MELROSE GAS MAIN.

Dominion, Volume 2, Issue 564, 20 July 1909, Page 6

MELROSE GAS MAIN.

> COUNCIL AND COMPANY. ORDEFWN-OOtmCIL OPPOSED. , DEPUTATION' TO AC3TING-EEKMIEE. A' deputation, consisting of the Mayor (Dr. Newman), and members of the (Sty s Council,, with Messrs. T. W. Hislop and J. G. W. Aitken, ex-Mayors, and local memi ibors of Parliament; waited oft the Aoting"Pnnie Minister (the- Hon. James Carroll) ,yesterday, to show reasons why an. Order-in-Council Should not be issued allowing tho Wellington Gas Company to run a mai^ through tho Molrose district to Miramar. ,- THE MAYOR'S STATEMENT. The Mayor (Dr. Newman) stated that Mr. Berdman, M.P., could not be present, because he was away at Petone, Mr. Wright, M.P.., had not been communicated with, and * Mr. Luke, M.P., was ill m bed. He believed tfhat all the members of tho City Council and all tho local mombors of Parliament were unanimously in sympathy with tho_ protest that was being made against the issue of tho proposed Order-m-Council. If the Government issued tho ,ordor it would be , granting to a company rights, free of charge, against tho city of Wellington, not for a fixed time, but for all timo. That would bo a violation of all tho principles of local government. Ever since local goveru- ' ment was' introduced into New Zealand, almost, local bodies had had tho right of control of these matters The company sought to lay mams from Wellington through Melrose, and if they got power on that occasion, he supposeji they could get power to go through the Basin Ecservo or wherever elso thoy hked, and be asked to g;ve nothing in return. Ho repeated that what the Government suggested was a violation of oB tho ot local government. When , a pxevmus deputation had waited on Sir ' Joseph Ward, the Prime Minister had laid it down that ponding negotiations the Governor would withhold his hand, and not iseue the Ordpr-in-Counoil The council took that as an intimation that they should negotiate with the Gas Company; negotiations had been'carried on from day to day, and they had sent an ultimatum to the ' company which, for reasons of their own, itho company had not jet replied to. The council had gone on as they had done, ielying on Sir Joseph Ward's . promise. A 1 fortnight ago ho (Dr. Newman) had inter- ' viewed Mr. Carroll on the same point,* and !" he had understood from him that the Government was still of the same mind. Tho council had got very nearly to conclusions •with'the company, and them,-to their amazement, they received a letter from him saying that an Order was about to be issued. • The Minister: J told you at the time we ' .would not do anything definite without ad- . yising yoUi The Mayor stated that the deputation was present to protest most emphatically against ' the proposed concession. It meant that the Government would be giving "a great con- / cession to a few shareholders of a company as against the ■ citizens. The council were determined to-treat the company with fairness and equity; they-had no "down" on the company, but they were , determined that no' company should have rights as against the city. They were willing on certain' conditions to grant the company the right to go to Miramar, but they must go along certain lines. -In addition the Gas Company were asking the council to practically tear up the agreement with the Mclrose Doiwjgh on January 1, andigive them a now agreement. \ They- were prepared to give the company a new agreement on certain linos. They were prepared to treat tho company well, but if they gave them vahiable concessions they asked the ' company for a quid pro quo. The company had declined before to make any concessions. The - council asked that they should lower the rate for gae, tind they declined; they asked that during 'a term of years tho company should sot put up the rates for gas, and they declined. The Minister: That is in respect of Mellose? • _ , * The Mayor: No, with respect'of the whole city. Continuing, Dr. Newman said that > the company declined everything. The countil asked that if they wanted to buy at any time the matter should be referred to ar•bitration, and the company refused. The ■council believed' that : : tney were in measurr I "■■ }ble distance of this arrangement, that they I give /the 'company tho right to go fthreugh Melrose on certain easy lines, and that the company should get concessions in Regard to Melrose, but that was contingent on the council getting a certain return for the concessions. The council did not believe that they had any right to give away the rights of the citizens of Wellington in favour of the Gas Company. He believed that no such rights as were now sought had ever frecn given, without return, in any borough n>r,city in 1 Now Zealand. Moreover, if the company got , these rights as against tho fcitizons, ,tho next thing would bo that any , Company could'go behind the scones and, if v ft had a, pull on the legislature, .could get , similar rights. JTho council claimed that they were , carrying out their promise to Sir Joseph Ward to go on with the negotiations, fcpd if the Government issued the Order-in-jfcoanail then, it seemed to them, all local {government was practically at an end. The Jfesuing of the order would inflict a great inTOistico on Wellington, and hamper the ISouncil in their subsequent negotiations. > HON., T. W. HISLOP'S VIEWS. ' Tho Hon. T. W. Hislop explained that he i '*as present at tho invitation of,the Mayor, and council. Ho was very-pleased to *be there to co-operate,in the council's request. He considered that if the Government was ' going to interfere in this matter no selfrespecting man would afterwards take a ,"band in the management of public affairs. ■If tho matter waa properly put before tlie people of New Zealand there would be only one cxpisssion. of opinion, and that , would bo of protest against the extension of the privilege proposed, and any interference by tho Government in the'matter. The value of tho privilege already given, to the company wae shown by the fact that their shares were now selling at 100 per cent, premium. It Was felt that tho moro theso rich corporations got, the more they desired, and, it was not good for the community that thoy should have und-uo privileges. When the amendment to'the Act-was passed he pro- ■ tested that .these matters were for tho local body to deal with, and that there should bo no interference by Order-in-Council. Ho claimed that the company had been dealt with very fairly by 'the.council. The company were not asking for the privilege for tho public good;,any suggestion to that -effect was negatived by the fact that they 'would no£ give tho assurances that had been asked of them. He did not think himself thatlthe coufpany should be" allowed to go through Melrose at all. The Bill of '1907 had been got surreptitionely through the House, and now tho only safeguard which was ( then provided was to be put aside, because tho company, forsooth, were impatient of the negotiations, with the council. The company had .virtually defied tho council in regard to the negotiations. ' HOW THE CLAUSE WAS PASSED. ' Mr. F. M., B. Fisher, M.P., roferring to the manner in, which the clause which hat , been complained of got through Parliament, said it was part of a Bill of 65 clauses and 20 schedules, and tho Bill went through the , House in half .an hour. Considering that the clauso was of general application and did not refer specifically to Wellington, and that it was'beforo the . House at* 4 o'clock in tho morning, it was not to bo wondered at that it escaped the observation of tho Wollington members. Had its intent, meaning; and power boon understood by members, whatever part of the country thoy represented, it would never have becorao law. It dkl not apply to Wellington alone, and tho Government might bo asked to issuo Ordors-in-Council under; it' for other places. When tho then senior member for Wellington flsked the Minister in charge of tho Bill, on the floor of tho House, whether tho City Conncil was privy to the clause, tho Minister answered in the affirmative It was now ' known that.that .was not so, and it was only by accident , that the purport of the clause was discovered when the Hon. Mr. Hislop went np to the House after it had paeecd through - both* Chambers. It waa thoa

tanended. by 'this also being done practically without the knowledge ofQie House. When tie Message from the .Governor came down, the. Erimo Minister was asked the reason of the amendment, and he replied that th« clause;would have given unliinitod' powers, which was not -intended. 33» whole incident, is another illustration oi tiie shocking methods of Pajliainent at, the endvof a'session; ; .!■.•.>■ ' : .■••■, «• Mr., J. G. W. .Aitken ; confirmed . Mr. Piaher's 1 statement that, when the Bill was before the House, he (Mr.Aitken), asked tbo Minister in charge /whether the City Council was aware of the -''clause,', arid was definitely assured by him that; the..council was aware of'it;.:/;/, v •'•.' ': ./■■•'■.' ..;.-v" :'; •. ;; --. ■ '•.;/..•:'; /OTHER SPEAKERS. ' Councillor M'Laren, M.P:,. said this rights of the citizens were at stake. The-Acting-Prime ' Minister:/ Are you against tlie'carrying out/of tliecontract by the company to supply gas-to the Miramar Borough Council?" -■>'$ •■■'.■•;.■ ■•■'■>' -.'"; ■'■■"-■'.:■ ■ - Councillor- M'Laren: Not if the negotia. tions between' tho council and the company 'are.-allowed--.'to proceed.; :. ■ .-,:. ■•'■' -. 'V/ Councillor A. 11. Atkinson referred ironic-, ally to the Gas •Company's^ , elegant sentiment," as expressed in thojletterjjo the Acting-Pnme Minister, .published yesterday mornmg: '"You :will doubtlessv.agree with me that it •is contrary to ■ public morality that a payment should be made -to any,local body for the express purpose_of bribing that body to.withdraw its-9pposition to the. faov-. ernmont carrying out its functions with justice to both parties." Mr. Atkinson suggested that it was contrary,. to pub he morality "that the clauso under which the Government would: exercise the functions, referred to was in the Act, and it would, agam bo contrary, to public morality if tho Executive, having been'.given such discretionary power/used it.to increase the powers of tho wealthy .monopoly which had engineered tho clause. It would be. interesting' to .know oii what .principlo the Government would decide this question, and. others liko it that would follow; , Was it going to sanction alienation of .public rights becauso a. local body and a'.company, could not agreo? : Tho present was a very proper occasion for the Government to use the famihaT watchword "Taihoa:" Parliament would have, to dea-1 with ' tho whole subject at ■ a futmro time. The company, ought\to promote a private Mill .■■.■•■ : '■ -■ .■ ■ v .-.■..' •' ' ■ ;' ■• ■■' : Mr .Carroll: Do you ask to put the.whole matter off until Parliamoiit can. deal with it? That/means that no result, can comeof 'any negotiations in tho ■ meantime. _ \, ."Councillor Atkinson said.that even;.if the negotiations went on,'", for some time longer, Parliament ought -to-deal with/the wholo general question.';",'/; /''. f> VALUE OF THE CONCESS|ON. ■ ■ Councillor T.- Balliiiger said .Mr.. Ferguson told the City Council's committee that /he would ask his directors to consider th«f last proposal, but instead-of that -he , had gone straiglif te the Acting-Prime Minister. The Auckland Tramways.Company paid the .City Council for ; tho'right to lay tracks in the streets,' and the. Wellingtonr Gas Company should not be more favoured; ••■•.- ■ Councillor G.Shirteliffe said that whatever the outcome of the present.negotiations' betneen the council and the company,-the matter would have to be dealt with by - legislation. 7 ' To ki&ni, the Order-in-Counca -would be fo say. that :the city could not be "allowed te'negotiate and get the best terms for the ci,tizens. : ; Hβ objected to the Gas Oonipany's reference to/the morality of the council's'action. The council was merely asking for ;a consideration for simething that-was of very great value. /The'condcssion Would be.-worth' several-times £300' to/ .the company. "'.'". : . '/ "Hon. T.-W. Hisfcp: ■■'■' It ■would/' be worth .£so,ooQ':to ; them:.'*' ";■ -~:■. ■^■■> '■■'":' ":' ■-•/ ■Mr. Shirtcliffe: It/is'-gomg 'to'be a; gold mine: to them , . -He might'-inerition'that the company, at one stage of the negotiations for purchase of the. undertaking, asked the City Council £23 per share for shares that were quoted at £lf. He.insisted, further, that the 'renewal of the Melrose lighting contract/was. bound up with'.the question of the pipe-linel ,Mr. Carroll: That's the whole question.- ~ SIR : JOSEPHI WARD'S PROMISE. 1 Councillor JiE;,Fitzgerald'said it was a' question of the righto of i> local government. being over-ridden by the General Government. He asked ,the Minister to/, respect Sir Joseph Ward's promise that the Government would stay its hand until the gotiations' wereended. : ,' - : . . ; ;■■ '■ i Councillor J. Smith also urged the Government to let .the negotiations proceed. •" Councillor F.. Cohen testified that City Councillors' knew nothing of the clause in the ■Act of 1907 until it was .passed. '. Councillor Frost, as a member of the late Melroso Borough Council, supported the contentious'of the deputation. ■•/..

'"'-.THE COMPANY'S PROFITS. ■',';.,''■ "The Hon. T. said the only proi. tection ,-the council had the :■ Gas Company 'was' the legal provision, which limited i)h.e'company's-profits , to 20 per cent.'on outlay. 'Th 6 company' would bo entitlcdtb 20 per cent; on the cost of; taking ythe -mains through Melrose, arid therefore should riot Be allowed to get that' privilege at far. below ifce real value. If a private Bill were-brought in no Legislature would assess the: concession so low as the council was prepared to part with it. If the : concession were now granted; the effect would bo to practically remove the limitation as to the <»mpany'spVofits...'' '■'''. ' ' Councillor Shirtcliffe said that' Mr.; Fergu r son had'stated that there was no chance of the price- of 'gas being reduced for. years to come,...- <;[:■■ -.'•■;.;'"■ ' ';-'•■:■'.■.■"' '■ , ■■' ';■ ;C!ouncillor ; Erost said he had heard of no agitation for gas onthe part ,of'the Mirama-r ratepayers. ~;'...,--... "7- ' ". n.-. Mr.,Carroll said the Borough' Council had made:representations in the matter. .-.,'"•■■ . Councillor M'Laren'j.M.P.j'said he had op , - posed the, council parting with th& concession ' at so. low a price .as £500 a year. L <■ '•' . The views of Mr. J.-P. Luke, who-was prtf-' vented by indisposition, from. being present, had-been received by telephone,- .and were read : at, this stage by the'■Aeting-Prime Minister. :. "As-M.P. for the Snburbs and a'member of the. Oity,Council," said,-Mri Luke; "1 enter iny most emphatic protest, against, the. granting of-this Order-iri-Couheil." V "' ! THE MINISTER'S STATEMENT.! .;' The-Acting-Prime. ! ilinister, iii-reply, said he would npt'go into' tho argument as to whe-. tlier' the legislation 'should have bce-npassed.. That' was in the'.b'ackgromid, and'.he would simply address himself to'the questonstfiat now reouired settlement. '.He'-had felt;".a short-tune ago.-that.:the parties, , if left:.to theraselves, would not come to a settlement: and as it was necessary'that finality shbuld be reached, it' would be better to put on'a little.'pressure:' (Laughter.)' The whole thing reduced itself .to the , qiiestibn .'' as to what the privilege was worth.'.'That Had been brought down to a narrow 'roargiii, £500 /a year being thV terms'asked by the City Council. : ' "■.';:/'■'.'. -. Mr. Hislop: And 1, as 'a: citazen,, protest 'against those terms;. ;'■ {■'■'■'. i:.-'• .'■■•" ■.;'"' The/Acting-Prime; Minister: "It is a definite offer, , ' and the Gas Company offers £250 a year. Yousay.that negotiations are. still pending, and that if you; are allowed further tinie, it i-s possible that rome arrangement will be amye'd- at. -I have had'the position put down in writing from my point of view, and I ■ will read it." Mr. ;Carroll then read a typewritten document, as follows:— '■•■'■.■'. A Ministerial Summing-up. "It seems to'me'that a good deal of con-fusion/ha-s arisen in connection with-this matter, and to make tho action of the Government dear it may be-well to state shortly what. I take to bo the-undisputed facts involved in this dispute. "(1) There <\& acontract- under legislative authority between'the pity and;the. Wellington Gas Company; under which the companyhas a dutyand theright to snpply gas. to tire- citizens of Wellington.' ~". ; :

."(2)-.At: the 'time,:.-or some timo subse-' quenttottie date, of this contract, the Met rose borough wae an independent local area. Recently, within the last year or two, rtho Melroso borough has become absorbed within the.city of Greater Wellingtohj and is now an integral part, of the city controlled, by ■tho. City Council; -. •■■'.. : ■■•,'■' '.- "(3) I understand that,:although the.contract, between the. city and the company atrtSiorises and requires, tho company, to enpply gas to the consumers in. the city of Welfington, tne proper interpretation, of the contract'limits, this right and duty to the area of, the city of Wellington. at the date of tie contract, and does not reguire or

empower tho company to supply gas in the new area /tfcat formerly was .the Borough of Melrose..', ' ... ... '"'-. .■ • .-

' "(4)' The Wellington Gas., Company, .for reasona, I understand, of economy, determined to remove their gasworks from tho oity to a, sito in,the borough of Miramar, ana work? have been erecteJ there, costing, it ie alleged, £50,000., '>. '•.; ''. ■~ . ..', I " (5) The .erection of, these works at .Miramar was preceded by a legislative provision contained ia Section 25. of the Reserves and Other Lands! Disposal and Public Bodies Empowering' Act passed in 19Q7. This provision was made by the Legislature to enable tho company land companies situated in similar positions' to : connect ' works with the city mains, provided that' proper provision was. made for compensation for breaking up the streets' or for., damage, and providing ■further, that- tho Governor-in-Council was satisfied that it was a proper case for Order-in-Council. ' : .,. : ' '.',", ■ . .

"It is alleged by the company that they have erected their works, costing £50,000, in reliance upon this • clause, and also in rclianco upon what thoy alleged they wore induced; to understand by tho Prime Minister, tho Right, Hon. Sir Joseph Ward. What then the; company now asks is that the clause bo made applicable by tho issue of an Order-in-Council, and that thoy bo thereby empowered to connect the, works they, have erected at Miramar with th'e mams now supplying the city'. ~; involves taking, the connecting mains' through the' okl Melrose borough'area now a part of tho city, which, I understand, connects Miramar with tho original city boundaries. The company declaresthat it'has no purpose other than this; that it does not intend to, and cannot legally, do more than this. In other words, the connection of their works with the city mains cannot upon them any rights to supply • tho Miramar area through ' which the connected main passes. .■':. "The City Council, on the other hand, 'stated in'the letter addressed to mo, dated/ July 16,- 1909, that there is .no desiro to prevent tho : company from extending its onterpriso, nor is tliere any objection-in doing so to tho connection being made between its works at 'Miramar and tho city,' but tho council! proceeds to say, 'To, grant this privilege over such an extended, aroa' as Molroso under the ' prosont ' conditions of. a rapidly-increasing population, practically for ever, without somo quid pro v quo from this company, would bo a ''failure on tho part of the council to recogniso its clear public duty.' ■'. /' . . _'_'.. " '''~■•■' ■■■ ' ' ' . Mr. Carroll's :Rocommo'ndatlon. ",Hence, then; the dispute iiarrows.'itself into., a nutshell. Tho council doe's not object to /the" connecting mains ' botweon the works'and the city mains, but .objects te the any privilege , such as-.that"setWiiit in.the.estract from'thfe'letter cited. I ngreo .rith the contention of the council that tho authority te: connect '.the , work's- of- tho city mains should ttiot. bo used to corifer rights or Erivileges which .were not intended 'by: the , egislaturo' when it passed 'the'-Bcction in question, namely, Section 25,of'the Reserves arid Other Lands Disposal and Public Bodies Empowering, Act, 1907.: I think that if it be necessary the company.should give some binding and effective undertaking to the City Council 'that if the Order-iri-Council is made the authority te' place : the. connecting mains, between the works and the city mains shall not be used as a right on the part of the company te reticulate! or serve the Mel--rose' areaj '-. It 'seems te me that : if this is done there is an end, of • the difficulty,'.and 1 offer, the suggestion • that; the: council -and the company'.should come' te such an understanding; - and ; agree to. i tho' making- : of; the prder-in-Council at once. WitTiout+allowing it to:affect my.i.view of-.the true .interp'reta- 1 tion-of Section 25; of the:R-eservos.and■ Other Lands Disposal and Publicvßodies Empowering; Act, • 1907;;of-the duty'of the Government thereunder, I cannoih help expressing the hope that the parties, may come k> terms, in. order that the '. large works proposed should go on, and thus afford relief te the, unemployed workers of this'city and district.". ~_. ■:'.- . \ .'■". . ■•;:■■ :.• ' ■./■ ~-;. Having finished his reading, Mr. Carroll said: "That the position T.have comeNto, and I still hope you will come .to .an .agree-. incnV'.,f :..'■■:.■.;■;'■-':'■ .'•• .-■'.■■ '•'. : : FURTHER DISCUSSION. The Mayor: If' you grant, tho Order-in-Council terday, that 'will stop,us. Can you not hold your hand? -'. , ; .; y , Mr. Carroll: If there is any chance of jour coming te an agreement, I'shall be only too glad te do bq.■■'......' .' '':'✓• '-.:'-'. : : The Mayor suggested that the Matter should be held over until, the meeting of Parliament. . . .'.-." .'. ." . . ' Mr.'Carroll said that would be too long. The Mayor: If you are going te side with the company, what ohance have we? You would Dut the Gas' Company in such'a high and mighty, position that there would,be no negotiations at. all. ■■ The only action, you can tike wills givo'the company a privilege against the city. "We .only ask you to' stand outside the-ring and let us have our. "go." y Councillor Shirteliffe:' So long as the;com r pany knows that'they will get the Order-ih- . Council, they won't, >'■;/, ... ■■;

; Mr.;Hieloi):;l speak as, an: outsider, , and. I say ..the. 'council has; no right. to give away a public' right, lik'e/tßis, and the] Government has nq.right'to threaten the; council that if it.does not give away so much ', it j will bo forced to give' away. more. There has been no.public discussion about this at all. ' The Mayor: If you grant, the Order-in-Council, you kill the negotiations. "We hayo Sir Joseph Ward's solemn, promise, given in this room,' that pending the negotiations— those were his would hold his hand. ; Let'■'us "hive , .. theV ; whole question fought out in Parliament, but don't rob the city of/its; rights.- If you let it go forth that you will issue the Orderrin-Couilcil, you will be giving the Gas Company all it is asking, and you will be denying the:pity Council all that it asks for!".'"■■'■.■■: - : " . .' Mr.Hisldp questioned the statement that the Gas' Company had spent £50,000 at Miramar. .-'■ ,■"'.'.'. The Mayor'said the company had told the council that they could bring the Miramar plant into the city for' £3000 or £4000.s ;Mr. 'Hislop said! that ; a fe'W months-ago the company was preparing to go before tie Court' of App'&al to .have the qudstion. of the right to ' taue the rnain- through Melroso settled! Why;did they not;do'.BO now? ■'• ARBiTRATiON SUCCESfED. Councillor Shjrtcliffe suggested' that .the price , to .heV paid for the cpncessiqn should be. settled.by. "arbitoatipnj'.and' that the , Govcrament should, in : the nieantiine,,,hold its hand..; .... ~' ... : ■'~' • ... . v Mr; Sislopiaid ho. would, like to.add ,to that suggestion a proviso that, , if the undertaking were afterwards purchased,, by the council under the'powers, which Sir Joseph Ward had promised to give' to local bodies, this privilege should not,be counted in the price, to be paid by. the. city. ■ i Mr! Carroll:, I am -not going to .issue the Order to-day, '". ,'.''..'.' .. Councillor Shirtcliffe: "Will you hold it back until the'negotiations are...coihpleted?. ' . Mr Carroll vl will hold it for. a reasonable tijne; ■:..'• ■ i". . : -:,: . . f . ■' ..',',.,■■ ~■.•■' The Mayor asked if; the Minister, would consider Mr. .Shirtcliffe's 'suggestion, as to arbitration..'', :.... ■■'■'_-.".:.' .:. v . Mr. Carroll: I have noted it down. I will let you know before Tissue the Order-iri-Council. ' ' . '' "'' '"\ ' Several members of tho deputation •referred to the fact that Mr.- Carroll's typed- statement -most have been prepared before the deputation arrived, and urged him to reconsider 1 it in the light , of the new representations that had been'made.. ■ ' Mr. Atkinson: Is the matter, being bona fide, held over whilo the , negotiations proceed? If you say you , will-issue: the Order after a reasoriablo time, the Gas Company only'has to refuse to agree with us, and it will get its own way. Is the matter being boha .Dde kept open, and. is • there no private understanding Detweonthe Gas Com-pany-and the Government?.. Mr.'Carroll:■ 1 don't understand exactly wbat you mean, you ; insinuate; Both sides have had- full oppbrttinities of putting tho , 'case to •the Government.- Somo new phases have.been brought'out by- the depu< tatWn,- bat I still say that both .partial (iughf to get together and eettje it, , u*.d for a'reasonable time , I ; will wait and- seo if that is done. ' I can't ; say any more than that at'present. ' ■' ■ ';■■■ .■' ' j Mr. Hislop: I hope the Mayor.will lot the citizen's have , a chance of sayi'ng so'mething. Mr. Fisher' aeked , whether the Government would withhold the Order-in-Council for' ten days', so ,that a proposal for arbitration might be submitted to "-. him. '...-.< : ■ ■ ..Mr. Carroll: I will consider.th*t.