APPENDIX.

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Great Britain. Parliament. House of Commons. Select Committee to Inquire into the Contract Packet Service

No. 1.—Memorandum of Contracts with Government for the Conveyance of Her Majesty’s Mails by the Peninsular and Oriental Steam Navigation Company.

STATION. Distance
per
Voyage.		 Annual
Distance.		 Annual
Sum.
£		 Per Mile.
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
nearly4/9
2. Southampton to Malta and Alexandria, once a month, on the 20th 6,084 73,008 28,500 7/9½
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
nearly½

London, 8th June, 1848.

No. 2—List of the Steam Ships belonging to the Peninsular and Oriental Steam Navigation Company.—June 10, 1848.

No. NAME
of the
VESSEL.		 REGISTER TONNAGE. Horse
Power.		 Cost.
Ship. Engine
Room.		 Old
Measurement.
New Measurement. £
1 Bentinck 94150/100 1,03281/100 1,70220/94 520 89,000
2 Precursor 1,1333/10 684 1,640 460 63,000
3 *Haddington 1,16684/100 48060/100 1,30313/94 450 61,500
4 Oriental 1,1035/10 684 1,30320/94 420 78,000
5 India 5011750/7500 3691750/7500 75574/94 350 10,500
6 Achilles 58679/100 40536/100 85378/94 430 26,500
7 *Pottinger 9349/10 467 1,225 450 66,000
8 *Pekin 75924/100 4239/100 1,000 400 46,000
9 Lady M. Wood 29651/100 25659/100 50320/94 260 31,500
10 Braganza 570 284 70770/94 264 21,100
11 *Canton 21835/100 170 38727/94 .... 14,000
12 Hindostan 9716/10 1,0466/10 1,55239/94 520 88,000
13 *Indus 9273/10 4589/10 1,2515/94 450 62,000
14 *Ripon 1,1678/10 458 1,39439/94 450 66,000
15 *Ariel 4438/10 265 8217/94 300 38,500
16 *Erin 5326/10 265 810 280 35,000
17 *Euxine 729407/3500 4352065/3500 1,03967/94 400 43,500
18 *Sultan 72879/100 36157/100 99085/94 400 38,500
19 Tagus 497 285 70988/94 286 28,000
20 *Pacha 30253/100 24588/100 51774/94 210 16,000
21 Iberia 3019/10 2138/10 520 190 22,000
22 Jupiter 288 255 4379/94 210 15,500
23 Montrose 2834/10 322 596 260 18,500
24 *Madrid 3151/10 1636/10 4468/94 140 17,000
25 *Malta 77682/100 44064/100 1,225 450 57,500
26 Bombay .... .... 1,20943/94 400 58,000
27 Ganges .... .... 1,20943/94 400 58,000
28 Vestis .... .... 90586/94 370 47,000
27,01770/94 9,870 1,220,500
No. NAME
of the
VESSEL.		 CREW. NATIVE CREW. Total
Crew.
Cap-
tain.		 Mates, Surgeons, Pursers, and Clerks. Stewards and Servants, Engineering
Department.		 Sea-
men.		 Ser-
vants.		 Fire-
men.		 Sea-
men.
Engin-
eering.		 Fire-
men.
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
commenced
Running.		 STATION. REMARKS.
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 Company afloat; first voyage, 17th October, 1845
7 *Pottinger 20 Sept. 1846 Ditto.
8 *Pekin 28 Jan. 1847 Ditto.
9 Lady M. Wood 1 Feb. 1842 Ditto.
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 19 Sept. 1840 Ditto
23 Montrose .... Southampton and Peninsula. Purchased afloat.
24 *Madrid 5 Sept. 1840 Ditto Ditto
25 *Malta 17 Nov. 1845 ....
26 Bombay .... .... Not yet Running.
27 Ganges .... .... Ditto
28 Vestis .... .... Ditto

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
General purser’s account, stores afloat 22,923 2 0
General purser’s account stores ashore 28,451 19 4
General material account ship’s stores 28,474 12 3
———— 74,849 13 7
Ships, &c., at work 754,670 16 0
Ships, &c., stock 304,600 0 0
Ships, &c., building £152,841 11 7
Advanced on account of repairs 19,273 13 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
Bills payable 121,475 19 5
Dividend, 8th to 13th, half-year 2,197 6 20
Dividend, 14th to 13th, half-year 2,426 6 4
London and South Western Railway Company 3,722 12 1
Southampton Dock Western Railway Company 1,944 7 0
———— 131,766 11 1
Suspense account 334 19 3
R. Franck, stamp account 6 0 0
S. R. Engledue account 13 0 0
Oil and Tallow account 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
———— 973,37 16 8
Repairs account £76,075 17 6
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
Balance of this account remaining 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 Expenses, Salaries 1,341 0 11
Malta Expenses, Salaries 461 1 4
Constantinople Agency 1,508 18 6
Calcutta Agency (exclusive of Repairs to Ships) 3,323 19 0
Bombay Agency (exclusive of Repairs to Ships) 1,382 7 8
Hong Kong Agency 835 1 7
Lisbon Agency (for two years) 1,206 19 3
21 Minor Agencies at sundry Foreign Stations 2,237 0 4
London Agency, 21/2 per cent. Commission on Freight and Passage Money, comprehending Rent of Offices, Taxes, Stationery, Account Books, Office Expenses, Postages (not foreign), Custom House business, and Clerks’ Salaries, for the business of the management, &c. &c., pursuant to the Deed of Settlement 8,246 10 9
Advertisements during the half year 1,121 3 11
Floating Light (Suez) Expenses, year 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
Donations; viz.—Lieutenant Waghorn 300 0 0
Donations; viz.—Captain Bingham 100 0 0
Donations; viz.—Sundries 39 0 0
———— 744 0 0
Subscriptions (see particulars at foot8) 163 16 8
Foreign Postages, Travelling Expenses, Charts, Newspapers,vand Petty Expenses 908 0 2
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 for the 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. 01/4d. a mile and by the company at 7s. 91/2d. 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 4s. 6d., the price of the Lisbon, instead of 8s. 01/4d., 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 4s. 6d. 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 elsewhere10 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 them11 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.”

                                                                                                                                                                                                                                                                                                           

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