"All hope of applying great general principles passed away. Every chance of
directing the course of railways to form a national system of communication
was lost.... The legislative body--to appropriate the idea of Mr
Morrison--committed the mistake of converting the Kingdom into a great
stock exchange, and of stimulating the various members of the railway
system to a deep and deadly struggle, destructive of order and fruitful of
vice."
This may seem to be unduly strong language; but what actually and
immediately followed on the course of events here in question was--the
Railway Mania of 1845-6.
By the summer of 1845 the country had gone railway mad. In the Session of
1843 the number of railway Acts passed had been twenty-four, showing no
more than a normal development of the railway system in meeting the
legitimate needs of the country. In the Session of 1844 the number
increased to thirty-seven. In the Session of 1845 there were no fewer than
248 railway Bills. In the next Session Bills were deposited with the Board
of Trade for the construction of 815 new lines of railway, with a length of
20,687 miles, and capital powers to the extent of £350,000,000. Of these
815 Bills many were abortive for technical reasons, or {272}because the
necessary deposit was not paid; but over 700 of them reached the Private
Bill Office.
How every class of society joined in the scramble for shares; how
extravagant prices were given for the scrip of lines which, when completed,
could not for years have covered their working expenses; how half-pay
officers, ticket-porters and men, even, in receipt of parish relief put
down their names on the "subscription" lists for thousands of pounds' worth
of shares, on their being paid a fee--sometimes as low as five
shillings--for so doing; how "frenzy seized the whole nation"; how "there
was scarcely a family in England which was not directly or indirectly
interested in the fortunes of the rail"; and how the inevitable collapse
reached every hearth and saddened every heart in the Metropolis, bringing
many families both there and elsewhere to ruin, will be found recorded in
detail by John Francis, in his "History of the English Railway," and need
not be enlarged upon here.
In referring to the events of this period, the Report of the Joint
Committee on the Amalgamation of Railway Companies, 1872, admits that "One
effect of the favour shown by Parliament to competing schemes was to
encourage a large number of speculative enterprises." Leaving aside the
enterprises, of whatever type, that did not survive the passage through
Parliament, I compile, from figures given in Clifford's "History of Private
Bill Legislation," the following table showing new lines of railway
actually sanctioned by Parliament during the Sessions 1845-7:--
YEAR. NUMBER. MILES. CAPITAL.
1845 118 2700 £56,000,000
1846 270 4538 £132,000,000
1847 190 1354 £39,460,000
--- ---- ------------
Totals 578 8592 £227,460,000
These figures indicate sufficiently the magnitude of the schemes in respect
to which, during so short a period as three years, Parliament assumed the
responsibility of giving its express sanction and approval.
The period of speculation was followed by the inevitable reaction, and in
1850 it was found necessary to pass an Act {273}"to facilitate the
abandonment of railways and the dissolution of railway companies." Of the
8592 miles of railway sanctioned in the three Sessions, 1845-7, no fewer
than 1560 miles were (as shown by the Report of the Royal Commission on
Railways, 1867), abandoned by the promoters under the authority of the Act;
while a further 2000 miles of railway, requiring 40 millions of capital,
are said by the Report of the 1853 Committee to have been abandoned without
the consent of Parliament.
To the extent indicated by these abandonments the railway situation was
certainly relieved. But the mania and the resultant panic had serious
consequences in regard not alone to investors in the schemes that failed
but also to the companies that survived.
Apart from projects designed to open up entirely new districts--many of
them of a perfectly genuine and desirable character--there were others
directly devised to compete with existing lines and capture some of the
remunerative traffic these were then handling; and it was, as I have shown,
quite in accordance with the accepted principle of State railway-policy
that such competition should be encouraged, in preference to any
"districting" of the country among particular companies or to the creation
or co-ordination of an organised system of railways on the lines proposed
by Mr Gladstone's Committee.
The existing companies, finding that the territory already "allotted" to
them (as they considered) was being invaded, or was in danger of being
invaded, felt themselves forced, for the purposes of self-defence, to enter
on a number of protective schemes which might not, at the time, otherwise
have been warranted. Clifford says on this point in his "History of Private
Bill Legislation": "As the Government took no steps to prevent the
promotion of competitive railways, tending to diminish the profits of
existing companies, the latter sought to protect themselves as they best
could, and justified their many unprofitable extensions and amalgamations
as measures forced upon them by the leave-alone policy of the Government."
Confirmation of this statement will be found in a speech delivered on
February 23, 1848, by Mr C. Russell, M.P., chairman of the Great Western
Railway Company, at the {274}sixth half-yearly meeting, at Paddington, of
the South Wales Railway Company (of which he was also chairman), and
reported in "The Times" of the following day. Referring to a pamphlet which
had been issued attacking the policy of the Great Western Railway Company,
Mr Russell said:--
"If their engagements were extensive, and he did not deny that they were
so, they had been entered in only as a matter of necessity. They all arose
out of the mania of 1845-46, and even in the pamphlet in question it had
been admitted that the Great Western was not one of those companies which
at that time had promoted any of the many schemes which were afloat. He, as
far as he was concerned, had not only not promoted these projects, but had
taken every means in his power to check them. In January, 1846, in his
place in Parliament he had predicted the results if some steps were not at
once adopted to put a curb upon reckless speculation; but most
unfortunately for all parties that was not the view which was taken by the
House of Commons. Mr Hudson and other gentlemen maintained that the course
he recommended would be an unfair interference with private enterprise, and
the consequence was that schemes involving altogether the sum of
£125,000,000 passed through the Legislature in that year. The Great Western
had remonstrated with the President and the Vice-President of the Board of
Trade, and, left to their own resources, they had been compelled, in
self-defence, to look after their own interests by getting hold of all the
rival or contemplated rival schemes."
In some instances the existing companies guaranteed interest to the
shareholders of branches and extensions which were feared as rivals. F. S.
Williams, in "Our Iron Roads," says of such lines as these that while many
of them were accepted as feeders they "proved for a time to be only
suckers."
The effects of the mania on the finances of existing railway companies was
further shown by the fact that, in order to pay their contractors, some of
the companies were obliged during the crisis to raise money at from ten to
thirty, and, in some instances it is said, even at fifty per cent discount.
Then, also, the shares in ten leading companies suffered between 1845 and
1847 a depreciation in value estimated at {275}£18,000,000. The following
are typical examples of the falls experienced:--
COMPANY. SHARES. JULY,1845. APRIL 4,1848. DECLINE.
£ £ £ £
London and Birmingham 100 243 126 117
Great Western 80(paid) 205 88 117
Midland 100 187 95 92
London and Brighton 50 76 28½ 47½
While the general situation in the railway world had been thus developing,
there was a revival, in 1846, of the idea that the work of Private Bill
Committees in respect to railway schemes should be supplemented by some
other form of inquiry into their merits.
Writing on this subject in the issue of his "Railway Magazine" for July,
1837, John Herapath had said:--
"It has long been anxiously expected that Parliament would take some steps
to relieve itself from the onerous duties of investigating and deciding on
railway matters. Probably no tribunals can be less fitted for inquiries of
this kind than Parliamentary Committees, of which the House of Commons has
lately given a demonstrative proof in the case of the Brighton line. After
Committees of the two Houses had sat nearly the whole of last session, and
a Committee of the Commons for thirty-five days of the present; after the
Committee's reports had been made on each of the lines and near 300,000l.
of the subscribers' money had been wasted, the House of Commons stamped its
own opinion of all those labours by giving them the 'go-by,' and referring
the whole four lines to the judgment of a military engineer."
As for the element of uncertainty in the decisions of Parliamentary
Committees, F. S. Williams is responsible for the statement that six
railway Bills rejected by Commons Committees in 1844 were passed on
precisely the same evidence in 1845; that of eighteen Bills rejected in
1845 seven were passed unaltered in 1846; and that of six Bills thrown out
by Committees of the House of Lords in 1845 four were adopted by other
Committees in 1846.
The failure, however, of the special department of the Board of Trade,
created on the recommendation of Mr {276}Gladstone's Committee to meet the
requirements of the situation, was complete. In giving evidence before the
Select Committee of 1881, the secretary of the Board of Trade, Mr T. Farrer
(afterwards Lord Farrer), referring to the work of Lord Dalhousie's
department, said the reports made "were very able, but they were thrown
over immediately they got to the House." When, he declared, the Board of
Trade had taken all the means in their power to make a full report, "it was
treated as waste paper. The Board might just as well have made no report at
all." On the other hand, he admitted that the reports had not been of much
actual value, the Board of Trade having no power to call the parties before
them and take evidence.
Apart from a feeling of jealousy entertained by members in general and
Private Bill Committees in particular towards any curtailment of their
powers, privileges and functions by departmental officials, experience had
shown that the Private Bill Committees, after examining witnesses, getting
expert testimony and hearing counsel, were better able to ascertain the
facts of particular schemes than the special department, while the latter
had lost credit, also, on account of its recommendations in regard to
amalgamations.
The first scheme of this kind on which it was asked to report was one for
an amalgamation between the Liverpool and Manchester Railway, the Grand
Junction Railway (from Liverpool to Birmingham) and the North Union (from
Warrington to Preston). The Bill was opposed by public bodies and traders
in the leading towns of Lancashire, and Lord Dalhousie's report favoured
the opposition; but the Select Committee on the Bill nevertheless assented
to an amalgamation which was, in effect, to lead to the creation of the
London and North-Western system of to-day. The department also reported
unsuccessfully in 1845 against the amalgamation of the Chester and
Birkenhead with the Chester and Holyhead Railway--two other lines which
were first united to each other and then to the London and North-Western.
It further reported against various proposed amalgamations and arrangements
in the Midland Counties; so that, as the Report of the Select Committee of
1872 points out, the department would have objected strongly to such
combinations as the present London and North-Western Railway, the
{277}Great Western, the North-Eastern, the Midland, the Great Northern and
the Great Eastern.
These considerations should be borne in mind by those who might otherwise
be disposed to criticise the attitude adopted by the Government of 1845
towards the special department here in question.
The one experiment had been a failure--with, as we have seen, deplorable
consequences for the country and serious prejudice to _bona fide_ railways;
but Committees of both Houses, appointed in 1846, were now to recommend
another. They advised the creation of a Board of Commissioners of Railways
who were to discharge the dual functions of (1) seeing that the railway
companies did not contravene the provisions of their special Acts or of any
general Statutes; and (2) report to Parliament, if so directed, upon any
pending railway Bills.
An Act to this effect was passed in 1846; but in the following Session
there was introduced a Bill which proposed greatly to increase the powers
of the Board of Commissioners. Clifford says, concerning this Bill, that it
made the Commissioners, in effect, arbiters of all railway legislation.
Promoters were not even to survey an intended line until the Commissioners
gave permission. When the survey was made one of their officers was to
report upon the project. With them plans and sections were to be deposited;
they were to examine into compliance with Standing Orders and report to
Parliament upon engineering merits and proposed rates. Considerable
authority was also vested in them over existing railways. They were to
report annually to Parliament upon tolls, fares and charges, and upon the
regularity or irregularity of trains; and they might call for returns as to
traffic and many other details of management, inspect the books and
documents of railway companies, and settle disputes between companies
having termini or portions of line in common.
"Parliament," Clifford further tells us, "was again jealous of this
proposed interference with legislation." The railway companies also
protested, and the measure was received with such general disfavour that it
was withdrawn before it reached a second reading. As for the Board of
Commissioners, instead of getting more authority it got less. Part of its
functions were re-united to those of the Board of Trade in 1848, and the
{278}remainder followed in 1851, whereupon the new authority ceased to
exist.[44]
Once more, therefore, railway Bills were left to be dealt with on their
individual merits by Private Bill Committees operating on lines to which,
not simply John Herapath, but Mr Gladstone's own Committee, had taken
exception; and once more was a set-back given to the aspiration for the
establishment of some central authority which could organise, co-ordinate
or otherwise consolidate the still rapidly increasing railways on the basis
of a national system of rail communication. The difficulty might, perhaps,
have been met by the creation of a Minister of Communications, who would
have held a position somewhat similar to that of the Minister of Public
Works in Prussia or in France, and have discharged a useful function as
director-in-chief, or, at least, as adviser-in-chief, in regard alike to
railways, roads, rivers and canals. Such a Minister, being a member of the
Government, might have acted or recommended without wounding the
susceptibilities of Private Bill Committees or of individual members; he
might have organised or been the means of organising an efficient system of
railways at an earlier date and at far less cost; and he might have saved
both the country from its enormous losses on the wild-cat projects of
unscrupulous schemers during the mania period and _bona fide_ companies
from much of the excessive capitalization into which they were driven.
Whether or not the problems of the situation could have been solved in this
manner, the fact remains that it was the railway companies themselves
who--in spite of the established policy of the State, directed to the
maintenance of railway competition, and in spite of the disapproval of
amalgamations by one Parliament Committee after another--brought about the
conveniences of through travel or through transit. It was they themselves
who, by amalgamation or otherwise, instigated the creation of the "great"
companies which both ensured these conveniences and effected a complete
transformation in the general railway position, to the great advantage of
everyone concerned.
{279}Before, however, reaching this stage in their development, the
railways had had some other struggles with the Government on questions of
State policy arising out of those aforesaid feelings of suspicion and
distrust, and due to the same fear as before that the companies would be
sure to abuse their position unless they were restrained from so doing.
Following on the recommendations of the Committee of 1840, and with a view
to safeguarding the public interests in regard alike to safety and to
reasonable treatment, some important statutory powers had already been
conferred on the Board of Trade. Under the Regulation of Railways Act,
1840, notice was to be given to the Board of Trade of the opening of all
new lines of railway; such lines were to be inspected by Board of Trade
inspectors; various returns in respect of traffic, tolls, rates and
accidents were to be made to that body, to which, also, all existing
bye-laws affecting the public were to be submitted for confirmation. In
1842 a further Act gave the Board power to delay the opening of any new
line until they were satisfied that all the necessary works had been
effectively constructed. Mr Glyn, chairman of the London and Birmingham
Railway, said of this measure: "It is a Bill which I do not hesitate to say
is, on the whole, calculated to do the interests of railways very
considerable service."
But the attitude of the companies was no longer favourable when Mr
Gladstone's Committee of 1844 proposed to confer on the Board of Trade some
drastic powers for the periodical revision of railway rates, and likewise
sought to lay down the terms on which the State might acquire all future
lines of railway. The proposals in question were incorporated in a Bill
which was brought in by Mr Gladstone; but the measure met with strenuous
opposition from the railway interests, and the modifications introduced
before it became law were of such a nature that the Act has never been put
into operation.
In regard to the revision of rates, the Act laid down that if, after the
lapse of twenty-one years (not fifteen, as proposed in Mr Gladstone's first
Bill), any railway sanctioned after the passing of the Act had paid ten per
cent for three years, the Treasury (not the Board of Trade) might reduce
the rates, guaranteeing, however, a ten per cent dividend to {280}the
company, while the revised rates and the guarantee were to continue for
another twenty-one years. Needless to say, railway companies in general do
not pay ten per cent dividends, though in 1844 ten per cent was regarded as
quite a reasonable dividend for a railway, in view of what the canal
companies had been paying; while no such guarantee as that suggested is
ever likely to be made by the Treasury. Provisions authorising the Board of
Trade to make deductions from the guaranteed income as penalties for what
they might regard as mismanagement, and prohibiting a company from
increasing its capital pending a revision of rates, without the sanction of
the Board of Trade, were so vigorously opposed that they were abandoned.
The clauses of the Act relating to State purchase were to apply only to new
lines of railway, the 2320 miles of railway sanctioned prior to the Session
of 1844--and including many of the chief links in the great trunk lines of
to-day--being expressly excluded. As regarded railways sanctioned in the
Session of 1844, or subsequently thereto, it was enacted that after the
lapse of fifteen years the Treasury might acquire them for twenty-five
years' purchase of the average annual profits for the preceding three
years; but if those profits were less than ten per cent, the amount was to
be settled by arbitration. It was further enacted that no railway less than
five miles in length should be bought; that no branch should be acquired
without purchase of the entire railway; that the policy of revision or
purchase was not to be prejudiced by the Act; that "public resources" were
not to be employed to sustain undue competition with independent companies;
and, finally, that no revision of rates or State purchase of lines should
take place at all without an Act of Parliament authorising the guarantee or
the purchase, and determining how either was to be done.
To argue, as many advocates of the nationalisation of railways habitually
do, that the basis for State purchase has already been established by the
Act of 1844 is to set up a theory which is obviously inconsistent with the
real facts of the situation.
Commenting on this Act of 1844 the Joint Committee on the Amalgamation of
Railway Companies (1872) say in their report:--
{281}"It would be impossible to deal with railways made since 1844 without
dealing with railways made before that time, since both form part of the
same systems.
"As regards the revision of rates, no Government would undertake to try
experiments in reducing rates on an independent company whose income they
must guarantee; and efficient or economical administration could scarcely
be expected from a railway company whose rates were cut down and whose
dividend at ten per cent was guaranteed by Government.
"Whatever value there may be in the notice given to the companies by this
Act of their liability to compulsory purchase by the State, over and above
the general right of expropriation possessed by the latter in such cases,
its terms do not appear suited to the present condition of railway property
or likely to be adopted by Parliament in case of any intention at any
future time on the part of Parliament to purchase the railways."
The proposals contained in the Bill, and modified into the Act of 1844,
were, of course, simply a further development of the then established
policy of the State in taking precautions against the evils that might
result from railway monopoly.
A greater degree of apparent success was, at first, to attend those further
precautionary measures which took the form of encouraging the construction
of competing lines, leading both to new and to existing companies invading
the so-called "territory" of other companies, as distinct from the
provision of lines in districts which had no railways at all.
There was at this time much discussion as to the rights of established
companies.
When the proposal for the appointment of the Committee of 1840 was under
discussion in the House of Commons, Sir Robert Peel had contended that a
material distinction was to be drawn between new companies approaching
Parliament for the first time and companies which, relying on the faith of
Parliament, had invested their capital in the construction of railways.
"Parliament, it was true, might repent of the indiscretion and levity with
which it had granted those powers ... but he would advise Parliament to be
very cautious how it interfered with the profits or management of companies
which had been called into existence by the {282}authority, and had
invested their money on the faith, of Parliament." Mr Gladstone's Committee
of 1844 also declared that they had been "governed throughout their
consideration of the subject by the strongest conviction that no step
should be taken by Parliament which would either induce so much as a
reasonable suspicion of its good faith with regard to the integrity of
privileges already granted, and not shown to have been abused, or which
would prospectively discourage the disposition now so actively in operation
to extend the railway system by the formation of new lines."
On the other hand, there was that ever-present and ever-active dread of
what _might_ happen if the railway companies _did_ become grasping and
merciless monopolists. There was, also, the fact that while there would be
direct competition between two railways having the same terminal points,
each line might further serve a more or less considerable and important
intermediate stretch of country which otherwise would be left without
railway accommodation at all.
For one or other of these reasons competing lines continued to be
sanctioned, notwithstanding Special Committees' recommendations and railway
companies' protests. One such protest, giving a specific example of the
tendencies of the day, was made in a memorial to the Board of Trade, dated
June 26, 1857, and headed, "Proposed Remedies for Railway Grievances." The
memorial, signed by Sir John Hall, Bart., and six others, and addressed to
Lord Stanley of Alderley, president, and Mr Robert Lowe, vice-president, of
the Board of Trade, had been drawn up at the request of those two gentlemen
as a more detailed statement of facts to which their attention had already
been called. Five specific grievances were dealt with, and the first of
these was "The Tendency of Parliament to concede competing or otherwise
unnecessary lines." Under this head the memorialists state:--
"It is not our desire that the railway system should be legislatively
restricted within its present limits, or that existing shareholders should
by any process whatever be nominally or practically gifted with a monopoly
of the means of railway transit. We should submit to the introduction of
new lines of railway wherever called for by absolute public necessity....
In such cases, however, we consider that the Legislature would only be
doing justice to its previous enactments in {283}giving former applicants
time to complete their engagements so that they might be able, at the
proper time, to exhibit their ability and their willingness to consider the
wants of the public as well as their proper remuneration."
The memorialists mention the fact that in 1853 several new lines were
sanctioned, the period fixed for their completion being 1858, and they
proceed:--
"Already, however, before these lines are opened, others are promoted in
competition with them--promoted, not by a complaining locality, but in some
cases by existing companies, in others by persons whose only apparent
object is to sell the schemes to advantage when Parliament has sanctioned
their construction. In such instances as these we humbly submit that the
Legislature should not permit the introduction of new lines until it has
seen whether or not the company in possession can fulfil its engagements,
and whether, also, such company should not be permitted an opportunity of
electing to extend its undertaking, or to leave further effort to the
discretion of the Legislature."
Whilst the State was thus maintaining its own policy of competition, the
railway companies were equally persistent in keeping to their policy of
amalgamation; so that, as the Joint Committee of 1872 remarked, "A new line
was sure sooner or later to join the combination of existing railways, and
to make common cause with them."
Practical railway experience was showing that the ordinary ideas of
competition, as regarded commercial undertakings in general, did not and
could not be made to apply to railways beyond a certain point. The capital
sunk alike in obtaining a railway Act, in acquiring and adapting land, with
provision of embankments, cuttings, viaducts, bridges, tunnels, etc., for
the railway lines, and in supplying the various necessary appurtenances,
railway stations, and so on, was irredeemable, since, in the case of
failure of the line, due to competition or otherwise, the capital invested
could not be realised again, the land, rails, buildings, etc., on which it
had been spent being of little or no value for other than railway purposes.
There could thus be no transfer of capital from one undertaking to another,
as in ordinary commercial affairs.
In addition to this it might be that interest would have to be paid on two
lots of railway capital in a district where the {284}traffic was sufficient
to allow of the financial obligations of only a single company being
efficiently met, any success achieved by the new company depending (until
the available traffic increased) on its power to divert business and
profits from the other company.
Hence it might well occur that "the best laid schemes" of Parliament and
Parliamentary Committees, in approving competitive lines, resulted only in
the companies concerned coming to, at least, a friendly understanding; and
it might even be that the public did not eventually benefit at all,
because, as the Joint Committee of 1872 say, "The necessity of carrying
interest on the additional capital required for the new line tends
sometimes, in the end, to raise rather than to reduce the rates."
Economic considerations, again, apart altogether from those monopolistic
tendencies on the fear of which the policy of the State had been founded,
were quite sufficient to account for the absorption of one company by
another, and especially of small companies by larger ones, not so much to
avoid competition as to ensure the provision of through routes operated
under one and the same management, involving less outlay on working
expenses, and providing greater advantages to the public than if the same
length of line belonged to a number of different companies.
The lines between London and Liverpool, for example, were originally
divided between three companies, and the same was the case with the lines
between Bristol and Leeds. In some instances the companies were not on good
terms with one another, and they ran their trains to suit their own
convenience. Even when they were on good terms, they might not have any
interests in common, apart from (at one time) offering as few comforts and
conveniences as possible to the third-class traveller, and compelling him
at least to complete his journey by going first class, if he wished to get
to his destination the same night.
As early as 1847 attempts had been made by some of the companies to
overcome the glaring defects of the original system of railway construction
by establishing the Railway Clearing House, with a view to facilitating
through traffic and allowing of a better adjustment of accounts when
passengers or goods were carried over various lines in return for a
{285}single payment. The companies persevered, however, in their further
policy of amalgamation and consolidation, and in 1853 the number and
magnitude of schemes with these objects in view created such alarm on the
part both of politicians and of traders that a further Select
Committee--known as Mr. Cardwell's Committee--was appointed.
The members of this Committee pointed out in their report that the whole
tendency of the companies was towards union and extension, that competition
ended in combination, and that the companies were able in great measure to
attain these ends by agreements with one another without the authority of
Parliament. The economy and the convenience resulting from amalgamation
were admitted by the report; but, though still no proof was offered, or
suggestion made, that the companies were actually abusing the greater
powers they had thus secured, there was an obvious under-current of alarm
in the minds of the Committee as to the many undesirable things which large
concerns _might_ do.
The Committee were opposed to any "districting" of the country between
different companies, and they recommended that, while working agreements
might be allowed, amalgamations between large companies should not. As an
example of the combinations they deprecated, I might mention that they
pointed with evident feelings of much concern to the fact that if the
amalgamation schemes then being proposed by the London and North-Western
Railway Company were conceded, they would involve the union under one
control of a capital of £60,000,000, a revenue of £4,000,000, and 1200
miles of railway, with the further result of "rendering impossible the
existence of independent rival trunk lines." One wonders what the members
of this Committee would have said had they been told that by the end of
1910 (as shown by the Board of Trade "Railway Returns") the London and
North-Western would control a total authorised capital of (in round
figures) £134,000,000, have gross receipts in a single year amounting to
£15,962,000, and be operating 1966 route miles of line, equivalent to 5490
miles of single track (including sidings), besides being only one of half a
dozen great trunk lines.
A much more practical result of the deliberations of this Committee was
seen in certain provisions of the Railway and Canal Traffic Act, 1854,
which laid down that every {286}railway company should afford proper
facilities for receiving and forwarding traffic; that no undue or
unreasonable preferences should be given; and that where the systems were
continuous the companies should afford due and reasonable facilities for
the interchange of traffic, without undue preference or obstruction. In
this way it was sought to bring about greater co-ordination between the
numerous small lines, and secure a better provision for through traffic.
The Act is well described by the Select Committee of 1872 as "a measure
valuable in fact and most important in its scope and intention." It may
have been further anticipated that companies which, as the result of the
Act, secured running powers or free interchange of traffic over the lines
of other companies--and especially as regards lines having access to
London--would be less ready to agree to absorption by them; but if this
expectation were, indeed, entertained, it was not realised.
The companies, in fact, continued to develop their commercial undertakings
in accordance with what they regarded as commercial principles, and the
Joint Committee on the Amalgamation of Railway Companies, 1872, taking a
much broader view of the situation than previous Committees had done,
pointed out how small had been the effect of the policy sought to be
enforced against the railways, since the combinations which had enabled the
great trunk lines to attain to the position they occupied at that date had
been effected "contemporaneously with reports against large combinations,"
those reports having had "little influence upon the action of Private Bill
Committees," and not staying "the progress of the companies in their course
of union and amalgamation." The Committee further said, on the subject of
"districting":--
"Among the various suggestions which naturally occur when dealing with the
question of amalgamation, one of the most obvious and most important is to
the effect that for the future some endeavour should be made to compel
railways in amalgamating to follow certain fixed lines or principles.... If
at an earlier period in railway history such an attempt had been
successfully made, there is no doubt that it might have provided us with a
railway system, if not more efficient, at any rate far less costly than
that which we now possess. But considering _the policy, or want of policy_,
which has hitherto {287}been pursued, and the interests which have grown up
under it, the difficulties of laying down any fixed policy for the future
are very formidable."
The words in this extract which I have put in italics, representing, as
they do, the views of a Joint Committee of the House of Lords and of the
House of Commons, justify, I would suggest, much of the criticism in which
I have here ventured to indulge.