96
New Zealand, South Australia, Queensland, Tasmania, Western Australia. Hawaii, and Fiji, and states that advances have already been made towards some of the agents of the Australian Colonies, with a view to having the terminus of the proposed cable in British Columbia instead of San Francisco, which have been favourably received. Mr. Fleming suggests that as Canada is greatly interested in establishing direct tele- graphic communication with Australia, India, and the East, it would be advisableʻ that this Government should take the initiative in the matter, and invite a conference of the Agents of the Colonies interested to discuss the subject.
The Minister, agreeing with the suggestions made as to the advantages likely to accrue to Canada from the establishment of direct cable communication between British Columbia and the East, and that it would be advisable that this Government should take the initiative in the matter, recommends that advantage be taken of the Colonial and Indian Exhibition now being held in London, and the presence in that city of representatives from the Colonies interested, to obtain an expression of opinion on the project, and that the High Commissioner for Canada be requested to invite a conference of the Agents-General of all the Colonies interested, and ascertain how their respective Governments would be disposed to act in the matter, and what amount of assistance they would be prepared to give; also, that the High Commissioner should ascertain from the Imperial authorities what assistance might be expected from them on behalf of the United Kingdom and India, and that the High Commissioner report the result of his inquiries' as speedily as possible.
The Committee concur in the report of the Minister of Public Works, and the recom- mendations therein made, and submit the same for your Excellency's approval.
The Committee further recommend that the High Commissioner be instructed to put himself in communication with the Secretary of State for the Colonies, and endeavour to secure the co-operation of Her Majesty's Government on the subject.
(Signed) JOHN J. McGee,
Clerk, Privy Council.
97
The opinion is gaining ground that the life of a cable, as now made, instead of being 10 or 12 years, is more likely to be double that period. As the conductors and insulating materials employed are practically indestructible, it is difficult to conerive that a cable, after lying 20 or 25 years at the bottom of the ocean performing its functions satisfactorily, will not continue to be serviceable for an indefinite period. I mention these views to show that there does not appear to be sufficient reason for burdening an enterprise at its inception by providing a large sinking fund for restoration at a very early date. Be that as it may, the soundness of
any
the principles have laid down in the memorandum cannot be gainsaid.
We are aiming to establish a work which will result in all future years in a great saving to each Colony. It is suggested that each Colony, in proportion to tho saving effected, should set aside a small portion of the money so saved to keep the work which effects the economy in an efficient condition. For every hundred pounds saved, 107, or perhaps eventually 57, or less, is proposed to be funded to cover possible contingencies. With regard to the probable carnings for revenue purposes, it will be seen, on refer- ence to the memorandum of 6th April, that the foreign business of the Australian Colonies for the year 1889 is estimated to be 85,000 messages, or about 850,000 words. It is not to be expected that the whole traffic will come to the new line, for the existing telegraph company will undoubtedly reduce its charges in order to retain a share of the business.
Let us assume that the business will be equally divided, and that the new Company will only have half of the 850,000 words; this will give 425,000 words, and we may reckon this business at 4s, per word, as the terms made with the Canada Pacific Railway Company will admit of “ through" messagos being sent at that rate.
425,000 words at 4s.
£ 85,000
Less cost of working and land service, say
40,000
Giving a balance of
45,000
II.
PUBLIC RECORD OFFICE
Reference -
mmmmm C.O. 885
PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-
COPYRIGHT PHOTOGRAPH-NOT TO
Direct TeleGRAPHIC COMMUNICATION BETWEEN AUSTRALIA, CANADA, AND GREAT BRITAIN.
Batt's Hotel, Dover St., London,
July 10, 1886.
SIR,
HAVING learned that the Canadian Government has instructed you to confer with the representatives in London of the other Governments interested in the projected telegraph communication between Australia and the United Kingdom, by what may be termed the Canadian route, I beg leave to submit the accompanying documents bearing on this important question.
I desire to direct your attention more particularly to the enclosed memorandum, of date London, 1st July. In this document I have ventured to explain the views I havo formed with respect to the projected telegraphic communication, and the principles
which a
company may be organised for carrying out the undertaking.
upon
I have consulted a number of capitalists, as well as experts in ocean telegraphy, and have quite satisfied myself that with a very moderato Government subsidy, a sub- stantial company can be formed to establish and work the new line of telegraph on the principles laid down in that memorandum.
The whole capital of the company, to complete an independent telegraphic connexion between Great Britain, Canada, New Zealand, and the Australian Colonies, may be placed at 2,500,0007.
This capital may be divided into two parts, viz., 1,500,000/., to bear a low rate of interest, secured for 25 years by Government subsidies; 1,000,000l. to be share capital apportioned between Australian, Canadian, and English capitalists.
This capital will be ample for the whole undertaking.
With regard to the restora-
tion sinking fund, I have consulted some of the best experts on ocean telegraphy on the general question, and I learn that opinions are rapidly changing with respect to the life of modern cables. The first cables laid may be considered to have been to a large extent experimental, and advantage may now be taken of the very large experience gained.
It is found that in ordinary cases the breakages are apt to take place within a com- paratively few years after the cables are laid, and that once properly repaired faults are not likely to recur.
equal to 41 per cent. on 1,000,000/. This estimate is for the first year the line can be in operation. On careful examination it will be seen that the estimate is an exceedingly moderate one, no allowance having been made for the great impulse which will undoubtedly be given to telegraphy and general business by the large reduction in charges.*
few
There cannot be a doubt that the earnings will go on greatly increasing, while the working expenses will increase but little. double the net earnings in a very
It would not be at all a high estimate to share capital, and it may be assumed as certain that the increase would continue year This would give 9 per cent. on the whole by year.
years.
I have explained that a subsidy is noeded for the purpose of securing a million and a half of pounds at a low rate of interest. If the Government subsidies be sufficient to provide a sinking fund to pay off the 1,500,000. in 25 years, it would be proper to carry all excess of revenue over a given dividend, say over 7 or 8 per cent., to the restoration sinking fund.
It will be noted, as one of the proposed conditions, that not only will the charges on messages be reduced to less than half the present rates, but that messages sent by any Government shall be transmitted free to the full amount of its subsidy. This feature will place it in the power of each contributing Government to receive directly back each and every year its full proportion of the subsidy contributed.
I
respectfully submit that the scheme above outlined is perfectly practicable; it will no doubt find warm and active hostility on the part of those pecuniarily connected with the existing telegraph company--those whose policy has been to maintain high rates in order to securo large profits. Such objections as they may offer should havo little weight in view of the great Imperial and Colonial advantages which the new undertaking will secure. The better policy for the companies to adopt will be to lower
"So fur
* Referring to the recent great reduction in charges between London and New York, the Report of the Directors of the Direct United States Cable Company for the six months ending 30th June last states: "the reduction has resulted in more than doubling the volume of traffic, and the Directors are not without hope "that with a revival of trade it may be still farther increased." The Report of the Anglo-American Tel-graph Company also states that the traffic has increased over 110 per cent, since the rates were reduced,
A 51431.
R