In order to insure the payment of an average sum of 4 cents or 5 cents per 100 words, the newspaper proprietors proposed that messages be transmitted for the newspapers “at rates not exceeding 24 cents for every 100 words transmitted at night, and at rates not exceeding 24 cents for every 75 words transmitted by day, to a single address, with an additional charge of 4 cents for every 100 words, or for every 75 words, as the case may be, of the same telegram so transmitted to every additional address.” By way of compromise, Mr. Scudamore proposed a charge of 24 cents for 75 words or 100 words for each separate town to which each message might be sent, and the limitation of the 4 cent copy rate to copies delivered by hand in the same town. Mr. Scudamore, however, withdrew that proposal, and accepted the proposition of the newspaper proprietors, which became the law. It is needless to add that the opposition of the newspaper press to the Bill of 1868 would have delayed the passage of that Bill even more than any opposition on the part of the telegraph companies and railway companies could have done. Indeed, it is probable, that the newspaper press could have defeated the Bill.

In 1875 the Treasury appointed a “Committee to investigate the Causes of the Increased Cost of the Telegraphic Service since the Acquisition of the Telegraphs by the State.” That committee consisted of three prominent officers taken from the Post Office Department and other departments of State. Upon the newspaper tariff fixed by the Act of 1868, the Committee reported: “The consequences of such a system must be obvious to every one. Even at ordinary times the wires are always largely occupied with press work, and at extraordinary times they are absolutely flooded with this most unremunerative traffic, which not only fills the wires unduly to the exclusion of better paying matter, but necessitates a much larger staff than would be necessary with a more reasonable system [of charges].104 After very careful consideration of these points, Mr. Weaver [one of the members of the committee, and the former Secretary of the Electric and International Telegraph Company], has no hesitation in expressing his opinion that the principle of the stipulations of the tariff authorized by the Telegraph Act, 1868, both as regards messages transmitted for the public, and those forwarded for the press, is essentially unsound, and has been the main cause of the large percentage of expenditure as compared with the gross revenue. In order to provide for the prompt and efficient transmission of the vast amount of matter produced by such a system, a considerable extension of plant was necessary, involving a large original cost, besides a regular yearly outlay for maintenance and renewal, and not only so, but a large and constantly increasing staff had to be provided to work lines, which, if taken separately, would not be found to produce anything approaching to the cost entailed for erecting, working, and maintaining them. It will be obvious, therefore, that, unless a retrograde step be taken in order to amend the principles upon which the stipulations of the tariff are made up, it would be unreasonable to expect that the revenue derived for telegraph messages under the present system can ever be made to cover the expenses of working, the interest upon capital, and the ultimate extinction of the debt.”105

In May, 1876, Mr. C. H. B. Patey, Principal Clerk in the Post Office Department, testified that the Post Office was losing $100,000 a year by transmitting 220,000,000 words for the newspaper press at an average price of 8 cents per 100 words. Mr. Patey said 180,000,000 words were being carried at the rate of 4 cents per 100 words, or for $74,180 in the aggregate; and 40,000,000 were being transmitted at the rate of 24 cents per 100 words, or, for $109,795 in the aggregate.106 Mr. Patey submitted no calculations in support of his statement that there had been a loss of $100,000 on newspaper messages yielding $183,975. But he cited two illustrations from Hull and the Nottingham-Sheffield-Leeds-Bradford group of towns. He stated that the Post Office received $1,600 a year for messages transmitted to six newspapers in Hull, and spent $5,275 on the transmission of those messages. He added that the service supplied to nineteen towns included in the Nottingham-Sheffield-Leeds-Bradford group of towns yielded $21,760, and cost the Post Office $38,270.107

In 1876, the Postmaster General, through Mr. S. A. Blackwood, Financial Secretary to the Post Office,108 asked the Select Committee on the Post Office (Telegraph Department) to recommend to Parliament that the tariff on newspaper press messages be made “24 cents for 75 words or 100 words for each separate town to which each message may be sent, and that the 4 cent copy rate be limited to copies delivered by hand in the same town.” That, it will be remembered, was the proposal made and withdrawn in 1868 by Mr. Scudamore. The Select Committee recommended that the amount of the loss on the newspaper press messages be clearly ascertained, and that the copy rates be raised sufficiently to cover that loss. But Parliament failed to act on the recommendation.

Mr. Patey had supported Mr. Blackwood’s request with the statement, based upon inquiry of postmasters throughout the United Kingdom, that “in a very large number of towns only a small part of the telegraphic news transmitted was inserted in the newspapers. In many cases, on inquiry of the proprietors, it was stated that it was not inserted inasmuch as it was not of interest to the readers. In other cases, because the amount of local news was more than would admit of the special telegraphic news being inserted.” Mr. Patey also had quoted from a recent issue of the Glasgow Herald the statement, that “there was not a leading provincial paper in the Kingdom, the sub-editorial room of which was not littered in the small hours of the morning ankle deep with rejected telegraph flimsy;” and from a recent issue of the Freeman’s Journal: “The fact is, that the Post Office, and the better class of papers as well, are both over-pressed with these cheap duplicate telegrams. We suppose we pay for about ten times as many as we print. Though we get them, and pay for them, so as to insure having the best news from every quarter, we regard them rather as a nuisance, and would be glad to have them reduced in quantity.” And finally, Mr. Patey had argued that the newspaper press was able to pay much more than it did pay, “inasmuch as there had been a tendency on the part of the papers generally, not confined only to the large papers,” to get their news by special messages prepared by their own agents and not sent in duplicate to any extent.109

Before the Select Committee on the Revenue Departments Estimates, 1888, Mr. C. H. B. Patey, Third Secretary to the Post Office, stated: “We believe that the tariff under which the press messages are sent in this country causes a loss amounting to nearly $1,000,000 a year.”110 In August, 1888, in the House of Commons, Mr. Cochrane-Baillie asked the Postmaster General “whether in view of the Report of the Committee on the Revenue Departments Estimates, he could state that the Government would bring in further legislation to relieve the country from the loss incurred by the present arrangement in connection with press telegrams?” The Postmaster General replied that “he was quite in accord with the Committee on Revenue Departments but he feared it would be difficult to effect any change, since the newspaper press tariff was fixed by the Act of 1868, and had been in force for upward of eighteen years.”111

In November, 1893, Mr. Arnold Morley, Postmaster General, stated in the House of Commons that “the best estimate that can be formed by the officials at the Post Office points to the loss on the newspaper press telegrams being at least $1,500,000 a year; and it probably is still more.”112 In April, 1895, Mr. Arnold Morley, Postmaster General, repeated the foregoing statement, and “maintained it in spite of various statements to the contrary in the newspapers.” He added: “and I should be quite willing to arrange for an impartial investigation such as is suggested by the Right Honorable Gentleman, if I were to receive satisfactory assurances that the press would abide by the result of an inquiry, and would undertake not to oppose the passage of the necessary legislation for a corresponding revision in the charges, if it should be shown that they are insufficient to provide for the cost of the service.”113 The assurances were not forthcoming; and the newspaper press tariff remained unchanged.

In April, 1900, Mr. R. W. Hanbury, Financial Secretary to the Treasury, and representative in the House of Commons of the Postmaster General, a member of the House of Lords, said: “The penny postage realizes an enormous revenue and brings in a profit, but every other part of the Post Office work is carried on at a loss. The whole profit is on the penny letter.”114

The Telegraph Act of 1868 provided that newspaper rates should be given to “the proprietor or occupier of any news room, club, or exchange room.”115 The clubs or exchange rooms in question are largely what we should term “pool-rooms,” places maintained for the purpose of affording the public facilities for betting on horse races.116 In 1876 Mr. Saunders, proprietor of the Central News Press Association, testified that his association would send in the course of a day to the same list of addressees the results of a number of races. The words in the several messages might not aggregate 75 words, and thus his association would be charged for the transmission of one message only. In that way a number of messages would be transmitted “gratuitously.” Mr. Saunders added that, in 1875, the Post Office had transmitted gratuitously for his association 446,000 sporting messages. Mr. Patey, Third Clerk in the Post Office, added that while the Post Office received 4 cents for transmitting from 8 to 10 sporting messages, it had to make 8 to 10 separate deliveries, by messenger boy, on account of those messages which were counted as one; and that each such delivery cost the Post Office on an average two cents. Thus, on a recent date, the Post Office had delivered the results of the Lichfield races to 205 addressees by means of 1,640 separate deliveries, and had received for the service, on an average, one-half a cent per separate message.117

In January, 1876, the Post Office discontinued the “continuous counting” of sporting messages.118 It took the Department six years to summon the courage to make this change whereby was effected some diminution of the burden cast upon the general body of taxpayers for the benefit of the sporting element among the voters of the United Kingdom.

It would seem, however, that the practice of “continuous counting” had been resumed at some subsequent date. For, in March, 1906, in reply to a question from Mr. Sloan, M. P., the Postmaster General, Mr. Sydney Buxton, said: “Clubs are, under section 16 of the Telegraph Act of 1868, entitled to the benefit of the very low telegraph rates accorded to press messages; and I have no power to discriminate against a legitimate club because it is used for betting purposes. I propose to consider whether the section ought not to be amended in certain respects.”119

On December 31, 1875, the Post Office discontinued entirely the practice—voluntarily assumed—of transmitting sporting messages to so-called hotels, in reality saloons. The waste of the public funds that the Post Office had incurred in response to pressure from the publicans, is illustrated in Mr. Patey’s statement that the Post Office had received from a certain Liverpool hotel $0.82 a week for messages which had entailed a weekly expenditure of $2.50 for messenger service alone.

CHAPTER IX
The Post Office Employees Press the House of Commons for Increases of Wages and Salaries

At the time of the transfer of the telegraphs to the State, February, 1870, the average weekly wages paid by the telegraph companies to the telegraphists in the seven largest cities of the United Kingdom, was $5.14 for the male staff, and $3.56 for the female staff. That average for the male staff includes the salaries of the supervisors; if the latter be excluded, the average for the rank and file of the male employees will fall to $4.80.120 In 1872, two years after the transfer, the average wage of the male telegraphists in the offices of Metropolitan London was $6.56, while the average wage of the female clerks was $4.30. For the United Kingdom exclusive of London, the average wage of the telegraphists was $5.46 for the male employees, and $4.50 for the female employees.121 The latter averages record a larger increase of wages in the period 1870 to 1872, than would appear at first blush upon comparison with the average of 1870, namely: $4.80 for men telegraphists and $3.56 for women telegraphists. For while the figures for 1872 record the averages for the whole United Kingdom exclusive of London, those for 1870 record the averages of the seven largest cities only.

The increases in wages and salaries in the years 1870 to 1872 were due mainly to the all round rise in wages and salaries that occurred in the United Kingdom in the period from 1868 to 1872. In the case of the telegraphists the rise in wages was postponed until 1870 to 1872, for the reason that the telegraph companies, as much as possible, adhered to the past scale of wages and salaries on account of the pending transfer of their properties to the State.122 The companies were able to pursue the policy in question by refraining from increasing their forces materially, working their old staff over-time. In part, however, the increase in the wages of the telegraphists after the transfer of the telegraphs to the Post Office was due to the fact that the Government was obliged to pay the employees in the Telegraph Department something more than the rates of wages prevailing in the open market. For, previous to the acquisition of the telegraphs, the Government had established the policy of paying its employees more than the open market rate for work requiring only fidelity and diligence in the performances of routine duty, as distinguished from work requiring a high order of intelligence and discretion. Shortly after the Post Office had acquired the telegraphs, it was compelled to extend the aforesaid policy to the new body of State employees. As a matter of everyday politics, it proved impossible for the Government to discriminate between the several classes of public servants, paying one part of them “fancy” wages, and the rest of them wages determined by demand and supply.123

An episode from the reorganization of the Civil Service in 1876, in accordance with the recommendation of the so-called Playfair Commission, affords insight into the British practice of paying the public servants something more than the market rate of wages and salaries. The Playfair Commission had recommended that the pay of the lower division of Government clerks begin with $325, and rise by annual increments to $1,000, for seven hours’ work a day. Thereupon the Government had fixed the rate at $400, to rise by annual increments to $1,000. The Playfair Commission had stated that if it had been guided by the “voluminous” evidence which it had taken, it would have fixed at $750, the maximum to which should rise the salaries of the lower division clerks. But it had desired to attract “the elite” of the classes that the Government could draw from, and therefore it had fixed the maximum at $1,000.124

In August, 1881, the House of Commons accepted the proposal of Mr. Fawcett, Postmaster General, to increase the pay of the telegraph operators, to count seven hours of night attendance a day’s work, and to grant various other minor concessions.125 Those several changes raised the average sum spent for salaries and wages in the transmission of a telegraphic message, from 11.70 cents in 1880-81, to 13.72 cents in 1884-85.126 Mr. Fawcett stated in the House of Commons that inquiry of “leading employees of labor, such as bankers, railway companies, manufacturers, and others” had led him to conclude that the telegraph operators were underpaid. He also mentioned the fact that while he was considering the arguments that the telegraphists had made before him in support of the proposition that their pay was inadequate, “outside influence” was brought to bear repeatedly upon the telegraphists, and that the aforesaid outside influence “went so far as to recommend the employees to resort to the last extremity of a strike.”127

Mr. MacIver replied that “he wished to say a word with regard to the imputation contained in the statement of the Right Honorable Gentleman, that he [Mr. MacIver] had exercised outside influence upon the telegraphists. In common with other members of the House, he had heard128 the complaints of the telegraphists, and had thought it his duty to bring complaints before the House and the Right Honorable Gentleman, the Postmaster General, so that, if he had erred, he had erred in common with many others.”

In the course of the debate in the House of Commons, Lord Frederick Cavendish, Financial Secretary to the Treasury, said: “With respect to the telegraph clerks, since they had received the franchise, they had used it to apply pressure to Members of Parliament for the furtherance of their own objects…. If, instead of the Executive being responsible, Members of the House were to conduct the administration of the departments, there would be an end of all responsibility whatever. In the same way, if the Treasury was not to have control over expenditure, and Members of the House were to become promoters of it, the system [of administering the national finances] which had worked so admirably in the past would be at an end…. With regard to the position of the telegraphists in the Government Service as compared with their former position under private companies, what had taken place would be a warning to the Government to be careful against unduly extending the sphere of their operations by entering every day upon some new field, and placing themselves at a disadvantage by undertaking the work of private persons. He pointed out that the Government Service was always more highly paid than that of the companies and private persons, and in the particular case of the telegraph clerks [operators] the men themselves received higher pay than they had before.”129

Before the Postmaster General had introduced into Parliament his scheme for improving the positions of the telegraphists, sorting clerks and postmen,130 Lord Frederick Cavendish, in his position as Financial Secretary of the Treasury,131 had written the Postmaster General as follows: “…Admitting, as my Lords [of the Treasury] do, that when discontent is shown to prevail extensively in any branch of the Public Service, it calls for attention and inquiry, and, so far as it is proved to be well founded, for redress, they are not prepared to acquiesce in any organized agitation which openly seeks to bring its extensive voting power to bear on the House of Commons against the Executive Government responsible for conducting in detail the administration of the country. The persons who are affected by the change now proposed are, as you observe, no fewer than 10,000, and the entire postal service numbers nearly five times as many. Other branches of the Civil Service employed and voting in various parts of the United Kingdom, are at least as numerous in the aggregate as the servants of the Post Office. All this vast number of persons, not living like soldiers and sailors outside ordinary civil life are individually and collectively interested in using their votes to increase, in their own favor, the public expenditure, which the rest of the community, who have to gain their living in the unrestricted competition of the open market, must provide by taxation, if it is provided at all. My Lords therefore reserve to themselves the power of directing that the execution of the terms agreed to in the preceding part of the letter be suspended in any post office of which the members are henceforth known to be taking part in extra-official agitation. They understand that you are inquiring whether the law, as declared in the existing Post Office Acts, does not afford to the public similar protection in respect of postal communication, including telegraphs, as is afforded by the Act 38 and 39 Victoria, c. 86, s. 4, to municipal authorities and other contractors, against breaches of contracts of service in respect of gas or water, the wilful interruption to the use of which [by means of a strike] is hardly of more serious import to the local community than is that of postal communications to the national community. If the existing Post Office Acts do not meet this case, it will be for my Lords to consider whether the circumstances continue to be such as to make it their duty to propose to Parliament an extension to the Post Office of provisions similar to those cited above from the Act 38 and 39 Victoria, c. 86, s. 4.”132

In June, 1882, Mr. Fawcett, Postmaster General, said in the House of Commons: “The House would remember how, last session, he was pressed by honorable Members on both sides of the House to increase the pay of the telegraph employees … in spite of all that was done for the telegraph employees, he noticed that they were constantly saying that what they received was worse than nothing. All he could say was that if $400,000133 a year out of public funds was worse than nothing, he, for one, deeply regretted that that sacrifice of public money was ever made.”134 In March, 1883, Mr. Fawcett, Postmaster General, said: “The salaries of the telegraph employees have—I will not say by the pressure of the House, but certainly with the approval of the House—been increased [in 1881]. I do not regret that increase; I think the extra pay they receive was due to them, and if I had not thought so, no number of memorials would have induced me to recommend the Treasury to make such a large sacrifice of revenue.”135 In April, 1884, Mr. Fawcett, Postmaster General, said: “$750,000 a year has been spent [of late] in improving the position of the telegraphists and letter sorters, and I say there never was an expenditure of public money which was more justifiable than that. If we had yielded to mere popular demands and thrown away the money we should deserve the severest censure; but I believe that if an increase of wages had not been conceded, it would have been impossible to carry on the administration of the Department; and I think there is no economy so unwise as refusing to increase remuneration when you are convinced that the circumstances of the case demand the increase.”136

In July, 1888, the following questions and answers passed between the Chairman of the Select Committee on Revenue Departments Estimates, and Sir S. A. Blackwood, Secretary to the Post Office. “With respect to the increase of salaries at the time when Mr. Fawcett was Postmaster General, I presume that those recommendations of his were founded upon recommendations addressed to him by the [permanent officers of the] Department?” “I can hardly say that they were. Mr. Fawcett held very strong views himself as to the propriety of making an increase to the pay of the lower ranks of the Department, and he carried out that arrangement.” “But the Department, I take for granted, was not excluded from expressing an opinion upon the subject?” “Certainly not. I became Secretary at the time [1880] when Mr. Fawcett became Postmaster General.137 I never should have initiated such a movement, but I saw great force in many of the reasons which Mr. Fawcett urged in favor of such an increase; and, at any rate, the Department, as represented by me, saw no reason to raise a serious opposition, if it were at liberty to do so, to the Postmaster General’s views and determinations.”138

Before the Tweedmouth Committee, 1897, Mr. E. B. L. Hill, “practically commander-in-chief of the provincial postmen,” testified as follows upon that part of the Fawcett revision of 1882 that applied to the postal service proper. He said that previous to 1882 all the revisions of the wages of the postmen had been made on the basis of demand and supply; but that the Fawcett revision had departed from that policy.139

The Royal Commission on Civil Establishments, 1888, took up at some length, the question of the pressure brought by the civil servants upon the House of Commons for increases of wages and salaries. Before that Commission, Sir Reginald E. Welby, who had entered the Treasury in 1856, had become Assistant Financial Secretary in 1880, and had been made Permanent Secretary to the Treasury in 1885, testified that many Members of the House of Commons had recently attended meetings of the civil servants for the purpose of endorsing the claims of the civil servants for increases of pay; and that they had taken that action without having made a close examination of the grounds upon which the civil servants had put forward their claims. He added: “It is utterly impossible for us [the Treasury] to ignore these symptoms that make it very difficult to keep within reasonable bounds the remuneration of such a body.” Thereupon one of the members of the Royal Commission said to Sir R. Welby: “…but are you not aware that there is a general feeling throughout the country among the people who are employed by private individuals and public bodies [other than the State], that Government servants receive higher pay than they do, and that when these persons are called upon to exercise the franchise they bring pressure to bear upon their Members just the other way [i. e., against the increase of government wages and salaries]?” Sir R. Welby replied: “Of course, I have no means of testing that. I am very glad to hear that Parliamentary influence is not all in one direction. We do not see the proof of it at the Treasury.”140

Sir Algernon E. West, Chairman Inland Revenue Commissioners,141 said he wished for a greater spirit of economy, “not in the offices so much as outside.” Thereupon the Chairman of the Royal Commission said: “I do not quite understand what you mean by outside.” Sir Algernon E. West replied: “I say it with all possible deference, particularly Parliament.” To the further query: “Has there been on the part of Members of Parliament, an increase of intervention on behalf either of the individual officers of the Inland Revenue or on behalf of classes of the Inland Revenue since the enfranchisement in 1869?” Sir A. West replied: “A large increase on behalf of classes, not of individuals…. I should like to add … that I think last year the Lower Division clerks succeeded in getting two hundred Members of Parliament to attend a meeting which was held to protest against their grievances.”142

Sir Lyon Playfair, who had been Chairman of the Royal Commission on the Civil Service, 1874 to 1876, and the author of the Playfair Reorganization of the Civil Service, 1876, testified as follows before the Royal Commission of 1888. “Unfortunately Members of Parliament yield to pressure a great deal too much in that direction, and they are certainly pressing the Exchequer to increase the wages and salaries of the employees of the Crown…. In a private establishment a man looks after his own interests, and if a person came to him and said: ‘Now you must increase the salaries of these men by $100 or $250 all round,’ he would say: ‘You are an impertinent man, you have no business to interfere,’ but you cannot say that to Members of Parliament, and there is continual pressure from Members of Parliament to augment the salaries of the civil servants.”143