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or other distant places might have been induced to subscribe ; and therefore I say that the power to issue legally a prospectus promising interest is eminently calculated to deceive. I advised the directors of the North-Eastern Company that, although they might be called upon to spend £400,000, yet, under the most favourable circumstances, they would not be able to get more than 2 per cent, interest for it; whereas in the case of an independent company, without the facilities of working which an old company possesses, the dividend would be practically nil. There is another question which has been raised, and that is as to the interference with railway extension which this Standing Order is said to be calculated to exercise. I have said already that the Standing Order will, if obeyed, prevent sensible people being decoyed into putting their money into speculations which cannot pay; but Ido not think it is a correct representation of the actual facts to say that railway enterprise has not gone on in a satisfactory way in this country. I have made extracts from the Board of Trade returns of the capital expended on railways. Twenty years ago the amount expended on railways was £348,000,000 —I give all the figures in round numbers. They have gone on adding every year up to 1880, until in 1880 the amount was £728,000,000, which is an average expenditure on railways of £19,000,000 per annum for the last twenty years. The bulk of that, of course, has been spent by the old companies. [The paper was handed in.] 414. Mr. Salt.] Have you got the proportion which was spent by the old and the new companies ?—No ; it would be impossible to get that. The net receipts of the railways was equivalent to 4 per cent, upon the capital outlay in 1861; in 1871 it got up to 466 per cent.; and in 1880 it was equal to 438 per cent. Now, during that period there has been an enormous development of trade in the centres of traffic, and a very great increase upon the main lines of railway; but the action of the companies in extending railways involving, as I said, during the last twenty years nearly £400,000,000 sterling has practically kept the net receipts in proportion to the capital as nearly as possible the same as it was twenty years ago. That does not show that the old railway companies have neglected their duty in extending railways in the country. [The paper was handed in.] 415. The Chairman.] Many shareholders, on the contrary, think that you have gone much too far in that direction : is not that so ?—Many shareholders say so, but most of the shareholders in the old companies have confidence in the directors who have the charge of their property; and the directors of the old railway companies have not been indisposed to arrange for expending capital where there was a chance of the most moderate return. When I say a moderate chance, Ido not mean anything like full interest upon the capital itself. In fact, it is difficult now to point to any place in the country where, in the way of filling up a gap, there would be the smallest chance for a dividend for any independent company. I know from my own experience of the smallness of the traffic in those districts that, according to the map, would appear not to have been supplied with railways, any independent company got up for the purpose of supplying such want, and inducing anybody to raise the capital, must lay their account to going without any interest upon the money expended. 416. Mr. Salt.'] Does that remark apply to the whole of England, or to the north only?—I think it applies to nearly the whole of England, according to my view of the case. I gave the figures of the capital expended up to 1880. I have taken out the commitments of a few of the large companies. At the end of December, 1881—because the Board of Trade returns were only published up to the end of 1880—I find that those large companies, in 1881, spent £10,000,000 ; and at the end of 1881 they were committed to £26,000,000 more for the expenditure in the future half-years ; so that the expenditure on railways may be taken at about £770,000,000 in round numbers. Then, as to the question whether railway construction has gone fast enough, from the same Board of Trade returns I have taken out a list of the little companies who pay no dividend at all [delivering in the same]: there is a very long list of them. 417. The Chairman^ How many are there?—l did not count them; but these are the figures which I have been quoting from. Summarized, it comes to this : that from the Board of Trade returns for the year 1880 there are nearly £38,000,000 of ordinary stock on which no dividend at all is paid, made up mostly by those small companies that I have mentioned. The total ordinary stock in the country is £270,000,000; so that about one-seventh of the whole capital raised as ordinary stock for the construction of railways in this country at the present time returns no dividend at all. 418. Do you think that if the Standing Order were repealed the state of things would be worse ?—I think it would be worse in this way : that it might induce parties to become more active in proposing these kind of concerns, which never had a chance of paying, and which never will have a chance as independent companies. 419. Notwithstanding the evasion, you are distinctly of opinion that the Standing Order has a very important deterrent influence in a good direction ? —I think in a good direction certainly. I think I heard some remark by one of the witnesses that it was not the business of Parliament to protect ignorant, unwary, and foolish people. The business of Parliament I think those in Parliament understand. Some reference was made to parties in Hull who had been depositors in the savings-bank, and had transferred their money. There is the document on which that statement is founded [delivering in the same]. I have dealt with independent companies got up for the purpose of " filling up " districts. Mr. Forbes, I think, felt the difficulties he had had in raising money. I think his case, perhaps, would have been stronger if he had been able to show that the concerns he raised money for in the way he himself described, and which I do not propose to repeat, had, after all, turned out to be remarkably prosperous, or anything of that sort. Now, the London, Chatham, and Dover Railway Company, with which he is specially associated, was originated—of course as a small concern—in 1853; and it has gone on increasing until there stands on its books at the present time about £11,000,000 of ordinary capital. Ido hot mean to say that they received £11,000,000, because I suppose they did not; but the nominal amount is £11,000,000 —on which up to this time, I