It is thus mainly in the direction of railway feeders that the need for increased transport facilities exists to-day.
In this absence of any general necessity for additional railways, the policy of the railway companies of late years has been directed more to the consolidation and economical working of the existing system of lines. This policy has especially aimed at the furtherance of those mutual agreements and amalgamations which, as we have seen, have constituted a prominent phase in the development of railways from a very early period in their history. Present-day tendencies in this direction are especially due to the fact that working expenses have greatly increased while the powers of the companies to increase their charges are still subject to the restrictions of the Act of 1894, under which they may be required to justify before the Railway and Canal Commission any increase in a rate since the 31st of December, 1892. Increase of expenditure is found in the higher wages bills, in the ever-expanding items of rates and taxes, in the heavier cost of raw materials, in the greater amount of clerical and other work resulting from the sending of frequent small consignments in place of consignments in bulk, and in the provision of greater conveniences and luxuries in travel.
An increased volume of traffic has, to a certain extent, compensated for these heavier expenses; but it has not done so sufficiently, and the ideal remedy has appeared to lie in the direction of effecting economies in operation and management, either by individual companies or through arrangements between two or more, to their mutual advantage, and without, as the companies have claimed, any disadvantage to the public.
In some instances companies have had to grant such concessions to local communities as a means of overcoming threatened opposition to their proposed arrangements that the value of the advantages eventually obtained has been represented almost by a negative quantity. In other instances the opposition has been so keen, and the "prices of assent" have been so exacting, that the companies concerned have preferred to abandon their schemes rather than go on with them. In still other instances companies have refrained from attempting to carry out amalgamations requiring Parliamentary sanction, and thus likely to provoke opposition, and have made such arrangements between themselves as were within their powers and were likely to give them some of the advantages they wanted, though not, perhaps, all.
Following on certain developments in these various directions, a Departmental Committee was appointed, in June, 1909, by the Board of Trade to consider and report "what changes, if any, are expedient in the law relating to agreements among railway companies, and what, if any, general provisions ought to be embodied for the purpose of safeguarding the various interests affected in future Acts of Parliament authorising railway amalgamations or working unions." The report of this Committee [Cd. 5631] was issued in May, 1911.
In so far as they deal with the principle that even Parliament itself is powerless to prevent the tendency to co-operation between railway companies originally designed to compete with one another, the Committee do little more than re-echo what was said, not only by the Joint Committee of 1872, but even by Morrison in the speech he made in the House of Commons on May 17, 1836. There is, also, a close resemblance between what I have stated concerning the position in 1836 and at subsequent dates—namely, that there was no allegation that the railway companies had abused their powers, only fear that they might do so—and the following extract from the report made by the Departmental Committee in 1911:—
"It is, of course, to the interest of the railway companies not to raise rates or stint accommodation to an extent that will reduce traffic unduly, but, subject to this, a policy of self-interest might frequently lead the companies to charge rates which, judged by any existing standard, would be unreasonable."
So, in 1911, no less than in 1836, and at any time between those dates, the policy of the State towards the railways, as far as it can be summed up in a single word, is represented by this word "might." The attitude of distrust and suspicion originally engendered towards the railways by the canal companies evidently still survives, and is expected to form, even to-day, the approved basis of State action. The principle of railway co-operation is, indeed, frankly and fully accepted by the Departmental Committee, who declare they have come to the unanimous conclusion "that the natural lines of development of an improved and more economical railway system lie in the direction of more perfect understandings and co-operation between the various railway companies which must frequently, although not always, be secured by formal agreements of varying scope and completeness, amounting in some cases to working unions and amalgamations." But, although they admit that mutual competition between railway companies exists to-day in only a "limited degree," and although they do not show that the agreements and amalgamations thus far carried out have been in any way really detrimental to the public interests, they are still influenced, as Parliaments, Select Committees and Departmental Committees before them have been for the last three-quarters of a century, by that one word "might." Railway companies may be allowed to co-operate—more especially because they cannot be prevented from doing so; but fresh restrictions and further obligations must be imposed lest they might abuse the facilities granted to them, in seeking to cover increased taxation and other items of heavier working expenses. Thus among the recommendations of the Departmental Committee are the following:—
"That it should be provided that when a facility or service is diminished or withdrawn, it should lie upon the railway company to show that the reduction or withdrawal is reasonable.
"That it should lie upon the railway company to justify a charge made for a service hitherto rendered gratuitously.