By a pleasing coincidence, of which I was, however, at the moment quite unaware, the honour of C.B. was conferred at the time of my formal installation on one of my former pupils, Major Beecher, for important services in India.

The close of the period which I have been describing found the department in a highly satisfactory state. The various improvements which had been effected since progress had become unembarrassed were already producing very manifest results. The public convenience had been in many ways promoted, and various arrangements for its further extension were in steady progress; the revenue, already large, gave every promise of continued increase; the numerous improvements in relation to the health, comfort, and remuneration of the staff, and above all the rule of promotion by absolute merit—modified only by seniority in cases where merit was equal—now recognised as in full force, had gradually diffused such a spirit throughout the department as seemed to have secured vigorous and harmonious action. All, in short, was working smoothly;[218] and I well remember the satisfaction which Mr. Tilley, the senior Assistant Secretary, who up to this time had uniformly given me earnest and efficient support, expressed at the general state of the service, so different from what he had once known; remarking that now every one seemed to do his duty as a matter of course. I did not then foresee how serious a change was at hand. Of this, however, I shall speak but very briefly.

LORD STANLEY OF ALDERLEY.

In February, 1860, there came upon me that severe illness of which I have more than once spoken by anticipation; an illness which, commencing with forty-eight hours of nearly continuous insensibility,[219] not only confined me to my house and prostrated my bodily strength, but, what was far worse, rendered me for a long time quite incapable of any serious mental action, save by such spasmodic effort as was at once both painful and injurious for the present, and hazardous for the future. In short, I was compelled to be absent from duty, with but little exception, and that only under imperative necessity, for several months. Fondly believing that the peaceful state just spoken of would endure, I did not anticipate any very serious positive consequences from my absence, though, of course, I knew it must delay the progress of improvement. Circumstances, however, proved untoward. Lurking discontent was fanned into a flame by a breath from without; and this, occurring during my disability—no accidental coincidence, as I believe—gave opportunity for the revival of those cabals, higher up in the office, which had so frequently interfered with good order, and made improvement difficult. At this critical period the office of Postmaster-General unfortunately became vacant, by the appointment of Lord Elgin to the direction of our expedition to China, and for a time there was a sort of interregnum, during which the duties of the office were provisionally discharged by the Duke of Argyll, who, however, had at the same time other demands on his attention. When, at length, a permanent appointment was made, in the person of Lord Stanley of Alderley, I had not the good fortune to obtain from him that confidence and support which I had enjoyed with his predecessors. I will not now dwell upon what followed. The facts are upon record, and the time may come when it will be proper that they should appear. Let it suffice for the present to say that I had to oppose a fourth cabal, occurring, like its predecessors, at a period of temporary weakness on my part; had again—and now without the support from the head of the department which I had previously received—to enter into contests—contests ever increasing in severity, which I had no longer the strength to maintain; and that, after a series of fruitless efforts, I found my health so grievously and hopelessly impaired as to compel me seriously to consider the question of final retirement from that important and almost absorbing task in which I had so long been engaged.

Before proceeding, however, to the concluding part of my narrative I must give some account of the improvements effected in the interim. Of course, in a period of such difficulty the progress of improvement was comparatively slow; and though the Department continued steadily to advance in its fiscal results, and in its beneficial effects on public convenience, this was due in a much higher degree to past reforms than to changes made at the time.

It is due, however, to Mr. Gladstone, then Chancellor of the Exchequer, to state that during these contests I had the advantage of his support and countenance so far as he was able to exercise independent action, and I received from him the following very gratifying letter:—

CHAPTER XXVIII.

PROGRESS AFTER 1859.

SAVINGS BANKS.

The plan of Post Office Savings Banks, already mentioned as having been brought before the public and the Government most prominently by Mr. Sikes, had, through the energetic efforts of Mr. Gladstone, been provided for, in the year 1860, by Act of Parliament. It was speedily brought into operation in England and Wales, and was extended early in the following year to Scotland and Ireland. As this new department was closely connected with the Money Order Office, its secretarial management devolved, in the ordinary course, on my brother; who, before proceeding to the work of organization, recommended that this should be based upon the contract system; a measure which would have been highly economical, but would obviously have involved the abandonment of patronage. This recommendation, however, did not find favour with the Postmaster-General, Lord Stanley of Alderley, and the department was soon afterwards transferred to Mr. Tilley. Together with this great measure of economy were rejected other means proposed by myself. In short, operation was made so expensive, that while a money order costs the department in issue or payment but three-halfpence, every transaction in the savings bank, whether of deposit or withdrawal, costs sevenpence.[220]

The full evil of such increase in current expense will appear when it is considered what, under strictly economical management, these savings’ banks might become. Their chief avowed object is, and most assuredly should be, to give the largest justifiable encouragement to popular thrift; and to this, as I conceive, every other aim should be completely subordinated. To this end it is important to induce, by all reasonable means, the greatest amount of deposit, but incomparably less important, if indeed at all desirable, to give more than reasonable facility for withdrawal. Certainly there is no just ground for extending and multiplying such facility at the expense of the department; especially seeing that the necessary consequence is a reduction in that rate of interest whose amount constitutes a main inducement to depositors; so that the effect is to mulct the steady depositors for the convenience of the more changeable. Had the Post Office been able to offer the same rate of interest as the old savings banks, its absolute security, combined with a reasonable and inexpensive increase of facility for the transaction of business, would not only have soon brought to it the whole actual amount of the savings bank business, but in all probability would have so extended that increase in thrift, which, with all defects, it has actually produced, as to make it correspond with the hopes of the most zealous advocates of the new scheme, and in particular of the benevolent gentleman in whose earnest suggestion it took its rise. Before the arrangements were finally adopted, I urged my views as to excess of expense and consequent prejudice to revenue, in an elaborate letter to the Postmaster-General. Some small change for the better was made, but, high as the estimate still remained, it has been exceeded by the actual expense, though the Annual Reports would seem to show otherwise.[221]

With all drawbacks, however, the institution may safely be pronounced to be a great national benefit. The number of Post Office Savings Banks in the United Kingdom by the end of the year 1861 was nearly four-fold the maximum number of savings banks existing under the old system,[222] and is now (1869) as high as six-fold.[223] It is important also to observe that the number of small deposits is more than proportionately increased; a fact obviously tending to show that this important means of thrift has been made more available to that class in which economy is at once most difficult and yet most desirable.

The new institution also proves very convenient to friendly societies, charitable societies, and penny banks, which avail themselves of its benefits in considerable numbers.

Fear had been expressed during the progress of the bill through Parliament that the sub-postmasters would fail to carry out the details of the measure; but it was found that—

REGISTRATION.

In the year 1862 an important improvement was made in the matter of registration. It may be remembered that my urgent advocacy of the lowering of the fee from one shilling to sixpence, in opposition to the opinion of Lord Lowther, appeared to be the immediate cause of my dismissal from the Treasury by the Government of Sir Robert Peel.[226] I had easily succeeded in obtaining that important reduction after my appointment to the Post Office by the Government of Lord John Russell, and the change had been followed by a large increase in the number of registered letters, and a corresponding diminution in the amount of loss by dishonesty or negligence within the Office.[227] Of course, however, even the lower fee proved a stumbling-block to some persons, and, notwithstanding all remonstrance from the Post Office, the practice of sending coin in unregistered letters, though diminished, was by no means extinct; so that losses were still reported; and, what was far worse, sorters and letter-carriers were exposed to needless temptation, and individuals of their number occasionally subjected to undue suspicion. It was consequently resolved, with the sanction of the Treasury, to make the registration of coin-bearing letters compulsory; a double fee being charged where the duty was omitted by the sender; while, to give a compensatory advantage, the registration fee was reduced from sixpence to fourpence. Even with this mitigation, however, there was considerable anxiety in the Department as to the light in which compulsory registration would be viewed by the public; but Lord Stanley of Alderley, then Postmaster-General, being anything rather than deficient in courage, readily encountered the risk, and the result justified his boldness; the speedy consequence being a large increase in the number of registered letters, and a very great decrease in the number of alleged losses. It may be added that the near approach to absolute security obtained by registration was shown by the fact that out of about nine hundred thousand registered letters posted in the United Kingdom, whether for delivery at home or abroad, during the latter half of 1862, the whole number lost was only twelve.[228]

PATTERN POST.

In the last year of this period the pattern post was established. This was done at the express desire of the Postmaster-General. My own wish was to make it part of that more extensive arrangement which I have already mentioned under the name of Parcels Post; my chief objection to the more partial scheme being the difficulty sure to arise as to the definition of a pattern. As, however, I was not then in a state of health to surmount immediately the many obstacles to the more comprehensive scheme, and as Lord Stanley was impatient of delay, the more limited plan was adopted and carried into effect.

PACKET SERVICE.

Transference from Admiralty.

The last improvements of which I shall speak here are those connected with the Packet Service. This service, it will be remembered, had, under the management of the Admiralty, become a source of very great expense; attributable partly to the fact of its extension, for political reasons, very far beyond the requirements of the Post Office. As this extension had ceased, it was desirable, as fast as possible, to bring the expense within such limits as would render the service self-supporting, and thereby relieve the British tax-payer from a needless burden. Opportunity was given for such improvement by the transference of the service from the Admiralty to the Post Office; a change made in the year 1860. Of course progress could be but slow, seeing that existing contracts had to be respected; but steps were promptly taken to put the department in readiness for availing itself of opportunities as they should occur. The secretarial charge of the department was from the first placed in the hands of my brother, who already had like charge of the foreign and colonial departments, and had previously performed such secretarial duties relative to this service as even then devolved on the Post Office.

Improvement in Tenders.

His first move was, so to frame the tenders as, in effect, to analyze the charges hitherto made in the gross; to show how much was demanded for the main duty, and how much for its various adjuncts; and by this means to ascertain how far the various details of any particular service justified the expense of their additional maintenance. The value of such analysis may be exemplified by stating that by abandoning stipulations which were really of little or no practical utility, either to the Post Office or to the public at large, we were able to reduce the annual expense to the Home Government of conveying the mails to and from Honduras from £8,000 to £2,000; eventually, indeed, to £1,500.

Discontinuance of Surveys.

A yet more important measure, however, as being even more general in its operation, was to relieve contractors from the admiralty surveys of the vessels, previously insisted upon, and to limit the demand to a stipulation—under adequate penalties—that the mail service should be regularly performed within a given time. It was not without much difficulty that the sanction of the Postmaster-General was obtained to so great an innovation. The measure, however, was in full accordance with the spirit of Lord Canning’s Report on the packet service; and, before it was recommended, good assurance had been received that the alterations required by the Admiralty, though often attended with heavy expense, really tended to render the vessels employed less fit for the performance of their special service. In short, the measure was, practically speaking, carried into effect; and, so far as I can learn, has never given rise to a single complaint. Its pecuniary benefit was exemplified by a tender subsequently made for a particular service by Sir Edward Cunard; the effect being to reduce the annual charge, in this one contract alone, from £23,000 to £19,000, a rate of saving, which, when applied to the whole cost of the packet service, would amount to about £200,000 a year.

Readjustment of Transmarine Rates.

Concurrently with these and other measures for reducing the cost of the service, my brother sought to do something towards meeting its inevitable expense by a moderate increase of postage in quarters where the charges for conveyance were proportionately the heaviest. Experience had shown that, where transmission necessarily occupies a long time, increase of correspondence depends far less on lowered rates than on increased speed and frequency of transmission. He felt, moreover that it could not be just to call upon the British tax-payers generally to pay exorbitantly for advantages specially appertaining to the comparatively few persons who were directly interested in foreign and colonial correspondence; that every branch of the postal service ought to be self-supporting, and the false principle of protection to particular interests entirely shut out. At the same time, to meet the convenience of those who required cheapness rather than speed, he proposed a concurrent reduction on all letters sent by ordinary trading vessels; a mode of conveyance involving very little expense. A change so doubtful of acceptance, though so sound in principle, Lord Stanley of Alderley had the courage to adopt; and it received the cordial approbation of Mr. Gladstone, then Chancellor of the Exchequer.

Fiscal Benefits.

The effect of these combined measures is most strongly exemplified in the service to the Cape of Good Hope and Natal; the loss on which was reduced in six years from about £28,000 to about £5,400 per annum. In short, I believe that the large annual loss involved in the foreign and colonial packet service was actually reduced during the time that the department was in my brother’s hands by more than £200,000; £100,000 being saved by reduced expenditure, and the like sum gained by increased yield from the correspondence; while the cost to the British taxpayer was further diminished by the extension of arrangements previously adopted for calling upon the colonies, once exempt from all expense of transmission, to bear their just share of the charge.

Increased Punctuality.

Whilst thus successfully striving for increased economy, my brother also took measures for improving the service. By a system of exact accounts he obtained quarterly tables showing at a glance how each line of packets stood with respect to punctuality, together with the length of its quickest and of its slowest voyage; so as to have ground of comparison with subsequent performances. He also introduced into all new contracts a stipulation for penalties to be levied in cases of over time. Lastly, while the Annual Report was in his hands, he was careful that, whenever a service was performed with great credit, the Postmaster-General’s Annual Report should contain due notice of the fact. The directors showed the value they attached to such recognitions by quoting them in their reports to the shareholders. To complete this matter, I may here state that so striking was the effect gradually produced by these various measures, that, in the last quarter during which the department was under my brother’s superintendence, viz., that ending September 30th, 1867, there were, as I learn, only twenty instances of a packet arriving after its time; while those of arrival before time were no less than two hundred and twenty-seven.

Large Expenditure Prevented.

The last great service performed by my brother in this department, which, for the sake of completing the subject, I mention here, consisted in the defeat of an attempt to draw the British Government into the adoption of such changes in the Australian service as, without any appreciable improvement in its efficiency, would have subjected the mother country to an increased annual expense of about £114,000. The proposal was drawn up with great art, and under show of certain advantages, really aimed at diverting the main burden of expense from certain of the colonies to the mother country. My brother, after a careful consideration of the whole subject, prepared a minute exposing the fallacies of the plan and justifying its rejection. This minute being approved by the Postmaster-General of the day (the Duke of Montrose), and confirmed by the Treasury, was sent out with but little change in its words to the colonies concerned, where it appears to have settled the question.

Reward for Faithful Services.

This important minute was written in the year 1867, about three years after my resignation. While, however, my brother was quietly rejoicing at the success with which he had surmounted these serious difficulties, and dwelling, perhaps, with some natural gratification on two recent minutes in which the Duke of Montrose had recorded his satisfaction with the financial results of the packet service during the time it had been under his management, and with the state of perfection into which that service had been brought; while, moreover, he was taking measures for further improvements of great importance, for which opportunity was rapidly approaching, through the termination of existing contracts, a change was preparing which soon put all such thoughts to flight. Will it be believed that in the course of the same year, nay, within a few months from the date alike of the despatch to Australia and of the Postmaster-General’s gratifying minutes, the whole packet service was withdrawn from my brother’s charge and placed in other hands. The motive assigned by his Grace was that Mr. Frederic Hill’s views were opposed to those of the Postmaster-General, Mr. Tilley, and the Treasury. No positive act of opposition was alleged or even hinted at, my brother’s proceedings in the matter having been limited to statements and arguments set forth in minutes to his Grace; while, to judge by all his antecedents, he was ready, as indeed he was bound, to obey any injunction, and to carry out any announced wish of his official superior, however little these might be in accordance with his own opinion. The consequences of the change, it must be added, were far more speedy than satisfactory. Within a year, the cost of the service, which under his management had been gradually reduced by about £100,000, was augmented by little less than £300,000; and I may add that but for such interposition as for a short time he was still allowed to make, the increase, great as it was, would in all probability have been greater still.[229]

CHAPTER XXIX.

RESIGNATION. (1864.)

I return to the year 1864, and to my personal narrative.

The necessity for my withdrawal was the more disappointing because I knew that I had the full confidence and even sympathy of the head of that department to which the Post Office is subordinate. This confidence, however, was not sufficiently near for my support; and in my immediate department the ground was slipping from beneath my feet. The chief point I was striving to maintain was that of promotion at once by absolute merit, and in faithful accordance with the requirements of the department. The rules by which this was maintained had to an important extent been of late set aside; all my resistance to the change being overborne. My appointment having been made by the Treasury, I had thought myself justified in appealing directly to that higher authority; and I now learnt, for the first time (February 6th, 1864), that such appeal had been condemned by the Postmaster-General, who at the same time denied in general terms my alleged appointment by the Treasury,[230] maintaining that “all appointments in the Post Office, without distinction, are made by the Postmaster-General, and him alone.” I had even gone so far (on the suggestion of Mr. Gladstone) as twice to solicit and obtain an interview with the Premier, Lord Palmerston. Though, on the first occasion, I was received in the most friendly manner, and listened to with great patience, and even obtained some little support, I became convinced, on the second interview, that I had no hope of effectual aid from that quarter. In short, matters had ere this come into such a state that it was in effect impracticable for me to retain my actual position; and, indeed, at the time of which I am now writing, viz., the beginning of 1864, no change, I am afraid, would have availed, my strength being already exhausted. The last six months I had passed in vacation, for which I had applied, in the hope that such a period of rest might so far recruit my health as to enable me to hold on in the hope of better times; but at the close of the period I was but too sensible that this end had not been attained. I therefore procured a consultation of all my medical advisers, four in number; their opinion, communicated to me through the mouth of their senior, Sir Thomas Watson, is thus recorded in my Journal:—

In yielding to the necessity thus falling upon me, I had some comfort in knowing that I left behind me, in addition to several men of tried zeal and ability in their respective stations, a few on whose zeal, talent, and earnest support of my plans, I could implicitly rely; for though I feared that under existing circumstances their efforts would be comparatively unavailing, yet I trusted they would have strength to endure until the return of better times. Unfortunately while my trust in their firmness has been fully justified, my hope seems as far as ever from fulfilment.

My whole family concurring in the necessity of the contemplated step, I called on the Chancellor of the Exchequer: my interview with him is thus recorded in my Journal:—

I fulfilled this promise, but could not venture to change my determination. Before sending in my resignation, however, I thought it due to Mr. Gladstone to wait upon him, and state the reasons which compelled me to take this step, as also to warn him of the evils that must follow some of the changes then in progress at the Post Office. Mr. Gladstone, receiving me with much kindness and evincing great sympathy, expressed his readiness to do anything in his power that might enable me to remain; but, while sincerely thanking him for all his kindness past and present, I was obliged to say that measures of relief, even if practicable, were now too late. Thus ended my last official interview with that distinguished statesman.[231]

My letter of resignation, which was addressed to the Lords of the Treasury, a copy being also sent to the Postmaster-General, was as follows:—

Of the brief and imperfect statement of results referred to above, the following is a copy. A few notes, however, are appended for the purpose of giving later results:—

(A) In 1868 the number had increased to 808,000,000.—(“Fifteenth Report of the Postmaster-General,” p. 4.) [In 1878 the number had increased to 1,097,000,000—nearly fourteen and a-half fold the number sent in 1838, in addition there were sent through the post in 1878, 111,000,000 post-cards, 197,000,000 book packets and circulars, and 130,000,000 newspapers.—Ed.]

(B) Return 1868, No. 215, the latest account rendered in this form shows that in 1867 the gross revenue had advanced to £4,548,000, and the net revenue to £2,127,000. [According to the form now in use, the gross revenue for 1878-9, was £6,274,000, and the net revenue £2,434,000.—Ed.] while the net revenue would sustain a loss of about £300,000. The preceding statement shows that the letters have increased, not five-fold, but nearly eight and a-half fold; that the gross revenue, instead of remaining the same, has increased by about £1,500,000; while the net revenue, instead of falling £300,000, has risen more than £100,000. (See Note[234]).

RESIGNATION.

In consequence of further communication from the Chancellor of the Exchequer, I wrote to him as follows:—

A few days later I received the subjoined from the Postmaster-General:—