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PUBLIC RECORD OFFICE, LONDON
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General Manager has shown that the quay already gives a reason- able return, and the extra tonnage which it might handle is com- paratively unimportant. Nothing in the present situation justifies any more elaborate agreement with the lighter companies; the Government decided to construct these works without considering the interests of the companies; they have constructed them and are operating them at a profit. But the smallness of the present issue has been lost in a grandiose scheme for harbour development, an indispensable preliminary of which is the formation of à Har- bour Trust, on which the companies would be represented. We must briefly discuss the main features of this scheme.
32. We do not propose to give in any detail the history of the harbour works; the facts have, in particular, been summarized in the report of the Imperial Shipping Committee dated 24th July, 1931. In 1921 the trade of Port Louis could not be handled on the existing lighterage system without difficulty and delay; it was inevitable then that improvement works should be taken into consideration. But the trade of 1921 was abnormal, and the real necessity for large works had passed away before even their design was determined; nevertheless the deep-water Quay D was constructed.
We have had much evidence of hostility to the policy of con- structing deep-water quays, but very little criticism of the existing dock or lighter companies which handle the whole of the sugar exports and the bulk of the general import trade. If the facilities provided by the companies were inadequate, the hostility offered not only by the sugar interests but by practically the whole busi- ness community to a forward policy of dock construction would be difficult to understand. In the actual circumstances of the case this opposition is not only intelligible but reasonable. The facili ties now existing are adequate for the requirements of the normal trade of the port, a trade which is admittedly not capable of much greater development. Although the cheapening of these facilities, provided by Government enterprise, would be welcome to certain trading interests, including the sugar trade considered by itself, the interlocking of capital between these interests and the dock companies would mean that the same individuals who would gain in one capacity would lose in another. The vested interests of the docks, which the Colonial Government at first defied, but now is disposed to placate, are by a long-standing alliance the same vested interests as those of a large part of the sugar trade, and sugar producers see no other result from the construction of quays than that what they may gain by cheaper shipping charges they will lose by the commercial collapse of the dock companies. This curious position, in which the Government is seeking to help the sugar trade by measures which the sugar trade almost unani- mously opposes, can have only one issue; the Government must
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buy out the vested interests if it embarks on a scheme for a deep- water port. The proposal for establishing a Port Trust amounts to nothing more than this.
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33. As we have noticed in the case of the railways, there is so large a measure of opportunism in these development schemes that we cannot be sure that the Trust scheme which we have examined may not be completely changed after a few weeks further thought **having regard to the present situation"; but as it stands the The Trust scheme for a Trust is one which we must condemn. capital is to be based on the respective assets of the different in- terests. The Government assets are (a) the cost of the new harbour works, taken, it is true, at a higher figure than that which is used for calculating the interest charges against the profits of the new quay, but at a far lower figure than the capital value of the Government interests in Port Louis harbour, (b) two-fifths of the value of the granary, and (c) the depreciated value of the other customs warehouses and plant. The assets of the dock companies, on the other hand, are so calculated as slightly to exceed the value of the Government assets, and by the addition of Rs.930,000 for goodwill "the companies are put in a dominant position in the new Trust. Yet it is the Government which owns the harbour, is the lessor of the docks, and possesses the modern works which are the only factors which can improve the present shipping methods, while the dock companies have nothing but old plant which cannot compete economically with the Government quays. The proposed Trust should certainly attain its object of securing the support of docks and allied sugar interests for further schemes of development. The dock companies would gain a preponderant position in the control of the Trust, their financial position would be rehabilitated by borrowing on the guarantee of the Government, their deprecia- tion charges would be covered by the revenue of the Trust and they would be paid for goodwill; some of their staff would be removed, for in this case the General Manager of Railways does not advance the argument that it is dangerous to reduce clerical and other labour; but this would be balanced by the provision of Rs.47,000 for
supervision and directors' fees ".
The profit to the Government is less easily determined: At present the Government is obtaining 9.6 per cent. on Rs.1,200,000 spent on Quay D, according to figures given to us by the General Manager of Railways. Even at the low rental of 8 cents the receipts of the granary would, on these figures, cover the working expenses and interest charges on Rs.1,000,000 capital (the same figure as is taken for the assets of the Trust). The Government could obtain further income by using Quay D to its maximum extent, another 20,000 tons, and by putting Quay C into commis- sion for the landing of cattle in a humane manner in accordance with the needs of public health. All these receipts can be secured
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