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PUBLIC RECORD OFFICE

Reference:

TC.O. 882

4 PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

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estate, and dividing the total of products by the number of tons of produce carried from the district.

7. No similar calculation has been made as to the traffic carried up-country, since for this traffic the carters will obviously be unable to compete with the railway. The contrary temporary experience on the Nawalapitiya-Hatton extension supplies no parallel and affords no argument against this contention.

8. No account has been taken of the increase of traffic that will arise from improve- ment in coffee crop when manured, nor of the general expansion and development of the resources of the district which the railway may fairly be expected to effect; neither has passenger traffic been considered, nor yet the tea traffic which will undoubtedly be very large. I have dealt simply with existing estate produce traffic for three years past, and the up traffic which a considerable experience has shown to correspond thereto. On this basis, and adopting various rates for the down traffic the General Manager I see no reason cent. per shows returns of nett profit varying from 73 per cent. to 8-10 to doubt this result; but even if it were certain that no more than 6 per cent. would in the first instance be obtained, I should still be of opinion that the extension of the railway to Haputalé should be at once undertaken.

9. The General Manager's report on the financial results of the extension already effected from Nawalapitiya to Hatton and to Taláwakele (which shows that while there is a small profit over the working expenses, the receipts do not amount to one-third of what is required if the payments for interest and sinking fund and the depreciation of stock be taken into account) is one of the papers enclosed in this despatch.

It carries conviction to my mind that the portion of the railway between Hatton and Nánu-oya now open cannot prove a success, and that having now been completed to Nánu-oya, it must necessarily be pushed on to Haputalé if it is to prove a remunerative enterprise. Whether it should ever have been extended to Nánu-oya at all, is another We must accept the fact that the question, but one which it is now useless to discuss. railway has reached that point, and if any advantage is to be derived from the costly work already accomplished, it seems to me demonstrable that its further extension to Uva must be at once undertaken. It is hardly, if ever, a paying speculation to extend a railway with the sole object and result of catching at a higher point the same traffic which is already secured to the line. Matters will doubtless to some extent improve here when the carters have exhausted their present stock of bullocks, for it will not pay them to buy bullocks at the present rates of cart hire, though it may answer their purpose to use up their present stock in under-bidding the railway. But making every allowance for this, the prospect in any case sufficiently bad to show how necessary it is that the Government should secure to itself the profit which is to be commanded by the extension of the line to Haputalé. That a profit will attend such an extension is, I think, clearly established, for the Manager's estimate is, for the reasons I have given, but a minimum estimate, and one perfectly secure of realization: it has been purposely so framed. As it is out of the question for the carters to compete with the railway in the up traffic to Haputalé, the planters will be forced to send their produce down by the railway. It will clearly pay them to do so; the greater speed saving their coffee from deterioration en route, and the greater security afforded by the railway protecting it from depredation. But even if this were not the case, they would be equally compelled to resort to the railway, for no carters could afford to allow their carts to ply in one direction empty; and it has already been shown that as to the employment of the railway for the up traffic of the Uva District there can be no possible question.

10. As [of] the whole of the traffic but an inconsiderable fraction will go from and to Haputalé, I have made no allowance for the difference of rates at Ambawella and Idulgashéna, the proposed stations intermediate between that place and Nánu-oya, the difference being infinitesimal. The traffic anticipated is all new traffic, and the under- taking must therefore be regarded (and I have so regarded it) from the point of view of The Railway the results to be obtained by carrying the traffic to and from Colombo. Commission anticipated, I presume, that this traffic would be secured at Nánu-oya, if the extension ended there, and calculated the results on the further extension alone from Nanu-oya to Haputalć, and on the extension from Nawalapitiya to Haputalé. These questions have no longer any practical bearing, and it is unnecessary to enter into them.

11. My Executive Council unanimously concur with me in the opinion that the work should be undertaken without delay, and in requesting the authority of Her Majesty's

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Government to raise the loan which will be required to effect it. They have also expressed it as their wish that I should make a strong appeal to your Lordship to endeavour to secure the utmost expedition in bringing the necessary preliminaries to a speedy termination.

12. I would venture to call your Lordship's special attention to paragraphs 73-81 of Mr. Waring's report, and at the same time to express my own decided conviction that the works contemplated should be undertaken directly by Government in the same manner in which those of the Colombo Breakwater have been so successfully carried cut. The work itself is of so peculiar a nature that a good contractor, as is pointed out by Mr. Waring, would probably insist on so-large margin, to meet every possible contingency, as to render his work extremely costly, while the employment of an inferior contractor, such as some of whom the Colony has unfortunately had experience, would in the long run prove only a source of expense, trouble, and disappointment.

13. I have called on Mr. Waring to prepare the scheme referred to in the 79th para- graph of his report, and when received it will be at once forwarded to your Lordship for consideration.

14. I have not made any reference to the suggestion that the projected extension should be of narrower gauge than those portions of the line already constructed. Had it been possible to effect such an alteration at Pérádeniya or Gampola, the question would have been well worthy of consideration, but to change the gauge of the line within thirty miles of its termination would be an act of folly, and the only practical effect of now entering on such a discussion would too probably be the postponeinent to an indefinite date of the commencement of all active operations.

15. Nor, in urging on your Lordship the expediency of sanctioning without delay the extension of the existing line, do I say anything of the claims of the Province of Uva to share in the benefits of railway communication. Those claims are strong, and I shall see them satisfied with no small degree of pleasure; but they would not in themselves have justified an undertaking of this nature, and I prefer to base my advocacy of it solely on the financial results with which I believe it will be attended.

16. For the same reason I forbear to urge the political considerations which would dispose me to commence and carry on this work, even if I were less satisfied with the prospects of remuneration which it opens.

17. But I think it right to add at once, although I shall reserve for other despatches a more detailed development of the subject, that, in my opinion, a partial extension of the Sea Coast line southwards should be carried on pari passu with that to Haputale, and I should propose to include in the loan to be raised a sum of 60,000l., being the amount of the estimate for the extension of the southern line from Kalutara to Bentota. On that question I, however, propose to address your Lordship in a separate despatch.

I have, &c. (Signed) ARTHUR GORDON.

The Right Hon. the Earl of Derby, K.G.,

&c.

&c.

&c.

Enclosure 1 in No 1.

CHIEF RESIDENT ENGINEER, Railway Extension, to the Hon. the COLONIAL SECRETARY.

SIB,

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Report upon and Revised Estimate for the proposed Extension of the Railway to Haputalé Pass.

Dimbula, May 25, 1885.

In accordance with the instructions contained in your communication No. 25 of 3rd March last, I have the honour to submit for the information of his Excellency the following report, accompanied with a revised estimate for an extension of the railway to Haputalé Pass.

2. In order that what is to follow may be clearly understood, it is, I think, necessary briefly to refer to the estimates previously submitted to Government for the work in question.

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