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Telegraph Money

Volume 155: debated on Friday 16 June 1922

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Considered in Committee, under Standing Order No. 71A.

[Mr. JAMES HOPE in the Chair.]

Motion made, and Question proposed,

"That it is expedient to authorise the issue out of the Consolidated Fund of such sums, not exceeding in the whole fifteen million pounds, as are required for the further development of the telephonic system and to authorise the Treasury to borrow money, by means of terminable annuities or by the issue of Exchequer Bonds, for the issue of such sums or the repayment thereof to the Consolidated Fund; and to provide for the payment of the terminable annuities or of the principal of and interest on any such Exchequer Bonds out of moneys provided by Parliament for Post Office services or, if those moneys are insufficient, out of the Consolidated Fund."—[King's Recommendation signified.]—[Mr. Kellaway.]

The reason for the Resolution has been briefly explained in the Memorandum which has been issued. It provides for the raising of £15,000,000 to be capitally expended on the telephone system, which amount is estimated to last until April, 1924. Legally, the telephone is a telegraph. That is the reason why the Bill is called Telegraph (Money) Bill. The capital for the development of the telephone system is provided by the Commissioners of the National Debt, and is repaid to them by the raising of annuities to be charged to the Post Office Vote, both for the interest and sinking fund. Last year, when a similar Bill was brought before the Committee, the amount asked for was £5,000,000. That amount will be exhausted in July. A criticism was made on that occasion by a right hon. Gentleman opposite that it was inconvenient that the Committee should be repeatedly asked for comparatively small sums of that kind. I agree that there was force in that criticism, and to-day I am asking for £15,000,000, an amount which will cover the estimated capital expenditure on telephone development for a period of just on two years. The fact of having to come to the Committee on fairly frequent occasions has its advantage, because it enables the Committee to get some view of the way in which the telephone system is being developed, and to make such criticisms as it desires on the growing efficiency or otherwise of that system.

I do not think that the position of the telephone system can be properly understood without some reference to its history. The Post Office only became responsible for the whole of the telephones of the country in January, 1912. At that time 80 per cent. of the telephones of the country were under the control of the National Telephone Company and 20 per cent. under the control of the Government. From then onwards the Government became responsible for the whole of the telephones. It must be borne in mind, indeed it is essential to be borne in mind if we are to properly understand the difficulties that existed when the system was taken over, and still exist, that the service had deliberately been depreciated by the National Telephone Company for some years before the transfer. That was inevitable in the circumstances. It is what every great undertaking would have done. Realising that their life was going to end they took as much as possible out of the service in revenue and did not make provision either for renewals or the proper maintenance of their system, so that when the system was taken over by the Government, the first work the Government had to consider was the bringing up to date and the making efficient as rapidly as possible of the existing exchanges, the trunk lines and the overhead lines.

That work occupied the attention of the Post Office almost exclusively until the end of 1914, so that it was impossible between 1912 and 1914 to devote any considerable amount of money or effort to the proper expansion and development of the system. The energies of the Post Office were almost entirely concentrated on bringing the service up to a higher standard of technical efficiency. From 1914 until the end of 1918 no development was possible. The whole of the energies of the Department were devoted exclusively to purely war purposes, and it. was not until the beginning of 1919 that the engineering department of the Post Office and the Telephone Department were able to devote their attention to that development of the system which is obviously necessary if this country is to remove the reproach which undoubtedly rests upon it of being far behind most other principal countries of the world in the development of its telephone system.

1.0 P.M.

I. should like to indicate to the Committee the progress that has been made since the hands of the Post Office were free to deal with developments. In 1919–20 a sum of £3,230,000 was proposed to be expended out of telephone capital on the development of trunk lines and exchanges, and on sites and buildings. Of that sum, £2,647,000 was actually spent. For 1920–21 an expenditure of £6,884,000 was proposed on these three heads, and the amount of capital spent was £5,866,000. Last year, 1921–22, the amount proposed to be expended on these capital works was £9,032,000, of which £7,438,000 was actually spent. For the present year we are proposing a capital expenditure of £9,250,000. Of that sum, £2,760,000 is for the provision of new trunk lines or the completion of trunk lines now under construction, £5,740,000 for new exchanges or the extension and improvement of existing ones, subscribers' circuits and junction circuits, and £750,000 for sites and buildings Dealing first with the trunk lines the principal item in the proposed expenditure of £2,760,000 is £1,727,000 for commitments already entered into, in existence on the 31st March, 1922, in respect of under ground lines, and the laying of trunk lines underground, either begun or authorised in previous years. These include the London-Southampton trunk line, where the work is well advanced, the London, Bristol and Newport trunk line, also well advanced: the Glasgow and Edinburgh underground trunk line for cables; the Derby and Leeds trunk line (cable), the Birmingham and Worcester trunk line, the Colchester and Ipswich trunk line, the Newcastle, Durham and West Hartlepool trunk, the London, Brighton and Worthing trunk, the Birmingham and Derby trunk, and the Birmingham and Manchester trunk.

The object we have in view is to secure that the great trunk lines of this country shall no longer be in the air, but shall be laid underground. The advantage of that. is enormous. Not only does it mean a great saving in maintenance, but it relieves the country from the danger of interruption of its communications, such as that which we experienced in a very grave form during one of the most important periods of the War, when the whole of the overhead telephone and telegraph lines were swept flat by a great storm which ranged over a trail, 100 miles wide. across the whole of the country. Then in respect of overhead lines, there is a sum of £343,000, and for submarine cables, etc., a sum of £185,000. The works to which I refer are works already being undertaken, but we also include in this year's programme an amount of £504,000 for new main underground cables. These include two long routes from Leeds to Edinburgh, via Darlington, Newcastle and Jedburgh, and from Worcester to Bristol, viâ Gloucester. The former will complete the provision of a main route affording underground communication between London and the North of England and Scotland, while the latter completes the underground communication between Birmingham, Bristol, and South Wales. Some shorter but very important extensions of the underground system, which will he either begun or completed this year, are included in this programme. I do not want to weary the Committee with too many details. but it is impossible to justify the granting of large sums of this kind without giving a great many details. These works include the cables between Manchester and Preston; Bolton, Bury, and Heywood: Bradford and Dewsbury: Bristol and Bath; Pontypool and Abergavenny: and Swansea and Pontardawe: also between Glasgow and Whitecraig, Kirkintilloch and Kilsyth, and Edinburgh and Kirkcaldy.

There is always considerable consultation between the Engineering Department of the General Post Office and those who represent commercial interests.

By contract. I think I am right in saying that the Department only keep a staff for maintenance and emergency work, especially where the lines are laid low by storm, and for such detail work as running overhead wires and drawing in and jointing short local cables. All main works are put out to contract. That is all that it is necessary to say at this stage in regard to the trunks. There is an item of £1,537,000 for Exchanges—for the provision of new and the extension of existing switchboards. A great number of the switchboards are sadly overloaded and it is necessary that they should be very rapidly renewed and extended unless we are to have a repetition of the experience of 1918, when the service practically broke down. Relief exchanges are proposed at Kilburn, Wallington, Addiscombe, Thornton Heath, Hounslow, New Malden and Eltham. The first five are under construction. New permanent exchanges will shortly be opened at Barnet, Tottenham, Sidcup and Wembley. We propose to provide this year new permanent exchanges in Central London (near the Tower) and at Wanstead and Woodford. An extension of the equipment at the Hop Exchange will shortly be completed, and later other London exchanges will be extended. In the provinces we propose to provide 20 new exchanges of considerable size. About 30 others will be extended. £1,800,000 is provided for local underground cables and £1,815,000 for the provision of overhead subscribers and private lines. There is a sum of £586,000 for junctions, circuits and call offices and miscellaneous work. For sites and buildings we ask for a sum of £750,000. There is still a very big programme of building work to be carried out in the near future in connection with existing exchanges. I repeatedly have representations made to me as to the inadequacy of many district Post Office buildings. I realise that is an inadequacy with which I have to deal, and we are making as rapid extensions and as many improvements as is possible within the financial limits of the country

I think it will not be said that the programme which I have so far outlined is an unambitious programme. Certainly many of the existing buildings must be dealt with as soon as the financial position of the country permits. During the current financial year we propose to acquire sites for three new exchanges in the centre of London and about 15 in the suburbs, as well as for 90 new exchanges in the provinces, including Scotland and Wales. We propose to begin building work in connection with the provision of about 25 new exchanges in London and about 80 new or enlarged exchanges in the provinces. This represents a considerable capital expenditure. Having said that, I want for a moment or two to bring to the attention of the Committee some figures which will show the progress which has been made in recent years. I will deal first with the completed work. In 1919 two large new exchanges were completed. In 1920 nine were completed, and in 1921 we completed 37 large exchanges. With regard to the extension of exchanges, one was completed in 1919, three were completed in 1920, and 17 in 1921. The number of lines included in this work represents a very considerable total. In 1919, the local lines represented a total of 13,240; in 1920 67,000, and in 1921 25,900. I will not worry the Committee with the figures as to the junction lines which are also very considerable. Then as to the exchanges. Take the total lines. in 1920, 74,200 miles of double wire circuit underground were completed. In 1921, 129,000 miles and in 1922 we estimate 135,000 will be completed. With regard to the trunk line the figures are strikingly significant. In 1920, 18,980 miles of double wire circuit underground were completed. In 1921, 57,000 were completed, and in 1922 we estimate we shall complete 104,000.

There will still remain certain areas when these works are completed where, owing to the shortage of plant would-be subscribers cannot be connected. Nothing could be more unsatisfactory to a telephone system than that there should be a considerable number of people in the country anxious for the telephone, but who, owing to the limitation of technical equipment, the Department are unable to provide with a service. In all these works which I am now describing to the Committee that is what we have in view. We want the Department to be in a position to provide a telephone service to meet all demands, and if we are to be in that position we must look at least three years ahead in the provision of exchanges and of lines. It takes at least three years to complete an exchange from the time the order is given and the same period for the provision of the connection, and in these works I have described we have been looking ahead for that period. I was impressed with what was said last year as to the necessity for taking a longer view than that. I asked the Department to prepare for me a programme of work for five years ahead. They have submitted an estimate of capital expenditure amounting, during that period, to £35,700,000. In arriving at that figure there are three considerations to be borne in mind. The first is the rate of development, the rate at which the demand for telephones will grow; the second is the level of prices which you have to assume for labour and materials; and the third is the extent to which the automatic system will be introduced. I will deal first with the last.

There are many people who think the automatic system is to solve all our telephone troubles. I do not take that view. I had the advantage, when I moved my Post Office Estimates this year, of having among my listeners in the Gallery the head of the telephone system of the United States, who controls, probably, one of the biggest organisations in the world, and certainly much the biggest telephone system. What he does not know about telephones is not knowledge. We have been only too glad to learn from him and to adopt his suggestions. I had the opportunity, afterwards, of discussing with him the question of the automatic. He made a remarkable observation. He said that in the United States the pressure for the automatic system does not come from the subscribers, but from the companies, who see in the automatic system the means by which they can get over their operating difficulties, the provision of the necessary operating staff. But the ordinary subscriber prefers, he said, to have a girl at the switchboard.

I am certain that, however much operating costs may be reduced—to some extent they would be reduced by the universal adoption of the automatic system—you will not get a more rapid working than you get, for instance, in London, or in any of our great exchanges, where a high standard of efficiency has been reached. That has not been the reason why we have not, so far, introduced the automatic system into London. There are some 14 or 15 automatic exchanges in existence in the country, and the problem is comparatively simple when you deal with a self-contained area served with one exchange. But when you deal with the problem in London. with a great number of exchanges, it becomes exceedingly complex and hard to solve. The difficulty that has stood in the way is expense. All the figures submitted to me as to the cost of providing an automatic service in London make it absolutely prohibitive. Until such time as we can see a workable and reliable system which can be introduced into London on much more reasonable terms than any offered, I should not feel justified in asking the House to vote money for that purpose. Some of the keenest brains in this country and the most able technical men have their energies concentrated on the problem, and I hope that before many years have passed they will effect such reduction in their costs as will enable us to introduce the system in the Metropolis. It must be remembered that there is no other city in the world which presents the same problem as does London.

The next point is the rate of development for which you must provide. Our forecast, in the estimated expenditure of £35,000,000 for five years, has been based on cumulative developments of 8½i per cent. per annum. That was the rate of expansion in 1920–21, and that, I am advised, may be regarded as a normal year. Development at that rate would give these results: On the 1st April this year there were 975,000 telephones on the Post Office system. I am not proud of the figure, for it is most disappointing, having regard to the number in the United States. An increase of 8½ per cent. would give us 1,058,000 telephones in April of next year, rising to 1,466,000 on 1st April, 1927. But I hope for much better things than that. Compared with the United States that is a miserable figure for 1927. If the use of the telephone grows here to anything like the extent it has grown in the United States the demand would be far greater than that, and if that demand is to be met, of course it will involve a very much larger capital expenditure.

The other item is the level of prices to be assumed. Looking ahead for five years, anticipating an increase in the de- velopment at the rate of per cent., we should require a capital expenditure of £35,700,000 to meet that development. As regards the percentage increase over pre-War rates, that varies widely in respect of different parts of telephone equipment, and we have had to assume varying percentages, and a drop towards the end of the period. Labour has been taken for 1922–23 as 100 per cent. above pre-War and for 1922–27 as 80 per cent. above pre-War. Taking those three considerations into mind, the very able advisers of the Post Office—the House is sometimes intolerant of compliments paid to civil servants, but I speak now of the technical staff of the Post Office Engineering Department, which has a standard of efficiency of which it is entitled to be proud—these technical men, men who began at the bottom rung of the ladder and have worked up to the head, tell me that these are reasonable estimates. I think the Committee is fairly safe in accepting the Estimates.

I want to say something about the growth of the Service. The telephone system of this country has improved and it is improving, but I agree that it ought to get very much better and to be more extended. Very gloomy prophecies were made the year before last to my predecessor when the new tariff was introduced. It was said, that the new tariff would lead to a very large percentage of subscribers giving up the service. I am glad to say that whilst there has been a reduction due to that cause it is far smaller than was anticipated. It amounted to about five per cent. of the total number of subscribers and that loss has been much more than made good by the increase in the number of new subscribers. Having regard to the fact that the period covered since the new tariff was introduced was a period of unparalleled depression of trade, and that instead of last year showing an improvement, industrial conditions rapidly became worse, I think that is not an unsatisfactory condition of affairs. The demand is growing at a steadily increasing rate. The new orders secured for the year ending 31st March represented the second largest total on record. The number of new subscribers connected during the 12 months was 71,500, and the number of new instruments connected, including extensions of existing installations, was 134,000. The number of new subscribers for April was the second largest on record and for May was the largest on record. I have very substantial reason to believe from these figures that there is a real revival in trade taking place in the country. I do not believe there is any better test or any more sensitive test of the tendency of trade in this country than the telephone demand. I am glad to be able to tell the Committee that our statistics show that in the demand for new telephones and in the increase in the calling rates, both on the trunks and the ordinary systems, each month is growing steadily better. I believe that this is one of the most substantial signs of an improving condition of trade in this country that can be provided by any test of which we know.

I said just now that one of the most unsatisfactory features was that we were unable to provide for meeting, on demand, requests for telephones. Two years ago 35,000 people had made requests for telephones and the Department was unable to provide them. When I spoke last year introducing my first Estimates the number of outstanding applications had been reduced to 28,000. That is to say, there were then 28,000 people who wanted telephones but could not get them. To-day, instead of 28,000, the number has been reduced to less than 5,000. I think very considerable progress is there indicated. In nearly all cities and towns throughout the country, intending subscribers may now have telephones installed without delay, but there still remains a number of cases where, owing to the fact that spare lines are not available or the exchange equipment is not sufficient, subscribers cannot be put on. I have had hon. Members asking me, "Why has this constituent of mine, after applying for a telephone, had to wait six months and it has not yet been provided. The excuse which the Department makes is that they have not got spare wires. What nonsense it is for the British Post Office not to have a bit of spare wire available to connect up my constituent!" It is not quite as simple as that. You may have an underground cable carrying 600 pairs of wires, each pair of wires serving a subscriber. If every pair of wires in that cable is at present linked up with a subscriber, we cannot provide any telephone in that district until one of those subscribers no longer uses his telephone. We have to look a long way ahead. If we are to meet the demand we have to provide not for one subscriber but to lay down provision which will enable us to meet the growing demand up to the number of pairs of wires running through that particular cable. It may sound elementary to remind the Committee that every telephone subscriber has got a pair of wires running from the instrument in his sitting room or office, either overhead or through the underground cable, direct to the switchboard, but as I know from Members who submit to me cases of failure to connect up their constituents, that is not universally understood.

As to whether or not the service is becoming increasingly efficient, I do not want to be charged with complacency, which is the besetting sin of heads of Departments, but I shall say that, in my view, in London and in that area served by the toll system—an area of about 25 miles round the outer circumference of London—we have reached as high a standard of efficiency as can be found in any great city in the world. That is borne out by appreciative letters which I get from subscribers. It is a great mistake to suppose that subscribers are always grumbling. There are some who are not. It is also borne out by what is told me by distinguished visitors from other parts of the world. The average time taken to reply to a call in our local services, taking the country as a whole, the figure for the whole country, is six seconds from the time the subscriber removes the receiver until he gets a reply from the operator. In London the figure is between four and five seconds. I see an expression on the faces of some hon. Members as though they were recalling cases in which they had to wait more than six seconds before securing the attention of the operator. I assure them these figures have been most carefully checked over a great number of cases. [HON. MEMBERS: "By whom?"] By those whose interest it is to see that the service is as efficient as possible.

I am sorry that on any occasion my hon. Friend should have been kept waiting for 10 minutes.

Then why not have it changed again? There were 26,000 tests taken and the figure I have given is the result. I should welcome it, if hon. Members were to visit some of our great exchanges in London or the provinces. They will there see the working of the system and have explained to them the method of supervision and the tests which are applied. The percentage of calls lost through numbers being engaged, no reply, etc., has been reduced from 20.9 in 1921 to 17.5 in 1922. There is still room for improvement, but the figures I have given compared with the figures given recently in the "Times" by a writer dealing with the system in America show that this country stands well and is doing quite as well in regard to efficient working as is the United States. As to the trunk underground cables, while there may be some difference of view regarding the local services I think there will be no difference of opinion that the trunk service in this country has greatly improved in recent years. For instance, the delay between Manchester and London has been decreased from an average of 21 minutes to 8 minutes, and as the works which I have described in my introduction come to completion, rapidity of communication between London and the great cities and towns of the country should continue to improve.

Before I conclude, I dish to say how much we in the Telephone Department were indebted to the work of the Select Committee. I was not able to adopt all the recommendations made by that. Committee, but I have adopted most of them, and I think it will be agreed that the reduction of charges which I announced in the House some time ago, and which will come into operation at the beginning of July, goes a very long way to meet the recommendations of the Committee. I think if I may say so respectfully, that they are in a more workable and a more effective form, but I would like to make this observation about this reduction. I anticipate that as a result of the reduction there will be a greatly increased demand, but there are some very eminent authorities on telephone working who take the view that I was wrong to reduce the rates, and a great authority who was listening to me when I spoke in the House said afterwards, "The Postmaster-General has made a fundamental mistake. He ought not to have reduced his rates; he should have devoted every penny to the development of his system rather than to reducing the rates." I do not take that view. The system is not being cramped for any want of capital expenditure, for the House has, I think, shown courage in the way in which it has provided this system with the money essential for its development; but if it is to grow as it ought to grow, we must continue this process of reducing the cost of the telephone to the commercial community in this country, and if I get the improved results which I anticipate as a consequence of the reduction which I outlined to the House, I think we shall be able to continue that process considerably further and, I hope, at an accelerated rate.

If there are any other points on which I have not touched—as there are a great number in regard to which I should like to have spoken to the Committee, but if would have meant trespassing too far on their patience—I shall be glad to deal with them on the Second Reading of the Bill. Before I sit down, however, I want to pay a tribute here to a very great public servant who has recently left the Post Office. I refer to Sir William Noble, the late Engineer-in-Chief. I think, perhaps, Ministers have been a little too shy in recognising in Parliament the work that these great public servants do. Sir William Noble, who retired a few weeks ago, is a man who entered the Post Office service some 45 years ago as a telegraph boy, and he ended up as the Engineer-in-Chief of the British Post Office—a very remarkable achievement. He had not the drawbacks that usually attach to self-made men, for he had great breadth of view, audacity, and a single eye to the public good, and I am glad to have the opportunity of saying this as a tribute to one of the most efficient public servants which the Post Office has ever had. I hope the Committee will approve the Resolution.

I might possibly be misunderstood as a result of an interjection which I made during the speech of the Postmaster-General. I admit at once that there has been a considerable improvement in the service of the Telephone Department, but I did protest, and I still venture to protest, against the statistics that are given, telling us that the average time in London to get an answer from the exchange is from four to six seconds. These statistics do not help us, because they do not refer to the times in regard to which the complaints generally occur, probably at night. Supposing you ring up an operator and are kept waiting four or five minutes, or even ten minutes, as I was, how is that known, unless you take the trouble accurately to take the time, and then send it in? These statistics are no good at all. They are simply taken at a particular time of the day, and it is not at all clear that the operators do not know when they are being taken.

That may be so, but they are taken at a time when business is in full swing and all the operators are there, and the trouble always occurs when the staff is changed, at eight in the evening, or later on in the evening. I admit at once there is an improvement in the telephone service, but I say that we are not helped by averages of that kind. They are just as good as the average of the pie man, who always said he had 50 per cent. of horseflesh and 50 per cent. of rabbit in his pies, and when he was cross-examined he said there was no question about that because when he bought he always bought one horse and one rabbit at the same time. These things do not help us really, and do not convince the public or oneself.

In regard to the financial side of this question, what did rather impress me in the speech of the right hon. Gentleman—on a very interesting subject, dealt with in a very interesting way—was the fact that he never, from beginning to end, dealt with the question as to whether or not this large expenditure of capital was going to result in a large loss, or in a small loss, or even in a profit. The fact on which he prided himself, and which he looked upon as a great improvement during the last few years, namely, that in 1919 only some £2,000,000 was spent, that in the following year £3,000,000 was spent, in the following year £5,000,000, and that he anticipated spending £15,000,000 this year, does not satisfy me in the least that the work is being done any better. I want to know what return is to be got on that money. The mere fact that you are going to have a larger amount spent on new sites and new buildings does not necessarily tend to efficiency, and the illustration which the right hon. Gentleman gave of the fact that you must in certain cases, for the sake of one or two subscribers, I think he said, start an underground cable, did not seem to be very convincing from a commercial point of view at all. On the main point which he took, which was that the underground service was necessary and was to that extent a great economy, if that be so, why is he spending £343,000 this year on overhead wires? I have always been rather doubtful as to the great economy which is going to be obtained by entirely putting in underground cables. The expenditure is very much greater, and we are very familiar in London at the present time with the inconvenience caused by laying them. It means taking up roads and dealing with them in that way, and I gather from a part of the right hon. Gentleman's speech that, as far as connecting with subscribers' houses is concerned, it is rather more difficult to do it through cables than by the overhead system. It seems to me, therefore, very doubtful whether we are justified in incurring this very large capital expenditure for that particular purpose.

I have in my mind a matter discussed in this House not many years ago—probably some other hon. Members remember it—which rather illustrates my point. The Post Office built a tube railway from Paddington to the General Post Office, and they had got a railway running within a hundred yards of them all the time. They had only to connect with the Great Western Railway at Smithfield, about 120 yards from the General Post Office, and they could have landed all their mails at the Post Office, taken them on the rail, and, without any transhipment, put them on the Great Western line. But the Post Office knew better. The engineers, whom we have heard so much lauded to-day, scoffed at that idea, and said they must have their tube, and they did. The estimate of £1,000,000 was far exceeded, and now you have still got that tube running from Paddington to the Post Office. I remember the right hon. Gentleman who was then in charge of the Post Office also offered very kindly that I should go and see the work. That is quite useless. What is wanted is to see that this large capital expenditure is not made on something that is unproductive. That tube railway, so far as I know, is absolutely unproductive. The mails have to be transferred at Paddington, and carried by hand from the tube, put into trucks or vans, and loaded on the Great Western Railway. What I want to make certain of is that when you are spending this £15,000,000, it is really necessary to the efficiency of the Post Office, and that there is likely to be a return upon it.

The right hon. Gentleman said that he proposed to keep the price down, and 1 think there is something to be said for that. I would like to know how much we are to pay for keeping the price down. He has complained of a lack of development in the country. People are largely deterred from subscribing because of the expense, but if there be a general use of telephones, and most business people and your friends are on the telephone, you have to get on, and the telephone habit is formed. When I first came to London in 1882, the telephone cost twenty guineas a year, and it was only when it was reduced by the company so that the smaller people could come in, that private people subscribed to any large extent. I do venture on a word of protest against putting large sums of capital into an enterprise unless it be absolutely necessary, and, secondly, having regard to the very divergent views as to the automatic telephone, is it wise to embark very large sums of the taxpayers' money unless you are certain that the return is going to be adequate, either directly or indirectly?

I wish to ask the Postmaster-General one question, but, before doing so, may I be allowed to refer to the average time of calls, because I think the telephone service is entitled to any praise that one can give on this subject? I have been surprised very often in making calls to hear the number asked for before getting the receiver to my ear. It is less than a second. I have been through a good many telephone exchanges, and I realise that the operator must look at the lamp, and plug the right hole, and how that can be managed before you actually take the receiver from the machine and put it to your ear, is to me a marvel and a mystery, and I think the Post Office is entitled to credit for it. I am perfectly certain that London, in comparison with some other capitals, is well ahead in the telephone system. In Paris, if you are not in a hurry, you walk there, and if you are in a hurry, you send a taxi. No sensible person thinks of telephoning. I think a large number of the statements made about the telephones in London are over-stated.

The Postmaster-General did not mention, in his interesting speech, the question of what is called rural party lines. It would be a great assistance if, in making out his plans for the extension of the telephone system, he could specially consider the rural areas. No doubt he is aware that in Canada farms are connected up with the telephone to an enormous extent. Although it is quite true the numbers in America and Canada absolutely outstrip anything here, would this country stand the disfigurement of the streets by the twisted poles that carry the telephone wires, unrestricted by rights of way and property, as they are over there? Of course, it is very much easier to extend the system when you can dump these telephone poles all over the place. But, in rural areas, will the right hon. Gentleman consider the question of connecting farms at a cheap rate? There are also many places where there is a small fishing industry, and there the telephone would save the industry and the fishermen an enormous amount of money. They cannot now get a message through to find out prices, or if so-and-so will take a catch which comes in late at night. There is very often an enormous amount of food and fish ready to be sold, if only there were telephones in that particular fishing hamlet where they could get through to some bigger market. It might be possible to provide this, though it would not exactly be a paying proposition from the telephone point of view, and help enormously a very hard-pressed industry. It would help the food supplies of the country, and a great many small fishermen who find matters very hard and difficult indeed. I hope the right hon. Gentleman, if he is considering any further extension in the matter of facilities, will deal, perhaps with generosity, with these rural areas and fishing places.

At the outset I want to enter a protest against bringing forward question of this importance, involving a large expenditure of public money, at this fairly late hour on a Friday afternoon. This matter calls for great consideration and attention on another day of the week. I am sorry I had not the advantage of hearing the Postmaster-General, as I wanted to raise one or two points with which, perhaps, he will deal when he comes to reply. Like the hon. and gallant Gentleman who has just sat down, I hope the Postmaster-General will develop the telephone service to its fullest state and be courageous enough to bring in a uniform rate throughout the country, so that where extension takes place to the rural areas, causing some loss it may be, that loss is made up from the larger demand in the more thickly populated districts. I look forward to the time when in this country there will be a telephone installed in every house. As I have said before, my experience of our own telephone system is that it is a good deal superior to that which obtains in the large towns of the American Continent.

2.0 P.M.

In the amount which the Postmaster-General is asking for there is, I presume, included the £4,000,000 which has already been set aside, or earmarked for telephone buildings. I hope in the extension and improvements that he is going to consider he will give some consideration to the wretched buildings now used in some of the large towns, such as Coventry, Sunderland, Scarborough and Sheffield. The accommodation for the public and the staff would be a disgrace to any pettifogging tradesman, let alone a large Department of the State. I know this matter has been brought before the right hon. Gentleman by deputations from time to time. I am hoping, anyhow, that some of the money for which he now asks will be expended in this direction. The Post Office has entered into arrangements, it would appear, with Jersey and the Isle of Man to transfer their telephones to the Governments of these islands. Jersey has accepted, and the Isle of Man has refused. Whether or not it is good policy, for the sake of getting hold of a little ready money, to transfer this service from a central authority and set up another system within what we may regard as the British Islands is a matter well worthy of some consideration. I hope also that some of this money will be expended in meeting some of the difficulties in which those people known as caretaker-operators labour. I imagine that might have something to do with the difficulties an hon. Member found when he had to ring up people late at night. People who sleep on the premises have to be awakened before they can give attention to the telephone. There is an agreement between the Post Office and the representatives of the union, that so far as the cost of living bonus is concerned you have to have regard to it in relation to some of these small offices; but the Post Office seem to be getting their own back by putting up the rent, and by charging these people at a rate even above the 40 per cent. allowed under the Rent Restrictions Act. There is one case that occurs to me at Chippenham, where the telephone is installed in a cottage in a by street. The occupant has had her rent increased to Ss. per week, which compares with 10s. for much better property in the neighbourhood, and is an exorbitant price. I hope the right hon. Gentleman will look into the matter with a view to providing better accommodation both for the public and better consideration for those who have to deal with the work.

Let me express appreciation of what the right hon. Gentleman said when he paid a tribute to the efficiency and devotion of the Post Office staff, first as to those who did such excellent work during the trying times of the air raids, and, secondly, to the very distinguished public servant who has just retired, Sir William Noble. It is not always one who has won praise in the higher administration who of necessity receives similar praise from those who have been working under him, but on this occasion I am glad to add the testimony of the staff to that of the administrative heads. Sir William Noble has worked his way up from the bottom, right through the Service, to the head, and he is one of the foremost electrical engineers of the country. He has made a great place for himself, and in that struggle he has always had the respect and esteem of the staff which have worked under him. That in itself is a great tribute both to the Post Office and to Sir William Noble, and I am sure the whole Service will appreciate very much the right hon. Gentleman's tribute to a very distinguished public servant.

Although glad to hear what the Postmaster-General had to say about the underground cable between Edinburgh and London, I was sorry the work is not to be proceeded with at present, for everyone who knows anything about Scotland knows perfectly well that at certain seasons of the year some of the cables are very often destroyed by the storms. It is not an uncommon thing in Glasgow and Edinburgh to find that you cannot possibly get into communication with London and the South of England. It would have been far better, I think, and much more to the interest of the country if, instead of putting in these local cables between London and Bristol, and the other places named, the right hon. Gentleman first of all should see that a cable was laid right from Edinburgh to London, so that in future there should not be that isolation of Scotland that sometimes happens.

A statement as to the rural position in respect of telegraphs and telephones was made by the hon. and gallant Member for the Honiton Division (Major Morrison-Bell). But there are some parts of Scotland where they are much in need of some communication with other places by telephone. I was in Inverness-shire lately, and I was told that in some parts of the country, and especially in the fishing districts, there was no outer communication at all, and the people of these districts are under a very great hardship and disadvantage in having no direct communication with the various towns to which they wish to send their fish. That is one thing the Postmaster-General should try to put right at once, so that these people, though it might cost the country a little extra, may have some of the advantages that London has: but I am rather afraid that until such times as the cables are underground we shall have difficulty. Some morning after a storm we find in some of these districts that we can get no telephonic communication at all, simply because the storm has destroyed for the time being the overhead wires. The whole solution of the difficulty is this, that the wires should be placed underground and that as soon as possible. Personally, I think that we should provide a sufficient sum to do that work. Much has been said about the automatic system, and it has been stated that we are claiming far too much for it. At any rate, the automatic system would make things much better in some of the local districts, and the sooner we get them the better. I was surprised to hear that the average time of waiting for a call is about six seconds. So far as I am aware, having some knowledge of the telephone system, London is the best place to get a very quick connection. I have always been impressed with the method adopted in London, because it is so different in some of the country districts.

I have heard someone state in this Debate that they have had 10 minutes to wait before getting a call. The other day I had to send off a telegram in a hurry, and I took off the receiver and stated that I wished to send a telegram. I waited seven minutes and then I was told to wait a little longer, and after nine minutes' waiting I got on to the post office where they attended to my telegram. The girl seemed so much put about that she took the wrong address, and the telegram did not get through until the next morning. I did not complain, and I simply mentioned the matter to the postmaster, who promised to have it attended to.

Very often there is a great difficulty in getting a call put on. A short time ago I went into the Edinburgh Post Office, waited 45 minutes, and even then I had to go away without getting my call. If the automatic system would alter this state of things, the sooner we instal it the better. I agree that recently things have very much improved. We have been told a great deal about the reduction of charges. I remember on one occasion when I indicated to the Post Office that on account of the high charges I should be unable to keep on my telephone a permanent member of the Post Office staff came to see me and he said: "If you cease to be a subscriber it will mean that nearly every man in your district will give up his telephone." Being a humane man of course I consented not to give up my telephone. The telephone system has very much improved in recent years, but nevertheless we are very much behind America in some respects. I have seen the system in America, and I see no reason why we should not be able to compete with them. The time will come when in every home there will be a telephone. I was struck very forcibly in America with the fact that the working woman could have a telephone for one dollar a month, and she could telephone to the various tradesmen and get all she required, and between the telephone and dumb waiter she had a very good time indeed. If something could be done here to reduce the cost so that we could have a telephone in every home it would be something worth while. On the question of underground cables I hope the Postmaster-General will see the advisability of putting down an underground cable at once between this country and Scotland, in order that Scotland will not be isolated after a storm.

We are all agreed as to the improvement that has taken place within the last few months in regard to the telephone, although I do not think the staff has yet realised what can be accomplished by an extension of the present system. The Postmaster-General is a West Country man, and I hope he will run down in his little two-seater motor-car to some parts of my constituency, and then I am sure he will realise what isolation exists in many parts of his birthplace. I hope the right hon. Gentleman will ascertain from the farming communities what is the best method of extending the telephone system amongst the farmers. I know the agricultural community is somewhat slow in adopting new ideas, but I am sure they would realise the enormous advantage if the telephone was made more accessible in rural areas.

I do not know whether the Postmaster-General has gone into the possibility of adopting the exchange system in connection with rural post offices, so that a farmer would know when he comes to the village that there was within his reach some means by telephone of getting into touch with those with whom they do their marketing. I was very pleased to hear a tribute paid by the Postmaster-General to Sir William Noble, and those who are acquainted with the wonderful development which has taken place under his care in recent years will cordially support what the right hon. Gentleman has said about him.

I want to reinforce the claim which has been put forward on behalf of the rural areas. I am very much afraid that there are some places which cannot be called either rural or urban districts. I wish to make an appeal on behalf of some very small townships in this country which are very badly served with telephones. From the statement which I have heard from the right hon. Gentleman to-day I gather that he intends to concentrate more and more on the large commercial towns of the country, and I wish to appeal for a better system for the small towns.

The Postmaster-General made a very interesting comparison between the telephone service of America and our own, and I am glad to learn that our service is a better one than the Americans have. He did not, however, tell us what were the figures upon which he based that comparison as to the number of telephones in use in the United States pro rata to the population, and the number in use in this country on the same basis. I agree with what has been said as to the difference in the speed and response to calls in the telephone system in London and in the provinces. I would like to know what is the average number of seconds a user has to wait for a call, for instance, in Manchester and in London. I find that the nearer we approach the House of Commons the quicker we are responded to on the telephone. I do not know whether there is any significance in that fact, but it would be very interesting to find out what are the number of seconds one has to wait in Manchester and Liverpool as against the number of seconds we have to wait in London. I thought, perhaps, that the Postmaster-General would tell the House what was happening at Hull in connection with the local telephone system there. We have had in the Press something in the nature of boosting the local telephone system at Hull. Perhaps he will tell us what is the real nature of that system, who runs it, and how it compares with the telephone system under his control. I would ask him not to have too much regard for the claims that are being constantly made upon him to let out all the work of the Post Office to private contractors. I should have thought that the day had passed when a very large and responsible State Department should let out some of its very small, petty pieces of work to private contractors. I imagine that the Post Office can do its work better and probably cheaper than private contractors.

There is a point in connection with underground cables that I would like to put to the right hon. Gentleman. I happen to represent a mining constituency. I can well imagine that some day an underground cable will pass through that district, and I am wondering what arrangements he has made with regard to subsidence in mining areas. Apart from the question of the inconvenience caused by the breaking down of overhead telephone wires, it would be interesting to know what is the cost of taking the wires underground as against keeping them overhead. There is a final point that I desire to make. The Postmaster-General told the Committee that the use of the telephone service was a very sure sign of the business prosperity or otherwise of the country. I can hardly agree with that statement, because the telephones, in the main, are used on the commercial side and not on the manufacturing side, while the prosperity of the country must necessarily rest more on the manufacturing side than on the trading and commercial side. I join with the hon. Member for North Camberwell (Mr. Ammon) in saying that it is rather unfortunate that a very important statement like this, involving the expenditure of £15,000,000, should he made on a Friday afternoon. The Postmaster-General ought to have a very much better audience for such a very important statement than he has to-day. In any case, however, we on this side of the Committee are very glad indeed to see the progress that is being made by the Post Office, showing once again that the State, when it is determined, can challenge anybody else in connection with a business of this kind.

I have heard one or two hon. Members say that they are looking forward to the time when every household has its own telephone. So far as I am concerned, I think if every household had its own telephone, the world would be called by another name. When the Postmaster-General is dealing with the allocation of this £15,000,000, there are a few directions to which I should like to call his attention. There is the case of the farmers. It very often happens that a farmer is expecting some goods by a particular train. He may live five or six miles from the station, and he sends a horse and cart. The goods do not arrive by that train, and the wagon goes back home. They arrive a few trains later, and the stationmaster sends the farmer the usual notification by a postcard. The farmer gets that postcard the next day, but it may happen that it is not convenient to send immediately for the goods. The farmer then has to pay demurrage, and a great deal of time is wasted. The great objection urged in the past against helping the farmers in this matter has been that it is not an economic proposition and that it does not pay. I submit that a State Department is the servant of the public, and, though it may not derive any profit directly, it does help the State and gain a large profit in an indirect way by economising time and bringing more wealth to the country. That is a point which I wanted to make on behalf of the farmers and the agricultural interests.

There is a minor point so far as the whole community is concerned, but a very important point to the individual. Most of us agree with the old tag that an Englishman's home is his castle. I should like to get a definite promise from the Postmaster-General that he will use some of this money to enable every Englishman to say that his home is his castle and that he is going to do away with the pernicious system, especially in the slum areas, of having telegraph posts in back yards to which there are no means of access except through the living room of the workman's home. It is nothing more nor less than a scandal. I cannot put the blame on any individual, but it certainly does not reflect very high praise upon the Engineering Department of the Post Office. I am thinking of one case which I saw a fortnight ago and about which I have been in communication with the postal authorities. We have a blank piece of ground, about half an acre in extent, on one side of the road, and on the opposite side we have the Woolwich Arsenal Government Factory. Yet the one spot that the Post Office must select to stick up one of these confounded telephone posts is a little back yard, about 5 yards square, where the women have to hang their washing and do their work and where unfortunately the children have to play. I do hope the Postmaster-General will allocate some part of this money to get rid of some of these pernicious posts that are blocking up the little back yards of our industrial towns.

There is a great tendency on the part of the House always to blame the Government for everything, but, when we are asking the Government to help us in one way, I think we ought to do them justice and not blame them in other matters. I wish to say a few words on behalf of the rural telephones of this country. My hon. Friend the Member for Northern Lanark (Mr. R. McLaren) asked for an underground cable all the way from London to Edinburgh. We found fault with the telephone system last year because we had to pay a higher price for it. I should like to congratulate the Postmaster-General on having brought it back on commercial lines. We cannot, however, expect him to be able to pay out in every way, and if we ask him to develop the rural system of telephones on economical lines, as carried out in America, we cannot expect him to give us enormous underground cables as well, because it will not pay. I also sympathise very much with the right hon. Gentleman's Department on the question of the difficulties to which the last speaker has referred. When I tried to get the telephone to my own private house in the country, I was held up by all sorts of regulations. The local proprietors would not allow the wires to go over their land, and the wires could not be attached to the trees. We ought to remember these matters, and not ask the Postmaster-General to give us something in every way

I should like him to help us in the way of a rural service on party lines. If he developed the service on party lines, he would get more customers and more money, and he could then put in underground cables. I realise the importance of this very much, because I found in Canada, and we also see here, the disadvantage which follows when there is a snowstorm and wire are broken and communication is cut off. If the Postmaster-General would run the Department on commercial lines and put by a certain amount of money, then, as the demand for cables arose, he could provide them. Run on those lines, it will do more good for the country than in any other manner. I realise also that you cannot expect a new telephone system in the rural districts to pay at once. But in commercial undertakings they put out a certain amount of capital in the hope of getting a return in about five years. I hope that the Postmaster-General will proceed on those lines. I also think it unfair to blame the Government for bringing forward this Vote today. It is not the Government's fault that Members are not here. It is the fault of Members themselves. I hope that the right hon. Gentleman will not hesitate to proceed with these proposals, and that he will have the support of the House in carrying them through.

There are a few points on which the Committee may desire a reply. The first point raised by the hon. Member for North Camberwell (Mr. Ammon) was a rather curious one. It was that this matter was raised at an inconveniently late hour and on an inconvenient day. What is the matter with the day or the hour? I think, on the contrary, that the time selected has given the Committee a full opportunity of discussing the matter. I am gratified that the Government was able to find time to put it down so that it can be discussed to-day instead of in the early hours of the morning. I think that my hon. Friend should try to find a better point than that. The hon. and learned Member for the Cambridge University (Mr. Rawlinson) wanted to be satisfied that this expenditure was going to be remunerative. He wanted to know what return we are getting. What does he mean by remunerative expenditure? This is capital expenditure and will not involve any charge on the State.

I have made it my guiding principle since I have been associated with the Post Office that services must be self-supporting services and these services will be self-supporting, and will provide not only the sinking fund and interest on the capital expenditure, but the new business resulting will be remunerative business. I should not have been a party to these proposals unless I was satisfied that they will be not only indirectly but directly remunerative to the State. The hon. and learned Member also asked, "Why spend money on underground cables?" An hon. Member on the opposite side asked, "Why not put all our wires underground?" You have to make your choice between the two. This is the position. You reach a point at which it pays to put your wires underground. It is asked, "If you save maintenance by putting wires underground, why not put all under ground?" That is stretching the argument too far. There is a certain point at which it pays to put the wires underground, at which reduced cost of maintenance covers the increased cost of putting the wires underground. It does not pay to put wires underground unless there are 14 pairs of wires carried underneath. That represents the economic point, and having regard to the great convenience of having the wires underground and the improvement in the service, I agree with my hon. Friend below the Gangway that it should be our object to get underground as many of our wires as possible.

It depends on the number of wires that have to be carried But undoubtedly in the first instance the cost is heavy. But over a period of time, having regard to the cost of maintenance and the improvement in efficiency of working, it is more than justified. Several hon. Members referred to the question of increasing the facilities in the agricultural districts. The hon. Member for Gains-borough (Major Molson) especially, took the point about rural party lines. That is really the way by which, as far as I can see at present, the difficulty of providing telephones in agricultural districts will be solved. There has been in this country great prejudice among our agriculturists against the rural party lines. They are suspicious of other people hearing their business. That is why the rural party line has been so slow in taking on in this country. But that prejudice is breaking down rapidly and great progress has been made within the past year in the provision of rural party lines. The total number of fixed stations at the end of April was 3,747, an increase of nearly 50 per cent. in the year. During the month of April 204 new subscribers were added. Colonel Orlebar is joining the Post Office Committee, and I shall certainly use his advice and experience in doing everything that can be done to bring home to the rural population the fact that this is the cheapest form of telephone that can be provided. It has drawbacks, but you have to compare them with the advantages. Seeing that the system is almost universal in the rural parts of Canada and in many parts of the United States, I hope that the prejudice against it will quickly disappear.

Since 1st January this year 245 call offices have been opened in rural districts, and at the present time there are 225 rural districts where call offices have been authorised, but not completed. The progress is steady and indeed rapid. I admit that I was first brought to realise the. importance of improving telephone communications in the countryside by representations made to me in my own constituency. As the result of inquiries which I then made, I was able, with the advice of the Department, to make proposals which have resulted in a very rapid improvement in the provision of facilities, but much more requires to be done. I think that the proposals which I outlined to-day will have a very useful effect in increasing the provision of telephones in this country. Referring to the aspirations of some hon. Members that the time may come when every house in the countryside will have its telephone, that is looking a very long way ahead. I do not suppose that there is the possibility of any postmaster being able to justify to the House any such far-reaching proposal as that. I believe that the solution, if it is found, is going to be found by some technical improvement. A proposal has been made to me by a very ingenious and far-sighted man, by which you would have an automatic system in the countryside where the exchange would be no larger than an ordinary row of bookshelves in a room about 15 feet square. He told me he thought it was within the range of possibility to have a complete exchange working automatically within dimensions of that order, without, any operator being necessary. It is along those lines, I believe, that we shall solve the rural problem and be enabled to put a telephone into every house in the countryside. We have to look for technical developments and improvements, for new inventions, for the application of ingenuity to these ordinary everyday difficulties, before we can really realise my ideal of a telephone in every house in this country.

I do not rule that out in some circumstances. I was asked what figures there were showing the comparative use of the telephone in the United States and in this country. I am not satisfied with our position in that respect, and the Committee will not be surprised at that when I tell them that in the United States there is one telephone to every eight of the population, while in this country there is only one to every 47. We have a good deal of leeway to make up. My hon. and gallant Friend the Member for Woolwich (Captain Gee), raised a point which I must say was strange to me, and in regard to which I am not fully informed, as to a telephone pole in someone's back yard. I will try and identify the back yard and the telephone pole, and see if something can be done to remove that inconvenience. I should like to thank the Committee for their very friendly reception of the proposals I have made, and to thank them on behalf of the Department for the appreciation they have shown of the improvement in our work.

Will anything be done to bring about an increase of efficiency in the villages in Scotland?

I take those villages as being covered by what I have said about the countryside.

Question put, and agreed to.

Resolution to be reported upon Monday next.