- CHAPTER I
Introduction Scope of the inquiry. - CHAPTER II
The Argument for the Nationalization of the Telegraphs The indictment of the telegraph companies. The argument from foreign experience. The promise of reduced tariffs and increased facilities. The alleged financial success of foreign State telegraphs: Belgium, Switzerland and France. The argument from English company experience. - CHAPTER III
The alleged Break-down of Laissez-faire Early history of telegraphy in Great Britain. The adequacy of private enterprise. Mr. Scudamore’s loose use of statistics. Mr. Scudamore’s test of adequacy of facilities. Telegraphic charges and growth of traffic in Great Britain. The alleged wastefulness of competition. The telegraph companies’ proposal.
- CHAPTER IV
The Purchase of the Telegraphs Upon inadequate consideration the Disraeli Ministry estimates at $15,000,000 to $20,000,000 the cost of nationalization. Political expediency responsible for Government’s inadequate investigation. The Government raises its estimate to $30,000,000; adding that it could afford to pay $40,000,000 to $50,000,000. Mr. Goschen, M. P., and Mr. Leeman, M. P., warn the House of Commons against the Government’s estimates, which had been prepared by Mr. Scudamore. The Gladstone Ministry, relying on Mr. Scudamore, estimates at $3,500,000 the “reversionary rights” of the railway companies, for which rights the State ultimately paid $10,000,000 to $11,000,000. - CHAPTER V
None of Mr. Scudamore’s Financial Forecasts were Realized The completion of the telegraph system costs $8,500,000; Mr. Scudamore’s successive estimates had been respectively $1,000,000 and $1,500,000. Mr. Scudamore’s brilliant forecast of the increase of traffic under public ownership. Mr. Scudamore’s appalling blunder in predicting that the State telegraphs would be self-supporting. Operating expenses on the average exceed 92.5% of the gross earnings, in contrast to Mr. Scudamore’s estimate of 51% to 56%. The annual telegraph deficits aggregate 26.5% of the capital invested in the plant. The financial failure of the State telegraphs is not due to the large price paid to the telegraph companies and railway companies. The disillusionment of an eminent advocate of nationalization, Mr. W. Stanley Jevons. - CHAPTER VI
The Party Leaders ignore their Fear of an Organized Civil Service Mr. Disraeli, Chancellor of the Exchequer, opposes the enfranchisement of the civil servants. Mr. Gladstone, Leader of the Opposition, assents to enfranchisement, but expresses grave apprehensions of evil results.
- CHAPTER VII
The House of Commons is Responsible for the Financial Failure of the State Telegraphs Sir S. Northcote, Chancellor of the Exchequer in Mr. Disraeli’s Ministry of 1874 to 1880, is disillusioned. The State telegraphs become self-supporting in 1879-80. The House of Commons, under the leadership of Dr. Cameron, M. P., for Glasgow, overrides the Ministry and cuts the tariff almost in two. In 1890-91 the State telegraphs would again have become self-supporting, had not the House of Commons, under pressure from the civil service unions, increased wages and salaries. The necessity of making money is the only effective incentive to sound management. - CHAPTER VIII
The State Telegraphs Subsidize the Newspaper Press Why the newspaper press demanded nationalization. Mr. Scudamore gives the newspaper press a tariff which he deems unprofitable. Estimates of the loss involved in transmitting press messages, made by responsible persons in the period from 1876 to 1900. The State telegraphs subsidize betting on horse races.
- CHAPTER IX
The Post Office Employees press the House of Commons for Increases of Wages and Salaries British Government’s policy as to wages and salaries for routine work, as distinguished from work requiring a high order of intelligence. The Fawcett revision of wages, 1881. Lord Frederick Cavendish, Financial Secretary to the Treasury, on pressure exerted on Members of Parliament by the telegraph employees. Sir S. A. Blackwood, Permanent Secretary to the Post Office, on the Fawcett revision of 1881. Evidence as to civil servants’ pressure on Members of Parliament presented to the Royal Commission on Civil Establishments, 1888. The Raikes revision of 1890-91; based largely on the Report of the Committee on the Indoor Staff, which Committee had recommended increases in order “to end agitation.” The Earl Compton, M. P., champions the cause of the postal employees in 1890; and moves for a Select Committee in 1891. Sir James Fergusson, Postmaster General in the Salisbury Ministry, issues an order against Post Office servants “endeavoring to extract promises from any candidate for election to the House of Commons with reference to their pay or duties.” The Gladstone Ministry rescinds Sir James Fergusson’s order. Mr. Macdonald’s Motion, in 1893, for a House of Commons Select Committee. Mr. Kearley’s Motion, in 1895. The Government compromises, and appoints the so-called Tweedmouth Inter-Departmental Committee. - CHAPTER X
The Tweedmouth Committee Report The Government accepts all recommendations made by the Committee. Sir Albert K. Rollit, one of the principal champions in the House of Commons of the postal employees, immediately follows with a Motion “intended to reflect upon the Report of the Tweedmouth Committee.” Mr. Hanbury, Financial Secretary to the Treasury, intimates that it may become necessary to disfranchise the civil servants. The Treasury accepts the recommendations of the so-called Norfolk-Hanbury Committee. The average of expenses on account of wages and salaries rises from 11.54 cents per telegram in 1895-96, to 13.02 cents in 1902-03, concomitantly with an increase in the number of telegrams from 79,423,000 to 92,471,000.
- CHAPTER XI
The Post Office Employees continue to press the House of Commons for Increases of Wages and Salaries The Post Office employees demand “a new judgment on the old facts.” Mr. S. Woods’ Motion, in February, 1898. Mr. Steadman’s Motions in February and June, 1899. Mr. Hanbury, Financial Secretary to the Treasury, points out that the postal employees are demanding a House of Commons Select Committee because under such a Committee “the agitation and pressure, now distributed over the whole House, would be focussed and concentrated upon the Select Committee.” Mr. Steadman’s Motion, in April, 1900. Mr. Bayley’s Motion, in June, 1901. Mr. Balfour, Prime Minister, confesses that the debate has filled him “with considerable anxiety as to the future of the public service if pressure of the kind which has been put upon the Government to-night is persisted in by the House.” Captain Norton’s Motion, in April, 1902. The Government compromises by appointing the Bradford Committee of business men. Mr. Austen Chamberlain, Postmaster General, states that Members from both sides of the House “seek from him, in his position as Postmaster General, protection for them in the discharge of their public duties against the pressure sought to be put upon them by employees of the Post Office.” He adds: “Even if the machinery by which our Select Committees are appointed were such as would enable us to secure a Select Committee composed of thoroughly impartial men who had committed themselves by no expression of opinion, I still think that it would not be fair to pick out fifteen Members of this House and make them marked men for the purpose of such pressure as is now distributed more or less over the whole Assembly.” - CHAPTER XII
The Bradford Committee Report The Bradford Committee ignores its reference. It recommends measures that would cost $6,500,000 a year, in the hope of satisfying the postal employees, who had asked for $12,500,000 a year. Lord Stanley, Postmaster General, rejects the Bradford Committee’s Report; but grants increases in wages aggregating $1,861,500 a year.
- CHAPTER XIII
The House of Commons Select Committee on Post Office Servants, 1906 The Post Office Civil Servants’ Unions demand the adoption of the Bradford Committee Report. Lord Stanley, Postmaster General, applies the words “blackmail” and “blood-sucking” to the postal employees’ methods. Captain Norton moves for a House of Commons Select Committee. Mr. Austen Chamberlain, Chancellor of the Exchequer, in vain asks the Opposition Party’s support for a Select Committee to which shall be referred the question of the feasibility of establishing a permanent, non-political Commission which shall establish general principles for settling disputes between the civil servants and the Government of the day. Captain Norton’s Motion is lost, nine Ministerial supporters voting for it, and only two Opposition members voting against it. Mr. J. Henniker Heaton’s appeal to the British public for “An End to Political Patronage.” The Post Office employees, in the campaign preceding the General Election of January, 1906, induce nearly 450 of the 670 parliamentary candidates who succeeded in being elected, to pledge themselves to vote for a House of Commons Select Committee on Post Office Wages. Immediately upon the opening of Parliament, the Sir H. Campbell-Bannerman Liberal Ministry gives the Post Office employees a House of Commons Select Committee.
- CHAPTER XIV
The House of Commons, under Pressure from the Civil Service Unions, curtails the Executive’s Power to dismiss Incompetent and Redundant Employees The old practice of intervention by Members of Parliament on behalf of individual civil servants with political influence has given way to the new practice of intervention on behalf of the individual civil servant because he is a member of a civil service union. The new practice is the more insidious and dangerous one, for it means class bribery. The doctrine that entrance upon the State’s service means “something very nearly approaching to a freehold provision for life.” Official testimony of various prominent civil servants, especially of Mr. (now Lord) Welby, Permanent Secretary to the Treasury from 1885 to 1894; and Mr. T. H. Farrer, Permanent Secretary to Board of Trade from 1867 to 1886. The costly practice of giving pensions no solution of the problem of getting rid of unsatisfactory public servants. - CHAPTER XV
The House of Commons, under Pressure from the Civil Service Unions, curtails the Executive’s Power to promote Employees according to Merit The civil service unions oppose promotion by merit, and demand promotion by seniority. Testimony presented before: Select Committee on Civil Services Expenditure, 1873; Select Committee on Post Office, 1876; Royal Commission to inquire into the Civil Establishments, 1888; from statement made in House of Commons, in 1887, by Mr. Raikes, Postmaster General; and before the so-called Tweedmouth Committee, 1897. Instances of intervention by Members of House of Commons on behalf of civil servants who have not been promoted, or are afraid they shall not be promoted.
- CHAPTER XVI
Members of the House of Commons intervene on behalf of Public Servants who have been Disciplined Evidence presented before: The Royal Commission appointed to inquire into the Civil Establishments, 1888; and the Tweedmouth Committee, 1897. Instances of intervention by Members of Parliament. Mr. Austen Chamberlain, Financial Secretary to the Treasury, in April, 1902, states that at a low estimate one-third of the time of the highest officials in the Post Office is occupied with petty questions of discipline and administrative detail, because of the intervention of Members of Parliament. He adds that it is “absolutely deplorable” that time and energy that should be given to the consideration of large questions must be given to matters that “in any private business would be dealt with by the officer on the spot.” Sir John Eldon Gorst’s testimony before the Committee on National Expenditure, 1902. - CHAPTER XVII
The Spirit of the Civil Service The doctrine of an “implied contract” between the State and each civil servant, to the effect that the State may make no change in the manner of administering its great trading departments without compensating every civil servant however remotely or indirectly affected. The hours of work may not be increased without compensating every one affected. Administrative “mistakes” may not be corrected without compensating the past beneficiaries of such mistakes. Violation of the order that promotion must not be mechanical, or by seniority alone, may not be corrected without compensating those civil servants who would have been benefitted by the continued violation of the aforesaid order. The State may not demand increased efficiency of its servants without compensating every one affected. Persons filling positions for which there is no further need, must be compensated. Each civil servant has a “vested right” to the maintenance of such rate of promotion as obtains when he enters the service, irrespective of the volume of business or of any diminution in the number of higher posts consequent upon administrative reforms. The telegraph clerks demand that their chances of promotion be made as good as those of the postal clerks proper, but they refuse to avail themselves of the opportunity to pass over to the postal side proper of the service, on the ground that the postal duties proper are more irksome than the telegraph duties. Members of Parliament support recalcitrant telegraph clerks whom the Government is attempting to force to learn to perform postal duties, in order that it may reap advantage from having combined the postal service and the telegraphs in 1870. Special allowances may not be discontinued; and vacations may not be shortened, without safeguarding all “vested interests.” Further illustrations of the hopelessly unbusinesslike spirit of the rank and file of the public servants.
- CHAPTER XVIII
The House of Commons stands for Extravagance Authoritative character of the evidence tendered by the several Secretaries of the Treasury. Testimony, in 1902, of Lord Welby, who had been in the Treasury from 1856 to 1894. Testimony of Sir George H. Murray, Permanent Secretary to the Post Office and sometime Private Secretary to the late Prime Minister, Mr. Gladstone. Testimony of Sir Ralph H. Knox, in the War Office since 1882. Testimony of Sir Edward Hamilton, Assistant Secretary to the Treasury since 1894. Testimony of Mr. R. Chalmers, a Principal Clerk in the Treasury; and of Sir John Eldon Gorst. Mr. Gladstone’s tribute to Joseph Hume, the first and last Member of the House of Commons competent to criticize effectively the details of expenditure of the State. Evidence presented before the Select Committee on Civil Services Expenditure, 1873. - CHAPTER XIX
Conclusion - INDEX
THE BRITISH STATE TELEGRAPHS
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