1905-02-02 — Page 11

TANJONG PAGAR DOCK.

THE EXPROPRIATION BILL

SPEECH BY THE GOVERNOR.

We take the following verbatim report of proceedings at a meeting of the Singapore Legislative Council held on the zoth ull, from the Straits Tithes of the 21st idem :-

THE HONGKONG TELEGRAPH, THURSDAY, FEBRUARY 2, 1905.

members would find briefly summarised in the despatch which had been laid on the table that afternoon, lo fact, he had received permission only that morning to hy that despatch, which was a confidential one, before the Council.

The proposals which he submitted to the Secretary of State in the despatch were briefly that the Government of the Straits Settlements

a. Pending the payment to the Company of the sum referred to in Section to the Board nr the Government on behalf of the Board shall pay to the Company from the appointed date interest at the rate of 12 per cent per a num on the ordinary share capital of the her, 1904.

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The Colonial Secretary moved the first read. Company under its present Articles had power capital of the company being $3,700,oco, he Government actually paid itself on the sinking Company as constituted on the 10th Decem- forthcoming. In this connection I pute the

and of the Federated States should take up 18,000 fresh shares in, the Company. The to issue more shares and he suggested that they should be asked to issue another 18.000 and that the Government of the Federated Malay States and the Colony should take up these shares between them at a price which he mentioned as a fair price-a generous price he even thought-namely $200 a share. Further, that the two Governments should either guar- antee or lend to the Company the further sums required for the extension of its works, mounting, as he then estimated, to some $8,000,000. In return for this and in order to secure the main obejct which he had in view, he asked that the Company should concede to the Government the right of vetoing on the ppointment of its directors and the right of veto with regard to the members of the London Committee also the right to nominate two nembers of the Board in London. Further,

nothing was the course which they finally decided on adopting. He must say in passing, though he did not want to enter into any con- troversy on this occasion, that while the share capital of the Company, as they all knew, was $3,700,000, he believed that a very considerable part of the shares representing that capital had- heen appreciated and that therefore $3,700,000 was only nominal amount and did not repre- sent the business. However that might be the

expected that the Government would view this ing of the Bill entitled an Ordinance to provide

proposition to put down four times that nominal for the acquisition by the Government of the

capitol into the business, and not ask-control Straits Settlements of the undertaking known

of that business, as scarcely reasonable, and at as the Tanjong Pagar Dock Company, Limited,

the same time to ask the Government to and for the management of the concern. This

practically guarantee their present dividend was a measure, he said, of vast magnitude, per-

although all this new capital was going in and haps the most important that had ever been

would have to be provided for in the way of introduced into that Gouncil. In the absence

interest and other charges paid on it-to ask of any printed objects and reasons it was per

them to guarantee six per cent, was a condition haps the duty of the mover to state them. The

which he thought was not a business proposi object of this Ordinance was to provide for the

tion. In the interests of the Colony he thought acquisition by the Government of the Straits

they would all agree that to have allowed the Settlements-he thought he was prepared to

Company, as they intimated, to go on with say, the acquisition by the Colony-of the

these works for a period of 30 years-that was undertaking known as the Tanjong Pagar

to say, to keep on tinkering at this wharfage, Dock Company in order that the Colony

which was of such vital importance to the future should in future control, itself, what was of

and the present of the Colony-to keep the utmost vital importance to its commerce.

Singapore waiting all that time for the Com- The Ordinance had been drawn up so as to

that the 'Articles of Association should be pany to provide the facilities which its trade interfere as little as possible with the business amended in respect of the provisions which demanded), was also a proposition which the undertaking hitherto carried on by the Com: required the previous approval of the London Government were bound to do their best to pany on business lines and by the most

Commitee to any expenditure of over $5,000, prevent if they possibly could. In these two businesslike men in our midst. if hon. mem-

and which limited the voting power of large things were the real reasons which had prompt: bers referred to the words of the Ordinance

hareholders, Thai Inst suggestion had already ed the Government to the step that they had they would see it was drawn with the special been given effect to by the Company, Further taken. The first was that they were going to intention of giving the new Board very, free that the previous approval of the Governor put a large amount of money into the business, control and of leaving them untrammelled by should be necessary for any increase on the the, only object of which was to secure the the changes attained. For example, if reference charges of shipping and the warehousing and control of the policy in the interests of the port, was made to Section zz, it would be seen that handling of goods, and for the distribution of and in the next place they desired that facilities the election of the chairman of the Board was

any dividend. As he had mentioned the in 'should be afforded within the shortest possible left to the members themselves, and Sections formation he gathered was that the number of time as the only course which was in the 16 and 29 gave the Board the freest possible shares in the Company which were held in interests of the shipping and commerce of the band in conducting and enlarging the existing Singapore was somewhere about 10,000, and place. He did not think there was anything more to trouble the Council with so far as the business and for the appointment and liberal with the 18,000 which he desired the Govern- treatment of all their officers and employees.ment to acquire it would have transferred the history of the negotiations was concerned. In the event of an agreement not being come bulk or the majority of the voting power in the The Secretary of State of course finally decided to under Section to as to the purchase price to Company from London to Singapore. He con- that expropriation should take place as being be paid, provisions were made following upon sidered that if a matter on which the Govern the only really satisfactory course to give the thelines of the provisions of the Metropolis Wa.

iment, the public of Singapore, found it neces- Government control of the policy, which they ly serious if the Government and the public very curious as it appeared in paragraph 13 of of Singapore spoke unanimously on the ques- the despatch that the Government in dealing tion-they would be able to make their views with his proposals had stated that the fatal effective by the fact that the majority of the objection to further negotiations was that the share capital was held in Singapore. He was London Committee doubtless expressed the very much adverse indeed to anything like Go-opinion of the majority of the shareholders and "would not consent to either and we have no power to compel them to do so." Whether the Government correctly interpreted the views of the London Committee or not, at any rate they honestly gathered the impression from their own statements at this interview, and this Fill, the main principles of which had been sent to him by the Secretary of State, was the con- sequence The earlier part of the Bill provided machinery for taking over the Company and then went on 10 provide for the payment of compensation and for its assessment by arbitra- tion in the event of their failure to come to an

11. (1), The Board shall be appointed by the Governor. Une-third of the members shall etire by rotation every three years but may be cappointed if the. Governor shall see fit. Of the original members those to retire in the first and second years shall be determined by lot.

(2) The Governor may at any time by writing under the band of the Colonial Secretary re- move any member from the Board and such member shall forthwith cease to act.

(3) In the event of a vacancy among the members of the Board from whatever cause arising the Governor nay appoint another per- son to fill the vacancy and such person shall hold office for the unexpired term of office of the meniber whom he replaces,

(4.) In addition to the members referred to above there shall be not more than two official members who shall be appointed by and hold office during the pleasure of the Governor.

(5.) The Chairman of the Board shall be ap. pointed by the members from among themselves subject to the confirmation of the Governor. He shall not be an official member.

the Colony at such times as the Governorshould | Board. The Court shall upon the application direct a sum equal to five per cent. per annum of the Government order the taxation of any of the total amount paid by the Government uch costs in such manner, and on such scale under the provisions of the tirdinance, no such of principle as they may think fit sum to be liable to assessment for the military contribution. The object of that was that the Government was not to interfere in the man- agement, and therefore the Board should be self-supporting. The charge mentioned was of course practically equivalent to what the

fund, on the loan. which they would have to raise for this measure, and the intention was that the Government should make no profit out of the transfer but at the same time should make no loss. The second sub-section of clause 30 provided that "at the end of each balf year the net revenue of the Board after providing such payment and for a suff. cient working balance shall be paid into an account to be called the reserve fund to be kept in names of the Colonial Treasurer and of one or more members of the Board and the Reserve fund shall be available from time to time with the sanction of the Governor and to such ex- tent as he aball approve for any purpose con- nected with the business of the Board." That was to provide that whatever the Board had over after its necessary charges had been met should be devoted to works of improvement or extension, or if they thought it so desirable to a reduction of the charges. At the same time with the very large capital expenditure which must be incurred in the near future to bring the Board's undertaking up to date he hoped that hon. members and the public would not run away with the hope that the Board would at any very early date be able to afford much | relief. He thought the immediate, early, pro- vision of facilities which were urgently requir ed was of more importance than any mere re- duction in the rates. He might say that the sum be mentioned of $15,000,000, which was the estimate of the Consulting Engineers of 26 The Board shall for the purposes of their the Company for their works, did not include powers and duties under this Ordinance or several works which, he believed, many mem-otherwise with respect to the carrying on of bers of the public in Singapore consider the undertaking have power to manage alter ed as eminently desirable. It included noth- and calarge and with the consent of the Gover ing for a large graving dock such as he nor to lease or alienate any land or buildings believed a very large number of people held by them under this Ordinance and to who were interested in the commerce of the acquire hire erect and furnish offices as

also did not provide for the very considerable require. expenditure which must be incurred on the branch of the Company's undertaking at Penang which certainly was in a condition which would justify a very large capital expenditure. He was sure hon. members would agree with him that under the conditions which the Secretary of State had laid down for the future adminis tration of this undertaking there was every 19. Subject to any instructions or regula. reason to believe that the shipping and com. tions issued or made under Sections 24 and 25 merce of Singapore would have its destiny in hereof all persons employed by the Board shail its own hands and that there were in this com- be appointed by the Board at such rates of munity plenty of technical men who would be salary or wages as the Board may determine willing to place their services at the disposal and any person may be dismissed by the Board of the Government for the purpose of managing with such notice or compensation in lieu of the undertaking in the public interests. He notice as is customary in each case. had every satisfaction in presenting the measure to the Council as one which was conceived in the best interests of the community and the Government, in the present and for the future. |(Applause.)

23. The members of the Board shall receive such fees and remuneration as the Governor may from time to time determine.

14. The Governor may from time to time issue to the Board such instructions as he may see fit and the Board skall forthwith give effect to such instructions.

I have no desire to make any reflection on the Committee-it is their business to promote who try consider to be the interests of their shareholders, as it is the business of the Government to promote the general inter- eats of the community-but I have not fall- ed to observe that a powerful indictment of their policy has been made by the late Chair man of the Board of Directors, to which, að far as I am aware, no adequate answer has been

observation made in the fifth paragraph of your despatch, "it is possible that the parsimony in regard to equipment and improvement, which is alleged with considerable force against the Committee in London in recent years, may have been due to their expectation that the Government might find it necessary in the interesis of the Colony to establish a Port Trust to take over their undertaking, and their desire therefore, that the dividends on the basis of which, under such a scheme, their shares should be taken over, should be as large a. passible! And elsewhere you endorse the view already expressed by Mr. Taylor when adminstering the Government, that "there is a large and growing opinion in the Colony, that the public interest imperatively demands that some arrangement should be made for securing that the welfare of the Colony, and of the great slip- ping interest with which it is bound up, shall not be subordinate to the immediate interests of a body of absent shareholders."

6. The suggestions which you put before me in your despatch were therefore framed with a double object--to ensure that the Com- pany should be equipped with adequate funds for carrying out the necessary works as quickly as possible, and to secure to the Government that effective control the Company's policy which you rightly regard as indispensable in the public interest. To these ends you propose that-

(a) the Government of the Straits Settle- take up 18,00 fresh shares in the Company at ments and the Federated Malay States should

$200 per share, though you regarded the price as a matter of minor importance;

tor Act under which the London Water Comsary to differ from the Company was sufficient believed to be essential. He might say it was place considered eminently desirable, and it workshops buildings and offices as they may proposal subsequently modified by your

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employed by the Board shall be deemed to be 28. No member of the Board and no person a member of the Civil Service of the Colony by reason only of such employment but all such members and persons shall be held to be public servants within the meaning of the Penal

30. (1.) In each half year the Board shall pay into the general revenue of the Colony at such times as the Governor shall direct a sum equal to five per cent per annum of the total amount paid by the Government under the provisions of this Ordinance. No such sam shali be laible to be assessed for the Military Contribution.

The first reading was agreed to unanimously, The Colonial Secretary stated that the second reading would be taken on 3rd March The Council adjourned till rath February,

(3) At the end of each half year the net Appended are the principal sections of the revenue of the Board after providing such pay. Ordinance to provide for the acquisition by ment and for a sufficient working balance shall the Government of the Straits Settlements of be paid into an account to be called the ke Tanjong Pagar Dock Company, Limited, and serve Fund to be kept in the names of the the management of the same, which was read Colonial Treasurer and of one or more mem- a festtime at the "ings, ore Legislative Coun-bers of the Board. The Reserve Fund shall be cil on 21st inst.:-

available from time to time with the sanction of the Governor and to such extent as he shall approve for any purpose connected with the business of the Board.

Whereas it is expedient that the property and assets of the Tanjong Pagar Dock Com pany, Limited, should be vested in the Govern- ment of the Colony and that provision should be made for the management of the same,

3. It shall be lawful for the Governor by writing under his hand addressed to the Managing Director of the Company to give notice that it is his intention to take over the property of the Company on a date to be stated in the said writing and from and after such date hereinafter called the appeinted dated the property and aseis of the Company in the Colony shall be vested in the Govern

ment.

4. The Government shall be liable for all debts and obligations lawfully incurred by the Company at the appointed date.

5. Until the appointedfdate the undertaking and business of the Company shall be main tained and carried on by the Company as berebefore in the ordinary course of business; but if the Government think that any appoint meat to any office or service or the Company or any contract with the undertaking or any alteration in the rate of salary or wages pay. able to any officer or servant of the Company made by the Company subsequently to the roth day of December, 190, was not reason. ably necessary in the ordinary course of busi- cess of the Company the Government may give notice in writing to the Company to that effect within three months after the appointed date.

CORRESPONDENCE.

SECRETARY OF STATE FOR THE COLONIES 70 GOVERNOR SIR J. ANDERSON,

Downing Street, November 4, 1904. Sir, I have given very careful considciation to the proposals contained in your confidential despatch of the 15th of June, for affording financial assistance to the Tanjong Pagar D. ck Company in order to enable them to carry out the extensive works which they have in con. templation.

2. I have obtained from the Company a copy of the Report of their Consulting En- gineers which I enclose for your information. is stated in that report (Section 20) that "the existing facilities are taxed to the utmost and are entirely inadequate to meet the increasing demands of the port," and from information at my disposal I have no doubt as to the correct- ness of the statements made in paragraph z of your despatch, that there can be no question of the toadequacy of the facilities at present provided, and that "delay in making adequate provision, not only for present requirements but for those of the immediate future will be a serious injury not only to Singapore but to the enormous British shipping interests engaged in the Eastern trade.”

panies were very lately expropriated. It was of course to be hoped that some just rangement would become tounder Section 10 without a refer- ence to arbitration because the cost of the latter must be very great, and it would be charged on the revenue of the Board. If course, it was wademtood that the undertaking must be a self-vernment inference with the management, as

Code. it was in the interests of the at the time he did not see how Government supporting one, whole Colony that the price paid for the under could take over the concern without such inter taking should be a fair one and that the costs ference on the part of the Government, and with of transfer connected therewith should be as

out running it in all its ways as a Government low as possible. He was sure the Council department he was very much opposed to any would give all is aid in endeavouring to effect idea of that sort and he expressed himself to that a prompt and just settlement of the matter; effect. When his proposals were received by the which certainly was hound up with our local Secretary of State he after long consideration commerce and closely connected with the trade of the subject and discussion with his predeces- of this part of the Empire. (Applause.) sor and others who were aware of the circums

The Colonial Engineer seconded the motion tances of Singapore and its needs decided to for the first reading.

approach the London Committee with whom His Excellency said that, before asking the the control in this matter, as they knew, really Council to vale on the motion which had been rested. Accordingly the Secretary of State ad put before them su concisely by the hon. Colo-dressed to them a letter which would be found Dial Secretary, he thought it desimble that he in the paper which had just been laid before should put them in possession of some of what them and invited them to say whether it had they might call the secret history of the last heen finally decided to carry ng the contem. few months, and of the objects and motives plated extensions and improvemenys, and if sa which had influenced the Government in com- within what period and beginning at whai date, ing to the decision which was embodied in the what was the sum which the Directors of the measure he was submitting to them. There Company had come to the conclusion must be could be no question of the importance to the borrowed for this purpose, and whether the Colony, not only in its present position but still Directors would welcome Government 'assia- mere with regard to its future, of the business lance in the maller of raising money; and he conducted by the Tanjong Pagar Dock.Com concluded by inviting the Committee if they pany. When he arrived here some nine months wanted to open up negotiations to come to an ago or thereby one of the earliest papers sub-interview at the Colonial Office. He might say milled to him was an application from the that when the application for $10.003,coo was Company for the loan from the Federated made in the first instance proposals were then Malay States, possessing a large balance, of before the Company by its Consulting Engineer $10,000,000 and a rate of interest of three per for the renewal of practically the whole of its ceni. At first gight he was inclined to inquire wharfage in a permanent form. The existing why the Federated Malay States Goverment wharves, as they were all aware, were wooden should lend money to the Tanjong Pagar Dock structures, and in a climate like this wooden Company at a lower rate of interest than it structures were of course very temporary, even was receiving on investments and what claim the best of them, and constantly required re- the Company had on that Government at all.newal, and that constant renewal must mean He did not raise that question because it ap- very large interference with the ordinary busi- peared to him obvious that the interests of the mess of the Company, for if you were repairing Federated Malay States in the shipping facili-n wharf, naturally the use you could make of it ties of Singapore were almost as close as they must be very limited; and the Company's are for Singapore itself, and therefore be de- Managing Director bad submitted to the Boardpropriation. That would be found in Sec- cided to examine the position as carefully as a scheme, ably conceived, for the renewal of he could and in every direction and see whethe whole of wharfage and also providing for ther the proposition put before him was a pro- very considerable extensions. The estimated position which he could gard as in the best cost of these extensions, was he believed, interests of the Colony and of the Federated £12,000,000, of which the Company were to Malay States. After looking round and seeing provide $2,000,000, and they asked the Govern what the position of the Company was, the ex- ment to provided the other $10,000,000. traordinary strength of its hold upon what one When the Managing Director went home in might call the available wharfage of this Colony, June at the instigation of the London Com. with the exception of a very small part at mittes he was placed in communication with Teluk Blangah, the part occupied by the P. a gentleman whose name was not unknown in and O. Company and other parts around St. Singapore and whom the Managers of Tanjong James's, he found that the whole foreshore Pagar had the greatest confidence in-Mr. which was available or might be available for Matthews—and the result of their joist con- the accommodation of large oceangoing sultation was to effect a considerable modifica steamers was in possession of Tanjong Pagar tion of the scheme prepared by Mr. Nicholson, Company. It was quite true that by reclaim. which meant a very consideiable increase in ing the parts be had mentioned, perhaps, on the cost. The cost then was estimated at the other side, they might have afforded some practically $15,000,000 for the new work. of facilities for bunkering and also facilities for

course the application of the Company was landing and despatching goods, but the fact now subject to that modification caused by the was very obvious even to one taking a fresh change in the plans and the increased cost of view of the question that the Company's posi the contemplated works. He might say that tion was a very strong one indeed and that to from the first the Colonial Office and the all intents and purposes the whole oceangoing Secretary of State were very doubtful whether shipping which touched at Singapore was sub-his proposals were adequate to give the Govern ject to the contral, really as far as its access to ment and the public bere the cd trol which Singapore was concerned, of this Company. they as well as himself thought essential in the It appeared to him that this was a passion interests of the port over the policy of the Con- which, however well it might have worked in pany. He said policy, not management, be- the past, was one which there was no guarantee caute Government would have nothing to do would always work equally in the future, and with the management of the Company either that it was very undesirable in the interests of now or in the future ; but the policy was decid the commerce of the place that practically the ed as a matter which sb closely affected the whole shipping facilities for larger steamers port and as a matter in which the Government should be entirely under the control of the had a say. When the London Committee Company. When he learned the position of responded to the invitation of the Secretary of the Company and found that a very large pro State the result was certainly not encouraging. portion of its capital-more than two-thirds, more It was summarised in the Secretary of State's like three-fourths-was held not in the Colony but despatch thus:-"I may add that at the meet- in London, it appeared to him, if any questioning with the representatives of the London were to arise between the community and the Board they made it perfecily clear that they shipping interests of Singapore and this Com would not accept any measure of effective pany, that in order for the voice of Singapore Government control, such as that proposed by to make itself heard respectably it had to con you, unless continuance of their present divi vince not Singapore but London. That ap dend of 12 per c/ were guaranteed to them peared to him to be a very serious position, and it was evidea that the continuance of that He did not say or imply at all any complaint dividend was as you histed in your despatch against the management of the Company-the paramount consideration in their minds. altherto. On the contrary, he thought they They stated during the discussion that without would all agree with him that the extraordinary Government assistance they could not hope to enterprise and foresight of the directors of the, obtain the requisite capital on terms which Company deserved the fullest reward from they would be able to accept. In such case Singapore, and he was glad to see from what they proposed to go on with the improvements he could learn that they had already reaped a | gradually, and as money was available, and very substantial reward. (Hear, hear). On they suggested a term of 30 years as a possible this review of the situation it appeared to him duration of the work." He did not, he confessed, that the opportunity presented by this applica when he got this despatch, share the Secretary tion of the Company for the Government to of State's views as to the hopelessness of at- obtain such control of the policy pursued by the tempting further negotiations. He conceived Company in the future as to ehable it to secure that the Company were asking for a good deal if necessary the interests of the port, was an more at first than they would expect and he object which was good for the Government or urged the Secretary of State to continue the perhaps the Federated Malay States incurring negotiations on the lines which he had recom. some sacrifice. discussed the matter at mended. However, the Secretary of State, some length with the Managing Director of having had what he had not, the pleasure of the Company, through whose courtesy and seeing what the attitude of the London Com readiness to place everything at his disposal mittes with whom this really rested was in the he was very much indebted, and after weighing matter, decided that it would be quite useless the matter as fully as possible he submitted to to continue further negotiations and therefore the Secretary of State the proposals which hun, the only course left unless they were to do

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(4.) the two Governments should guarantee an issue by the Company of four per cent debentures up to an amount of $8,000,000-a

borrowed by the Colony and lent to the Com telegram of the 13th of September in which you suggested that the necessary tum should be

pany:

(c) that the Governor should have a veto on the appointment of all directors and members of London Committee, and the right to nominate at least two members of the Board and une member of the Committees,'

(d) that the Articles of Association should be amended in respect of the provisions which require the previous approval of the London Committes to any expenditure of over $50,000 and which limit the voting power of large shareholders;

(c) the previous approval of the Governor should be necessary for any increase on the charges on shipping and the warehousing and handling of goods, and for the distribution of any dividend,

7. While cordially agreeing in principle with the objects which you had in view, I felt it necessary, before arriving at any conclusion on your proposals, to ascertain what would be the probable attitude of the Company with regard to them, and I therefore caused to be addressed to the Company the letter of the and of September of which 1 enclose a copy, My object was to elicit from them a statement as to their willingness to accept assistance from Covernment and as to the larms which they would be willing to offer in return, and in of. der to secure full consideration of the matter I gave them the oppertunity-of which, as you will observe, they took advantage of discus sing the matter verbally before sending a written reply.

8. From their answer of the 14th ultimo (a copy of which is also enclosed) you will see that the Company are willing to accept Govern. ment assistance on the following terms:

(a) the Government to take up the unissued 8,000 shares at $300 per share, and to lend the Company such further money as they may require for the scheme on three per cent debentures;

(5) the Government to nominate two of its officials as members of the Singapore Board and one as a o ember of the London Consulting Committee.

9. It will be obvious that this offer falls so far short of securing the objects aimed at by you that it hardly affords even a basis for fur ther negotiation. There is no suggestion, such

you anticipated, of the creation of new shares. The tau thousand shares which, if the offer were accepted, would be held by the two Governments would confer a voting power of little more than o votes. The price suggested in fifty per cent hi, her than that mentioned by you, and about twenty-five per cent above what I understand to be the present qua tions, although the natural effects of a large emission of captal would naturally be to de 3. The scheme prepared by the Consultingpreciate the price of the shares. The Colony Engineers appears to me, so far as I aru able would be lending a very large sum to the to form a judgment on the matter, to be well Company at a lower rate than that at which it devised and to make adequate provision, if it

would have borrowed the money for the pur- is carried out in its entirely, for the require- pose. The control offered to the Government ments of the port for many years to come, but as regards buch its voting power and its re- its cost will be greater than you were led to ex presentation on the two Bards would ba pect. In paragraph rt of your despatch you wholly illus ry, while the resposibility of the contemplate an expenditure of about Governinect for the note of the Company would

1,200,000, whereas the estimate of the En- be practically complete. gineers is over £1,500,000, to be spread over 15 years.

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agreement with the Company. As the Colonial Secretary had said, the Government was ex- tremely anxious in the interests of Singapore to meet the Company if possible-to find a basis upon which they could agree-but at the same time it was necessary for them to remem. ber that they were trustees of the public money and trustees of the future of Singapore. (Hear, hear In both capacities it would be unpardon able, impossible, for them to give anything more than, what would be a fair and just price for the Company's property. He hoped the Company would meet them in the same frame of mind. They might come to an agreement which would save the costs of an arbitration and also save much difficulty in regard to the future administration of the harbour. The principles upon which compensation was to be assessed had been taken, as the hon. Colonial Secretary had already stated, bodily from the London Water Act of 1902. It was the very latest instance of expropriation of a Company charged with a great public trust as the Tanjong Pagar Dock Company was, and he thought the principles which were embodied in that were such as would commend themselves to the acceptance of the Council. They differed from the ordinary law of acquisition of property for public purposes in that they provided that there would be no condition for compulsory ex tion 13. After Section 13 followed some clauses- which were to provide for the winding up of the Company, If the Company did not wish for those provisions the Government would be quite prepared to strike them out. They were merely intended to facilitate the winding up of the Company after the Government had taken over the management of its business. They came in sections 19 to 23 the clauses to which he dare say han, members would turn with most interest-the clauses providing for the future administration of the Company's undertaking. The Company was to be managed by a Board be members of which were to be nominated by the Governor. The new Board were to pay the expense of the arbitration if that should be incurred and they were to take over the whole of the undertaking, that was to say, the whole business of the Com• pany of whatever kind. The numbers of the Board were left indefinite, but one-third of the Board were to retire annually, so that the number must be some multiple of three. The Governor had the power with the Colonial Secretary to remove any member from the Board. He thought this was a provision that was very likely to be little used. The chair man was to be appointed by the Board among themselves and provision was also made to add not more than two official members to hold office during the pleasure of the Governor. That was a measure of great importance be- cause he should hope that so far as informa: ion with regard to the Board was concerned the Governor would always find the best source of information in the chairman of the Board for the time being. This clause dealing with the Board he would ask bos, members to read along with the words of the despatch from the Secretary of State which dealt with the con. stitution of the new Board. "The manage ment of the company's business would then be conducted by a Beard on strictly commercial principles and every person employed by the Board from the General Manager downwards, would stand to the Board in the ordinary bual ness relation of employed to employer. The Board would be appointed by the Governor for a fixed period, its members retiring in rota: lon, but being eligible for re-employment, and its actions would be subject to his control; but hit interference in the ordinary administra. tion of the port management would be poither 19. A Board to be called the Tanjong Pagar necessary por desirable." It was for the Govery Dock Board shall be constituted, as hereinafter

13. Again the Colony and the Federated ment to get control of the policy of the Board, provided. The Board shall from and after the

Malay tates might consent to provide the not of its management. There would be an appointed date hold the undertaking of the

money required by the Company on the con the Board one or possibly two official members Company and may exercise all the rights

ditions which are now offered by the latter," whose duty it would be to bring to the notice of power authorities and privileges of the Com- 5. If the Company's management were be subject to such improved terms as might be the Governor any important questions of policy, pany and shall (to the exclusion of the Com-yond criticism, the question before me would secured by prolonging the negotiations. This and through whom any necessary instructions pany) be subj ct to all the duties obligations admit of an easier solution, but this is far from would secure one of our objects, but the object would be communicated to the Foard." That and liabilities of the Company.

being the case. Though the formal_responsi. tions to the proposal to which I have already contained the ideas of the Secretary of State: The Board shall be a body politic and cor.bility rests with the local Board at Singapore, referred, as regards both its financial aspect with which, he might say, he fully concurred, porate and have perpetual succession and a by the Articles of Association a consultative and its placing on the Government responsibi, as to how the undertaking should be run after common seal and may sue and be sued in its voice in important matters is given the Lon-lity without effective control, would make it it bad passed into the possession of the Govern corporate game as freely and unrestrictedly as don Committee which, in addition to the very difficult to defend. ment. After the constitution of the Board there any other Incorporated Company.

powers so conferred, is able to exercise a para- followed other provisions which were more of

20. The costs of the Company incurred in mount influence over the Board from the fact the nature of the machinery for enabling the arbitration under this Ordinance shall except that it represents a great majority of the share Board to carry on its business. In Section 30 and so far as the Court otherwise determine be capital and that its members are senior partners there was a clause which provided that the borne in the first instance by the Government in drma whose junior members are members of Board should pay into the general revenue of ! and shall be a charge upon the revenues of the the local Board.

Provided always that if the Government give any such notice it shall be referred to the Court to determine whether or not the appoint ment, contract or alteration was reasonably necessary in the ordinary course of business of the Company and the Court shall determine whether and to what extent as between the Government and the Company any liability arising in respect thereto is to be transferred to the Government or is to continue a liability of the Company.

10. There shall be paid out from the funds of the Colony to the Company as compensa. tion for the taking over of the property of the Company a sum to be determined by mutual agreement between the Government and the Company or failing such reement by arbitra tion; but any sum payable or any part of it may if the Government and the Company so agree be discharged wholly or partly in inscri- bed stock of the Colony

12. In the event of no agreement being ar rived at by mutual consent as provided for in Section 10 within three months from the ap pointed date the Court shall be constituted us soon thereafter as conveniently may be. It shall hold its sittings in the Colony and the provisions of "The Arbitration Ordinance 189" Sections 20 to 23 inclusive shall apply to its proceedings.

14. As soon as the compensation due to the Company shall have been duly paid or satis fed to the Company in accordance with this Ordinance the Company shall enter upon a liquidation of its affairs and upon conclusion therefor be dissolved.

10. I may add that at the meeting with the representatives of the London Board they made it perfectly clear that they would not accept any measure of effective Government control, such as that proposed by you, unless the continuance of their present dividend of 12 per cent were guaranteed to them, and it was evident that the continuance of that divi dend was-as you hinted in your despatch- the paramount consideration in their minds. They stated during the discussion that without Government assistance they could not hape to obtain the requisite capital on terms which they would be able to accept. In such case they proposed to go on with the improvements gradually, and as money was available, and thy suggested a term of 30 years as a possible duration of the work.

4 It is evident that, if this money is pro. vided and the proposed improvements are car- ried out, the position of the Company will be materially modified its capital in shares and debentures will be increased nearly four-fold, and its influence at once on the affairs of the Peninsula and indirectly on British trade and British interests in the Far East, for good on evil, will be correspondingly increased.

There can be no question as to the vital im- portance to the Settlements and to the Malay State of providing adequate shipping facilities The Tanjong Pagar Dock Company has estab, lished a practical monopoly in this respect, and it would be difficult to name another Colony, at any rate any Colony approaching the Straits Settlements in size and importance, whose fortunes are no intimately connected with and indeed dependent on, the policy of a com mercial body. Mismanagement, or even an administration solely devoted to shareholders i 12. It would be possible to take no further interests, on the part of the Company would in steps in the matter; but in view of all the con the course of time strike a blow at the pros.siderations urged in your despatch, and already perity of the Peninsula from which it might referred to here such a course would clearly never recover. I therefore consider that labe contrary to the interests of the Colony and terference in the Company's affairs, whether it. the Federated Malay States. take the shape of the control of its administra- tive policy in return for financial assistance or otherwise, is amply justified in the public in- terest

II. In these circumstances a decision has to be taken as to the attitude which the Colonial Government should adopt, and several courses

are open

14 Athlid course would be to make a counter- proposal to the Company based on the princi. ple that the Goverment, In return for giving such large pecuniary assistance, should have, a controlling voice in the Company's affairs, - This control might be effected in one of two ways.