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PUBLIC RECORD OFFICE

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for himself that the sharcheiders, fat from paving the way for capropriation, were denying themselves, in the interests of the expansion of the enterprise, of the enjoy- ment of net earnings to the extent of over $500,000 a year. That is to say that had the shareholders been pursuing the, shall I say, somewhat unworthy practice attri- buted to them, they would have been dividing in dividend not the paltry $444,000 they have contented themselves with for many years back, but the sum of $1,000,000 per annum, which is the amount of the annual net earnings of the Tanjong Pagar Dock Company as shown by its published accounts.

11. I cannot avoid the reflection, but I mention it with every possible respect, that the mystification which the shareholders have found in the low figure of $240 per share offered by Government is solvable on the supposition that it was arrived at while the Government was still under the impression that $444,000 was the extent of the dividend of which Tanjong Pagar was capable on a system of parsimony,

12. If the dissection of the Company's composition be insisted upon and a dis- crimination is to be set up between the Committee on this side and the Board on that (a treatment of the subject which, however, I have no desire to participate in) then I am compelled to assert and prepared to prove up to the hilt that the whole weight of the proprietary on this side was utilised in years of struggle with the Board for the greater expansion of the resources of the Company to cope with the ever growing demands of the Colony and without a moment's hesitation on the score of expenditure.

13. It is perfectly true that there were internal dissensions amongst us. Far greater bodies than Tanjong Pagar have their internal dissensions, with equal difficulty in preventing their publicity. But Tanjong Pagar dissensions arose, not as the Secretary of State would seem to imply, from any concern as to dividend results, but solely from the determination of the Committee that, whatever the cost, the modernization of the Company must proceed without further delay.

14. The initial bone of contention was the representation of the Committee that the affairs of the Company could no longer be attended to in the intervals snatched from individual businesses-that an expert Managing Director had become an in- dispensability-and the Committee may be said to have forced this appointment in the teeth of the Board's most determined opposition. Yet without it no commensurate progress would have been possible and it was only by means of it that the Committee were at last able to produce the comprehensive scheme of deep water wharves recently approved of by the Colonial Office Engineer. This scheme, which the Secre- tary of State himself commends, the Committee emphatically claim as the ultimate attainment of the object for which they had to struggle with the Board for years.

15. I fear I am somewhat labouring a shade of the subject which I have dis- claimed, but the Secretary of State, by paragraph 5 of his despatch, evidently mis- apprehends the power of the Committee to make itself felt in the deliberations of the Board. He apparently supposes that home shareholders dominated the votes of the Board. This was very far from the case. Of the nine Directors, three only could possibly be considered as subject to London influence. The other six were absolutely independent.

16. But these internal troubles were not, in a relative survey, after all, of a very prolonged duration, and for the past year the conditions of harmonious manage- ment, which have distinguished by far the greater period of this Company's long and prosperous career, have been completely restored. For the Secretary of State, therefore, to imply that a temporary dissension amongst its controla by no means infrequent experience of all large enterprises-was an argument for expropriating this particular enterprise is, I submit, open to the objection which I have represented.

17. But this is all detail. It is, however, detail forced upon me by the harmful prominence accorded to it in the arguments of the Secretary of State. His main contention that the Company has not kept itself up to the demands of the port is, I maintain, abundantly refuted in the figures with which I supplied him in my letter of the 14th October, 1904.* A Company which was able at its inception to deal in six months with only 57,000 tons of shipping, but has developed itself into a capability of handling 2,332,000 tons in the half year is scarcely chargeable, one would have thought, with neglecting its field of operations. The Secretary of State refers to the Company as a practical monopoly. It is so, but this arises, not from any intention to make it so per se, but simply through the Company's energetic policy

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of increasing its whariage resulting in an absorption of almost all the available fore- shore. I maintain that any representation that the Company has not been equal to all demands of the port is next to baseless and the best answer to the charge is the freedom from complaint which it enjoys throughout the length and breadth of its vast and manifold business operations.

18. To come now, however, to the Secretary of State's principal count against the Company, that it finds itself behindhand in its preparedness for the great expan- sion of the shipping trade which has taken place to the Far East, I would respectfully express the doubt if the Secretary of State quite realises the rapidity with which the change, particularly in the additional draught and the other enormously increased dimensions of modern tonnage, has come about. I do not go the length of repre- senting that the dissensions amongst us, which led to delay, are after all a subject for congratulation, but I do submit, in all gravity, that it is quite possible they have in this important respect not been an unmixed evil. It is by no means inconceivable that a five years' earlier start might have been on lines (I lay stress again on deeper draught) which we might be realising to-day had been totally inadequate.

While on this subject of the alleged backward state of the Company, may I be allowed to refer parenthetically to some former negotiations with His Majesty's Government which threw the Compan development back several years. After years of negotiation, during which any other important work of the kind had to be held in abeyance, the Admiralty and the Company had completed an arrangement for the building of a graving dock on the most modern lines, capable of docking the largest battleship. The Company was to provide the site and build the dock and the Government and Company's respective shares of the cost were arranged and everything else down even to the tariff at which Government work was to be charged. Had this been carried out, which at the time seemed an absolute certainty, the Government would have had in Singapore for several years back, the call of one of the finest docks in the world. But unfortunately the Treasury would not ratify the arrangement and the project had to be abandoned. The Navy failed to get its dock and the Company lost several years of valuable time.

19. However, financially, the delay, of course, also finds the Company only more competent to contemplate extraordinary expenditure. The Company's credit is stronger to-day than ever it was. The impression to the contrary which the Secretary of State apparently derived from my letter of 14th October is, I think, scarcely war- ranted. The Company's desire that the Government should be its banker for this extraordinary expenditure was absolutely and exclusively for the reason that I attempted there to state clearly, viz., that the Government's equally zealous interest in the progress of the Colony might lead it to lend on terms which would enable the Company considerably to accelerate the completion of the work. The negotia- tions with the Government in short were solely in the interest of the best terms.

20. The Secretary of State, however, apparently has gathered the impression that it might be onerous for the Company to finance the scheme. Nothing could be further from the fact. The Company had made all necessary arrangements for the money and the Government's refusal to lend to the Company would have made very little difference. The Company had decided, in any case, upon the immediate carrying out of the whole scheme as laid down in the plan and upon its completion within a period of ten years or less if that were possible and this was plainly stated in my letter of the 14th October.*

21. Not only so, but, foreseeing the probability that the Company's regular business would be greatly hampered during the reconstruction, the Company had entered into negotiations for the acquisition of the P. and O. and St. James's pro- perties, by means of which to replace the facilities of which they might have been temporarily deprived. This alone, it is hoped, sufficiently answers any suggestion that the Company was finding itself at the end of its financial resources.

22. This brings me now to refer to the use in the despatch that has been made to the Company's detriment of an incidental remark during the conversation which took place in your office on the 1st October. The point being discussed was the ability of the Company to dispense altogether with Government financial assistance, and it was pointed out that, even without borrowing at all from anyone, the Company could still do the work out of its customary reserves although in that way it would

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