Another proposal which, though always condemned by competent judges, is still, in some form, very often brought forward, is to charge equal mileage rates.[7] Admitting the impossibility or impropriety of making rates vary according to the cost of conveyance of goods without reference to their value or quality—recognising the expediency of classification in some form—many persons think that it would be well to charge for the same kind of goods the same sum per mile universally. This plan is simple; it has an appearance of being equitable; and, as such, it is attractive. But, on the slightest consideration, it becomes apparent that exceptions which mar this simplicity must be admitted. In fact, no one proposes that this principle should be inflexibly carried out. Far from being really equitable, equal mileage rates would often act most unfairly. Mileage run is only one element out of many in cost of service; and to compel companies to charge the same sum between points equally distant, irrespective of the original cost of constructing the way, the nature of the gradients, the amount and regularity of the traffic to and fro, and the extent of back haulage of “empties,” would be doing great injustice. Obviously an allowance must be made to cover the cost of specially expensive undertakings, such as the Runcorn, Tay and Forth Bridges, the Sol way Viaduct, or the Severn Tunnel. So, too, allowance must be made for steep gradients; manifestly the same paying load cannot be carried over gradients of one in forty as over one in eight hundred. In Germany and Holland an effort has been made to adopt the mileage system; and (subject to exceptions for import, export and transit rates, referred to afterwards) it is assumed to be carried out. But patent facts could not be ignored; in these countries an extra mileage up to 12 kilometres (about 7½ miles) is taken into the calculation of rates for expensive bridges and steep gradients. Speed, too, must be taken into account; as it increases, a more than proportionate increase in engine power is necessary.[8]

Equality is here not equity. To all railway companies the result of establishing a system of equal mileage rates would not be the same. Much would depend on the question whether the rates were the same over all parts of the same railway, or whether equal mileage rates were in force throughout the country: a distinction not always borne in mind by those who propose such rates. Undoubtedly to many railways the loss of traffic as the result, of equal mileage rates would be serious. Unless a very low scale of rates, entailing heavy and unnecessary loss, were adopted, much of the long distance traffic would cease to be carried. On other railways, however, the present net revenue might be maintained by levelling up rates; although the amount of traffic would be less, the working expenses might be reduced. On the whole, the more the theory of equal mileage rates is studied, the clearer it becomes that its adoption would probably be much less injurious to some railway companies than to colliery proprietors, manufacturers, traders, ports, and to the country at large.[9]

To consumers, whose interest are so apt to be lost sight of in the controversy, the change would be disastrous. Equal mileage rates would seriously lessen or even destroy traffic now conveyed long distances. By narrowing the area of supply, they would raise the prices of provisions and commodities such as milk, fish, and vegetables in and near great towns. The sustenance of a community such as London, is, one might almost say, possible only because it is not fed solely from the region immediately round it, but is supplied from very distant points. If the London markets are able to procure fish from remote parts of Scotland or Ireland, beef from Aberdeenshire and adjacent counties, milk from farms within 100 miles, vegetables from Penzance, and the Channel Islands, eggs and butter from Normandy, coals from the Midlands, Lancashire and South Wales, the capital owes these advantages to the fact that English railways have not been bound by equal mileage rates. Were such a system strictly enforced, fuel, provisions, and most of the necessaries of life would be raised in price. So far as consumers are concerned, equal mileage freights by sea—the height of absurdity in the eyes of all who know anything of commerce—would be as reasonable as equal mileage rates by land.[10]

To manufacturers whose works and premises are not near densely populated districts or ports—the great centres of consumption or export—the change would be disastrous. They would be driven out of the field by more favourably situated competitors, who would acquire a monopoly. The pursuit of certain trades would become impossible in districts in which they are now carried on with success. Not a few manufactories would soon be closed, but for the facilities which they now possess for procuring raw materials from remote parts. To give a few illustrations out of many: South Staffordshire is supplied with iron ore or pig-iron from Staveley in Derbyshire, Westbury in Wiltshire, Fawler in Oxfordshire, Frodingham in Lincolnshire, Ulverstone and Wigan in Lancashire, Middlesborough in Yorkshire, and also from South Wales; and it receives limestone from Froghall in North Staffordshire, Minera in Denbighshire, Wirksworth in Derbyshire, Presteign in Radnorshire, and Porthywaen in Shropshire.[11] Such are examples of the interdependence of districts and industries, the co-operation of places far apart, with which equal mileage rates would interfere. Even if originally they would have been beneficial they would revolutionize the conditions under which trade has been carried on in this country since the introduction of railways.[12]

Some advocates of the theory of mileage rates may concede that their adoption would entail loss on certain districts and to some individuals, but deny that the community as a whole would suffer.[13] Is this a reasonable view? Even if the home trade were not injured, the result of equal mileage rates must be to increase the cost of production of many articles manufactured at a distance from ports of shipment. Would not this make competition with foreign countries more difficult than it is? And must it not reduce the demand for labour?

The principle of equal mileage rates, it may be added, has been condemned by every Royal Commission and Parliamentary Committee which has investigated the subject; and this condemnation has been pronounced on grounds for the most part wholly independent of the interests of railway companies. As pointed out by the Select Committee of 1872, the principle would “prevent railway companies from making perfectly fair arrangements for carrying at a lower rate than usual goods brought in large and constant quantities, or for carrying for long distances at a lower rate than for short distances.”

“It would prevent railway companies from lowering their fares and rates so as to compete with traffic by sea, by canal, or by a shorter or otherwise cheaper railway, and would thus deprive the public of the benefit of competition, and the company of a legitimate source of profit.”

“It would compel a company to carry for the same rate over a line which has been very expensive in construction or which from gradients or otherwise is very expensive in working, at the same rate at which it carries over less expensive lines.”

The Committee add—“It will be found that the supporters of equal mileage, when pressed, often really mean, not that the rates they themselves pay are too high, but that the rates which others pay are too low.” In other words, they desire to apply the principle when it works in their favour, and to reject it when it does not.[14]