:
Metropolitan-Vickers Electrical Export Co., Ltd.
à
ELECTRICAL PLANT AND ACCESSORIES OF ALL DESCRIPTIONS.
SOLE DISTRIBUTORS IN CHINA & HONGKONG, ARNHOLD BROTHERS & Co., Ltd.
'Phone Contral 1800.
1A, Chater Road.
OUR TELEPHONES.
GOVERNMENT'S PROPOSAL ADOPTED,
HISTORY OF THE NEGOTIATIONS.
able to do so becques of certain "We have already stated. in our information which they could not got pany in not prepared to assure the methods under which this valuation letter of the 9th inst. that the Com. from the Company. There were two installation of any particular?
on thean lines. The Government The Company replied: then asked Mr. Holyoak, Sir Nowton Stabb, Mr. Parr and Mr Hay to advise it on the question in general; and after consulting them it was decided to pat before the Chambers of Commerce a reference, on various pointe, including a reference to the effect that a local company should take over the undər taking. I may mention that in 1919, when the Company was representing to us the difficulties of exchange and of carrying on, we were informed that certain local financiers were in ne gotiation with them, and the Com. pany were saying they could not negotiato at a lower rato than £9 for s one pound share for purchase. The Government considered the question, in 1920, of a local company being formed to take over the concern. Certain requests were made to the Chamber of Commerce to go into the figures and they appointed Mesers. Lowe, Blaglam and Matthews On April, 1920. The report was handed in March, 1921. I do not propose to deal here with the report, except to say that it proved of the very greatest value to tho Government in consider. ing further points that had been put before it; also, that the report was baard upon the idea that the Company would be bought out by a local com- pany. The rate recommended was $110 per telephone, in Messra. Lowa They said they could not give very Dingbara and Matthews report. definite ɓgures in certain directions, because they had not the expert knowledgo available, The Govera
tho
system of telephone pleat until the could be arrived at. Mr. Cook was Government
has guaranteed a working on what is known as "pro- mialmum subscription rate of $130 sent-day reconstruction coat, less de per annum, when they will consult preciation."Mr. Lewe's Committee was expert opinion and adopt the working upon actual money put into system advised.
the business, less depreciation. The The oract position of affairs is as Government found some difficulty in follosa: Tho Government is not decided what view to take with ro- prepared to state the rate which will gard to the methods of valuation, provide an adequate profit until the but it decided that this is not a matter Company has decided upon the which it desirec--or is indeed com- plant to be installed. The Competent-to give a decision upon. If pany declines to guaranten any Mr. Cook'e method of the inflated minimuin rate of $150 is asanted. 1 particular type of plant until a value given by present-day acat This is the lowest eum which will then there is
of reconstruction ja correct, reason why give them on adequate return esca the shareholders in the Company with the plant in its present form, should get the ligh rate of interest.- and when thin sum is agreed upon namely, I per cent.-upon which Mr. the Company will take expert Cook was working. For instance, the opinionand install the plant advised. value of the land upon which the In this case the rate of subscription offices stand, or are to be built, bas may be higher. As we have already gone up enormously since the Com pointed out, the rata of $100 Compares favourably with telephoto abscribers' point of view the service
pany purchased and, from zatea in other parts of the world."
is just as efficient if that led is sold We replied:
and the und -rtaking were to be re moved to a cheap site in a back street, There appears to be no valid ground for allowing shareholders to take a re turn from subscribers in respect of the cahnased value of the load. Be that as it may, the Government does not feel called upon to decide as to what "Whereas the China and Japan time) and the result was the presentment referred that report to the
the exact amount of the capital should Telophone and Electric Company, agreement, signed on the 1st February Chamber of Commerce, who consider March this year, Mr. Parker Ness Parel to pay liberally on the money A deadlock was agair reached. In bo, but it feels that, while it is pre Limited, has requested the Govern 1905, under which the Governmented that owing to the slurp, and the came back to the Colony and he in actually put into the business taking ment of Ilongkong to grant to it a grants to it what is, in fact, though falling exchange, the time was not excused his deman to $175 175 sub Lowe a figures, it does not see new Agreement in place of the Agree not in words, a monopoly: and the opportune to go ou with the idea of a scriptions and he put the capital why it should allow a: equally bigh ment which now exists hetween the Company undertakes to maintain local company, and the Government value at £225 000. the game figure ka return on the higher valuation of re Company and the Government: throughout the 25 years of the agree again turned to its unofficial advicers had a and in London. The Govern construction cost.
And Whereas a Report upon the mest a good and efficient telephens and appointed Hon. Mr. Perkinsment said it could not consider the subscription cover both ways of look Company's request has been furnished service with approved and modern Coinnet Davy, Mr. Barlow, Mr. matter at all. It appeared that Mr. g at the maltar. to the Government by the joint appliances at a reasonable rate of Dodwell and Mr. Marsh to consider Cook, the Company's expert adviser
ubscription which thull not exceed the question of the terms that should was due bere carly in day. As binth of new capital. Mr. Parker Ness Theu, again, there is the question And Whereas a Reprcecatative of £10 for the first mile from zehnugb offered to the Company by way of Mr. Lowe in his repat ant the Com- urged that 15 per cent should be the Company he intimated that the and 3 30s. fer every additional hall Company will not be able to ester mile, upon a now Agreement upon the terms recommended in the aid Report:
HON. MR. A ́R, LOWE'S SPEECH!
Below we publish in full the illuminating speeches which accompanied the moving, in the Legielavo Council pesterday by the Colonial Secretary (Mr. A. G. M.: Fletcher CM,) of the following resolution dealing with the proposed agreement with the Telephone Company :-
Chambers of Commerce:
It is hereby resolved that to new Agreement shall be entered upon be- tween the Company and the Govern ment, unless the Company in prepared to accept the rates of subscription recommended in the said Report and set out in the following Schedule:
ANNUAL BUSCAFPTION PAYABLE MONTHLY
IN ADVANCE.
VICTORIA.
PEAK.
Res KOWLOON.
$ $
"Wall or Deek Telephone..81
On application by
Company
to
rates.
A PERSONAL EXPLANATION.
"This Government is unable to increase the present subscription rato until your Company is in a position to inform it of the type and approximate ocat of tho ́nstallation: which its consulting engine.r advises it to adopt."
ANOTHER DEADLOCK.
These rates of
mitten had advised the .vernment allowed, and he was not willing to go In 1997 the dolls went temporarily
that thy required certain exp.it is below 12 percent. The Government over two shillings and the Company I may mention, by way of perron: formation in order to me to s is impressed with the fact that one of approached the Government for per explanation, in view of the fact that definite decision, we asked Mr Cuir, his own corporations, the Bugal mission to charge $100 instead of £10 a statement has been published that of Shanghai, to meet Mr. Cook and go Telephone Corporation, ha very This was refused. There the matter I ógreed in London to
figure of
uto the qu-ation. They had various recently issued, in London, £350,000, rested until 1917, when the Company $150 as a rate, that, at the request of meetings, at one of which Mr. Lang first mortgage de bontures 7 per came forward with further representa Sie Newton Stalb, who had been and Afr. Barlow were invited to be cunt. at 97, and the issue was el ad tions about the losses they were very closely connected with me in present, and they presented their re within an hour of the opening of the suffering through the rise in exchange. 1920 over this question I met 5 port Their capital value differed by lat. This appears to show that the The Government called for the balance Parke: Ness in London in June and we £70 000, but they were in agree rates for this kind of undertaking
heel which they had not seen discussed the matter fully. Mr.
ment as to the rutes to be charged, are considerably cheaper than 12 hitherto and were impressed by the Parker Ness put forward a statement $149 for private telephonee and $15 per cent. The Government is most apparently prosperous state of the that the value was £325,000 and for business telephones, through at oxious to dral both fairly and Company, and replied that it regrete! that the subscription should be $150, Victoria, Kowloon and the Pesk. liberally with the Company on the it could not grant any concession, and I said I had no figures available to
The Goverment fals that it now same lines as it dealt with the Electria $pointed out that a paragraph in their cheek his: I had not seen Mr. Lowe's had suficient data in which to base a Company, the Dairy Farm and 84 84 Directors' Report for the year enthul report. with was then out; and I decision and it began to consider the other public utility concerns, and it 31st December, 1916, stated that in was cousinced that the terms given Mr. Cule's rates as a basis for a new these rates will give a liberal retura maiter afresh with Mr. Cook's and is-as far as it can beatisfied that accordance with the resolution passed would not be better than those gives Committes 1923 96 96-96 held on the 21st June, 1910, the rum' which were being negotiated when swer to a question in this Council. business. Of course, the recommen.
at the extraordinary general meeting to the Hongkong Electric Company,
agreement. This was stated, in upon the money invested in the 1924 108 108 108 of £31,000 odd, being a part of the I left the Colony. The only way in any distance in the matter, Mr. a revision of these rates if, in practice, 1925 114 114 114 Reserve Fund of the Company, was, which I committed myself was to My Parker Ness prea ed for publication of the return is tou: d not to be sufficient. but, before the Government had got dation of the Committco provides for 1926 120 120 120 in the following Auzue, distributed that, taking Mr. Parker Neu figure there new ratir. The Government Mr. Parker New maintains that the
to the barebolders by way of bonus. of £325,000 as coirect and having It was suggested that this money regard to the fall in exchange, there was extremely reluctant to allow it, terma org catirely unfair and he Extension Telephone (lu-
wou'd have been better applied teemed to be a prima facie case for a There were a number of outstanding quotes the fact that higher rates are ternal) Wall or Deak.. 30 30 30 to the Reserve Fund Dr to subscription of $150.
points in connection with the agree being paid to other companies in Extension Telephone
the Equalization of Dividend Fund,
ment which was not even in dra.t- Singapore, Calcutta and elsewhere. (External), According to to meet temporary rice in exchange, mittee reported and they recommend be cleared up. It was recognised, Japon are law, and, particularly in there was this differ noe of £70,000 to We have replied to that that rates in The matter then reated till 1919, ed a rate of $120 There were various how ver, that publication was the Shanghai. The Mutual Telephono when the Company again came for points in their report which were bing quickest way of getting the matter Company of Shanghai apparently ward and stated that they were practi-considered, and the rate was not for before the public; and permission, carries on at a good profit on rates of cally unable to carry to as they were mally given to the Company but the therefore, was given to publish, but T. 45 for private telephones and suffering very heavily from excl anes. main Teadings of the report were by direction of the (vernment Mr. Tis. 05 for an office telephone, over a 1 which was at that lime, at a very read over to the local manager. The Parker N-es was particularly told that range of two na! a kali miles.
high rate. We then pointed out, Company refused to accept this rate the Government had not accepted the again, that in the report for 1997, of $120. I way quote the foll wing rates, that the matter bad not gone standing. This Government proposes There are various other points out- which had then been recently received, respondence of January of this before the Executive Council, and to make it a condition of any w the Directors, in pasing a resclation on the death of Mr. Carter, who was 'quetion of an automatic exchange the rats would be inoperative. Ife trausfor its man çemont to Ilong
year. We had referred to
hem the that until the agreemien: was signed agreement that the Company is to Manager for many years, said: "The and the Company wrote:
must Euti fy
themselves the account
mitted and ser vice condit one justify eatc...
Extension Beer Singly
Switch...
Private Kranels Exchange
Switchboards per line
Capacity
REMOVALS.
Telephone Enes and ringle teleplone. In the surge house...... From one touse to an
other....
Extension telephone... Private Branch Ex- change Switchboards per lino capacity....
distance
I
I
5 D
5
12 12
5
12
poriod of Mr. Carter's management
coincided with the great development
1 1
1
of the prosperity of the Company's business." That impressed the Go- ver..ment and wo sid wo were not Kowloon includes the area South of satisfied that the Company was the old boundary line.
making losses, and we suggested that the service was not all it might be. We also proposed, that in order to get rid of this trouble, through the fihteluation of exchange, the Company should move its headquartes to Hung- king and work on a dollar basis.
In all districts not included in the above boundari & the same rates ap- ply with the exception that outil Buch time as it is economically prac t'cable to open further exchanges, there shall be an extra charge of 850 per annum per route mile for part tbercul) from the nearest point on the boundary of the areas mentio: ed in this Schluter of any exchange bere
after op feted.”*
MR. PARKER NES ARRIVES. In March, 1920, Mr. Pacher Ness came to the Colony for the 6rst time He brought with him a draft agree ment which, he informed us, was ex- On the completion of the exchanges actly on the lines of the agreement at Victoria, Peak, Shankiwon, Kow-recently eigned in Singapore, That Joon and Taipo hereof the annual agreement allowed bin an extension rates of subscription and other charges of 50 years and to limit us to the Jor enbscribers with the array of such rate: to be sharged. The Company exchanges shall be at same rate as confirmell later, in writing, that they th.se in the above schedule ma had obtained this concession in Singa tioned."
pore. Mr. Parker Ness was informed
The Colonial Secrotary said: Sir, that this proposat could not even -It may, I hope. assist bonourabla forma a basin of tirgotiation, that the members in getting isto perspective Government would have nothing to the various repects of this dificult do with it. Ilo then put forward an question it in orm ben briefly of alternative proposal, that the rafe the history of the Telephons Company should be $110 and 40 per cent. ad- and of the various negotiations be-ditional 6 cause of iuerense is working tween it and the Government. The expanses not of cost of material after Company, was registered in Loudon the end of the war, The Government. in 1883. In 1891 it bad 49 eub- drew bis attention, again, to the bal scribers and ten years later, thia ano. sheets and the state of the Com number hat viéén to 423, I then paur as shown in. them. They raid decided to reorganize its business on that they regarded it as a very pro abe metallic circuit, put its main I ara perous concern and the wino Unterground, and open an exchange poly
va'nable Colony growing so fast;
.lo Kowloon Accordingly it approach in a
П
most
one
esd the Cluvernment for some recurity and they did not consider that a cata of tenure (which it had not at that had broa made out for any increase
1
!
Towards the end of 1921 this Com
thea pabli hed the rates and this ted kong. We fad great difficulty in We hasten to point out that to various qu ations in the Council, getting iuto tunch with the Directors, this question is a highly technical sad st the request of my honourable and it is no more reasocable that one and it can only be decided by friend who represents the Chiness Hongkong telephonce should be run expert opinion which the Company (Hon, Mr Chow Shod-son) the Gov- from London than that Directors in will seek on a satisfactory conclas erament put the whole caso before a Hongkong should run telephones in ion of cur application for a revised joint Committee of the Chambers of, Manchester. There is also the paint Jia ner. The Company'e attitude Commerce They asked that a small that subscribers are paying consider- towards the installation of an auto-Committ:e-two mimbera from caoh'able sums in income tax excess matic plant is as follows: Wa Chamber should be appointed to go prota duty and cor; oration tax, is will not be bound to install an auto-into the matter and the Goytrument the United Kingdom. Thers zra matic system, but, provi'ed the agreed. rate of subscription which we con-
other difficultie, such as the question sid.r to be a fair one is granted, we
I am afraid I am taking some time of the value of obsolescent plant, and
to explain these prelimin ry matters.there is one other point, the question
aro prepare to refor the subject to wish to emphasise the point of the automatic telephone. The Go- our consulting caglar, whose de, that the Government has not vernment is not sat efi d with the cision in that matter will be accept gone about this in a hole and finding that an automatio telephone ed by the Company.
Corner manner without the advice of should not be installed, and it wishes. The Government replied to that:
business men, and also that the to go further into the matter. Government has not bound its. If in This Government understands any way to the Company in the
In conclusion. I would like to .x- that you are now or ceipt of matter of this Agreement. I may say
press the great obligation of the Go telegraphic information to the efTet that at the meeting of the joint Cham meat to the various gentlemen that your Company na com to no bera of Commerus the matter was so who have advised it and more decision regarding the type of ap far not settled that there was not even particularly Mr. Lowe, who has spent paratus which it proposes to install, a dratt agreement The Guverament a very great deal of time and troubla In the circuit tances, this Govern- burriedly got together the rarions in this matter; also to express the Go- ment is not propared to make a points which had been considered in verament's indebtedness to Mr. definite proposal regarding the rates various departments-the Pub is Bennett, the Local Manager of the must be apparect to your Directore Crown Solicitor's, and so on-and put assistance whenever he has been asked to be charged to subscribass. ItWorks, the Attorney-General's, the Company for his very radz that this Government, with no these into priot. The next step was the fer information. I beg to move the knowledge of the initial cost or report of the Committee. The rates
solution. operation cost of the intended' tel [iven in that report word endorsed by
(Continued on page 9.) aphone system is not in a position ( the joist Chambers, and the Govern to form en opinion as to the capital ment is contest to accept them. The) Aum which is required or tho rates Chambers, of course, represent the which will be necessary to provido subscibers, who have to pay for the an adequate profit upon the un-telephone. dertaking. What is wanted is the best possible installation and; as
HOW MUCH CAPITAL?
But the report does not deal with
soon as your Company is able to one outstanding difficulty, namely,
supply the necessary i formation the amount of espital upon which
funshine and Common Sense. Don't dolor your blood fur thousa
'se an external application of Chamberlain's Pain Balm. in a fow days
tism
sunshine, than Nature will restore the It will gt you up ad cut into the rich red blood to your veins and son
on this point, the Government will these subscription rates ar to provide rid the system of this troubls me dis
put lorgard its proposals,"
ouse. Fur ta'o by all Chemists and
a retum, The Committee were ub Scorekeer or
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