THE Otago Daily Times. THURSDAY, JULY 4, 1872.

Otago Daily Times, Issue 3248, 4 July 1872, Page 2

THE Otago Daily Times. THURSDAY, JULY 4, 1872.

A COEKESPONDEKT whose letter we pubHnhed. on Tuesday, draws attention to the dispute between, the .Corporation of 'Dunedin and Mr Larnaeh, as an example of the bud effects of a l theory of Government' which he thinks is disaatrosiSily popular in this Colony. Thus theory he defines to be ' tliat the Government, or ruling authority, should actually assume the reaponsibility of carrying out the whole functions of our social organism/ The definition is not so lucid as it might have been ; but few will fail to recognise by its aid what tendency of popular thought our correspondent alludes to. lie is quite right in his idea that British colonists in this part of the world—New Zealand colonists are not at all exceptional in this respect—are a great deal too ready to throw upon the Government duties which in older countries arc either undertaken by private owners of projKjrty or by minor local authorities. We agree with him, also, when he deplores this tendency as a mistaken one, and likely to lead to mischievous arrangements when applied to various matters of great social importance. We do not, however, go with him so far to to recognise in the particular case which has boon made the text of his exhortation, one of those instances in which the action of a public body can properly be called in question, as an undue meddling with business properly belonging to private persons only. The course which the City Council has taken in connection with that part of the contract proposed to him which ilr Laknacii objects to, appears to us to j be quite indefensible. If it should lead | to a law-suit the members of the Corporation will not be long in discovering that their action has not the support of the general body of the ratepayers. The Council has made it a condition of refraining from the erection of new Gas Works that the proprietor of the old ones shall reduce the price of gas to a certain figure. It has the undertaking of his agent, given in writing, that he will comply with this condition, and if he obtains the new contract for the supply of gas to the city.; and fails to carry out this promise, he will have committed a fraud for which he will undoubtedly be punishable in a manner much more serious than any j>enal clauses of a contract could provide for. The affair appears '■ to be one of temper on both Hides, and we have been very sorry to have had occasion to chronicle it. The objections we take to the action of the Council are not those of our correspondent. He ignores the details of the question ; they are immaterial to his argument. 'The attempt of the Corporation to control the price of gas' is the object of his animadversions. He compares the gas monopoly with other similar monopolies, such as are sure to exist in small communities, and are not altogether without parallel in the affairs of the largest. And without reflecting upon the history of this gas contract, or taking into account the* peculiar privileges which the public must of necessity extend to a manufacturer of gas, in order that he may carry on hLs business at all, he asks why the City Government should take upon itself to interfere with this monopoly any more than with others which he enumerates. We are not prepared to accept his view of this matter at all. No one can undertake the supply of gas to private consumers without in the first place obtaining from the public authorities very important privileges. This fact alone renden* it doubtful whether this business ought in any case to be left in the hands of private individuals or companies. The tendency of modern thought is entirely against the dispensation of such privileges. Wherever they have been granted they have created vested interests which have been too often found to clash with the interests of the public. Too often in the end the body politic has been glad to purchase back again, at an enormous cost, the privileges which in an unsuspicious moment it has been so weak as to confer. What has happened in so manyjinstances is likely, sooner or later, ti happen in each and eveiy instance. Now that experience on the subject has been gained, these concessions to private capitalists are in all civilised countries becoming more and more difficult to obtain. In regard to the particular class of concession with which in this instance we have to do, the theory that it ought never to be made is becoming popular everywhere, and has the support of many of the ablest writers on Political Economy. Virtually, by refraining from interference with the monopoly enjoyed by the proprietor of the Dunedin Gas Works, the Corporation is continuing to him the concession of those rights without which he cannot carry on his business at all. It has therefore a right to dictate terms to him, arid in fixing a scale of maximum charges to be made to private consumers, it does nothing either unusual in its character or improper in itself. It is hardly possible to point to any individual or company that has obtained concessions from the public that has not been subjected to similar restrictions in the conduct of its affairs. Maximum charges for carriage by railway, for ferriage, bridge tolls, and so forth, are constantly made the subject of legislative enactment, or of contract between the representatives of the public and the persons on whom the right of making them is conferred. So in the present ease there would have been nothing unreasonable in a stipulation as to the maximum price of gas being inserted into the Act by which the Gas Company originally obtained those righto without which it could not have reached the consumer of gas at aIL !Fhis is the general argument by which the action of the

Corporation in seeking to impose upon Mr Hankey a maximum price for his gas may be supported. There is, how«vcr, another, bused on the special circumntances of this case, which is equally coger.it —perhaps more so. Before the compact to which our correspondent objects was entered into, the Corporation of Dunedin had almost perfected arrangements for entering into a damaging competition with Mr Hankey in his business. By that compact he bought off a most formidable opponent in business. The Corporation had as much right to dictate the terms upon which it would relinquish its intended competition as a rival Gits Company would have had. In the latter case the limit of exaction could only have been the last farthing that could be extorted, and no third person could, with any propriety, have criticised the bargain, for the very simple reason that, as it takes two to make a bargain, it may be taken for granted when one is made that, both parties see their advantage in it The position token up by the Corporation w moreover justifiable on another ground. It was incited to take steps to enter into business competition with Mr Hankey by a large body of ratepayers, on the double ground that the public lighting ought thus to be done at less expense, and private consumers supplied at a lower price. There could have been no excuse for the Council if it had withdrawn from an enterprise imposed upon it by the public for certain defined ends, simply because it could by other means accomplish some only of those ends. For all these reasons, we think that our correspondent has gone quite astray in quoting this particular action of the City Council as an instance of undesirable interference of a governing body, with what he calls the 'functions of our social organism.'