To the Editor of the "Norru-Cinwa Dany News'
Sin—So a new franchise has bees granted to the Shanghai Gas Com-any by the Shanghai Municipal Council, the terms of which are mad public only when the Council taken action on the matter, Recent correspondence "in your columns drew attention to the 13 per cent. return of the Tramway Com-any for the year 1994, and a 9 per cent. dividend was also' mentioned in respect of the Waterworks Company, though it was dificult to judge from the form of report of the latter just what was paid. There been criticism of so high a rate permitted to the Telephone Company—nvnel,, 4 per cent. plus 2 per cent, but this at any rate is stated. Has not the time come when public utility companies in Shanghai should be strictly limited in their dividends to a reasonable amount (and lower than any mentioned above), with injunetion to maintain the cost of the services to consumers at a level which will only yield this return? Yet a forty year franchise is apparently now granted to the Shanghai Gas Company, and T am unable to find mention, in the resume in this morning's press, of limitation of dividends. The monopoly which public utility employs put it out of the range of competition as a factor in keeping down costs of services, and, therefore, other forces than competition should be invoked to see that high dividends fare not paid at the expense of too high charges, In the case of the Tramway Company it could be added s-at the expense of using obsolete fand slow equipment.
T should be Interested to have the views of others on this question, Shanghai, May 1,
Text read from the printed page and cleaned; old type leaves the occasional error.