کو
SIR,
Treasury Chambers,
18th June, 1900.
In reply to Mr. Lucas's letter of the 3rd April last, respecting the contributions to be made by Ceylon, the Straits Settlements, and Hongkong towards the cost of the Eastern Mail Service, I am directed by the Lords Com- missioners of Her Majesty's Treasury to say for the information of Mr. Secretary Chamber lain that they are only now in a position to give an answer to his request for the accounts pro- mised in the letter from this Department of the 18th November, 1898. The delay which has occurred has been due to the settlement of ques- tions raised by the India Office as to the proper interpretation to be placed upon various pas- sages of Lord Morley's award, and it has been necessary to refer some points again to his Lordship.
Lord Morley has now given his decision upon the points submitted to him, and his decision has been accepted by the Secretary of State for | India in Council.
Amongst other things it has been decided that the Mails of the year 1901, the middle year of the contract, should be taken as the basis upon which the cost and earnings of the service should be apportioned between this country and India, and My Lords propose, if the Secretary of State should see no objection, to adopt the same course as regards the contri- butions of Ceylon, the Straits Settlements, and Hongkong. If this course be followed the ac- counts cannot be furnished till after the figures of 1901 have been taken, and My Lords pro- pose that in the meantime the contributions now made by these Colonies should be regarded as provisional and subject to adjustment in ac- cordance with the results shown by the account to be taken next year.
The account will, my Lords anticipate, show that the contributions now paid by the Colonies are considerably less than the amounts properly due from them under the award, and will re- quire to be increased accordingly.
I am, &c.,
E. W. HAMILTON. The UNDER SECRETARY OF STATE,
Colonial Office.
Downing Street,
13th July, 1900.
SIB,
I am directed by Mr. Secretary Cham- berlain to acknowledge the receipt of your letter 9732/1900 of 18th ultimo relative to the basis upon which the cost and earnings of the Eastern Mail Service should be apportioned so far as the Colonies of Ceylon, the Straits Settlements, and Hongkong are concerned.
2. I am to request you to inform the Lords Commissioners of Her Majesty's Treasury that their letter will be referred to the Government of the three Eastern Colonies for consideration, and I am to state that with the information at present before him, Mr. Chamberlain is unable to express any opinion as to acceptance of Lord Morley's award as a basis for the calculation of the future contribution of these Colonies or as to the proposals in the penultimate paragraph of your letter.
3. I am at the same time to enclose copy of a further despatch from the Officer Administer- ing the Government of the Straits Settlements on the subject and to enquire what answer their Lordships would wish to be returned to it.
I am, &c.,
C. P. LUCAS. The SECRETARY TO THE TREASURY,
[Copy.]
31, Prince's Gardens, S.W.,
November 8th, 1898.
MY LORDS,
1. In accordance with the request con- tained in your Lordship's letter of July 20th, I have enquired into the questions at issue between the Postmaster-General and the Se- cretary of State for India as to the proportion of the cost of the Eastern Mail Service to be charged to the Government of India.
2. The case of the Post Office and the case of the Indian Government, which were for warded to me on July 27th, are annexed to this
award.
3. I have had several interviews with Mr. J.. J. Cardin, C.B., representing the Post Office,
THE HONGKONG WEEKLY PRESS AND
and Mr. H. H. Kisch, the Postmaster-General of Bengal, who have argued the cases of their respective Governments before me.
4. Since Lord Halifax's award in 1876 cir- cumstances have considerably changed, and on the occasion of each subsequent contract the Indian Government has raised questions of importance which have never been definitely settled. During the two contracts from 1880 to the present time the Indian contribution to the Mail Service has been fixed by a series of compromises, the details of which are given in the two cases. It was therefore necessary for me to go very fully into the principles which have regulated the apportionment of the cost of the service between the two countries.
5. On the conclusion of a new contract with the Peninsular and Oriental Company for the conveyance of the Eastern Mails and Australian Mails for seven years from February 1st, 1898, the Post Office made the following proposals:
(a). That of the total subsidy of £330,000, £85,000 should be regarded as applicable to the Australian service, leaving £245,00 1 to be taken as the cost of the Indian and Eastern Service.
(b). That each country should retain its own collection of postage, as they have done since 1891.
1
(September 24, 1900.
(£7,500)
(b.) The cost of 时 tin alleged, was established for the benefit of India.
the instance and
9. After a careful consideration of the two cases, and of the arguments used in support of them, I have arrived at the following conclu- mons —
(a.) That, as regards the Australian service, the arrangement proposed by the Post Office should be adopted during the continnance of the contract and that £85,000 should be ap. propriated to that service. When the present contract expires, it appears to me that it would be desirable to enter into separate contracts for the two services.
(b.) That, as regards the sections between Colombo and Shanghai, India should not con- tinue to be made liable for any loss which may be incurred on these sections, but that she should pay transit rates for any use she may make of this portion of the Mail route. The receipts from such transit rates being credited to the sections.
(c.) That the postage collected in the two countries, and the receipts from other adminis- trations for land and sea transit on Mails sent over the line should be pooled. and the balance of the united collections, after deducting the cost of continental transit and rates paid to other countries, should be equally divided.
(c). That the cost of each of the seven sections into which the Mail route is divided, should be ascertained by dividing the subsidy (d.) That, subject to the above mentioned in proportion to the annual mileage of each conditions, the apportionment with the princi- section. That one half the cost of the Section ples laid down in paragraphs 23 and 24 of the should be charged to the United Kingdom, the Post Office with this exception, that the Indian other half should be paid by India and the Government should bear the whole expense of various Colonies interested in proportion to the sea-sorting on the Bombay line which by number of letters sent and received by them. Article 35 of the contract is fixed at £7,500. The United Kingdom paying for any letters Under this article, the Postmaster-General may which it exchanges with other countries. give notice to the Company that he no longer That the incidental expenses should be divid-requires provision to be made for sea-sorting ed in the same proportions as the cost of the and may deduct £7,500 from the subsidy. service, and that the amounts received for ses-
understand that he would be willing to give postage on foreign mails should be divided this notice if the Indian Government desires between the contributing countries in the him to do so. proportion which each bears of the cost of the service. In its main principles, this is the mode in which the apportionment has been hitherto adjusted.
6. The Indian Government objects to these proposals on the following grounds:
(a). That the amount (£85,000) appropriated to the Australian service is too small.
(b.) That India should not be charged with any portion of the loss accruing on the sections between Colombo and Shanghai.
(e.) That an account should be prepared by the Imperial Post Office and audited by the India Office, and that the amounts thus ascer tained shall be payable by the contributing coun- tries to the end of the contract.
I have, &c.,
MORLEY.
The LORDS COMMISSIONERS
OF HER MAJESTY'S TRbasury.
Hongkong, General Chamber of Commerce,
Hongkong 11th September, 1900.
SIR.
(c.) That, if each administration retains its postal collection, the share of the subsidy char- ged to India is too large having regard to the I have the honour to acknowledge receipt fact that the Mails from England to India are of your letter of the 30th ultimo (No.1685) trans. far heavier than the Mails from India to Eng-mitting for the information of this Chamber land.
The discrepancy between the homeward and outward mails or traffic in letters is not very great, but England sends to India about six times as many Newspapers, Circulars, &c., as she receives.
The following figures for the were given to me:-
From the United
Kingdom.
lbs. 96,000
Letters and Postcards Newspapers,
Circulars, &c. 1,561,200
year 1896-7
From India and Aden. lbs. 88,800
259,400
The result, it is argued, is that the United Kingdom makes more use of the service than India, and also that the United Kingdom has the advantage of the larger collection of postage, whereas India has to bear the expense of dis tributing the heavier Mails.
7. To meet this case, the Indian Govern- ment suggests that a new principle should be adopted, viz-that the Postal Union rules should be applied to the sea-transit, as if it were pro- vided by a foreign Government, and that Pos- tal Union rates should be charged on all Mails to the sending country.
As an alternative scheme it is stated in the Indian Case (Page xiii) that "India would be prepared to return to the arrangement for the pooling of postage and sea-postage which was in force from 1857 to 1891."
8. The Post Office on the other hand states that, if the principles of Lord Halifax's settle ment are re-opened, there are various claims which can be equitably raised against India which have not been thus far pressed, eg
(a.) The cost of extra speed on the Bombay line.
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copy of correspondence between the Colonial Office and the Treasury on the question of the colonial contribution to the subsidy for the Eastern Mail Service and copy of an award given by the Earl of Morley as arbitrator upon the questions which arose as to the proportion of the cost of the service to be borne by the Government of India and asking whether this Chamber desires to supplement the remarks made on the subject in their letter of the 5th June, 1897.
say
This correspondence has received the atten- tion of my Committee, who instruct that they simply wish to reiterate and emphasise the remarks made in the letter above alluded to. They protest now as then most emphatically against a mileage basis being adopted to estimate the proportion of this Colony's share of the mail subsidy; and they would point out that, since that letter was written, Imperial interests north of Hongkong have largely developed, not alone by the growth of British trade in Chins but also by the acquisition of the port of Weihaiwei.
The arguments used in paragraph 6 of the letter have since been strengthened by the fact that the German mail steamers now run fort- nightly instead of monthly as formerly and that the Nippon Yusen Kaisha maintain regular service to London, via Marseilles.
The inclusion of Hongkong among those Colonies compelled to adopt the penny postal rate within the Empire--a step taken by the Imperial Government in spite of the represents- tions of the local Postmaster General that it would be a loss to the Colonial Treasury-has had the effect of reducing the revenue of the Post Office Department, which, in 1899, showed
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