power of each individual citizen taxed to the greatest extent; and therefore every Englishman is concerned in the progress of this system. The real question is, how can we best promote the march of co-operation? Now, will you allow me to show you that, notwithstanding all the progress which co-operation has made, there is no prospect of any really great work being done by it, until we can enable the men to co-operate with the masters. It really requires a sum of something like £5,000 at the very lowest amount, to provide a capital which shall employ 100 working men. Now, if the working men can only raise £50 or £100, how is it possible to employ many of their number on the principle we are now following? What I want to show you is this, that co-operation, with all its wonderful results, so far, cannot be carried out in this way, with the prospect of producing adequate results. Take the case of Rochdale. There, 28 men, with a capital of £1 each, or £28 altogether, commenced the business, and it now shows an aggregate capital of something like £150,000. Still, it would take the whole of this and the next generation of working men to be sacrificed under the present system, before they could have a vital interest in the concern. It appears to me that the mistake which co-operators are making, is to suppose that capital is to be obtained for their concerns, at the rate of 5 per cent. At present, in all the concerns that have been started, they place 5 per cent. for the interest of the capitalist against the wages of the labourer. But that 5 per cent. does not pay, and will not pay for the risk incurred by capitalists in working a commercial speculation. You must, as Mr. Holyoake well said, offer the capitalist the average dividend he can earn in manufacturing concerns of the sort which it is proposed to establish; and therefore our proposal is, as very fairly described by Mr. Holyoake, that the masters shall take to themselves the average sum which they fairly expect to get as interest for their capital, and as remuneration for the risk they run, and that above that they should divide with their workpeople. Mr. Briggs, in the small pamphlet he published on the subject, mentioned that, if they could only get large coal instead of small coal, they would save £1,500 a year, and if the men were only careful in separating the two kinds of coal before they were brought to the surface, they would save another £1,500. The entire capital necessary to work that immense concern, is something like £60,000, so that they could actually ensure a saving on these two items alone, of 5 per cent., by a small expenditure of care on the part of the men. In various other ways also, the two parties could assist each other, and a large dividend above the present rate of profit could be made under this system. My own firm has been named in connection with this subject. I may say that some time ago I contemplated taking this step, and talked it over with my brother, and we came to the conclusion that we could before long introduce the system amongst our workpeople; but in order to prepare them for it, I formed a committee of the workmen themselves, and invited them to tea once a week, and very gradually we talked matters over. On our part, we were most conscientious scolders and grumblers, and we explained as well as we could all the various things with which we had to find fault. After a time, I said, "I am coming to the conviction that we will never do any good until we make you all partners." The men left, and the thing was very soon noised abroad. When at last I made the proposal definitely to them, there was not a man who was not prepared to take shares as soon as they could have them. We have arranged, as Messrs. Briggs have done, that the men should form clubs amongst themselves, selecting their own treasurer, who will receive their savings, so that they may be able to buy a share week by week as their funds accumulate. Yesterday, in this section, you had a gentleman who has done more perhaps to introduce the limited liability and joint stock companies principle into such concerns, than any other man in this kingdom-Mr. David Chadwick; and I see that he thought it sufficient to form the various large concerns into joint stock societies, and the working men might become shareholders. I wish Mr. Chadwick was here, as I would have found fault with that. It seems to me that in all the individual firms and companies with which he has had to do, he has erred by making the shares too large, not less than £100. Now, where a working man is to get £100 in order to pay for a share, I can't tell. I would suggest to him that the shares should never be made more than £5; and that the men should be induced to come in by giving them a share in the surplus profits. But in order to cure Mr. Chad wick of this

prejudice, it will be necessary to convince the shareholding public also, who are his clients. In some of his largest companies, like John Brown & Co., a very large number of noblemen and ladies hold large amounts of stock; and if we could persuade the parties taking the shares that it is for their interest to admit the working men also to share in the profits, we would have Mr. Chadwick doing something more than he is doing at the present time for the improvement of the condition of the working classes. The remark made by Mr. Steinthal is a very correct one, that the comparative failure of the experiments in the cotton trade, is very much due to the exceptionally bad time at which they were undertaken. It is quite true, also, that so sure are the co-operators themselves of the return of prosperity now, that they will not part with their shares except at something like par; and the masters are themselves buying shares in co-operative mills, and are even paying a premium on them at the present time. I was speaking the other day with a very intelligent man in the cotton trade, who said, "I have recently had to go through the length of Lancashire, and have looked at the new mills, and I am bound to say that the mills erected by co-operative societies are the best arranged mills of any, and are most likely to prove profitable." This system, I would say in conclusion, has afforded a common platform on which we can all meet determined to go forward to that better future which we believe the Father of all has in store for us.

Mr. EDGAR: The committee of this department, in preparing their report for the year, mentioned the new partnership Act, which allows the introduction of the limited liability principle, without the necessity for the concern being converted into a joint-stock company. They thought that was a matter which might be considered with advantage in connection with this subject. It has not been adverted to by any of the speakers, but I believe the committee are anxious to know what you think of the probable effect of that Act. I am quite clear that it would avoid all the formality of changing the business into a joint-stock company, and although I think the joint-stock company system is, on the whole, the best, yet there are some cases where it appears to me that the Act would be very valuable and very beneficial. You might, for instance, give a share in the profits to a man, under this Act, without his putting in any capital at all. Then, with regard to many small businesses, where it might be scarcely worth while to divide, the Act, it appears to me, might be beneficially used; but if you, Mr. Greening, would give us any information at all on the matter, I think the committee would be obliged to you.

Mr. GREENING: As regards the probability of that Act being made useful, I think there is a defect in it which will prevent it coming into general operation. The capitalist, who lends his money to the manufacturing working man, must not come in as a creditor until every other creditor is paid 20s. in the pound.

Mr. EDGAR: I referred rather to the case of a man carrying on business, who chose to give a share in his business to his own workmen.

Mr. GREENING: I took it for granted that you wished me to speak on both sections. As to the probability that under that Act masters will give some share of their profits to their workpeople, I think it is likely that that to some extent will take place. It has long been the custom in the Manchester warehouses to give the head man a bonus on the turn-over. That system is rather vicious, as it induces the men to force sales. No doubt many masters will avail themselves of this Act to give their managers an interest in the profits; but it will be rather to the managers than to the men. I am afraid the new Act will scarcely do that good which was expected of it, in its present form. Even supposing that masters, under the Act, were to give a share of their profits to the men, it will not operate so well on the men as if you make them actual partners in the concern, and make what they will receive depend upon the excellence of their work.

Mr. HUGHES, M.P.: I am delighted to hear what is taking place so rapidly, because I am quite certain that exactly what was wanted in the old system of co-operation-which was started in this country some twenty years ago, and in which I took an active part at that time-that the element which was then wanted was the skill which the masters bring to bear. Most of the associations which were founded at that time had the other elements of success in them, but, in consequence of having to employ men who simply knew their own work as buyerą

and as sellers, and not all the higher turns of trade, almost all these productive associations failed; and, therefore, I am naturally delighted to find that the work is going on even much more rapidly than I knew. I would like to know if either Mr. Solly or Mr. Greening can tell us whether any of these new companieswhich I believe to be the real solution of the great problem-have been going on long enough to give in returns, that we may know whether they are working as well as was expected, and what are the results.

Mr. GREENING: The colliery of Mr. Briggs has now been at work on the new system for two or three months, and he says the men are working better, and realising a larger profit than under the old system; that the men are subscribing for the shares at £1 per week, the shares being £10, and in that way are rapidly becoming large partners in the concern. My own business has just been formed on the new principle. It has been done among my own friends without publicity, and we are only really beginning to work, but I think I can see a better feeling, and that we are working better and more profitably for each other since then. I was recently speaking with Mr. Stephen, of Messrs. Sharp, Stewart, and Co., of Manchester, and he says they have formed a council of their workpeople in the same way, with the happiest results.

Mr. SOLLY: The Messrs. Crossley have been working on that system for a much longer time than any that have been mentioned, and are working very satisfactorily; but they do not give the bonus-they pay every working man as a shareholder, so far as he takes up shares.

Mr. HUGHES, M.P.: The system of co-operation was tried in France twenty years ago most successfully. But the men in France seem to have a greater aptitude for association than they have here; at any rate for association for the purposes of production-perhaps not so in the case of distribution.

Mr. FISHER, Waterford: In France, as in this country, there have been a great many failures and a great many successes. In France, wherever there was a large capital required, the result has generally been the same as here, but in most of the cases abroad the capital employed had been small, as the articles produced and distributed were mostly for local use.

Mr. THOMAS WEBSTER, Q.C., F.R.S.: I cannot but feel that the question that has been introduced here is really a solution of the difficulty, in what way the working man can have an interest with the capitalist so as to be independent; I think the success that has occurred in the instances that have been referred to is most satisfactory. I care nothing for a failure; we learn more from a failure than from a hundred successes. Let us have one or two failures, and then we can have a diagnosis of the whole matter. The interest of the working man, the way in which he can be made independent in the contest now going on between capital and labour, is the most interesting question to which society can direct itself. I am not an employer of labour myself, except in the ordinary way of having a few servants and dependents, but I have always sympathised most deeply with the working man. I do think that whatever phase the question may assume, it is incumbent upon us as philanthropists to consider in what way the working man will get one step, so to speak, on that ladder of capital by which alone he can be raised; and I believe no single plan has yet been devised that is at all comparable to this. I look on what has passed to-day as the most satisfactory proof that has ever been given of the success of that principle of limited liability for which we struggled so many years, and I would point to this as the consummation of it. It is by means of shares, I care not of what denomination, make them as small as you will, but so long as you give the working man a share of some kind or another in the business of his employer, you make the interest of the employer and the employed identical, and get over that prejudice which too often exists against the improvement of the working man. Some reference has been made to the peculiar position of the working man with respect to the question of the introduction of machinery. Now we know full well that, in the first instance, the workmen have been opposed to the introduction of machinery, but they are now becoming much wiser. Let them only be referred to the existence of the sewing machine, by which the condition of the persons hitherto employed in doing the work the machine can do is very much improved, and they will be satisfied of this, that for a human hand to do what a machine can do is a bad economy, and a bad applica

tion of labour. By these means we shall be able to give the labourer a property in his labour. That is what I have always looked forward to as a great object which we ought to have achieved. We cannot give him land, but we can give him a property in what he has an interest in, and by means of this system it appears to me we can give every man a property in his labour, we can raise him in the social scale, and we can make him feel that we are all as one body, though many members.

Is it desirable to consolidate the existing Railways of the United Kingdom into one system under Government control? In addition to Mr. Edwin Hill's paper, which will be found at p. 487, Mr. Plimsoll read a paper, of which the following is an abstract:

AFTER remarking that in England we appeared to have accepted the present results of the railway system almost without considering whether any improvements could be introduced into it, he urged that the system was capable of yielding a vast augmentation of service to the country at a scarcely appreciable increase of cost.

The statistics of the actual cost per mile of working all trains in 1863 were cited, and a statement of the average number of passengers and weight of goods carried was supplied.

The results in respect of carriage of passengers and goods might have been multiplied many times without adding appreciably to the

expense.

Whilst, therefore, it was clear that the railway companies could not do with a less revenue, yet for a very slightly increased one they could render the public, with positive advantage to themselves, treble or quadruple the service.

Facts were introduced to illustrate the assertion that a reduction of present fares and freights would be followed by the increase of business sufficient to maintain the present financial position of the companies.

Having thus indicated the object to be attained (greatly reduced rates), and the grounds upon which it might be urged as not unreasonable, the case of the shareholders was considered.

In the event of the provisions of the Act of 1844 being carried into effect, their property would be paid for at the rate of 25 years' purchase of the average of the three years' dividends last preceding the transfer.

The Act at this juncture served two good purposes; it precluded any idea even of injustice, in case its provisions were called into action, and its expiration invited a more general and simultaneous consideration of the subject than it would probably otherwise have received. It had been argued by some, in view of the expediency of adopting the provisions of the Act, that, while on the one hand Government could well afford-by means of the great gain they would make in the purchase, from raising the money at 3 per cent.

and getting a return of 4 per cent. (25 years' purchase)—to try "the great experiment of the greatest possible cheapness," and would moreover be supported by the public in incurring a transitory deficiency, as in the case of penny postage, for the sake of the enormous advantage to the country of so greatly reduced rates; yet, on the other hand, it would be in the highest degree unreasonable to expect private companies to incur even a temporary loss for the advantage of the public.

It was concluded by them, therefore, that that degree of cheapness could only be obtained as a result of the purchase of the railways by the Government.

A further argument was, that unity of management would result in greater economy.

So far as he, Mr. Plimsoll, could see, all the advantages of cheapness obtainable from unity of management were already achieved by the process of amalgamation, as to at least three-fourths of the railways now constructed; and any further progress in the direction would not be economical but wasteful in the highest degree, since it would probably result in decreased efficiency of management.

Was then the greatly augmented cheapness of fares and other matters, (which all agreed would result if railways were managed with the sole aim of giving the utmost possible benefit to the public, compatible with payment of expenses and interest of capital, instead of, as was very properly the case now, with an exclusive regard to the shareholders' interests), unobtainable except by means of the purchase of the railways by Government ?

It did not appear to him that to secure that great boon for the public, so extreme a step as the purchase of our railways by Government was essential. He suggested that a Government gurantee, securing the companies against a diminution of revenue during the period of transition necessary for the growth of traffic to as high a revenue from a diminished rate as that now obtainable from the high ones, was all that is necessary. We thus got rid of the purchase, for which the public mind (at any rate for the present) was not ripe. Even that liability might be diminished.

The total receipts of the railways in England and Wales (but excluding Scotland and Ireland) in 1863, was £26,212,822, of which £10,878,635 only was from passenger traffic.

While all traffic would respond to reduced rates by augmented quantity, the passenger traffic would undoubtedly prove most sensitive and respond most promptly. To try the great experiment, therefore, as to whether a greatly reduced rate would yield as good results as the large one, it was not necessary to try it upon the whole of the traffic, it would suffice to try it with the passenger traffic; we thus reduce the dimensions of the risk to the lower sum, £10,000,000. It was not needful to try it on all that. First class passengers needed, as a class, no great help. Thus, by limiting it to the second class, producing in gross £3,773,684, and the third, producing £2,868,221, we arrived at the diminished total of £6,641,905.