Railway Rates: English and Foreign

by James Grierson

In 1883, a Committee was appointed by Parliament to enquire into the condition and the position of the canals and internal navigation of the country, to report thereupon, and to make such recommendations as might appear necessary. It sat during the greater part of the Session. Many charges were made against railway companies which owned canals. They could not be answered in that Session for want of time. So little importance seems to have been attached to them or indeed to the subject of canals, that the Committee was not re-appointed in the following Session. No report was therefore ever made.

The subject affords a valuable illustration of the railway legislation in this country, and of the prejudice and misapprehension which exist in some quarters as to the conduct of railway companies. Far from there being an inordinate desire to absorb canals, it will appear that those which belong to railway companies have, as a rule, been forced upon them, either to remove the opposition of the canal companies, or as a condition of railway Bills being passed.

Let us give an instance of the treatment which the promoters of railways, when opposed by the representatives of waterways, have received at the hands of Parliament. In respect of the Severn navigation, the Great Western Company are at the present time under a heavy liability. This liability was forced upon their predecessors, the Oxford, Worcester and Wolverhampton Railway Company, when applying for powers to construct their railway, which did not really compete with the navigation to any serious extent, if at all. Clause 94 of the Oxford, Worcester and Wolverhampton Railway Act of 1845 recites that the Severn Commissioners had raised the sum of £180,000 upon the security of the tolls on the Severn navigation, in the expectation that those tolls would reach the sum of £14,000 a year. It provides that the Great Western and the Oxford, Worcester and Wolverhampton Railway Companies should, from the opening of the Oxford, Worcester and Wolverhampton Railway for traffic between Worcester and Wolverhampton, and so long as the principal moneys raised by the Severn Commissioners, or interest thereon, remained due, make up to the Severn Commissioners any deficiency between the actual amount of the tolls for any year, and the sum of £14,000. The Great Western Company do not possess or even control the navigation. Yet this liability was forced on the promoters as a condition of obtaining their Bill; and in respect of it the Great Western Company actually now pay between £6,000 and £7,000 per annum!

How much truth there is in the allegation that the canals owned by railway companies are not properly maintained by these companies, but that on the contrary the railway companies obstruct the trade on them, may be shown by the case of the Kennet and Avon canal, which is also the property of the Great Western Company.[107]

This canal was authorised by an Act of 1794. The canal is between Newbury and Bath, a distance of 57 miles. But the water communication is extended beyond Newbury on the one side to Reading by means of the River Kennet, and from Bath to near Bristol on the other side by means of the River Avon. The total navigable distance between the points named is 86½ miles. This canal is joined by the Wilts and Berks canal (which is connected with the Thames by the Thames and Severn canal) and the Somersetshire Coal canal. Thus the Kennet and Avon canal forms part of an extensive system of waterways, by communicating direct with the Thames on the one hand and the Severn on the other. The total cost of the Kennet and Avon canal was £1,011,589. It was opened in 1810, from which date, up to 1813, no separate accounts of capital and revenue were kept. But the returns from 1813 show that the receipts of the canal gradually increased from £22,075 gross and £11,843 net in 1813 to £58,820 gross and £39,113 net in 1840. The opening of the Great Western Company’s line between Reading and Bath in 1840-41 seriously affected the canal revenue. The canal company applied to Parliament for powers to construct a railway alongside their canal. Failing in that project, they in 1848 availed themselves of the powers of the General Canal Act, and entered upon the carrying business, from which, however, they derived little profit. In fact the first year was the only year when the revenue derived from the carrying business exceeded the expenses. The opening of the line of railway between Chippenham and Trowbridge in 1848-50 still further injured the canal traffic. The canal company offered to transfer their undertaking to the Great Western Company; and the terms for such transfer were agreed and approved by Parliament in 1852. In sanctioning the arrangement, Parliament, however, imposed upon the Great Western Company the condition that, if at any time the canal tolls were complained of as, in comparison with those of the railway, prejudicially affecting traders on the canal, the Board of Trade should make such regulations and fix such tolls as they might think fit. In 1867-1868 the traders using the canal memorialized the Board of Trade to reduce the tolls. An Arbitrator, who was appointed, reported in favour of a reduction, which was accordingly carried out. The tolls thus fixed were charged up to 1877, when the traders again memorialized the Board of Trade. The matter was referred to the Railway Commissioners, before whom it was given in evidence that if further reductions were made on certain articles constituting the chief trade of the canal, the traffic would materially increase. The Railway Commissioners thereupon reduced the tolls upon those articles from 1d. per ton per mile with a maximum of 6s., to 1/2d. per ton per mile with a maximum, for the whole distance of 86½ miles, of 2s. But the statements of the traders that an increase of the traffic would follow upon a reduction of the tolls have been found to be entirely baseless. Notwithstanding this great reduction, the traffic had fallen from 159,190 tons in 1876, to 125,807 in 1885.

The gross receipts in the year 1840 were, as already stated, £58,820; in 1848 they had fallen to £33,205; in 1852, when the canal was taken over by the Great Western Company, to £24,291, and in 1885 to £4,237. The canal has been maintained in an efficient state of repair by the Great Western Company, in accordance with the obligation imposed upon them by their Act of 1852, and the navigation has been always kept open. Notwithstanding the large reductions in the tolls, the traffic has year by year diminished, until in 1885 the expenses considerably exceeded the receipts, without taking into account the interest (between £7,000 and £8,000 a year) which the company have to pay upon the capital expended in acquiring the canal undertaking. These are weighty facts. Although the Great Western Company purchased the Kennet and Avon canal, pay interest on the purchase money, and maintain it, and although they are deprived of the power to fix the tolls upon the canal, and have had to submit to two reductions—the maximum under the latter arrangement being for the whole length of the canal little more than one farthing per ton per mile in respect of any description of goods—the traffic has continued to fall off. The tolls do not yield sufficient to pay the salaries and wages of the working staff, or even the actual cost of the labour and materials necessary for maintenance and repairs.

The foregoing illustration, may help to correct the statements which have been made as to the conduct of railway companies in the capacity of owners or workers of canals. Not only the Kennet and Avon canal, but, it is probable, all the other canals which have been taken over by the Great Western Company, must have been closed years ago if they had remained in the possession of the canal companies. The public have, in fact, had the opportunity of availing themselves of the water carriage when it was to their interest to do so, just because the railway company took over the canals and kept them in working order.

Though every railway company owning or managing a canal may be compelled under the Section cited on page 193 to keep it in repair, only one application for that purpose has been made to the Railway Commissioners. This is scarcely consistent with the loose, unverified accusations as to the shortcomings of railway companies. Besides, it is not true that the whole canal system has passed under the influence of railways. Of the 3,029 miles of canals in Great Britain, 1,592½ miles are owned or managed by other than railway companies.[108] An examination of the map prepared by Mr. Abernethy, C.E., for the Select Committee of 1883, shows, that south of a line passing through Worcester, Birmingham, Nottingham and Hull, there is scarcely a canal of any importance, with the exception of the Kennet and Avon canal, between Bath and Reading, permanently, temporarily, or partially in the hands of a railway company.

The fact appears to be that canals flourish only where certain conditions exist. Where a large traffic can be conveyed in full boatloads; where the country is flat, and there are consequently few locks; where large vessels propelled by steam can be used; where works are so situated that the cost of collection or delivery can be saved; in such circumstances, canals are suitable for coal, chalk, cotton, stone, bricks, pig-iron, round timber, grain, &c., and such like goods carried in large quantities, or for short distances. They can, no doubt, when such conditions exist, be beneficially used at a low cost for carriage; but for traffic not large, or composed of a great variety of articles, which have to be collected in small quantities from different places, or to be distributed all over the country, canals cannot successfully compete with railways. Want of water in dry summers, interruptions from ice in winter, and diversity of gauges in locks and tunnels—all matters which add to cost—are great inconveniences, and grave objections to water carriage. Often carriage by canal necessitates the erection of warehouses for storing goods, which is saved by the transit of traffic by rail. The speed and despatch demanded by the modern necessities of trade have tended to throw upon the railway more and more of the traffic which formerly went by canals, as well as the increase in the traffic of the country. In Staffordshire, canal boats meet from all the principal towns such as Manchester, Liverpool, and parts of Yorkshire in the North, and London and Bristol in the South; but no through traffic is exchanged. All the traffic of Staffordshire in iron, hardware, chains, anchors, nails, &c., outwards, and grain, timber, spelter, bone, manures, &c. inwards, requiring speed, is carried by railways. Where the canal charges are equal to, or lower than, the railway rates, the railways and canals divide the traffic. Newly-opened collieries and works are now, as a rule, laid out for loading into railway wagons, not into boats, because railway stations and railway trucks give greater facilities for distribution of coal to all parts of the country. No doubt certain large canals—for example, the Aire and Calder, Bridgwater, and the Leeds and Liverpool—can be profitably worked in their exceptional circumstances, as they possess a plentiful supply of water, and traverse a long stretch of comparatively level country. Where such conditions exist for distances of fifty to sixty miles, canals may compete successfully for heavy traffic with railways.

Nor have the proprietors of canals done the utmost to overcome inherent disadvantages. The existing inland system, with only 7-feet locks, is inadequate. The canals are too shallow; they are wasteful in the consumption of water; and they cannot be worked economically. The cost of working larger boats of 300 tons on suitable canals, hauled by steam, and loaded and unloaded by the best appliances of steam cranes would, of course, be much less expensive than that of working the boats of, say 30 to 60 tons, now used.