Sin,—In accordance with the Council's instructions I beg to submit a general report. on the question of the sale of the Electric Lighting Undertakin; Broudly speaking the Concessionnaire proposes to pay the Municipality Tls. 170,000,, then to clear out all the present plant and replace it by new auachinery, to re-wire the Settlements and give the com-unity an unlimited supply during the 24 hours, Under this offer I take it that a consumer residing in any part of the Settlements would be able to obtain the light. This would mean the running of a very extensive network of wires all over the Settlement, which would entail a heavy outlay and it would be interesting to ascertain, first of all, how the tenderer proposes to make such a scheme a financial success. He does not. say in what time all these improvements will be made and this is. very important point. In my opinion the Concessionnaire should give figure: to how he expects to obtain his revenue, how much he proposes to spend upon new plant and within that tine he will make such expenditure. The peried for which the Concession is to be granted is not mentioned or the terms of re-purchas:
A Concessionnaire may think it a good thing to relieve the community of the al Electrical Department, but the communi will require something more. They will seme undertaking that the concern to bea'paying one, as in the event of the scheme being a financial failure, the community would be worse off than A scheme of this magnitude wil ire very large support from the chinese consumers alone could not make it pay) and the question is, will the Chinese be: come consumers of the electric light? Tf they do, it will have to be furnished very ch ly und there will also be competition with the Gas Company. A Chinaman is not particular about the brilliancy of his Tight, but he must have it supplied cheaply. Chinese sup pected in kong and a large plant was installed, with the result that no dividend was paid for many, years. The statements as to. the plant and other technical matters will be deals with by the Council's: Electrical Engineer but F would remark, in passing, that an intending purchaser naturally looks the condition of the plant from a one-sided point of view.
The first thing that will occur to a business man is, that if a Company is able to start with a debt of Tls. 170,000, discard all the present plant and then make the concern pay, why should not the Council (who would not have to commence with such a burden) be able to do the same? The Ratepayers would not, of course, be asked to vote the money for carrying out \the extensions at once, but there is not anything to prevent the change being effected gradually. The gradual replacing of the plant would certainly be more business-like than the immediate disposal of it. The Electrical Superintendent has already initiated the change by making arrangements to instal larger units.
Ttakeit that the Ratepayers will not object to voting money (gradually) to a Department which pays its way. The Department although having to fight against (all kinds of difficulties has, on the whole, done very well indeed. Since the Council acquired the undertake 1893 the old ramshackle {done away with and a very fine Central Station has been built, and a portion of the loan amounting to Tls. 65,000 has been paid off.
The continuation of the small unit" policy has been forced on by existing circumstances, which it has been impossible to avoid. After purchasing a yoing concern the Ratepayers could not afford to do away with the whole plant immediately, but a good deal has been discarded. There are a good many Electric Lighting undertakin; at home to-day (Municipal and otherwise which, owing to the rapid march of events {in regard to electrical machinery, are in j the sime position as our Electrical Depart-{ment at the present moment, and I am sure that, if they were in an equally good financial position, they would esteem them-Iselves very fortunate. 'The rates have [been mised, but if the price of coal increases the cost of manufacturing electric Tight and gas must increase in proportion. It is to be regretted that, so far, the supply of light has not been' equal to the demand, To a great extent this has been caused by the extreme dilatoriness of the manufacturers in England and this is a very serious matter—it has kept tae De-[partment back from the start. Thi condition of affairs has prevailed for sever years and if it does not soon improve the j result will be that orders to go elsewhere. The long a e meant actual loss of revenue to the Department and have proved a source of irritation to the consumers.
The final point is, why should we sell The Council have borne the burden and [heat of the day—they have built a new station—trained an excellent Chinese staff, contended with i and the undertake Surely it Is unwise to discuss the sale of the business and plant? At this important moment in the of the concern, the Council's newly appointed Electric: has been here barely twe not even had time to show w he can If a company takes the concern over and akes it pay, who will reap the benefit?
of the consumers, but the shareholders. Experience in company undertakings of a similar nature shows that large profits do not mean improved lighting or lower rates. LIf the concern developed does wut pay, then how will the terms of the Agreement be carried out? The st t is entirely [erroneous (so far as England is concerned) that Municipalitiesare very #lad to part with their lighting plants; on the contrary, the Municipalities in England have been even {more successful in working their undertakings than the companies, their charges averaging in the last returns about 2d per unit less than those of private companies. In a recent article in an American Magazine it was pointed out that the Americans were becoming very interested in the success of English Municipalities in earrying on the supply of light, ete., and the writer urged that the American Munici-polities might do well to investigate the matter. Reference is often made to America as furnishing an example of the disastrous effects of Municipalities undertaking public supplies, but the Municipal life and. institutions' of England and America are on totally different bases. Wherever Municipalities have undertaken electric lighting in Great Britain they have carried it on with the greatest success, the Corporations of Glasuow, Manchester, Liverpool, Birmingham, Brad~ ford, Brighton, Edinburgh, Bristol, being (among many other cities) cases in point. It is also worthy of note that the Corpor tions ate also Muniipalising the tram ways with great success as the leases of the Companies fall in, The total indebtedness of £93,000,000 sterling (nearly half this amount being invested in Waterworks) which represents Municipal loans at the present: moment in England, is a measure of the activity of Corporations in undertaking work for the benefit of the Community. Nor can it be said that the results of such work suggest any immediate limit to the indebtedness that is being cheerfully undertaken by almost every Municipality in the Kingdom.
The electric light figures are very instructive, and show the growth of Municipal trading in electric current. Up to the end of March, 1895, £1.378,818 only had been invested in these undertakings by local authorities and now over fifty Muni cipal authorities own their Electric Undertakings and the capital invested is estimated at nearly £6,000,000 sterling.
I am sure that the sale of the Electric Lighting undertaking (after having once purchased it) would' be a decidedly retrograde step from a Municipal point of view and would be condemned by all those who have had lengthened and practice experience in such matters.
Tam, Sir, Your obedient Servant Cuantes May Engineer & Sw'
J..0. P. Buasn, Esq,
Text read from the printed page and cleaned; old type leaves the occasional error.