FORTY YEARS A LIBERAL

Wanganui Chronicle, Volume 72, Issue 112, 13 May 1929, Page 10

FORTY YEARS A LIBERAL

Life Story of Sir Joseph Ward F rom Telegraph Messenger to Prime Minister By R. A. LOUGHNAN. (Copyright—“bun” Feature Service .

Impelled by I lie pressure of generally recognised fact. Mr Seddon brought down his Bill, as abovesaid, in the session of 19<>1, for empowering the State ’o buy the railway. The conditions prescribed were simple. The State would lake over a parrel of the company’s debentures, and pay 3(ls a share for the I ;',(i.(i()(j shares of tin* company. For this consideration of £915.000 the company was to surrender its Jim* and all its assets. Jt was to In* a case of “you walk out and we walk in.” There was just one little fly in this otherwise most, clear ointment. The inclusion in the assets to be surrendered of the company’s remaining 1.-ad endowment —granted under the Railway Companies and Land A<-1. ISM —on which they had floated thifir project to dazzling success. This was the difficulty. Sir Joseph Ward, speaking in the debate on the second reading and defending the terms to In* offered to the company against the charge of gross over-payment, declared the value of this to bp £112.000, including some cash due by purchasers. Though there had been a good deal of talk about tin* desirability and the immediate possibility of purchase, the Bill caused a good deal of surprise. Captain Russell, then Leader of the Opposition, attacked it sharply, declaring that not more than an hour had been given the House for the study of that ••important and complex measure. ” denouncing the same as oflering to pay £336,000 too much for the property. He moved that the Bill be read that day six months. A lively skirmishing debate followed, with inevitable reference to the share market, and the same sharp things were said. Why, it was asked, had the Government not exercised the power of purchase under the Railways Construction and Land Act ? To this the Government replied that their procedure was better for all parties and the public interest, adding that it was only that day that the company’s chairman had signified readiness to treat. The Bill passed both Houses in due course. But the simple process of “you walk out and we walk in” did not come about. Mr Seddon. in moving Second Reading, had intimated that the assent of the director would go before the shareholders, who would ratify as a matter of course. But the Bill was turned down by them. All further negotiation appearing hopeless, the Minister of Railways (Sir Joseph Ward) gave notice to the company for the end on a certain date of the running agreement. This was followed by an outburst of rumours of a most disquieting kind. There was something like a panic in the Palmerston district, and men talked everywhere of the sharp practice involving great hardship to the public, by which the Government was proposing to force the sale of the IXfauawatu to the State. A few extracts from Hansard will give an idea of the position of affairs.

On July 4 Mr Wilford (Wellington Suburbs) asked the Minister of Railways (Sir Joseph Ward) “whether the Government had been advised that all the English shareholders of the Wellington and Manawatu Company had forwarded proxies to Now Zealand to I be used on their behalf in the direcj iion of facilitating the proposed sale of the railway to the Government. And whether the Minister is aware that these proxies which arrived in New Zealand were unable to be found at the date when the voting took place for the sale of the company’s property, and whether the Minister can explain what became of such proxies from the time they were forwarded to the time when the actual voting took place?” Sir Joseph Ward was “very sorry he could not give the honourable member any information on the matter. As Minister of Railways he bad not been consulted about any proxies or about the intentions of the shareholders of the Manawatu Railway Company, either previous or subsequent to the meeting. If the proxies were sent out here for the purpose of being used at. the meeting, he took it it would be anything but the proper course for anyone who had received them to have prevented them from being used for the purpose for which they were sent. But the Government had nothing whatever to do with the internal .affairs of the Manawatu Company, and, speaking for himself, he did not intend to have anything to do with them. His duty was to look after the interests of the State, and he intended to do so.” On July 4 Mr Pirani wanted the Minister ‘‘to explain the proposals of the Government in connection with the interchange of traffic between the Government Railways ami the Manawatu Railway on the termination of the existing agreement. Sir Joseph Ward saitl that the intention of the Government was to retain, as far as possible, all the tratiic. which originated in its own lines. He thought that was the right thing to do. They had, at enormous cost to the country, constructed railways through the North island —from Wellington to Napier on the one hand, and from Palmerston to Wanganui on the other, and it seemed to him that as custodian of the several railways of the state it was their duty, having offered to take the Manawatu railway over, at what they believed to be a fair price, and the owners having determined to retain the railway for themselves, to do the best they could for their own railways in order to secure to their railways as much of the tratiic as belonged to them.” Air Pirani replied “he did not ask the Minister the intention of the Department. He asked the Minister if he would explain the proposals of the Department. He understood the proposals of the Government were to absolutely block the interchange of • traffic between the .Manawatu Company’s and the Government lines, by taking up the rails and removing the stations, so compelling passengers to walk a quarter of a mile from one station to the other, and goods to be carted that distance. This was the proposal as published and he thought the Minister would have been glad of the opportunity given him to state if either of these were or were not the proposal of the Government.” The Minister said he intimated that the Government intended to secure to

r | its own railways all the tratiic it. could t from the existing lines. That was what ■ they intended to do. The Government • had made no proposals whatever to the - .Manawatu Company. All they did was i to serve the company with a notice of < their intention to determine the exist- > ing agreement, and the right time for r tin* Government, as representing the - I people of the Colony, to submit pro--1 posals to the Manawatu (’om]>aiiy was I some time before the expiry of that • notice. In tin* meantime their duty • was to get all the business they could i for their own railways.” • Asked “what about the public?” 1 the Minister said “the public had not - complained, with the excejition of a i few people who had taken up cudgels • on behalf of the Manawatu Company . before knowing what was the nature of • the Government’s proposals. The Gov- • eminent had made no arrangements ( ' such as had been mentioned by the ; honourable member. They intended to ; look after their own interests at. the right time, and no imaginary complaints or threats on the part of anybody would deter the Government from doing what they believed to be right on behalf of the railways of the State. They would do the best they could for the large and valuable asset which was under trust to the Government in this matter. ’ ’ On July 8, Mr Field “was aware that negotiations had been carried on recently and that they had failed through no fault of the Government. But since that time there had been an altered condition of things, inasmuch as “the most valuable portion of the company’s land had been sold.” The reason given by the Government in the. past, for not buying the line under the Railways Construction and Land Act of .1881, was that the Act did not provide for the purchase of the land, and they declined to take the line without the land. Recently, however, the company had sold their most valuable land properties —namely the Makerua Swamp and the Thorndon Reclamation —and the remainder of their land was mostly rough and mountainous, and hardly worth acquiring by the Government, whether the Government, considering the altered circumstances, would buy the line in virtue of their power under the Act of 1881.” Sir Joseph Ward said “The Government had no intention of re-opening the negotiations with the purchase of ; the Manawatu line. They had already > made their position clear.” ; CHAPTER NRK. The Line Passes Over. Tn 1908 the time was ripe for tho acquisition of the Manawatu line by the* State. On one side the company | had built its line and worked it with ‘ conspicuous success; on the other, the • obstructions to the State acquisition, ' chief of which related to the disposition of the company's landed endowment, had passed away. The public mind had become determined on iho

acquisition for various reasons, and while the terms of acquisition were being considered on both sides, it became clear to both that the time had come for the absorption of the line by the State, even : if it was suspected *n some quarters the State must use its powers to make an end of the private possession. Sir Joseph Ward had become Prime Minister. He had made clear his determination to bring all the railway work of the country under State management. He had made the reason for this equally clear. That the transfer of the line to the State must be effected had become obvious. All that was wanted was patience, tact and mutual goodwill These conditions were present. Sir Joseph proceeded about the business with great care and with full recognition of the excellent work the company had done; and the directors of the, company showed themselves to be as reasonable over the transfer as they had been energetic and public spirited in the construction. A bargain was struck advantageous to both sides. When the Bill came before the House for completing the transaction it contained the bargain struck, wherein it had advantage over the Bill of 1902, which contained only the offer of terms to be sanctioned. This time Parliament was asked to ratify a treaty —carefully thought out. fully discussed, complete in every detail. The progress of the Bill through both Houses of the Legislature was, with one exception, a procession of eulogies ending in cordial ratifieation of the bargain. The absorption of the Manawatu railway into the State railway system was one of the most successful things in our Parliamentary history. In moving the second reading of the Bill, Sir Joseph called it the concluding chapter of the history of the Manawatu Railway Company. Having explained that the terms of purchase had been agreed on and embodied in the Bill, and ratified by the Manawatu directors and the Cabinet, he stated the terms, ami gave an account of the negotiations—between the chairman of directors, Mr John Kirkcaldie, and himself, Premier, attended by the Manawatu railway manager. Mr Hannay, ami by the Public Works Secretary, Mr Blow. Before this, he gave a brief but very interesting short history of the railway. Thus: “The construction of a railway between Wellington and the Manawatu was first definitely proposed by the Hon. .lames Macandrew in the Public Works Statement of August 27, JB7B. He proposed the construction of a line between Wellington and I’oxton, intending to use the Foxton-Palmerston railway as part of the Main Trunk line through the North Island. He estimated the distance at fit miles, and the cost of'the line at £440,000. or an average mileage cost of £7,213’ The construction of this line was duly approved by Parliament, and was forauthorised in Public Works Act of 1878 and its construction was commenced in the latter part of 1879. Shortly after this the colony passed through a period of depression, and it I was resolved by the Government of . t.i.’.f day to take no further steps in tho j

construction of the railway for the present. A Royal Commission appointed in February, .1880, to advise concerning sundry lines of railway, reported unfavourably of this particular line. In 1881 the Hall Government passed the Railway Construction and Land Act. This Bill was passed to enable railways to be constructed by private enterprise on the land grant system, the contracting companies being entitled to receive from the Government a gran of land equal to one-third of the cost of constructing the railway. The railways specially mentioned in the Act. referred to were the WaikatoThames railway to Rotorua, the Wellington and Manawatu, the Nelson to Hilgrove, the East and West Middle Island railway and the Otago Central. Companies were formed to construct all these railways but the Otago Central; and lie only one successful in completing the < rprise was the Wellington ami Alanawatu railway. The contract, for the construction of a line was entered into on March 20, 1882, and provided for the construction of a line from the City of Wellington to such point north of the Manawatu River as the company’s directors should determine. The conditions were completion iu five years up to standard of Governmeent. railways, and subject to the approval of an engineer specially appointed by the Governor for that pur-

The company entered on their task without delay and prosecuted it vigorously up to completion and the whole railway betwe<*fl Wellington and Longburn was opened for traffic on November 29, .1886, sundry stations at the Wellington end having been opened at. various dates previously. The Act gave the Crown the right of purchase, after 10 years, at. a price to be fixeed by arbitration on a year’s notice.

Having given notice duly, Sir Joseph and the Government feared the delays and costs of arbitrators, which might waste years. He accordingly suggested to the company’s directors a personal negotiation. They accepted, and as before mentioned, Sir Joseph and Mr John Kircaldie were left to it. They differed at first very considerably, for they played the game according to the rules established when the world was young, the one standing out for more than he, was ready to take, the other offering less than he was willing to give. It was understood that the discussion would be thorough, and without prejudice. In due course they approached one another for the final stroke. For this Sir Joseph prepared formally, drawing up a letter setting out the terms he thought reasonable, which he sent to the chairman: Prime Minister’s Office, August 19, 1908. (1) The Government to pay £900,000 for the railway, rolling stock and all appurtenances pertaining thereto. (2) Payment to be made of £500,000 on August 31, and interest at tht rate of 4 per cent, from December 7, the date of the expiry of the Governor’s notice.

(3) The £400,000 payable on February 28 to be paid in cash, or at option £400,000 of 4 per cent, debentures to be issued to your company with endorsement giving you right of conversion into 34 per cent, inscribed stock at 101.

(4) Your proposal that the railway should be held and worked by your company until February 28 is one that I regret I am unable to agree to, as from the Government standpoint it is desirable that the railway should be acquired and worked by the Government Railway Department from December 7. As I recognise that it is not unreasonable on your part to have some consideration extended by your giving up the railway at so early a date, and so losing the earnings of the same, I should on that account be agreeable for the Government to pav £15,000 on February 28 for your giving up possession on December 7. (5) The final payment of £415,000, less adjustment of interest to above, to be made on February 28. It is estimated the difference of interest will be

about £lOO. and, in round figures, our payment will he £914,000. (6) The Government to take over the stores, at the book value, stock being taken on transfer and being paid for in cash. (7) That the Manawatu Company give every facility to the Government; permission to bo given to the Railway Department, if they desire it, to enter upon the company’s railway at. once, for the purpose of installing the tablets or doing any other work which may be considered necessary, with the company’s general manager. (8) The Government to grant the company’s head office for the purpose of liquidation or a Bill will be submitted to your directors carrying out the above arrangements and upon being mutually agreed to will be gone on with. J. G. Ward. To this, prompt reply, as asked for. was sent: W. and M.R. Co.’s Office. August 20, 1908. I have tho honour to advise you that after our interview this morning I called a meeting of directors for 2.30 p.in. when the following resolution was passed: “The proposals submitted to tho Prime Minister and amended by tin* memorandum of August .19, handed to the chairman by the Premier on the 28th, were duly considered by the board, and it was unanimously agreed that the Premier be informed that, the amended proposals are accepted by the directors, and that, they will strongly recommend their acceptance by the shareholders.” JOHN KIRCALDIE, Chairman. (To be Continued).