on our Chairman's figures. You originally verbally admitted in my presence that you could not dispute the figures concerning the mobility of a railway wagon.

After an attempted evasion of my letter asking you to confirm your statement in writing, you claim to have "pointed out at the time, that the reason you did not dispute the figures was that they were largely based upon assumptions which you could not check."" We are willing to assume that you may have intended to so qualify your admission out of all value and meaning, and you may now think you did so, but you most certainly did not use those words or any other words qualifying your admission.

Your letter of the 24th June, 1912, distinctly implies that the assumptions made by Mr. Gattie are unverifiable, and suggests them to be unreasonable.

We consider that we are justified in asking you to be good enough to inform us what the assumptions you allude to may be, and why you cannot check them.

We are, of course, aware of the unfortunate attitude of incredulity with which an official of your Department thought fit to treat the proposals of this company, but we fail to see why, having originally blundered, you should persist in a very unwise hostility to an honest enterprise. We invite you in the most friendly way possible to answer our questions fully and properly, and if you find you made a mistake, openly to admit it.

We intend to submit the diagram of the life of a goods wagon to the Royal Commission now sitting, together with the correspondence with you upon the subject. The Commissioners will perhaps draw their own conclusions why you decline to specify assumptions which are either self-evident propositions or easily verifiable.

a very un

We trust you will not compel us to put you in pleasant position, but unless you can see your way to help us, we shall have no other course.

Yours faithfully,

For The NEW TRANSPORT COMPANY, LTD.

(Signed) JAMES CULVERWELL,

Secretary.

APPENDIX IV

REPORT BY MR. EDGAR HARPER, F.S.S., ON THE COMPANY'S ESTIMATE OF REVENUE AND EXPENDITURE FOR ONE YEAR'S WORK OF THE PROPOSED LONDON GOODS CLEARING HOUSE

GENTLEMEN,

The project of a Goods Clearing House for London has been under my consideration since June, 1910, when Mr. Gattie first explained it to me. The application subsequently made by the Company to the London County Council in December, 1910, was in due course referred to me, as the Council's Statistical Officer, to consider and report; and I have accordingly investigated the whole question from the point of view of the public.

In accordance with your instructions I have considered the preliminary estimates forwarded with Mr. Gattie's letter of 18th inst., and will deal separately with each section of it.

CAPITAL ACCOUNT.

SITE. The sum of £5,700,000 provided for the acquisition and clearance of the site of the proposed Clearing House, including 17 acres of land intended to be let or sold as surplus land, works out at £142,500 per acre. From my experience of the compulsory acquisition of land in the neighbourhood of the site, this appears to be a full allowance; but I understand that a detailed estimate is being prepared by an eminent surveyor. I assume that this sum of £5,700,000 is intended to include the cost of constructing the new wide roads proposed to be formed on all four sides of the Clearing House, and I am of opinion that it will be sufficient to cover the cost

of this work, in addition to the cost of acquiring the property.

BUILDINGS AND PLANT.-These figures depend wholly on the authority of Mr. Ayling and Mr. Gattie respectively.

ROAD CARS.-The total number to be provided is 4,000. The number in regular working is 3,750, leaving 250 spares, or I in 16, which is barely sufficient for repairs and periodical overhaul. One of the bases of the estimate is that 80,000 tons of goods per day will be received or despatched by road. In order to do this, each car must make on the average six journeys out and home per day, and must carry 31 tons per journey, in addition to returned empties. This hardly allows sufficient margin for light journeys. I have inspected the original quotations, both dated 20th inst., from Commercial Cars, Ltd., and from the Bristol Wagon & Carriage Works Co., Ltd. From these it appears that the road cars can be obtained at a price of £486 17s. 6d. each, if 50 are ordered at one time. I have also seen the original quotation, dated 21st inst., from the Evans-Doubleday Chassis, Ltd., offering to deliver 500 cars at a price of £325 each. These figures compare with the estimate of £300 each, and in order to be on the safe side, both as to numbers and as to price, I think the sum provided under this head should be increased to £1,600,000.

ELECTRIC LOCOMOTIVES.-I am not competent to express an opinion on the price of these locomotives. I have, however, been furnished with a time-table showing the times of the trains expected to arrive at the Clearing House (underground level) in the course of 24 hours, and from this it appears that 38 trains will arrive during the busiest hour, between I and 2 a.m. Nearly the same number will have to be despatched during the same period, and after allowing for spares, it does not appear to me that 30 locomotives is a sufficient provision, having regard to the traffic in the busiest hours. On that account I should increase this figure to £100,000.

CONTAINERS.

TUBE AND TRACK CONSTRUCTION.
WHARF EQUIPMENT.-

The amounts of these items depend wholly upon the authority of the experts who have estimated them.

Except in the case of land acquisition, no margin appears to have been allowed for Parliamentary and legal expenses, or for unforeseen contingencies.

Taking all the foregoing considerations into account, I think the total capital estimate should be increased to £14,000,000 (fourteen million pounds).

WAGES.

In round numbers, 20,000 men are expected to handle the goods in the Clearing House, both above and below ground, and 15,000 men to collect and deliver them by road. I assume that this staff will be sufficient to deal with 100,000 tons per day with the benefit of Mr. Gattie's system. But this full staff will probably be required to work the Clearing House and the road collection and distribution in connection therewith, irrespective of the volume of business, so that a reduction in the quantity of goods handled would not produce any material saving in wages.

The men are to work six days a week and eight hours per day, and the rates of wages are not below the standard rates for similar work.

It would be prudent to add a 10 per cent. margin for contingencies to this item.

RECEIPTS AND EXPENDITURE.

The charges proposed for handling and carting goods do not exceed those now made by railway companies and other carriers in London.

The ground rents to be received in respect of the 17 acres of surplus land are, in my opinion, over-estimated, but on this point no doubt the surveyor will report. On the other hand, the receipts from the wharf have not been estimated, and these would account for more than the difference.

On the expenditure side it should be noted that the sum of £11,000 allowed for "Maintenance of building represents less than one-half per cent. of the capital cost (including equipment of wharf). This is insufficient to cover a sinking fund to replace the building when required, and I think this item should be increased to £25,000. Nor is any provision made for (a) water, (b) insurance or (c) unforeseen contingencies.

There is, moreover, a clerical error in the "Fuel " £10,500 being put down instead of £105,000.

item,

I am unable to check the quantities of fuel and electrical energy required, and I think the Company may have some difficulty in obtaining current at the low price of a halfpenny per unit.

The other items of expenditure are fair and reasonable, except that the provision for maintenance and depreciation of the road cars and electric locomotives should be increased to correspond with the increased capital estimates I have suggested.

After making full allowance for all the foregoing considerations, and assuming that (1) 100,000 tons of goods would be placed daily in the hands of the Clearing House, and that (2) that quantity could be satisfactorily dealt with in the 24 hours, I am of opinion that the resultant figure in the Company's estimate, viz., taxes and surplus, £13,536,503, would not be reduced below £12,000,000 (twelve million pounds) per annum.

(Signed) EDGAR HARPER, F.S.S.

In continuation of my report of even date, I submit the following observations.

As your preliminary estimate is founded on the assumption that 100,000 tons of general merchandise will be handled daily, it rests upon a purely hypothetical basis unless it can be shown that such a volume of business will be attracted. To consigners of goods the attractions of the Clearing House will be mainly two greater expedition, and lower charges; and in all ordinary cases these will no doubt suffice to bring the business into your hands with the co-operation of the railway companies. But in the case of food and other perishable goods, it may often be necessary to consign direct, instead of via the Clearing House. Of this the milk traffic is a good illustration, the inward trains usually dropping a number of full churns at each suburban station, as well as at the terminus, while the outward trains pick them up empty. If they were all sent up to the Clearing House, the suburban consignments could not reach their destination as early as they do now. At the same time the better and cheaper general facilities offered by the Clearing House would certainly attract fresh trade by inducing firms