?--I understood that she was rejected, because it -was not---- - -2281. Whatever were the reasons, was the fact so?--Yes. - -2282. And your opinion was, that the Admiralty ought to have made -in 1844 a different set of conditions, which would have included -the steamer “India?”--I think the Admiralty, having the plans and -specifications of the ship “India” before them, ought to have judged -from them as to the sufficiency of the vessel, and not from the nominal -horse power. - -2283. Do you think that if a public department, instead of laying down -specific rules to which all parties must conform who make engagements -with regard to the specifications of particular vessels, that would -be a better mode of excluding favouritism than the mode which is now -pursued?--Most assuredly it would be a proper mode. - -2284. Am I right in understanding that the “India” was, afterwards, -employed upon this very line by the Peninsular Company?--Yes, and they -got £15,000 a year by her. They bought her for less than £15,000, and -they patched her up for £1,000, and then got her surveyed in 1845, -and she remained for two or three years in the contract ready to be -employed, after being so patched up. - -2285. Was she there as a reserve vessel?--Yes. - -2286. Was there any difference in the specification of horse power for -a reserve vessel, in comparison with the vessels which were to carry -the mails regularly?--Yes, there was a difference, and she was admitted -upon that. - -2287. What was the amount of horse power required by the contract for a -reserve vessel?--I suppose it must have been less than 300-horse power. - -2288. Have you seen the contract?--Yes, but I do not recollect whether -it was 300 or 250-horse power. - -2289. Is it not customary that the reserve vessel is of less tonnage -than the vessels which are regularly performing the voyages with the -mails?--Yes, it is so, and we intended her to be so originally. - -2290. When you tendered the “India,” did you propose her as a reserve -vessel, or as one of the regular vessels to carry the mails?--We -proposed her for the China line. - -2291. You never proposed her for this line at all?--We could not. - -2292. With reference to the Ceylon and Hong Kong contract, in the year -1844, did you tender the steamer “India” for the Ceylon and Hong Kong -contract?---Yes. - -2293. Your intention being that the mails should be carried as far as -Point de Galle by the Peninsular and Oriental Company, and taken up at -that point by you, and carried in your ships to Hong Kong?--Yes. - -2294. How many vessels would that service have required?--It would have -required three vessels. - -2295. How many vessels were you in possession of, at that time?--We had -one vessel. - -2296. Where did you intend to get other vessels from?--We offered to -hire them in India, where we had four or five at our disposal. - -2297. You said the other day that it was not possible for you to -guarantee any particular vessels in the Indian Seas as being obtainable -by you for that purpose?--We stated in the tender that we would hire -such vessels as we could procure, but we could not do that, because no -time was allowed. - -2298. You said the other day that the “India,” being a paddle ship, -and over-built, was not particularly well qualified to deal with the -typhoons in the China seas?--She was not the vessel that I would have -chosen. - -2299. You also told us that you had in your eye, as one of the other -vessels of the contract, a steamer which had gone to China in the year -1830?--Yes. - -2300. Will you be so good as to state what, according to your -intention, was to have been the third ship by which the contract was -to be performed?--The tender states that two vessels were to be built -within a year for that purpose. - -2301. But, speaking of time present, you intended to employ the -“India,” and to take the chance of a steamer which went out to China -in the year 1830, and to take the risk of your being able to pick up a -third vessel; was that your intention?--Yes; but a company, of which I -was a large proprietor, had five ships in India besides the “India.” - -2302. Was that company, of which you were a large proprietor, able -to guarantee that there would be other vessels to perform the -contract?--Certainly. I made this tender quite certain that they would -be very glad to employ their vessels there. - -2303. Why, then, did you say, in answer to question 1931, that you -could not guarantee any vessels?--If we had not time to offer it to -them, and get an answer from them, I cannot say that they might not -turn round and refuse to let us have the vessels. - -2304. Did you expect the Admiralty, in the absence of any guarantee, to -form a contract with you to take the “India,” which in your judgment -was bad of her kind, as one ship, and to take a steamer which went to -China in the year 1830, and which you thought you probably could get -as a second ship, and the chance of some third ship then in the Indian -seas; upon that basis, did you expect the Admiralty to form a contract -with you; was that so?--What I expect is stated in my former evidence. - -2305. The “India” lay for a long time for sale in the London docks, did -she not, in 1839?--I think, for three or four months, she lay there for -sale. - -2306. Was she not put up for sale at Lloyd’s?--Yes, I believe she was. - -2307. Who were the owners of the “India” when she sailed for India?--An -old gentleman from Norfolk, a Mr. Banyan, was the registered owner. - -2308. He was not the real owner?--Yes, he was a real owner; she -belonged to a company got up by Captain Ross, and he represented them. - -2309. When she went to India, was she not mortgaged?--Yes, she was. - -2310. To what amount?--She was under two mortgages, I understood, -but what the other mortgage was I do not remember. There was $20,000 -advanced to the builders, as stated in answer to question 1814; but she -was not under mortgage when I tendered her for contract mail service. -The real owners were some forty residents and natives in India, and -seven firms and individuals in England, who purchased her from the -mortgagees, and established the India Steam Company of Calcutta in 1841. - -2311. You have stated that the “India” has been running on the line -between Calcutta and Suez?--I never said that she was running on the -line; she was employed on the line; she was receiving a certain portion -of the money paid for the contract. I suppose about £15,000 a year -would be her proportion. - -2312. Are you aware that she never left her moorings?--Yes. - -2313. The Peninsular and Oriental Company bought her, did they -not?--Yes; after a desperately hard bargain. - -2314. Are you aware that she was full of dry rot at the time they -bought her?--Yes, but I am aware that they deducted £1,300 from the -£15,000 which they engaged to pay, in consequence of that; and I am -also aware that they told me it would require £15,000 to repair her -when they offered £23,000 for her; and I sent in the same drawings that -I had sent in to the Admiralty, and offered to do it for £8,000, upon -which they said, we will give you £15,000. - -2315. Are you aware that the “India” has been broken up?--I never heard -it till now. - -2316. You stated that the Peninsular Company sent out to the China line -two old vessels?--Yes, they were used in the Peninsular lines. - -2317. What were their names?--The “Lady Mary Wood” was one, and the -“Braganza” was the other. - -2318. Are you not aware that in 1844 the “Lady Mary Wood” was only two -years old?--Yes, I know it perfectly. - -2319. Would you call her an old vessel?--Yes, she had been a good deal -used there; the best proof of her age is, that she was inefficient -before she could be relieved. - -2320. How do you know that?--I have heard so. - -2321. Are you aware that the “Braganza” was within a few months of the -same age as the “India?”--I do not know that; I know that she had some -repairs before she went there; such repairs as I should have given the -“India.” - -2322. You said that you expected to hire in India a vessel called the -“Fire Queen?”--I never said a word about the “Fire Queen;” the “Fire -Queen” we had nothing to do with; the vessels which I mentioned are -mentioned here. - -2323. It is in the answer to question 2135: “In Bengal, the ‘Forbes,’ -‘India,’ ‘Dwarkanauth Tagore,’ ‘Henderson,’ and ‘Gordon;’ at Singapore, -‘The Royal Sovereign,’ ‘Express,’ and ‘Windsor Castle;’ on her passage -out to India, the ‘Fire Queen,’ built for a Calcutta Company?”--If you -look you will see that those are mentioned as the ships that are in -India, I did not say that I had them; that is a quotation from a letter -to Mr. Sidney Herbert, stating that there are those vessels there. - -2324. But the India Steam Company possessed no other vessel than the -“India,” did they?--No. - -2325. In one of your answers you stated first, that “no honest man,” -which you afterwards qualified by saying, “no man intending to act -honestly, would sign a contract with such stringent clauses and -penalties for over-times on arrivals?”--I did not say, “no honest man” -would sign it. I said that you would not like to undertake such things, -if you could not honestly undertake to do them. - -2326. Did you allude to the penalties for non-arrival in proper -time?--Yes. - -2327. I suppose you have read these contracts attentively?--Yes. - -2328. And know them by heart, probably?--No, I do not think I know them -by heart. - -2329. Has it escaped you that there is this clause in the contract: -“The contractors are not to be liable to any penalties under this -contract for any matters arising from circumstances over which they and -their servants had not and could not have had any control, and which -shall be so proved to the satisfaction of the said Commissioners?”--I -do not recollect that particularly; there was some such clause. - -2330. Did you ever see that clause before?--I see that if a vessel -should have a very foul wind and could not get on, that clause would -perhaps meet that case. But there are a great many causes from which an -engine might break down, which would not be provided for by that clause. - -2331. You particularly specified stringent clauses, and alluded to the -penalties for arrival after time; you said that the clauses were so -stringent that no honest man, or no man intending honestly, would sign -the contract, because there were penalties for arriving over time?--I -was speaking then with reference to the tenders, which I got in 1840. -This is the contract I was speaking of. I saw that the first condition -was, that they were to be properly built and efficient vessels of -400-horse power; and then there are a number of clauses which I have -marked here; the result of them is, first, that the contract was to -provide for the passages being performed in a certain number of hours, -under a penalty of £500 for twelve hours’ delay. - -2332. With such a clause as that you would be afraid to make such a -contract?--It exactly amounts to what I say; it is of no use to put -such a condition into a contract, except to keep people away. - -2333. In answer to a question put to you by the Chairman (1816), -which was, “Whatever the nature of the arrangement between the India -Company and the Peninsular Company was, the result is that they -received £20,000 a year for five years, from the spring of 1841, for -doing certain services; is that so?” you answer, “Yes.” Is that answer -correct, that for five years they received £20,000 a year?--That is a -mistake; they were to receive that. - -2334. For how many years did they receive that £20,000 under the letter -of the East India Company?--For two years. - -2335. You have been speaking about screw vessels; did you ever command -one?--No. - - -_Inspection of the Company’s Affairs by the Government._ - -It will have been observed, from the evidence of Mr. Croker of the -Admiralty (see page 27), that in consequence of the Directors offering -to the Government the permission to investigate the accounts and -books of the Company, the Admiralty appointed Capt. A. Ellice, R.N., -the comptroller of steam machinery, and previously superintendent of -the packet service at Southampton, together with Mr. W. H. Bond, an -experienced accountant, connected with the civil department of the -naval service, to make that Investigation. The following is their -Report, which, although it was considered by the Admiralty as a -confidential one, and therefore not to be published without the consent -of the Company, the Directors had no hesitation in permitting to be -produced to the Committee, and which has, accordingly, been published -in the Appendix to the Committee’s Report. - - -_Report by_ CAPTAIN ELLICE _and_ W. H. BOND, _on the Peninsular and -Oriental Steam Packet Company_. - - SIR, Admiralty, 17 June, 1848. - -In obedience to their Lordships’ instructions of the 30th ultimo, -I have inquired into the matters therein mentioned respecting the -Peninsular and Oriental Contract Steam Packet Company, having called -to my assistance, for this purpose, Mr. W. H. Bond, purser of her -Majesty’s navy; and I have now the honour of enclosing the Report -thereon for their Lordships’ information. - - H. G. Ward, Esq., (Signed) A. ELLICE. - &c., &c., &c. - - * * * * * - -This Report being founded on certain documents which were -confidentially placed in my hands, I consider that this Report should -be confidential also. - - (Signed) A. E. - - * * * * * - - Admiralty, 16 June, 1848. - -In compliance with the instructions of the Lords Commissioners of the -Admiralty, contained in their minute of the 30th ultimo, “To ascertain -whether the profit of the voyages between Southampton, Malta, and -Alexandria, have been such as would provide a dividend of 10 per cent. -per annum on the capital, after the ordinary deductions of wear and -tear, and sea risk of vessels,--if the directors had not thought fit to -invest a portion of their profits in the extension of the stock, by -the purchase of additional vessels:” - -“Also to endeavour to institute a comparison between the expenses -of carrying on the mail services by the company, and those -which are incurred by her Majesty’s naval service in similar -duties:”--Application was made to the directors of the Peninsular -and Oriental Company to furnish a copy of the balance-sheet for the -last half year, ending the 1st March, 1848, together with such other -documents as would serve to explain the various items contained in it. -These being furnished, the readiest access was afforded to the ledger -and other books of the company, for their verification. - -As these accounts are kept so as to include all the operations of the -company, without distinguishing the profits on the different branches, -it became necessary, in order to carry out the spirit of their -Lordship’s instructions, to inquire into the state of the company’s -affairs generally; and to conduct this inquiry in such a way as to -arrive at a satisfactory conclusion on the following points:-- - -1. Whether the postal duties performed by the Peninsular and Oriental -Steam Company are proportionate to the amount paid for those duties. - -2. Whether such duties can, with advantage, be transferred from the -contract steam vessels to those of her Majesty’s navy. - -3. The propriety of throwing these duties open to public competition. - -4. The expediency of accepting the Peninsular and Oriental Company’s -proposal for a modification of the terms of the contract. - -Upon these important points the most careful and mature consideration -has been bestowed; all the documents have been closely examined and -compared with the books of the company, and the following are the -results which are submitted for their Lordships’ information:-- - -First. That the amount paid to the Peninsular and Oriental Company for -the duties it has performed has not hitherto been more than it was -justly entitled to receive, on the principle that the shareholders are -entitled to a fair commercial profit on the capital invested in the -undertaking, and admitting that the affairs of the company have been -managed, as they appear to have been, with economy and efficiency. The -dividend hitherto made has never reached the amount of 10 per cent. -per annum, and the additions made to their shipping and other capital -are from reserves to meet contingencies. The principles on which these -reserves have been laid aside, instead of being divided as profits, -will be hereafter explained in this report. - -Second. That the present inadequate means of ascertaining the expense -of her Majesty’s steam vessels, especially in the Indian and China -seas, renders it difficult to determine the comparative pecuniary -results which would follow the transfer of the duties. Considering, -however, the difficulty of adapting her Majesty’s vessels to commercial -purposes, accommodation of passengers and freight of merchandise, -and the superior convenience and advantages of mercantile companies -in these respects, the success or expediency of such a change is -exceedingly doubtful, except on a necessity, arising from exorbitant -demands for carrying the mails by contract. - -Third. Considering that the postal duties have been well and -satisfactorily performed; that the company has never been fined for -any breach of contract; that it has never asked for any increase of -remuneration, or decrease of the duties to be performed, as has been -the case in other instances of contract with companies; considering, -also, the energetic manner in which this company has persevered in -extending steam communication through new and untried channels, and -that it has formed extensive establishments on the faith of the -continued support of the Government, and that it still contemplates an -extension of its communications with the farthest southern and eastern -point of the British possessions; establishing for these proposes a -steam navy of considerable magnitude, at the command of the public, on -any emergency,--it appears to be entitled to as much consideration as -is compatible with an economical administration of the duties of the -Post-office. - -Fourth. That for reasons hereafter suggested, the contract may now with -great propriety be brought under conditions more favourable to the -Government; and that this may be done either by a fixed reduction for a -permanent term, or on a scale varying with the profits of the company. - -In either case it will appear essential that any new arrangement to be -made should rather be of a permanent than of a temporary character, -both to ensure confidence to the company in the conduct and extension -of their concerns, and efficiency in the discharge of the service -entrusted to them. - -The reasons for adopting these results, which are submitted with great -deference to their Lordships’ consideration, are founded upon facts -contained in the following statement:-- - -First: As regards the duties performed, and payments made. - -The annexed table, No. 1, shows the routes, distances, and amounts of -the existing contracts. Of these, the third route has been recently -transferred to Government vessels. From this return it appears that -hitherto the company has been paid the sum of £224,525, which, however, -has been reduced by this transfer to £209,000. - -For the performance of these duties, and the other business of the -company, the establishment of vessels detailed in the annexed table, -No. 2, is in efficient operation, with the exception of the “Ariel,” -recently stranded in the vicinity of Leghorn. - -The original project fixed the capital at £1,000,000, but the amount -paid up was, and remains, at the sum of £973,378 16s. 8d. In addition -to this capital, reserved amounts have been credited, arising from -undivided profits, under the heads of “Repair,” “Insurance,” and -“Depreciation” funds, amounting to £306,424 19s. 2d., as will be seen -by the annexed statement, No. 3. - -The balance-sheet of the company, No. 4, shows the last half-yearly -expenditure to amount to £238,404 19s.; and the receipts, including the -amount paid by the Government for the conveyance of mails, £301,034 -10s. 2d. - -Some idea of the extent of this establishment may be formed from the -following items of expenditure:-- - -For the half-year ending the 31st March last, the company disbursed for -the shipping department alone-- - - £ _s._ _d._ - Coal 93,568 2 4 - Oil and tallow 2,687 14 0 - Victualling seamen 16,501 14 6 - Wages to seamen 29,383 6 0 - Incidental expenses 8,114 1 11 - Chartering hired vessels 6,326 12 0 - ---------------- - £158,581 10 9 - ---------------- - -The receipts under the following heads, for the same periods, amounted -to-- - - Passage-money, after deducting the charge for £ _s._ _d._ - maintenance 110,508 4 6 - Stewards’ fees 1,677 16 8 - Freight and parcels 72,894 9 9 - Conveyance of mails 112,262 10 0 - ----------------- - £297,343 0 11 - ----------------- - -The company has not thought it prudent to pay a larger dividend than 8 -per cent. per annum to the shareholders. - -In addition to the dividend, the before-mentioned reserved funds have -accrued from the annual profits, viz.:-- - - Depreciation £175,183 - Insurance 137,162 - Repairing 74,079 - -------- - £386,424 - -------- - -Beyond 2½ per cent. on the freight and passage-money, paid to the -directors under the head of management; and 5 per cent. on the profit -balance on closing the account, paid on the same account. - -These charges of 2½ per cent. on the freight and passage-money, and -5 per cent. on the balance, include, beyond all other expenses of -management, allowance to the managing directors, for conducting the -affairs of the company, to the net amount of from £15,000 to 16,000 per -annum. - -This remuneration is paid to them under the deed of settlement, and has -probably secured to the shareholders an efficiency and economy in the -general arrangements which have contributed greatly to the success of -the concern; at the same time it may be doubted whether, in estimating -the profits of the company, the amount paid to the directors may not be -considered (beyond the usual compensation for such services) as part of -the general profits, rather than as a charge of management. - -The principles on which the reserved funds have been laid aside appear -fair and reasonable. - -The insurance is at a rate of 5 per cent. on the first cost of the -vessels employed, after deducting the amount already carried to -depreciation account; out of which amount the premiums for insurance at -Lloyd’s are paid on such assurances as are effected there, the balance -being added to the insurance fund. The portion of the insurance -actually effected is at rather a higher rate than the 5 per cent. It -would not be fair, therefore, to include any portion of this reserved -fund in an estimate of the company’s profits as shipowners or mail -contractors. It belongs fairly to them in their character of insurers, -as, if they had insured the full value of their property, it would have -been paid to underwriters. - -The depreciation fund is calculated at a rate of 5 per cent. per annum -on the first cost of the vessels, after deducting the amount previously -carried to the same account. - -The repair fund is at the rate of 10 per cent. per annum, calculated -on the same amount as the preceding; and it will be seen that the sum -thus reserved for the last six months was £37,633 13_s._ 3_d._, which -did not provide for the actual expenditure of £39,630 6_s._ 3_d._ - -So far, therefore, as the affairs of the company have hitherto -proceeded, the amount paid to them under the contract would not appear -to have exceeded a reasonable remuneration for the services performed, -on the principles before stated. - -Second: The comparative advantages which might result from the -employment of her Majesty’s vessels, instead of contract vessels, for -the performance of those duties, appears to be a question of somewhat -difficult solution. - -The present mode of keeping the accounts of the navy, and the -commixture of expenditure for the steam and other departments in the -dockyards and public offices, must render it exceedingly difficult to -ascertain the cost of any separate branch of service. - -Supposing, however, that the financial comparison could be made, yet -there are many other important elements in the consideration of the -subject. - -For the rapid and secure performance of the public mail duty, no -branch of the mercantile marine is so well prepared as her Majesty’s -naval department. But by the employment of her Majesty’s vessels, -light merchandise could not be conveyed; the habits and comforts of -the passengers could never be so well provided for as by persons paid -for such duties; and as regards the troublesome details of carrying -passengers, freight, and merchandise, the war steamer must be less -adapted than the merchant vessel. - -It must be recollected, also, that a sufficient number of vessels -must be fitted up, equipped, provisioned, stored, and specially and -exclusively adapted to and employed upon this service; and that fresh -arrangements, depôts, and agencies along the lines of route would -be required; the preparation for such services would therefore be -necessarily attended with an expense which years of any probable saving -could scarcely defray. - -Third: The question then arises whether, in the continued employment of -the Peninsular and Oriental Steam Company’s vessels, considering the -actual condition and the established profits and credit of the company, -owing in some measure to the existing contract, some modification of -the terms, for the advantage of the public, may not be fairly expected. - -With a view to the consideration of this question, the following facts -are submitted. - -The general transactions of the last half-year, the best period for -judging clearly the present operation of the company, furnish the -following points: - - The gross profits, after deducting 2½ per cent. for £ _s._ _d._ - management, and 5 per cent. for repairs, and 2½ per - cent. for insurance, amount to 62,629 11 2 - - From which is deducted 2½ per cent, for depreciation 16,915 0 0 - -------------- - Leaving, beyond the amount deducted for directors £45,714 11 2 - -------------- - -The dividend to the shareholders, at the rate of 4 per cent. for six -months, or 8 per cent. per annum, on the original capital of £973,378, -amounted to £38,933, leaving a surplus balance of about £6,781, to be -carried to the next account. - -If even the amount paid to the directors from the 2½ per cent. -(deducted for charges of management, being for a half year, £8,248 10s. -9d.), were added to the surplus balance of £6,781, and a dividend paid -to the proprietors at the rate of 10 per cent., the scale suggested by -their lordships, a residue would only be left of about £5,296; from -which residue the expenses of management, and ordinary salaries for -managing directors, would have to be defrayed. - -Their lordships will thus have before them the means of considering -what modification of the terms of the contract the present and -prospective state of the profits of the company would appear to -justify; or whether it would be expedient to adopt such modification -to the varying profits of the company in the terms proposed by it; -viz., that when the financial position of the company, with respect -to such mail services, shall be such as, after making the customary -allowances for the repairs, &c., a maximum dividend of 10 per cent. -can be realised to the shareholders, any surplus over and above such -maximum dividend shall be placed to the credit of the Government. - - (Signed) A. ELLICE, - WM. H. BOND. - - - - -APPENDIX. - - - _No. 1.--Memorandum of Contracts with Government for the - Conveyance of Her Majesty’s Mails by the Peninsular and Oriental - Steam Navigation Company._ - - ----------------------------------+--------+---------+--------+----------- - |Distance| | | - STATION. | per | Annual | Annual | Per Mile. - |Voyage. |Distance.| Sum. | - ----------------------------------+--------+---------+--------+----------- - 1. Southampton to Vigo, Oporto, | | | £ | - Lisbon, Cadiz, and Gibraltar;| | | | - three times a month, say on | | | | - the 7th, 17th, and 27th | 2,400 | 86,400 | 20,500 | 4/8¾ - | | | |nearly 4/9 - 2. Southampton to Malta and | | | | - Alexandria, once a month, on | | | | - the 20th | 6,084 | 73,008 | 28,500 | 7/9½ - | | | |nearly ¾ - 3. Southampton to Malta and | | | | - Alexandria (bi-monthly) on | | | | - the 3rd | 6,084 | 73,008 | 15,525 | 4/3 - 4. Calcutta to Madras, Point de | | | | - Galle, Aden and Suez, and | | | | - Point de Galle to Penang, | | | | - Singapore, and Hong Kong, | | | | - once a month | 15,590 | 187,080 |160,000 | 17/1¼ - +--------+---------+--------+---------- - | | 419,496 |224,525 | 10/8¼ - | | | |nearly ½ - ----------------------------------+--------+---------+--------+---------- - - London, 8th June, 1848. - - -_No. 2--List of the Steam Ships belonging to the Peninsular and -Oriental Steam Navigation Company.--June 10, 1848._ - - ----+-------------+----------------------------------------------+---------+---------+ - | | REGISTER TONNAGE. | | | - | +---------------+----------------+-------------+ | + - | | | | | | | - | | | | | | | - | | | | | | | - | | | | | | | - No. | NAME of the | | | | | | - | VESSEL. | Ship. | Engine Room. | Old | Horse | | - | | | | Measurement.| Power. | Cost. | - | | | | | | | - ----+-------------+---------------+----------------+-------------+---------+---------+ - | | New Measurement. | | | £ | - 1 | Bentinck | 941-50/100 | 1,032-81/100 | 1,702-20/94 | 520 | 89,000| - 2 | Precursor |1,133-3/10 | 684 | 1,640 | 460 | 63,000| - 3 |*Haddington |1,166-84/100 | 480-60/100 | 1,303-13/94 | 450 | 61,500| - 4 | Oriental |1,103-5/10 | 684 | 1,303-20/94 | 420 | 78,000| - 5 | India | 501-1750/7500| 369-1750/7500| 755-74/94 | 350 | 10,500| - | | | | | | | - 6 | Achilles | 586-79/100 | 405-36/100 | 853-78/94 | 430 | 26,500| - 7 |*Pottinger | 934-9/10 | 467 | 1,225 | 450 | 66,000| - 8 |*Pekin | 759-24/100 | 423-9/100 | 1,000 | 400 | 46,000| - 9 | Lady M. Wood| 296-51/100 | 256-59/100 | 503-20/94 | 260 | 31,500| - 10 | Braganza | 570 | 284 | 707-70/94 | 264 | 21,100| - 11 |*Canton | 218-35/100 | 170 | 387-27/94 | | 14,000| - 12 | Hindostan | 971-6/10 | 1,046-6/10 | 1,552-39/94 | 520 | 88,000| - | | | | | | | - 13 |*Indus | 927-3/10 | 458-9/10 | 1,251-5/94 | 450 | 62,000| - 14 |*Ripon |1,167-8/10 | 458 | 1,394-39/94 | 450 | 66,000| - 15 |*Ariel | 443-8/10 | 265 | 821-7/94 | 300 | 38,500| - 16 |*Erin | 532-6/10 | 265 | 810 | 280 | 35,000| - | | | | | | | - 17 |*Euxine | 729-407/3500 | 435-2065/3500| 1,039-67/94 | 400 | 43,500| - 18 |*Sultan | 728-79/100 | 361-57/100 | 990-85/94 | 400 | 38,500| - 19 | Tagus | 497 285| | 709-88/94 | 286 | 28,000| - | | | | | | | - 20 |*Pacha | 302-53/100 | 245-88/100 | 517-74/94 | 210 | 16,000| - 21 | Iberia | 301-9/10 | 213-8/10 | 520 | 190 | 22,000| - 22 | Jupiter | 288 | 255 | 437-9/94 | 210 | 15,500| - | | | | | | | - 23 | Montrose | 283-4/10 | 322 | 596 | 260 | 18,500| - 24 |*Madrid | 315-1/10 | 163-6/10 | 446-8/94 | 140 | 17,000| - 25 |*Malta | 776-82/100 | 440-64/100 | 1,225 | 450 | 57,500| - 26 | Bombay | .... | .... | 1,209-43/94 | 400 | 58,000| - 27 | Ganges | .... | .... | 1,209-43/94 | 400 | 58,000| - 28 | Vestis | .... | .... | 905-86/94 | 370 | 47,000| - +-------------+---------+---------+ - |27,017-70/94 | 9,870 |1,220,500| - +=============+=========+=========+ - ----+-------------+------------------------------------------+-----------------+-----+ - | | CREW. | NATIVE CREW. | | - | +-----+---------+------+-------------------+------+-----+----+ | - | | | | | Engineering | | | | | | - | | | | | Department. | | | | | | - | | | | +-------+-----+ | | | | | - | | | Mates, |Stew- | | | | | | | | - No. | NAME of the | |Surgeons,| ards | | | | | | | | - | VESSEL. | |Pursers, | and | |Fire-| | | | | | - | |Cap- | and |SERV- |ENGIN- | men,| SEA-|SERV- |FIRE-|SEA-|TOTAL| - | |tain.| CLERKS. |ANTS. | EERS. | &C. | MEN.|ANTS. |MEN. |MEN.|CREW.| - ----+-------------+-----+---------+------+-------+-----+-----+------+-----+----+-----+ - | | | | | | | | | | | | - 1 | Bentinck | 1 | 7 | 21 | 5 | 4 | 23 | 10 | 67 | 39 | 181| - 2 | Precursor | 1 | 7 | 25 | 5 | 9 | 28 | 8 | 60 | 28 | 171| - 3 |*Haddington | 1 | 7 | 27 | 5 | 9 | 28 | 10 | 60 | 30 | 177| - 4 | Oriental | 1 | 5 | 7 | 3 | 8 | 31 | ... | ... |... | 55| - 5 | India | ... | 1 | ... | ... | ... | ... | ... | ... |... | 1| - | | | | | | | | | | | | - 6 | Achilles | 1 | 5 | 6 | 4 | 12 | 23 | ... | ... |... | 51| - 7 |*Pottinger | 1 | 6 | 11 | 4 | 6 | 17 | 30 | 60 | 43 | 178| - 8 |*Pekin | 1 | 6 | 10 | 5 | 7 | 14 | 7 | 45 | 41 | 136| - 9 | Lady M. Wood| 1 | 5 | 4 | 4 | 3 | 9 | 8 | 26 | 29 | 89| - 10 | Braganza | 1 | 5 | 9 | 4 | 3 | 5 | 4 | 31 | 30 | 92| - 11 |*Canton | 1 | 2 | 3 | 2 | 6 | 12 | ... | ... |... | 26| - 12 | Hindostan | 1 | 7 | 28 | 4 | 24 | 27 | ... | ... |... | 91| - | | | | | | | | | | | | - 13 |*Indus | 1 | 7 | 28 | 4 | 24 | 27 | ... | ... |... | 91| - 14 |*Ripon | 1 | 7 | 31 | 4 | 23 | 25 | ... | ... |... | 91| - 15 |*Ariel | 1 | 5 | 13 | 3 | 12 | 19 | ... | ... |... | 53| - 16 |*Erin | 1 | 5 | 12 | 3 | 13 | 8 | ... | ... |... | 52| - | | | | | | | | | | | | - 17 |*Euxine | 1 | 6 | 15 | 4 | 18 | 22 | ... | ... |... | 66| - 18 |*Sultan | 1 | 6 | 15 | 4 | 18 | 22 | ... | ... |... | 66| - 19 | Tagus | 1 | 5 | 14 | 3 | 12 | 17 | ... | ... |... | 52| - | | | | | | | | | | | | - 20 |*Pacha | 1 | 3 | 13 | 3 | 8 | 15 | ... | ... |... | 43| - 21 | Iberia | 1 | 3 | 12 | 3 | 9 | 13 | ... | ... |... | 41| - 22 | Jupiter | 1 | 3 | 11 | 2 | 9 | 12 | ... | ... |... | 38| - | | | | | | | | | | | | - 23 | Montrose | 1 | 3 | 10 | 2 | 10 | 14 | ... | ... |... | 40| - 24 |*Madrid | 1 | 2 | 11 | 2 | 9 | 13 | ... | ... |... | 39| - 25 |*Malta | ... | ... | ... | ... | ... | ... | ... | ... |... | ... | - 26 | Bombay | ... | ... | ... | ... | ... | ... | ... | ... |... | ... | - 27 | Ganges | ... | ... | ... | ... | ... | ... | ... | ... |... | ... | - 28 | Vestis | ... | ... | ... | ... | ... | ... | ... | ... |... | ... | - +-----+---------+------+-------+-----+-----+------+-----+----+-----+ - | 23 | 119 | 340 | 82 | 256 | 434 | 77 | 349 |240 |1,920| - +=====+=========+======+=======+=====+=====+======+=====+====+=====+ - ----+-------------+---------------+-----------------------------+----------------------- - | | | | - | | | | - | | | | - | | | | - | | | | - | | | | - No. | NAME of the | | | - | VESSEL. | When | STATION. | REMARKS. - | | commenced | | - | | Running. | | - ----+-------------+---------------+-----------------------------+----------------------- - | | | | - 1 | Bentinck |24 August, 1843| Calcutta & Suez. | - 2 | Precursor |10 Sept. 1844| Ditto. |Purchased afloat. - 3 |*Haddington | 4 Dec. 1846| Ditto. | - 4 | Oriental | 2 Sept. 1840| Ditto. | - 5 | India | .... | .... |Reserve ship, purchased - | | | | in India. - 6 | Achilles | .... | Bombay & China |Purchased by the - 7 |*Pottinger |20 Sept. 1846| Ditto. | Company afloat; - 8 |*Pekin |28 Jan. 1847| Ditto. | first voyage, 17th - 9 | Lady M. Wood| 1 Feb. 1842| Ditto. | October, 1845 - 10 | Braganza | Sept. 1846| Ditto. | - 11 |*Canton |not comd runng.| Hong Kong & Canton. | - 12 | Hindostan |29 Sept. 1842|Southampton and | - | | | Alexandria. | - 13 |*Indus |20 June 1847| Ditto. | - 14 |*Ripon |20 Nov. 1846| Ditto. | - 15 |*Ariel |26 Sept. 1846| Malta & Alexandria. | - 16 |*Erin | 3 Sept. 1846| Southampton, Constantinople,| - | | | & Black Sea. | - 17 |*Euxine | 3 Jan. 1848| Ditto. | - 18 |*Sultan | 3 August 1847| Ditto. | - 19 | Tagus |16 Nov. 1840|Southampton and | - | | | Peninsula. | - 20 |*Pacha |13 May 1843|Southampton & Italy. | - 21 | Iberia |19 Sept. 1840| Ditto. | - 22 | Jupiter | .... |Southampton and | - | | | Peninsula. |Purchased afloat. - 23 | Montrose | 5 Sept. 1840| Ditto. | Ditto. - 24 |*Madrid |17 Nov. 1845| Ditto. | - 25 |*Malta | | |Not yet running. - 26 | Bombay | .... | .... | Ditto. - 27 | Ganges | .... | .... | Ditto. - 28 | Vestis | .... | .... | - - - The vessels marked * are built of iron. - - -_No. 3.--Statement of the Debts, Assets, and Effects of the Peninsular -and Oriental Steam Navigation Company, 31st March, 1848._ - - +---------------------------------------------------+--------------------+---------------------+ - | | £. _s._ _d._| £. _s._ _d._| - | General coal account | | 44,345 2 5 | - | Ditto purser’s ditto, stores afloat | 22,923 2 0 | | - | Ditto ditto ditto ditto ashore | 28,451 19 4 | | - | Ditto material ditto ship’s stores | 28,474 12 3 | | - | +--------------------+ 74,849 13 7 | - | | | | - | Ships, &c., at work | 754,670 16 0 | | - | Ditto stock | 304,600 0 0 | | - | Ditto building £152,841 11 7 | | | - | Advanced on account of repairs 19,273 15 7 | | | - | ------------------| 172,115 7 2 | | - | +--------------------+ | - | | 1,231,385 3 2 | | - | Less received from the Portuguese government, | | | - | on account of the “Royal Tar” | 4,799 0 1 | | - | +--------------------+ 1,225,587 3 1 | - | Debts due by agents £25,388 18 2 | | | - | Less due to agents 4,396 16 3 | | | - | | 20,992 1 11 | | - | Cash, Bills, &c. | 94,728 19 3 | | - | Insurance fund invested in Government securities | 34,168 8 0 | | - | Freehold property, King’s Arms | 16,958 15 11 | | - | Peninsular and Oriental Steam Navigation Company’s| | | - | shares | 18,004 2 6 | | - | Outstanding freights | 3,054 7 3 | | - | O. C. Edmond | 421 16 7 | | - | +--------------------+ 188,328 11 5 | - | | | | - | General stock account, barges, hulks, &c. | ... ... ... | 4,231 10 7 | - | Purser’s cash account | 245 10 1 | | - | Mazagon Dock, working expenses | 1,724 12 0 | | - | Petty cash | 90 0 0 | | - | Bills receivable in suspense | 57 5 1 | | - | Pacha voyage to Havre | 4 0 8 | | - | Colombo agency | 25 18 1 | | - | New iron steam ships | 423 10 3 | | - | Transit for the Pacha of Egypt | 80 0 0 | | - | Dadabhoy Rustomjee | 1,078 13 1 | | - | +--------------------| 3,729 9 3 | - | | +---------------------+ - | | | £1,542,071 10 4 | - +---------------------------------------------------+--------------------+---------------------+ - +---------------------------------------------------+--------------------+---------------------+ - | | £. _s._ _d._| £. _s._ _d._| - | Bills payable | 121,475 19 5 | | - | Dividend, 8th to 13th, half-year | 2,197 6 20 | | - | Ditto 14th ditto | 2,426 6 4 | | - | London and South Western Railway Company | 3,722 12 1 | | - | Southampton Dock ditto | 1,944 7 0 | | - | +--------------------+ 131,766 11 1 | - | | | | - | Suspense account | 334 19 3 | | - | R. Franck, stamp account | 6 0 0 | | - | S. R. Engledue ditto | 13 0 0 | | - | Oil and Tallow ditto | 199 2 11 | | - | Patent Fuel Company | 76 19 0 | | - | Burton and Co. | 1,515 10 0 | | - | Lord and Co. | 211 18 7 | | - | Transfer fees | 33 15 0 | | - | “Bredalbane,” for the Pacha of Egypt | 896 5 5 | | - | W. Longridge | 14 2 8 | | - | +--------------------+ 3,301 12 10 | - | | | | - | Capital | 304,600 0 0 | | - | Additional amount called up | 668,778 16 8 | | - | Repairs account £76,075 17 6 +--------------------+ 973,37 16 8 | - | Addition made this half-year 37,633 13 3 | | | - | ------------------| | | - | 113,709 10 9 | | | - | 39,630 6 3 | | | - | ------------------| 74,079 4 6 | | - | Insurance account £123,639 9 4 | | | - | Addition made this half-year 15,683 4 9 | | | - | ----------------- | | | - | 139,322 14 1 | | | - | 2,160 7 3 | | | - | ---------------- | 137,162 6 10 | | - | Depreciation account £158,268 7 10 | | | - | Addition made this half-year 16,915 0 0 | | | - | ------------------| 175,183 7 10 | | - | Profit and Loss: +--------------------+ 386,424 19 2 | - | Balance of this account remaining from last year | 1,484 19 5 | - | Ditto ditto ditto from the half-year now concluded | 45,714 11 2 | - + +---------------------+ - | | £1,542,071 10 4 | - +------------------------------------------------------------------------+---------------------+ - (True Copy.) (Signed) C. W. HOWELL, _Secretary_. - - -_No. 4.--Disbursements and Receipts of the Peninsular and Oriental_ - - -------------------------------------------------------------------------------------------------- - DISBURSEMENTS. - - (Six Months from 1st October, 1847, to 31st March, 1848.) - -------------------------------------------------------------+------------------+----------------- - | £ _s._ _d._| £ _s._ _d._ - To 58,789 tons of Coals (cost) | 93,568 2 4 | - Oil and Tallow | 2,687 14 0 | - Victualling Crews | 16,501 14 6 | - Charter Money for Hire of Vessels to supply the place | | - of “Royal Tar,” (sold), and “Tiber,” (lost) | 6,326 12 0 | - Wages to Commanders, Officers, and Crews | 29,383 6 0 | - Fees to Commanders of the Company’s Ships | 445 16 3 | - Port Charges, Sea Stores, and other incidental expenses | | - in the ships | 8,114 1 11 | - Directors’ Attendances | 918 15 0 | - London Office; Expenses, Salaries, &c. | 976 18 8 | - Southampton ditto ditto | 1,341 0 11 | - Malta ditto ditto | 461 1 4 | - Constantinople Agency | 1,508 18 6 | - Calcutta ditto (exclusive of Repairs to Ships) | 3,323 19 0 | - Bombay ditto (ditto ditto) | 1,382 7 8 | - Hong Kong ditto | 835 1 7 | - Lisbon ditto (for two years) | 1,206 19 3 | - 21 Minor Agencies at sundry Foreign Stations | 2,237 0 4 | - London Agency, 2-1/2 per cent. Commission on Freight } | | - and Passage Money, comprehending Rent of } | | - Offices, Taxes, Stationery, Account Books, Office } | | - Expenses, Postages (not foreign), Custom House } | 8,246 10 9 | - business, and Clerks’ Salaries, for the business of} | | - the management, &c. &c., pursuant to the Deed } | | - of Settlement } | | - Advertisements during the half year | 1,121 3 11 | - Floating Light (Suez) Expenses, ditto | 71 15 5 | - Condemned Pursers’ Stores | 271 15 1 | - Income Tax for six months | 811 3 1 | - Damages (and goods stolen on China line £463 10s 10d) | 578 1 2 | - Law Charges | 325 16 5 | - Auditors’Fees (for two years) | 42 0 0 | - Captain Guthrie’s pay (nautical examiner) | 120 0 0 | - Stationery and Printing for Foreign Agencies, &c. | 323 10 1 | - Donations; viz.--Mrs. M’Leod £305 0 0 | | - Lieutenant Waghorn 300 0 0 | | - Captain Bingham 100 0 0 | | - Sundries 39 0 0 | | - -------- | 744 0 0 | - Subscriptions (see particulars at foot[8]) | 163 16 8 | - Gratuities to Officers | 105 0 0 | - Telegraph Charges | 35 19 0 | - Foreign Postages, Travelling Expenses, Charts, Newspapers,| | - and Petty Expenses | 908 0 2 | - Repair Account for the half year | 37,633 13 3 | - Insurance (on vessels at work) ditto | 15,683 4 9 | - +------------------+ 238,404 19 0 - Balance carried down | 62,629 11 2 - +----------------- - |£301,034 10 2 - +================= - - To Depreciation for the half-year 16,915 0 0 - Dividend ditto about 40,000 0 0 - Balance carried down 5,714 11 - ----------------- - £62,629 11 2 - ================= - - -_Steam Navigation Company.--Fifteenth Half Year, ending March 31, 1848._ - - -------------------------------------------------------------------------------------- - RECEIPTS. - (Six Months, from 1st October, 1847, to 31st March, 1848) - -----------------------------------------------------+-----------------+-------------- - | £ _s._ _d._| £ _s._ _d._ - By Passage Money received during the half-year | 151,757 4 8 | - Loss, Transit through Egypt £14,767 6 6 | | - Victualling Passengers 26,481 13 8 | | - ------------- | 41,249 0 2 | - +-----------------+ 110,508 4 6 - Freights and Parcels received during the half-year | 77,764 3 3 | - Less, Cattle, head money £ 16 1 0 | | - Proportion of Carriage on Constantinople | | - Cargoes 2,057 14 3 | | - Cartage and Lighterage 399 2 2 | | - Carriage of Goods, Southampton | | - (Railway Expenses) 2,396 16 1 | | - ------------ | 4,869 13 6 | - +-----------------+ 72,894 9 9 - Mail Contracts during the half-year | | 112,262 10 0 - Stewards’ Fees, ditto ditto | | 1,677 16 8 - Interest | 1,059 15 11 | - Ditto (Dividend on Company’s Shares invested) | 2,229 3 4 | - +-----------------+ 3,288 19 3 - | | - Profit on Exchequer Bills, for gain on sale of £20,000 invested | 402 10 0 - | - | - | - +-------------- - |£301,034 10 2 - +============== - - By Balance brought down £62,629 11 2 - ============== - - 31st March, 1848. - By balance brought down £5,714 11 2 - ============== - - (Signed) JOHN PIRIE. AR. ANDERSON. - FRAN. CARLETON. B. M. WILLCOX. - - (True Copy.) - - (Signed) C. W. HOWELL, Secretary. - - - _Copy of a Memorandum made by_ Mr. COWPER _on the Contract - for the Calcutta Mails, after the receipt of the Report of - Investigation by_ Captain ELLICE _and_ Mr. BOND, _and sent to_ - Lord AUCKLAND. - -“The contract for the Calcutta mails, from Southampton to Alexandria, -expires on the 8th January, 1849. Two offers have been made for its -renewal, one by the Peninsular and Oriental Company, for £27,500 -the first year, and for sums diminishing by £500 a year for every -subsequent year that the contract may remain in force. A new company, -the India and Australia, offer to do the same service for £25,650; the -sum now paid is £28,500. - -“The Peninsular and Oriental Company accompanied their tender by an -offer to pay over to the Government any earnings or profits they might -receive beyond a maximum dividend of ten per cent. to the shareholders, -after the customary allowances have been deducted for repairs, wear -and tear, and sea risk of the vessels and property; and as a security, -they offered to submit, from time to time, the accounts of all their -transactions connected with the mail service, to the inspection of such -competent persons as the Government may appoint. - -“Captain Ellice and Mr. Bond were then requested to examine the -accounts of this company before any decision was come to upon the -tenders; and having had every facility afforded them, have made the -accompanying report. From this it appears that the profits made upon -the capital of the company, about equal ten per cent. as a total sum; -but that after reserves for depreciation, repairs and insurance, and -expenses of management, there has remained hitherto not more than -eight per cent. for the shareholders. The question of how much of -the earnings ought to be kept in reserve to meet depreciation, is so -discretionary that I have no expectation that any company would ever -admit that there was a surplus profit to be handed over to Government; -and this report confirms my impression, that we ought not to make such -an arrangement a part of the contract. - -“But I think both the tenders too high, and that we ought to decline -them both; and this we can do without irregularity, for they are not -tenders called for absolutely, but only tenders ‘to treat.’ - -“If this be done, we should then make an offer on our part; and as -the Peninsular and Oriental Company have performed their contract -perfectly, and furnish every guarantee that can be desired for the -regular execution of a future contract, I consider that we ought to -make our offer to them only; and if they should refuse it, we might -repeat it to the India and Australia Company. - -“The mileage we pay them at present is estimated by the hydrographer -at 8s. 0-1/4d. a mile and by the company at 7s. 9-1/2d. a mile (he -measures the distance of the voyage out and back at 5,920 nautical -miles, they at 6,084); but we pay the same company about 4s. 6d. a mile -for the line to Lisbon and Gibraltar, and I think we are justified in -offering the same payment for the Alexandria line. But in that case -we must not tie them down as to size of vessels, for the lowness of -the remuneration on the former line is explained by the contract not -requiring the vessels to be more than 140-horse power. - -“To this department the size of the vessels is a matter of -indifference, we care only that it be sufficient to secure speed; and -we should stipulate only for a certain rate of speed. - -“If my proposition be adopted we should immediately signify to the -parties that their tenders are not accepted, and make a communication -to the Treasury. - -“I omitted to mention, that by directions from the Treasury we fixed -the duration of the contract for which we demanded tenders, at three -years; and also, that a reason for offering 4s. 6d. a mile may be -found in the agreement made in May, 1845, by this same company, -to convey mails between Southampton and Alexandria, in vessels of -280-horse power, as far as Malta; and of 180-horse power between Malta -and Alexandria, for £15,525, which gives a mileage of about 4s. 6d. -This agreement was entered into for only one year, since the company -complained of its lowness, and declined, on that account, to make a -formal and permanent contract at that rate; but they have continued it -ever since, and it has been terminated by ourselves in May last. - - (Signed) “W. COWPER.” - - -_Copy of a Memorandum by the_ Earl of AUCKLAND, _on the receipt of that -of_ Mr. COWPER. - -MAIL CONTRACT TO ALEXANDRIA. - - “27th June, 1848. - -“I think with Captain Ellice and Mr. Bond, that we should desire to -conclude an arrangement with the Oriental in preference to any other -company, for the present contract has been loyally kept, and the -capital and means of that company give better promise of efficiency -and exactness than could be looked for in any other quarter. The -Indian and Australian Company is indeed supported by good names, but -it has yet no paid-up capital, or body of shareholders, or organised -establishment on which we could depend; and though it may be desirable -to establish a rivalry and competition on the line of communication, -It would not be wise to do so at the hazard of uncertainty and -interruption. We have, however, advertised for tenders; and though we -are not bound to take the lowest offer, we should scarcely be justified -in rejecting it without a fair examination of its value. The first -question, however, must be, which is the lowest offer? The Oriental -Company propose to perform the service in the first instance, for -£27,500; the other company for £25,650. But the Oriental are ready -to lower their charge by sums of £500 in the second, £1,000 in the -third, £1,500 in the fourth, and £2,000 in the fifth year, or £5,000 -in the five years. This would reduce the difference between the two -companies to only £850 annually, in the event of the contract winning -for five years, or to £1,350 if it should be taken for three years. -But the Oriental further offer to the Government a share in their -profits on this line, whatever they may be beyond 10 per cent. paid -to the shareholders. It is difficult to calculate to what this might -amount, or to determine upon what principle it should be calculated. -The dividend to the shareholders has not yet amounted to more than -eight per cent., but large sums have been applied to new capital, -to reserve funds, for insurance, and to other purposes. There may -be profit on the Mediterranean line, and there may be loss on other -lines, and an annual inquiry into all these matters might lead to -endless discussions and disputes, and would be a source of frequent -vexation to both parties. It is clear, however, that the company makes -considerable profits, and I would prefer, to a share in them under the -exercise of an inquisitorial power, a liberal compromise by a reduction -of the terms which have been proposed; and I think that this reduction -should be to a sum considerably lower than the £25,650 which has been -tendered by the Indian and Australian Company. Mr. Cowper would reduce -the sum demanded to about £15,000, taking the mileage at 4_s._ 6_d._, -the price of the Lisbon, instead of 8_s._ 0-1/4_d._, the mileage of the -Mediterranean packets. I doubt whether these terms would not be too -hard. The Lisbon packets are less efficient and less expensive than -those of the Mediterranean, and though the profits of the latter are -large at some seasons of the year, there are months when passengers to -India are rare, and the receipt small. - -“I am inclined to propose a middle term between the £16,000 and the -£27,500, and to offer £22,000 for five years, as a fixed sum, without -condition for periodical reductions, or for a share in the company’s -profits; but before this is determined on, I should like to have -further opinions upon the result which may be drawn from the company’s -accounts. - -“I have carefully looked into them, and I find it difficult to decide -upon what portion of the receipts is to be regarded as net profit, -and what portion of disbursement is to be referred to necessary -expenditure. Looking to the accumulation of capital which has taken -place in twelve years, the profit must have been large. - - (Signed) “AUCKLAND. - -“NOTE.--I find that from May, 1845, up to this month, the Oriental -Company has been running their Mediterranean packets at 4_s._ 6_d._ the -mile; and I am reconciled, therefore, to the offer which it is proposed -by Mr. Cowper should be made to them.”[9] - - -_Extract from the Deed of Settlement of the Peninsular and Oriental -Steam Navigation Company, dated 25 January, 1841._ - -“That the managing directors shall provide and furnish, free of all -costs to the company, suitable offices for the business of the said -company at the house No. 51, St. Mary Axe, in the city of London, or -elsewhere[10] in the said city, including a suitable board-room for -the meetings of the Board of Directors, and the general meetings of -the company; and shall provide all necessary superintendents, clerks, -agents, and servants, for conducting and performing the business and -matters to be done by the said managing directors; and also will -provide and pay such printing and stationery, and office expenses, -as shall be connected with, or necessary for the performance of such -business; but all superintendents, clerks, or other persons employed in -any repairing or building establishment of the said company, and the -salaries of the secretary, and of any clerks employed at outports, at -foreign places, and all other expenses relating to the conduct of the -affairs of the company, except such as are agreed to be transacted by -the managing directors, are to be paid by the said company. - -“That in consideration of the duties to be performed by the said -managing directors, and the expense to be incurred by them, and of the -services rendered by them[11] in the formation of the said company, -and of the negotiating and procuring the contracts with her Majesty’s -Government for the mail service, and of applying for and procuring -the aforesaid charter of incorporation for the said company,--the -said managing directors shall be allowed and paid by the said company -a commission of two and a half per cent. on the gross receipts or -earnings of the said company; and also a further commission of £5 per -cent. upon the net profits of the business of the said company, after -deducting from such net profits the amount which shall be considered -necessary to set apart as a reserve fund, as after mentioned, for the -purpose of repairing machinery and vessels and other of the stock -of the said company; the aforesaid commission of £5 per cent. to be -paid on the making up the half-yearly accounts of the company for the -ascertaining and declaring the dividends to be paid to the proprietors; -and that such compensation shall be paid to the managing directors in -equal shares so long as there shall be more than one.[12] - - “B. M. W.” - - “11 August, 1848.” - - - - -CONCLUDING REMARKS. - - -The preceding statement and evidence can scarcely fail to force on the -conviction of every unbiassed mind “the following conclusions:-- - -1. That the Company owes its present extensive employment in the -Contract Mail Packet Service to no other circumstance than that of -having placed itself, by its own enterprise, in a position to execute -that Service with greater advantage to the public interests than could -otherwise he obtained. - -2. That in the planning, undertaking, and executing of that Service, it -has realised important benefits to the public, whether considered in a -financial, political, social, or commercial point of view. - -And, looking to its present position,--namely, the possession of -an ample capital and means--of extensive practical experience in -the management of steam navigation--a well-organised establishment -of agencies at its numerous stations abroad--exclusive docking -accommodation for its large ships at the principal ports of -India--extensive main or trunk lines of communication, established -in the principal tracks of Oriental intercourse, and to which any -further extension of postal communication must of necessity subserve, -as auxiliaries or feeders,--there is scarcely room for entertaining a -reasonable doubt that the Peninsular and Oriental Company will be able -to maintain its ground, both in respect to the Services in which it is -already engaged, as well as in the undertaking of any further Services -which may be required in the East, against any _boná fide_ competition, -and on the same legitimate, and, therefore, invulnerable basis on -which its present connexion with the Contract Packet Service has been -established,--namely, its capability of maintaining the present, and -undertaking such future Services, with the greatest advantage to the -public interests, both as to efficiency and economy. - - - _Benefits of the Contract Packet Service, and of Steam - Communications with our Dependencies and Foreign Countries._ - -The advantage, as regards economy of the public expenditure, of -maintaining these communications by means of private enterprise under -Contract, instead of by Government vessels, managed by Government -establishments, has now been fully recognised. - -It has, however, been the practice in some quarters[13] to estimate the -value of these communications, and the expediency of maintaining them, -by the amount of postage of letters which they produce. - -A more narrow and unstatesmanlike view of the question can scarcely be -entertained; and a slight consideration of the following facts will -suffice to show that such a mode of estimating their value to the -public is extremely fallacious. - -Who, that has had any experience of the operations of commerce, or of -the practical business of Government, would estimate the value of an -accelerated and certain transit of a merchant’s letter or a Government -despatch by the amount of postage which the one brings in, or the other -would bring in, to the revenue? - -The rapid transit of the merchant’s letter is often the means of -originating a commercial operation which gives employment to hundreds -of artizans and labourers, thus increasing production and expenditure, -and thereby returning into the exchequer, in taxes on consumption, -thousands of times the comparatively trifling cost of its conveyance. - -And how often does the acceleration of the public despatch facilitate -the duties and contribute to the lessening of the expenses of -Government? Instances are not unknown where the rapid transit of a -despatch has saved an expenditure for warlike supplies and operations, -to the amount of many hundreds of thousands of pounds. - -That facility of intercourse and transit creates and increases -commerce, is a fact which experience has abundantly established. A -circumstance strikingly illustrative of it, and connected with one -branch only of this Company’s operations, was stated in evidence before -the Parliamentary Committee of last session on the Steam Navy, and is -as follows,--viz.: - - -_Extract from the Evidence of Mr. Anderson, M.P., a Member of the -Committee._ - -But I wish to remark that, to estimate the value of these -communications merely by the postage of the letters carried, I consider -to be a very erroneous estimate; there are incidental public advantages -arising from those communications which I consider far to overbalance -the cost of them; for instance, by facilitating the communications with -those foreign countries and dependencies, you promote the increase -of your commerce. And I will mention one fact, which I think will -illustrate the opinion I am now giving. About some six or seven years -since, the merchants connected with Constantinople and the Levant were -very desirous of having steam communication established with those -places, and the Company with which I am connected were willing to -establish such communication; but the returns being rather uncertain, -while the expenses were certain and very heavy, they considered they -were scarcely warranted in entering upon such an enterprise without -some assistance. It was proposed to the then Chancellor of the -Exchequer, Mr. Goulburn, that he should make some allowance, some few -thousand pounds, for an improvement which was proposed to be made in -the postal arrangements with Constantinople, and which would have -reduced the post between London and Constantinople to thirteen days, -instead of twenty-four. Mr. Goulburn objected to entertain the matter, -but subsequently the communication was established. I find, in looking -to the statistics of our export trade, that comparing the amount of -our exports to the quarters to which those steamers run, previous to -their establishment, with the amount at the end of the year 1846, -there was an increase of about £1,200,000 a year. I find also that the -actual value of the goods exported in those steamers from Southampton -last year amounted to within a very trifling fraction of one million -sterling. And referring to several Greek merchants connected with the -trade, of much intelligence, for the cause of that increase, they told -me that they felt perfectly certain that the establishment of the steam -communication had been the great cause of the increase of the trade. I -asked them on what grounds they formed that opinion, and they said it -was upon these grounds: that the steam communication enabled them to -turn their capital over a great deal oftener than by sailing vessels; -that it gave them a certainty as to the time their goods could be in -the market, and they also had a certainty of return for their exports. -That no less than forty new Greek mercantile establishments had been -formed in this country, since the time of the establishment of those -steamers. Supposing those assumptions to be correct, which I believe -they are, or nearly so, I think I am warranted in forming the opinion -that the revenue has been very greatly increased, inasmuch as the trade -is of the most valuable nature for the employment of our artizans and -labourers. The exports consist of manufactured goods of the finest -class; and the imports of raw material, as for example, silks and -goats’ wool, coming here to be manufactured. I am informed that the -wages of labour on this fine class of manufactured goods amount to -about two-thirds of their value. Assuming that to be the case, and -that the trade has been increased by means of the steam communication -with Constantinople and the Levant to the extent of about £1,000,000 -sterling, that is taking the exports and imports together, £600,000 -of that amount have been paid to artizans and labourers, and expended -by them for the supply of their ordinary wants. And as the proportion -which goes to the revenue in the shape of direct and indirect taxes is -usually estimated at about twenty per cent. of such expenditure, it -follows that the national exchequer has been benefited to the amount -of twenty per cent. on £600,000, or say £120,000 per annum, by the -establishment of that steam communication. The effects, therefore, of -those communications are, I submit, to increase trade and industry, and -consequently the public revenue, while they at the same time provide us -with an important means of maritime defence in case of need.[14] - -The means of maritime defence provided through the three large -Companies employed in the Contract Mail Packet Service are as follows:-- - - ---------------------------------+----------------+---------+---------+ - | | |Aggregate| - Name of Company. | No. of Vessels.|Aggregate| Horse | - | | Tonnage.| Power. | - ---------------------------------+----------------+---------+---------+ - Peninsular and Oriental Company | 23 vessels | 25,226 | 8,040 | - West India Royal Mail Company | 12 vessels | 19,993 | 5,520 | - North American Royal Mail Company| 9 vessels | 15,560 | 5,400 | - +----------------+---------+---------+ - Total | 44 vessels | 60,779 | 18,960 | - +----------------+---------+---------+ - - Of which 2 vessels are of 800 horse power. - ” 4 ” 650 ” - ” 26 ” 400 and upwards to 520 horse power. - ” 5 ” 250 and upwards to 380 ” - ” 7 ” 140 and upwards to 240 ” - -The first thirty-two vessels being of the tonnage and power of the -steam frigates of the Royal Navy--the remaining twelve vessels of the -power and tonnage of the steam sloops and gun vessels of the Royal Navy. - -By a stipulation in the Mail Contracts, these vessels, with the -exception of a few which are under 400-horse power, are required to -be so constructed as to be able to carry and fire guns of the largest -calibre used in the war steamers, and the Government have the power of -employing them for warlike purposes, if required. The vessels under -400-horse power are included in the above list, as they would, without -doubt, be also placed at the disposal of the Government if required. - -Assuming that this reserve fleet supersedes the necessity, as it surely -ought to do, of the employment of war steamers to the extent of only -one-fourth of its number, a financial saving to the country of from -£250,000 to £300,000 per annum on that account is due to the Contract -Packet Service. - -The annual amount paid to these three Companies for the East India and -China, Mediterranean and Peninsular, West Indian, Mexican, &c., and -North American Contract Mail Services is £589,000. The returns for -postage, as estimated by the Post-office, is about £380,000--leaving an -apparent cost to the pubic of £209,000 for these communications. - -But it appears, from the circumstance stated by Mr. Anderson, that at -least half of this apparent deficiency is made good to the exchequer -by taxes on consumption, proceeding from the increase of commerce and -industrial resources consequent on the establishment of _one branch_ -of _one Company’s_ communications only; and it surely cannot be an -exaggerated estimate to assume that the whole of the other improved -communications of that and the other Companies make good to the -exchequer, in a similar manner, at least the other half. - -It therefore follows, looking at the question as a merely financial -one, that the establishment and maintenance of these communications, -so far from being any burden on the national exchequer, is a gain to -it; their cost being more than returned to it in postage of letters, -_and revenue derived from the increase of industry and consumption -created by their means_; in addition to which the country is, or ought -to be, a gainer, to the extent of not less than a quarter of a million -sterling in a reduction of naval expenditure, seeing that a large -reserve steam navy, promptly available for the national defence, if -required, is provided by these great steam navigation enterprises. -That reserve navy also, while forming so important an auxiliary to the -means of national defence in case of war, is operating as one of the -most effective instruments for the maintenance of peace, by promoting -the extension of foreign commercial intercourse--thereby tending to -bind nations closer together by the strongest of all ties, that of -mutual dependence on each other for their material wants. Assuming -these facts and conclusions to be correct, instead of the expense -of these communications being grudged, it ought to be regarded as -the most beneficial outlay of public money that occurs in the whole -balance-sheet of our national expenditure. - -Although, in the preceding remarks, the benefits of these improved -postal communications have been considered only in reference to their -financial, commercial, and political importance, it ought not to be -forgotten that they also involve social benefits, of equal, if not -superior consideration.[15] How few are the instances, comparatively -speaking, where a family in the United Kingdom is to be met with who -has not one or more of its members absent in our distant dependencies, -engaged in industrial pursuits, or in the public service of their -country. To lessen the hardships of absence and separation to so large -a portion of the community, by facilitating to them the means of social -intercommunication, reducing, as it were, the distance which separates -them (as has been done in many cases, to less than one-fourth of what -it formerly was) is surely an object worthy of national sympathy and -solicitude, and claiming to be supported by national means. - -FOOTNOTES: - -[1] See question 2169, p. 45, and 2187, p. 48; also 2254, and 2255. - -[2] Now reduced to £20,500. - -[3] Note, the sum of £3500 was deducted subsequently by the Admiralty, -in consequence of their superseding the small vessel engaged in the -Ionian Mail Service by packets of their own; and this sum became -thereby reduced to £28,500. - -[4] This sum, of £148,000 for 70,080 miles, is at the rate of 42s. 6d. -per mile. If the same amount for passage-money and parcels which the -East India Company’s packets earned, as shown by their return made -to Parliament, (No. 746,) for the same year, 1844-45, in which the -Peninsular and Oriental Company’s proposal was made, namely-- - - For passengers £23,543 - freight of parcels 2,764 - ------- - Total £26,307 - ======= - -be deducted from the above sum of £148,000, it will leave for the net -estimated cost of performing the Service between Bombay and Suez, -by Government vessels, of the power of those of the Peninsular and -Oriental Company, £121,693, being £41,693 in excess of the sum of -£80,000, for which the Peninsular and Oriental Company offered to do -it: or, - -If this estimate of 42s. 6d. per mile be applied to the service between -Suez and Calcutta, for which the Peninsular and Oriental Company -receive £115,000 per annum, it will amount, for the annual mileage of -that Service--115,000 miles--to £244,375, being no less than £129,375 -in excess of the sum received by this Company--or if the passage-money -on this line had been estimated at double the amount of that earned -by the East India packets, on the Bombay and Suez Line, say, in round -numbers, £52,000, an estimate certainly as high as prudence would have -warranted in its then untested state, there would still be an excess of -estimated expenditure, under Government management, of £77,375. - -[5] See Lord Auckland’s expression, p. 77. - -[6] Five _weeks_, and not months, being all the time necessary for a -communication between Ceylon and Southampton, the word “months” might -be taken to be a typographical error, were it not that the evident -drift of the following question is to make out a case against the -Company of tardiness in sending out another vessel to replace the -_alleged_ defective “Lady Mary Wood.” - -[7] The investigation has since been completed, and the Admiralty have -acquitted the Company of the charge of overloading the vessels, and -of any breach of contract. One principal cause of the vessels being -occasionally beyond the time stipulated in the contract, in arriving at -Hong Kong, was, that in defining the time in the contract no allowance -was made for the north-east monsoon on the passage eastward, as is -done for the south-west monsoon on the passage westward. The grievance -to the Hong Kong merchants could, however, have been but of trifling -importance, as the steamers, even when behind contract time, always -arrived so as to afford to the China merchants ample opportunity to -answer letters by the return mail. No complaints from China were made -prior to the Company extending the terminus of the China Line to -Bombay, and thereby coming in competition with the opium clippers in -the carrying of that article to Hong Kong. - -[8] Subscriptions referred to above: - - £ _s._ _d._ - Steam Association 133 6 8 - Infirmary at Southampton 10 10 0 - Rent of Children’s School at Southampton 20 0 0 - ------------ - £163 16 8 - ============ - - -[9] The tenor of this memorandum is satisfactory in so far as it -recognises the efficiency with which this Company has executed the -services contracted for, and its consequent claim to be continued in -the performance of it. But in two points his lordship has fallen into -error:-- - -First--In drawing the conclusion that the mileage rate of payment for -one line of mail service ought to regulate the payment for another -line, without taking into account the various circumstances, such as -the amount of commercial traffic, cost of fuel, &c., on one line as -compared with the other. Had his lordship informed himself on these -matters, he would have learned that it was the large amount of traffic, -in the carrying of merchandise to and from Constantinople and the Black -Sea, by those steamers carrying the India mails to and from Malta, that -enabled the Company to carry the mails in the Mediterranean at so low a -rate as 4_s._ 6_d._ (or rather, as was actually the rate, 4_s._ 3_d._) -per mile, and that such a circumstance formed no criterion of the rate -which would be remunerative on the Southampton and Alexandria line, -where there was no such amount of traffic to meet the expenses. - -The second point is in his having mistaken those funds necessary to be -reserved out of earnings to maintain the integrity of the Company’s -property, for an accumulation of capital. - -[10] “The company have since built premises in Leadenhall-street, and -the managing directors, in consequence, pay to the company £1,000 per -annum as a rental, under this agreement.” - -[11] “The three managing directors established the trade at their risk, -before it became a joint-stock company; and the rate of commission -contemplated a remuneration for past as well as future services.” - -[12] “This has since been modified: one managing director will retire -in 1850, without any consideration, the saving to be credited to the -Company.” The salaries of assistants, clerks, and other disbursements -which the managing directors have to pay out of their commissions, now -amount to £6,000 per annum. - -[13] See Report of Committee of the House of Lords on the Post Office, -Session 1847. - -[14] An instance of the value of these contract steamers, otherwise -than in the postal service, occurred at Ceylon, on the breaking out -of the insurrection in that island. The Governor, not having troops -sufficient at hand to quell it, this Company’s contract steamer, -“Lady Mary Wood,” (subsidiary vessel on the China line), proceeded to -Madras, and brought up a detachment, which mainly contributed to the -prompt putting down of that insurrection. The recent destruction of a -number of piratical vessels on the coast of China by this Company’s -armed steamer “Canton,” is another instance of their value on distant -stations. - -[15] The enormous extent of the correspondence conveyed by this -Company’s steamers may be inferred from the fact that the mail for -India and China, forwarded from Southampton by the “Indus,” on the -20th instant, consisted of 157 chests, amounting, in bulk, to within a -fraction of twenty tons, exclusive of 13 bags for the Mediterranean. To -this must be added the mail despatched from London on the 24th, _viá_ -Marseilles, to be taken up by the same vessel at Malta, averaging 120 -smaller chests. Each of the chests or cases forwarded _viá_ Southampton -is computed to be capable of containing 10,000 single letters; -therefore, allowing that a portion of them is occupied with newspapers, -the number of letters must be very great. - - -[Transcriber’s Note: - -Inconsistent spelling and hyphenation are as in the original.] - - - - - -End of the Project Gutenberg EBook of An Abstract of the Proceedings of the -Select Committee of the House of Comm, by Peninsular and Oriental Steam Navigation Company and Great Britain. Parliament. House - -*** END OF THIS PROJECT GUTENBERG EBOOK CONTRACT PACKET SERVICE *** - -***** This file should be named 55064-0.txt or 55064-0.zip ***** -This and all associated files of various formats will be found in: - http://www.gutenberg.org/5/5/0/6/55064/ - -Produced by Brownfox, Adrian Mastronardi, Wayne Hammond, -The Philatelic Digital Library Project at -http://www.tpdlp.net and the Online Distributed Proofreading -Team at http://www.pgdp.net (This book was produced from -scanned images of public domain material from the Google -Books project.) - - -Updated editions will replace the previous one--the old editions will -be renamed. - -Creating the works from print editions not protected by U.S. copyright -law means that no one owns a United States copyright in these works, -so the Foundation (and you!) can copy and distribute it in the United -States without permission and without paying copyright -royalties. Special rules, set forth in the General Terms of Use part -of this license, apply to copying and distributing Project -Gutenberg-tm electronic works to protect the PROJECT GUTENBERG-tm -concept and trademark. Project Gutenberg is a registered trademark, -and may not be used if you charge for the eBooks, unless you receive -specific permission. If you do not charge anything for copies of this -eBook, complying with the rules is very easy. You may use this eBook -for nearly any purpose such as creation of derivative works, reports, -performances and research. They may be modified and printed and given -away--you may do practically ANYTHING in the United States with eBooks -not protected by U.S. copyright law. Redistribution is subject to the -trademark license, especially commercial redistribution. - -START: FULL LICENSE - -THE FULL PROJECT GUTENBERG LICENSE -PLEASE READ THIS BEFORE YOU DISTRIBUTE OR USE THIS WORK - -To protect the Project Gutenberg-tm mission of promoting the free -distribution of electronic works, by using or distributing this work -(or any other work associated in any way with the phrase "Project -Gutenberg"), you agree to comply with all the terms of the Full -Project Gutenberg-tm License available with this file or online at -www.gutenberg.org/license. - -Section 1. General Terms of Use and Redistributing Project -Gutenberg-tm electronic works - -1.A. By reading or using any part of this Project Gutenberg-tm -electronic work, you indicate that you have read, understand, agree to -and accept all the terms of this license and intellectual property -(trademark/copyright) agreement. If you do not agree to abide by all -the terms of this agreement, you must cease using and return or -destroy all copies of Project Gutenberg-tm electronic works in your -possession. If you paid a fee for obtaining a copy of or access to a -Project Gutenberg-tm electronic work and you do not agree to be bound -by the terms of this agreement, you may obtain a refund from the -person or entity to whom you paid the fee as set forth in paragraph -1.E.8. - -1.B. "Project Gutenberg" is a registered trademark. It may only be -used on or associated in any way with an electronic work by people who -agree to be bound by the terms of this agreement. There are a few -things that you can do with most Project Gutenberg-tm electronic works -even without complying with the full terms of this agreement. See -paragraph 1.C below. There are a lot of things you can do with Project -Gutenberg-tm electronic works if you follow the terms of this -agreement and help preserve free future access to Project Gutenberg-tm -electronic works. See paragraph 1.E below. - -1.C. The Project Gutenberg Literary Archive Foundation ("the -Foundation" or PGLAF), owns a compilation copyright in the collection -of Project Gutenberg-tm electronic works. Nearly all the individual -works in the collection are in the public domain in the United -States. If an individual work is unprotected by copyright law in the -United States and you are located in the United States, we do not -claim a right to prevent you from copying, distributing, performing, -displaying or creating derivative works based on the work as long as -all references to Project Gutenberg are removed. Of course, we hope -that you will support the Project Gutenberg-tm mission of promoting -free access to electronic works by freely sharing Project Gutenberg-tm -works in compliance with the terms of this agreement for keeping the -Project Gutenberg-tm name associated with the work. You can easily -comply with the terms of this agreement by keeping this work in the -same format with its attached full Project Gutenberg-tm License when -you share it without charge with others. - -1.D. The copyright laws of the place where you are located also govern -what you can do with this work. Copyright laws in most countries are -in a constant state of change. If you are outside the United States, -check the laws of your country in addition to the terms of this -agreement before downloading, copying, displaying, performing, -distributing or creating derivative works based on this work or any -other Project Gutenberg-tm work. The Foundation makes no -representations concerning the copyright status of any work in any -country outside the United States. - -1.E. Unless you have removed all references to Project Gutenberg: - -1.E.1. The following sentence, with active links to, or other -immediate access to, the full Project Gutenberg-tm License must appear -prominently whenever any copy of a Project Gutenberg-tm work (any work -on which the phrase "Project Gutenberg" appears, or with which the -phrase "Project Gutenberg" is associated) is accessed, displayed, -performed, viewed, copied or distributed: - - This eBook is for the use of anyone anywhere in the United States and - most other parts of the world at no cost and with almost no - restrictions whatsoever. You may copy it, give it away or re-use it - under the terms of the Project Gutenberg License included with this - eBook or online at www.gutenberg.org. If you are not located in the - United States, you'll have to check the laws of the country where you - are located before using this ebook. - -1.E.2. If an individual Project Gutenberg-tm electronic work is -derived from texts not protected by U.S. copyright law (does not -contain a notice indicating that it is posted with permission of the -copyright holder), the work can be copied and distributed to anyone in -the United States without paying any fees or charges. If you are -redistributing or providing access to a work with the phrase "Project -Gutenberg" associated with or appearing on the work, you must comply -either with the requirements of paragraphs 1.E.1 through 1.E.7 or -obtain permission for the use of the work and the Project Gutenberg-tm -trademark as set forth in paragraphs 1.E.8 or 1.E.9. - -1.E.3. If an individual Project Gutenberg-tm electronic work is posted -with the permission of the copyright holder, your use and distribution -must comply with both paragraphs 1.E.1 through 1.E.7 and any -additional terms imposed by the copyright holder. Additional terms -will be linked to the Project Gutenberg-tm License for all works -posted with the permission of the copyright holder found at the -beginning of this work. - -1.E.4. Do not unlink or detach or remove the full Project Gutenberg-tm -License terms from this work, or any files containing a part of this -work or any other work associated with Project Gutenberg-tm. - -1.E.5. Do not copy, display, perform, distribute or redistribute this -electronic work, or any part of this electronic work, without -prominently displaying the sentence set forth in paragraph 1.E.1 with -active links or immediate access to the full terms of the Project -Gutenberg-tm License. - -1.E.6. You may convert to and distribute this work in any binary, -compressed, marked up, nonproprietary or proprietary form, including -any word processing or hypertext form. However, if you provide access -to or distribute copies of a Project Gutenberg-tm work in a format -other than "Plain Vanilla ASCII" or other format used in the official -version posted on the official Project Gutenberg-tm web site -(www.gutenberg.org), you must, at no additional cost, fee or expense -to the user, provide a copy, a means of exporting a copy, or a means -of obtaining a copy upon request, of the work in its original "Plain -Vanilla ASCII" or other form. Any alternate format must include the -full Project Gutenberg-tm License as specified in paragraph 1.E.1. - -1.E.7. Do not charge a fee for access to, viewing, displaying, -performing, copying or distributing any Project Gutenberg-tm works -unless you comply with paragraph 1.E.8 or 1.E.9. - -1.E.8. You may charge a reasonable fee for copies of or providing -access to or distributing Project Gutenberg-tm electronic works -provided that - -* You pay a royalty fee of 20% of the gross profits you derive from - the use of Project Gutenberg-tm works calculated using the method - you already use to calculate your applicable taxes. The fee is owed - to the owner of the Project Gutenberg-tm trademark, but he has - agreed to donate royalties under this paragraph to the Project - Gutenberg Literary Archive Foundation. Royalty payments must be paid - within 60 days following each date on which you prepare (or are - legally required to prepare) your periodic tax returns. Royalty - payments should be clearly marked as such and sent to the Project - Gutenberg Literary Archive Foundation at the address specified in - Section 4, "Information about donations to the Project Gutenberg - Literary Archive Foundation." - -* You provide a full refund of any money paid by a user who notifies - you in writing (or by e-mail) within 30 days of receipt that s/he - does not agree to the terms of the full Project Gutenberg-tm - License. You must require such a user to return or destroy all - copies of the works possessed in a physical medium and discontinue - all use of and all access to other copies of Project Gutenberg-tm - works. - -* You provide, in accordance with paragraph 1.F.3, a full refund of - any money paid for a work or a replacement copy, if a defect in the - electronic work is discovered and reported to you within 90 days of - receipt of the work. - -* You comply with all other terms of this agreement for free - distribution of Project Gutenberg-tm works. - -1.E.9. If you wish to charge a fee or distribute a Project -Gutenberg-tm electronic work or group of works on different terms than -are set forth in this agreement, you must obtain permission in writing -from both the Project Gutenberg Literary Archive Foundation and The -Project Gutenberg Trademark LLC, the owner of the Project Gutenberg-tm -trademark. Contact the Foundation as set forth in Section 3 below. - -1.F. - -1.F.1. Project Gutenberg volunteers and employees expend considerable -effort to identify, do copyright research on, transcribe and proofread -works not protected by U.S. copyright law in creating the Project -Gutenberg-tm collection. Despite these efforts, Project Gutenberg-tm -electronic works, and the medium on which they may be stored, may -contain "Defects," such as, but not limited to, incomplete, inaccurate -or corrupt data, transcription errors, a copyright or other -intellectual property infringement, a defective or damaged disk or -other medium, a computer virus, or computer codes that damage or -cannot be read by your equipment. - -1.F.2. LIMITED WARRANTY, DISCLAIMER OF DAMAGES - Except for the "Right -of Replacement or Refund" described in paragraph 1.F.3, the Project -Gutenberg Literary Archive Foundation, the owner of the Project -Gutenberg-tm trademark, and any other party distributing a Project -Gutenberg-tm electronic work under this agreement, disclaim all -liability to you for damages, costs and expenses, including legal -fees. YOU AGREE THAT YOU HAVE NO REMEDIES FOR NEGLIGENCE, STRICT -LIABILITY, BREACH OF WARRANTY OR BREACH OF CONTRACT EXCEPT THOSE -PROVIDED IN PARAGRAPH 1.F.3. YOU AGREE THAT THE FOUNDATION, THE -TRADEMARK OWNER, AND ANY DISTRIBUTOR UNDER THIS AGREEMENT WILL NOT BE -LIABLE TO YOU FOR ACTUAL, DIRECT, INDIRECT, CONSEQUENTIAL, PUNITIVE OR -INCIDENTAL DAMAGES EVEN IF YOU GIVE NOTICE OF THE POSSIBILITY OF SUCH -DAMAGE. - -1.F.3. LIMITED RIGHT OF REPLACEMENT OR REFUND - If you discover a -defect in this electronic work within 90 days of receiving it, you can -receive a refund of the money (if any) you paid for it by sending a -written explanation to the person you received the work from. If you -received the work on a physical medium, you must return the medium -with your written explanation. The person or entity that provided you -with the defective work may elect to provide a replacement copy in -lieu of a refund. If you received the work electronically, the person -or entity providing it to you may choose to give you a second -opportunity to receive the work electronically in lieu of a refund. If -the second copy is also defective, you may demand a refund in writing -without further opportunities to fix the problem. - -1.F.4. Except for the limited right of replacement or refund set forth -in paragraph 1.F.3, this work is provided to you 'AS-IS', WITH NO -OTHER WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING BUT NOT -LIMITED TO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PURPOSE. - -1.F.5. Some states do not allow disclaimers of certain implied -warranties or the exclusion or limitation of certain types of -damages. If any disclaimer or limitation set forth in this agreement -violates the law of the state applicable to this agreement, the -agreement shall be interpreted to make the maximum disclaimer or -limitation permitted by the applicable state law. The invalidity or -unenforceability of any provision of this agreement shall not void the -remaining provisions. - -1.F.6. INDEMNITY - You agree to indemnify and hold the Foundation, the -trademark owner, any agent or employee of the Foundation, anyone -providing copies of Project Gutenberg-tm electronic works in -accordance with this agreement, and any volunteers associated with the -production, promotion and distribution of Project Gutenberg-tm -electronic works, harmless from all liability, costs and expenses, -including legal fees, that arise directly or indirectly from any of -the following which you do or cause to occur: (a) distribution of this -or any Project Gutenberg-tm work, (b) alteration, modification, or -additions or deletions to any Project Gutenberg-tm work, and (c) any -Defect you cause. - -Section 2. Information about the Mission of Project Gutenberg-tm - -Project Gutenberg-tm is synonymous with the free distribution of -electronic works in formats readable by the widest variety of -computers including obsolete, old, middle-aged and new computers. It -exists because of the efforts of hundreds of volunteers and donations -from people in all walks of life. - -Volunteers and financial support to provide volunteers with the -assistance they need are critical to reaching Project Gutenberg-tm's -goals and ensuring that the Project Gutenberg-tm collection will -remain freely available for generations to come. In 2001, the Project -Gutenberg Literary Archive Foundation was created to provide a secure -and permanent future for Project Gutenberg-tm and future -generations. To learn more about the Project Gutenberg Literary -Archive Foundation and how your efforts and donations can help, see -Sections 3 and 4 and the Foundation information page at -www.gutenberg.org Section 3. Information about the Project Gutenberg -Literary Archive Foundation - -The Project Gutenberg Literary Archive Foundation is a non profit -501(c)(3) educational corporation organized under the laws of the -state of Mississippi and granted tax exempt status by the Internal -Revenue Service. The Foundation's EIN or federal tax identification -number is 64-6221541. Contributions to the Project Gutenberg Literary -Archive Foundation are tax deductible to the full extent permitted by -U.S. federal laws and your state's laws. - -The Foundation's principal office is in Fairbanks, Alaska, with the -mailing address: PO Box 750175, Fairbanks, AK 99775, but its -volunteers and employees are scattered throughout numerous -locations. Its business office is located at 809 North 1500 West, Salt -Lake City, UT 84116, (801) 596-1887. Email contact links and up to -date contact information can be found at the Foundation's web site and -official page at www.gutenberg.org/contact - -For additional contact information: - - Dr. Gregory B. Newby - Chief Executive and Director - gbnewby@pglaf.org - -Section 4. Information about Donations to the Project Gutenberg -Literary Archive Foundation - -Project Gutenberg-tm depends upon and cannot survive without wide -spread public support and donations to carry out its mission of -increasing the number of public domain and licensed works that can be -freely distributed in machine readable form accessible by the widest -array of equipment including outdated equipment. Many small donations -($1 to $5,000) are particularly important to maintaining tax exempt -status with the IRS. - -The Foundation is committed to complying with the laws regulating -charities and charitable donations in all 50 states of the United -States. Compliance requirements are not uniform and it takes a -considerable effort, much paperwork and many fees to meet and keep up -with these requirements. We do not solicit donations in locations -where we have not received written confirmation of compliance. To SEND -DONATIONS or determine the status of compliance for any particular -state visit www.gutenberg.org/donate - -While we cannot and do not solicit contributions from states where we -have not met the solicitation requirements, we know of no prohibition -against accepting unsolicited donations from donors in such states who -approach us with offers to donate. - -International donations are gratefully accepted, but we cannot make -any statements concerning tax treatment of donations received from -outside the United States. U.S. laws alone swamp our small staff. - -Please check the Project Gutenberg Web pages for current donation -methods and addresses. Donations are accepted in a number of other -ways including checks, online payments and credit card donations. To -donate, please visit: www.gutenberg.org/donate - -Section 5. General Information About Project Gutenberg-tm electronic works. - -Professor Michael S. Hart was the originator of the Project -Gutenberg-tm concept of a library of electronic works that could be -freely shared with anyone. For forty years, he produced and -distributed Project Gutenberg-tm eBooks with only a loose network of -volunteer support. - -Project Gutenberg-tm eBooks are often created from several printed -editions, all of which are confirmed as not protected by copyright in -the U.S. unless a copyright notice is included. Thus, we do not -necessarily keep eBooks in compliance with any particular paper -edition. - -Most people start at our Web site which has the main PG search -facility: www.gutenberg.org - -This Web site includes information about Project Gutenberg-tm, -including how to make donations to the Project Gutenberg Literary -Archive Foundation, how to help produce our new eBooks, and how to -subscribe to our email newsletter to hear about new eBooks. - |