Page
HONGKONG GOVERNMENT'S SHIPPING PROFITS.
(Continued from Pige 43
THE HONEKONG DAILY-PRF88, FRIDAY, JULY 2717, 1993
It was decided that the Government had no option, but to charge the then market rab
true that high freights 12 WAN meant inflated price, but imarket rates were being charged in regvet of rewela under Imperial control, and the Com A revision of Blue Book rates for modore had advised that full freight rates) tramps osabled the Hongkong Government should be maintained in respect of Liner to increase its payments to owners with Requisition vessels; and, if the Flougkong deffer from the commencement of the local (overnment had offered its ships below
weben, but about the same period notion | was given that the arrangements as to own mision were being modified. It was urged that then should not be aug reduction in the rate paid to owners unster the Hongkong scheme, and, pending rec ipt of further instructions the full expimission was paid ng to the end of the
Some currypondence; requisition period, on the subject ended in
May, 1020, with letter from the Ministry of Shipping: 41 am to sty the the Shipping Con- trol er regrets the decision arrived as by the Government of Hongkong and feels bomid to place on record his view that the rea- adduced for that decision do not seem to him to be altogether schwpunto.”
This letter is quoted, and, the matter of -owners' remuneration, has been dealt with in some detail, because there has been a widespread impression that the Hong kong Government had a free hand in the matter and had not been "libera in its treatment of the owners.
THE QUESTION OF INSURANCE.
There were some who did not see eya toye with the Hongkong Government on this question of, remuneration, complaint was made to the Shipping Con- tror in Loudon regarding the alleged preferential treatment accorded, to the Hongkong controlled ships, in their cate
prevailing prices, instructions would to doubt have been received from the Shipping Controller that competitors, for example the Indo-Chinn and China Navis] gation vravels, must not be undercut. In any event freight remitted to a shipper | would not have gone into the, consumer's | porkut. There was the further point that the owners were getting & per cont. upon the earnings of their ships and they natur ally didnt want the earnings to be reduced. It may has mentioned that in the ease of in ship such as the Patrint, carrying coal for Clovernment terunt in respect of which no freight was parable, the Government allowed the owners to dine comission on the sum which would have been paid for freight is the open market.
The Government strictly adhered to thi policy that, in deciding upon the various uses for which ships were required, may gonsideration of profit making must be kept entirely the background.
Late in the year 1918 instructions were received from the Admiralty that a num ber of reels, which had been on Imperiat requisition, were to be transferred to the Hongkong Control Scheme, but after some telegraphic correspondence the instruc to were cancelled and in a telegram dated the 23rd January, 1919, the Hong- kong Government was authored to u its discretion as to continuance of control, which it accordingly discontinued as from the 31st January, 1919.
THE FINANCIAL, RESULT,
is re.
of tramps, as compared with ships Classified as lures. The Hongkong (or ernment, being askel to report, expressed the opinion that the arguments, which had been advanced in support of the complaint, were untenable. The Hongkong as The Hongkong Control Scheme resultal were old and of inferior class and they
faucially not profit of 22,231,204. were not considered seaworthy enough for the total expenditure, exclusive of war full requisition. For this reason the cost
risk insurancis, amounted to $8,97, a of upkeep was proportionally heavier and somewhat striking figure when it special concessious should be granted. The age of the vessel varied from numbered that it represents the entire 43 years, and, they were not in good cost of controlling seventeen ships, with detailed examination of all their trading condition, consting repairs were necessary,
first compared accounts, for the best part of a rear at enormously enhaue with pre-war rates. The Ministry of Many a brokerage few for negotiatag a Shipping had pointed out that the revisingle charter anunted to vasty greater ion of tramp rates in the United King sun, and, if the immense amount of work dom was nevessiry largely on neront of me had been charged for neording to the cost of insurance. In the ease of the Hongkong trampy marine risks out as rule be tasured against for total low buy"
at rales between 10 and 15, per ventum, it being impossible to insure
with average,
the spacious ideas as to remuneration in profits would have been most materially the shipping business then prevalent, the
reduces The opportunity may be taken to record the very great obligation which the Colony is under to Mr. Sutherland, Mr. Young, and Mr. Cary for their devoted rate for the two cargo liners under the work on its behalf. Mr. Sutherland and Scheme was 3 per centum for total los Mr. Young received no remuneratim of only “ and 6 per meatum " with average 75 | and those liners might be taken as repre my kind, and Me. Cary, who was respon sentative of a' the His on the Chitale for the ontrol and checking of all
Const.
whereas the insuran
which reads as
Colonist Office referred to in the Inst MODEST SHANGHAI COMPÁNY
DRIVEN INTO LIQUIDATION.. paragraph, the note of
On the 7th June, 1091, at a meeting of follows:
Sir G. Grindle said that before the the shareholders of Messrs. Mellor & Co. discussion went further it would in (Shanghai), Ltd.. held at Shanghai, Mr. his opinion be useful if has were E. Möller referred to the Hongkong atate the general position of the Government's unjustifiable scheme, which Imperial Government in the matter, in its pitilessness and relentlessness is He stated that it had bem quite unparalleled scheme which has Mary for war reasons for the Govern had the effect of driving into liquidation ment of Hongkong to take the netima modest Shanghai Shipping Company which was taken as to requisitioning which has had its Red Anchor flag fring of ships. The Secretary of State's over these Chinese waters for over half uttitas as to this action was that. a century." Mr. Moller did not make withar it was legal or if it were not it clear to what company he referred; --and for the sake of argument hit was not Messrs. Molleri & Co. (Shang was prepared to admit, that is washni), Ltd.. as that company was incor hopeles illegal-it must be made
porated in 1918. Lloyd's Register of legul. The Indemnity Ordinance Shipping for the year inmediately he was not a device of the Hongkong fore the outhak of war does not in Government to meet their htt
"ship's aremats, was paid at a rate which, from a business point of view, was ntere'y The question of instruce against war manual. Each member of the Control risk was one of some diffenity" lua cir Committee had to God time for the shipm cular letter addressed us the 13th March, ping work in addition to his own work, 1018, to all owners, they were informa! which was in itself almoral that the tiverament wentid gerept all war depletion of sufs, and, having rare to risks, and the question for decision was all the rentes, it is perhaps note- whether the Hongkong Government should worthy that the critics have found such insure or whether it should carry the risk anty material on which to base their iteit. The risk was slight and insurance demeiations. Mention may also be made rates were high, but there was a proibi of the goat work performed by Com lity that ve's might be lost through mander Beckwith. R.N., Harbour Master, 1- the sudden appearance of a raïder, or the who, as Government Coaling Officer, was placing of explosives, in carguy or other responsible for the very satisfactory nr. eneng netinu. On the advice of the Vital rangement to empection with the large Requires Committer the chips Weym insured for three months in the first quantity of coal handled),
stance. The Shipping Control Committee obtained from Mosses, Goddard & Don- glas a valuation of each ship at its the value, the total anm for the fourteen ships bing £7,000, and upon this sum insur. auce premia amounting to 848,716.41 were mid. At the expiration of the three months the Government had a sufficient sun in hand to form the cleus of a sinking fund, and it was decided, again on the advice of the Vital Requirements Com mittee, that the Government should there after carry the risk. At a meeting of the Legislative Comeil on the 17th October, 1918, the Colonial Secretary speaking of the Shipping Fund, said:"The money is kept for insurance against war risk,"
No claim arose at any time in respect al war risk.
마
THE POLICY OF RUNNING THE SHIPS.
Another problem which gonfronted the
Some figurer
THE INDEMNITY ORDINANCE.
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special difficulties, but was passed clude Mesars, Moller in the list of ship- on the instructions of His Majesty'swers, and it appears from subsequent Government, as similar Ordinances litious of the Register that the ships were passed in Colonies similarly shareholders were acquired at various which were named by Mr. Maller to his situated, and was intended to carry dates after war begah, out the deliberate intention and
decision of His Majesty's over Hongkong Control Scheme Mr. Moller. In particular, connection with the ment that shipowners in Hongkong mentioned three vessels only, the 4.8. and elsewhere in the Colonùs must
not be placed in any way in a more Mannpour Chatfield, and Wolara, favourable position than shipowners and he stated that the audited figures in this country. It had been sug covering the running of the steamers) gestel that the action of the Hong, under control in most cases showed a kong Government imposed a special severe loss." The Government has re- tax on shipowners. Sir G. Grindle reived statements of alleged losses in was prepare to admit this, but he respect of six of the seventeen steamers pointed out that this was a disability controlled.
TEA-
shared in war-time by Hongkong Mr. Moller's remarks were generally) with home shipowners, and that if supported by Mr. C. R. Burkill, who could not be avoided. He observed said that he could confirm them from that it was only for technical rva. personal experience. sons, not specially affecting Hook WHY AUDITED ACCOUNTS, HAVE kong, that it had been decided not
NOT BEEN ACCEPTED. to apply the Imperial Indemnity Act to the Colonies and that us. audited figures, referred to be Mr. The Government has not accepted the matter of fact such a cour had been very seriously considered. ThMoller, and it is its experience that, ex Hongkpag Ordinance was a piece of pert opinion of the value of the subject Imperial policy which no Secretary matter of a claim varies very consider af State was likely to reverse, and ably according as the claim is made by it was inconceivable that it should against the Government. The follow- be disallowed,”
ing figures may be quoted in this con- nection. The audited, accounts in „On the 29th March; 1921 the following peet of two vessels gave $10,488 and letter was addressed
owners: $36,320 as actual losses sustained, exclu- solicitors;
sive of interest, over "the" period. 18th "With reference to my letter of the April, 1018, to 31st January, 1919, These!
of September, 1022, I am; vessels were owned by two one-ship directed to state that a reply has Companies whoss balance sheets in re- now been received from the Seere spect of the year 1st February. 1919, to tary of State for the Colonies who 31st January, 1910, show: in the one requests that you should be in-exse profit for the year 8384,045, remuner formed time he regrets that he has ration to Directors and Auditor $39,424) not seen his way to recommend and dividend of 8378 per $50 shaver and to His Majesty the King that the in the other case profit for the year | Indemnity Ordinance (No. 1 of #214,205, remuneration to Directors and 1929), in so far as it concerns the Auditor #21,446, and dividend of $130,50 shipping control of Hongkong, per $30 share, the capital being $40,000 | should not
receive the Royal and the steamer being written down to Assent.
$20,000..in each ease,
19th
ན་
the
I am also to state that His Grace the With regard to Mr. Moler's ships, his Duke of Devonshire has requested nudited accounts. which have not been His Excellency the Governor to Recepted by the Government, show losy consider and part on any répre sustained by owner exclusive of interest sentations which you may wish to pect of the Hamquares, and make with a view to showing that $10.137 in respect of the Castlefield." Mr. "local shipowners have received less Muler has not made any claim for s
favourable treatment than under
in respect of the Walfour. The total the two claims is 301,401; against, which the Imperial Subeme.
Hongkong Government in the sum of there is a debt due by Moller to the $44,12. exq'usive of interest. the whole of this debt is due, not in respect of Mr. Moller's ships, tit, in respect of a sum paid in error by the Government to Adessrs. Moller (Hong. kong), Ltd., on account of enrgo in the พ.ต Patriot.
His Grace further desires that you
should be warned that any cones sion which the Hongkong Gover ment might wish to suggest would require his sanction after consulta tion with other departments of His Majesty's Government interested in
the matter."
No reply has been received to that letter, and there the matter now stands.
THE ALLEGED LOSSES, SUSTAINED, BY OWNERS.
Almost
Under date the 29th December, 1920, a circular despatch was issural train the Colonial Office to the Colouis regarding | Various statements have been made, in Fressel up, the Attorney-General of Hong
petitions presented to the Legislative Council and elsewhere, regarding alleged losses sustained by owners owing to the Hongkong Government's Control. The following correspondence bears upon the
Harston
Messrs. Deacon, Looker, Dezeen,
April, 1918.
to Colonial Secretary,
the recently passed Imperial Indemnity Act. It was provided in the Act that His Majesty in Conneil might apply its pro visions to aur of the Crown Colonies, but the Seermary of State pointed out that in the course of its passage through the point:- House of Commons the Bit was so deve hoped that in its final form it was closely bound up with conditions and transpelions in the United Kingdom. It appeared to him that it was inexpedient to issue duy Orders in Council under the Act, and the Colonies were invited to consider the alteniative of local legislation, An Indemnity Bill was accordingly intra- duced in the Council on the 1st Septem ber, 1991. It was opposed by the own who were represented by counsel. and it was then decided not to proceed
Gwernment was the question of the policy further with the matter until the return to be adopted with regard to the ruani from leave of Mr. Fletcher who had con- of the shipa at a profit. regarding certain profits which were being ducted all negotiations with the owners made at the time may be of interest it on behalf of the Government.
this connection. The balance sheets of a Mr. Fletcher came back to the Colony public company controling van of the rent the end of the year 1921, and, after quisitioned steamers show the following further conversations with the owners. figur
in proposal that half the money held by Capital 240,000 in 800 shares of so the Hongxong Government should bo enelt. ¡Va'us' of stramer, written down to
to them was put before the $20,000. Profit for the years ending in embers of the Legislative February 1916, 1917, and 1019 rispectively Council. The owners were warned that 2163,762, 8243,011, 831,339; Dividend pee in any event it was improbable that the share of 850 in respect of these
Imperial Government would be able to years $183: $275:50: #508 and remuneration to weept the proposal; but the Unofficial Directors and Anditor, $18,306: 324,524 Members rejected it, on the ground that. $53,463. This may have been an extreme all British ships having been treated case, but there were other instances of very like, it would be unfair to discriminats large gains The Government had to in favour of the ships which had been con- decido to what extent it should take trolled in Hongkong. This matter wis advantage of the extraordinary earning referred to at a discussion at the Colonial powers which the war had given to the Office on the oth November, 1022, at which Mr. Burrows a solicitor representing the wors, and Mr. C. B. Burkill repre interest in the ss. Wolfour, were, pre senting this Pufriól" and having on
ent. The following note was taken:
Referer" was maileto negotiations:
with Mr. Fletcher and to an offer of division of profite on n.30/50 | bakis said to have been made by the Government of Hongkong but turn- ed down by the Unofficials. Sir G. Grindle aid that any offer on the lines referred to above, even if it had been decided upon by the Colonial Government, would undoubtedly
steamers.de
*
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The Shipping Controller' instructicas seemed to be clear. The ships which were not required for spects Government work were to be run by the owners in their cus tomary mouter: vessels will be left to owner to run as if for themselves but etually for Indian or Colonial Govern- ments. The Hongkong Control Schem was to be based on the Liter, Requisition Schenie, the instructions regarding which were: It is not the desire of the Gov ernment to interfere either with the nature- of the business of the Established Lipe or the method of conducting it which would have been followed, had the controllccl ves, sels, nos bern" requisitioned, except in gas far na the National interest may require. Each Established Line shall continus Therefore to manage its business and to run this controlled vesels with as much zest and shall have the same discretion in such management as if its own interest. alone were involved,
"
WEN
As regards the Castlefields Messra. Moller & Co. with the approval of the Shipping Control Committee let the ship on most advantageous charter for twelve calendar months from December, i 1918. The charterer failed to take the
kong joined with the Castlefield Steam- ship Company as plaintiffs in an action against the charterer judgment obtained in a very large sum, and it is understood that the matter was finally settled on payment of between $300,000 and and 400,000. The Hongkong Govern
1th went made no claim in respect of the sum which would have been due to it We enclose herewith working control terminated.. hut it did rely upon up to the end of January, when its counts of the steamships Tele Mr. Moller's debt being paid out of that machus, Pheumpenh, Heimun, Bris money. Even if Mr. Moller had dis- bane, Wollowra, Castlefield, and charged tois debt, he would still have had Patriot. From a perusal of such a most substantial sura in hand. working accounts it will be seen
The Government is unaware of the that, when the remuneration pro subsequent history of Mr. Moller's three posed to be paid by the Governships; except that it is informed, though ment is placed against the working it cannot vouch for the fact, that the expenses, the result is a very subs.s. Belfour was sold for a much larger stantial loss inféach 'ense.”
sum than the original purchase price; Colonial Secretary to Messrs. Doncon, but it is unable to find any evidence in Looker, Deacon, and Harston, 5th support of the allegation that the wind- April, 1918. !
ing up of Messrs. Moller & Co. (Shang- "I may state, however, that this hni), Ltd., is in any way due to the
Government is unable to accept the Hongkong Coatrol Scheme figures which you have put before The s.s. Patriot was owned by Messrs. it. In the case of the ss. Tele A. R. Burkill & Sons, and at the time marhus for instanes the owners when she came under the Hongkong commission is reckoned upon the Control Scheme she was on time charter sum of 845,007: whereas it would for a period of five years ending in 1921, in fact, under the calculation given, at a rate of $12,000 a month. With ref be payable on a sum of 8,800, gard to this Messrs. Burkill's agents Depreciation is allowed for upon wrote to the Shipowners' Protection As value of 000,000, or roughly wciation under date the 11th April, £00,000, whereas, apart altogether 1918: from the question, whether or no depreciation is a proper charge, it is customary to take the value, för purposes of depreciation, as the purchase price plus renewals less the amount already written off. Without going further into detail, it may he stated generally that the accounts, as présented by you, are. not drawn up in accordange with the customary practice of shipping, companies,
This Government, will, however, closely water the working of the requisition scheme, and I am to assure you that the, interests of the owners will receive its sympathetic · còn- sideration."
With regard to the value of $3000,000 |
have failed to secure the Secretary placed upon the s. Telenchus, at the of State's sanction.
time when she was about to come under
The Hongkong Government fund now no control.. it may be mentioned that in alternative bus to pass, the Indemnity Bill 1910, when large profits were being made which" accordingle became law by an une and there was no control, the value of ums vote of the Legislative Council the ship was given for probate purposes
the 18th August, 1009. The Hongkong in the sum of $188,000. The sterling| Government's responsibility in the matter equivalenta on the pertinent dates word
·was clearly defined at the interview at the approximately £92,000 and £10,000;
B.S. Patring Owing to the above -vessel coming under Government Control on or about the 15th April. 1918, according to the proposed. control rates the steamer will be earning $15,010 per month, which in this particular case is de im-1 provement in the extraing capacity. of the steamer ; and on this very same date, the 11th April, 3fossrs. I Burkill' solicitors wrote to the Colonial Secretary stating: "We enclose herewith working accounta of the we. Telemachus, Phique peil, Hama, Brixhmar,
In urra, Manapoúrni, Custjefteld, and Paris. From a persual of such working accounts it will be seen that, when the remine ration proposed to be paid by the Government is placed against the working expenses, the result in a very substantial monthly loss. Unless the Government “are pres pared to rery substantially in- cfense the remuneration bok ruptey or liquidation will the inovitable outcome,"
(Costinued on, page 4.),
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