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.