STATE OF THE STEAM-MARINE: THE GOVERNMENT CONTRACT SYSTEM.

TO TRH EDITOR OF TUE SPICTATOR.

London, 234 May 1342.

SIR—In bringing forward the Navy Estimates, the Secretary of the Admi- ralty took occasion to allude particularly to the large sums of money required under the contracts entered into for the conveyance of the North American, West Indian, and other mails beyond sea; informing the House at tbe same time, of an addition of 20,000L per annum on the Halifax contract, and giving the contractors for the West India mails the agreeable intelligence that they are not to be confined to the letter of their contract : and last wed the House voted 400,000/. odd for this service, without remark.

Considering the contract system bad in principle, destructive of private en- terprise, detrimental to improvement, and most injurious to our naval service, 1 beg to trouble you with a few observations on the present state of our Steam Marine.

The great stride made of late years in steam-navigation maybe said to have dated from 1834, when the facts and opinions elicited before the Select Com- mittee of the House of Commons on steam-navigation to India set people thinking and scheming on the subject. It is curious now to look back at the pitched battle then fought between the practical men, headed by the Admiralty and Admirals, and the mere theo- retical shore-goers, led on by the representative of the East India Company ; the maximum of a steam- vessel for the Red Sea communication, advocated by the former, being one of 950 tons and 120 horse-power, and the minimum of the latter, one of 600 tons and 200 horse-power. Fortunately for the cause of steam-navigation and the comfort of our East India friends, the East India Company earned their point, and built the Berenice and Atalanta, two of the finest vessels of the day. With these vessels a continuous steam-voyage was made to Bombay, at the rate of nearly two hundred miles per diem excluding the stoppages for coals ; proving the important fact, that in case the passage through Egypt was at any time stopped, a regular steam-communication to our East Italian possessions could be carried on by relays of vessels in sixty or sixty-tire days. This I consider to be the first great stride in ocean steam- navigation, opposed as it was by every naval man in or out of office.

The next step proposed was the passage of the Atlantic, equally opposed by practical men, from the First Lord of the Admiralty down to their scientific coadjutor, Dr. D1ONTSIUS LARDNER.

Fortunately, the projectors of Transatlantic steam-navigation were as obsti- nate in the pursuit of their crotchet as the East India Company had been in theirs ; and steam communication between the Old and New Worlds was established in 1838, by private enterprise alone, without Government patron- age, assistance, or countenance, in the face of a determined opposition on the part of the American trading interest, and against the expressed opinion of all naval authorities.

The practicability of making long sea-voyages in steam-vessels having been thus established, in the one case by the East India Company, in the other by private individuals, in both against the opinion of the practical men of the day, the Government were fumed into action ; and had three courses open to them-

1. To keep this improved method of conveyance in their own hands, by em- ploying in it her Majesty's steam-vessels; 2. To encourage private enterprise by giving to all private steam-vessels the postages collected by her Majesty's Post-office on the letters they carried ; 3. To Make contracts with private individuals for the conveyance of the mails.

They dose the latter, and commenced that extended contract system of which I complain. Tl:e contracts I more especially refer to are the North American, or Cunard's; the West Indian, or Royal Mail Company's ; and the Alexandrian, or Penin- sular and Oriental Company's. These three contracts amount to 354,4001.; and all epiang from the Indian and Atlantic voyages, which I have character- ised as the two great strides in ocean steam-navigation. Of these three contracts, two were private, the North American and West Indian ; the other was open to public competition. The history of the North American contract is such a warning to all that may hereafter he tempted to improve any given line of communication without first securing the Government support and favour, that no apology is necessary for going into detail upon it. In 1b38, the passage to the United States had been successfully made by two vessels, the Sirius and Great Western ; and four other vessels were build- ing or fitting out for the trade. In March 1839, the Government invited tenders to convey the mails monthly between Halifax, Boston, and Great Britain, in vessels of not less than 300 horse-power, to commence on the 1st of May next ensuing, and for one year only. Of course they had no tenders, as there were not vessels in existence at that time to tender for such service, of which they were aware ; and if there had been, none would have been mad enough to tender them for one year only.

Malting more was heard of the contract; and it was naturally supposed it would be carried into effect by Government-vessels; when, to the astonishment of the proprietors of the Great Western and other steam-vessels, who little dreamed what was in store for them, out came the North American contract, given to the lucky Mr. CUNARD, (a gentleman who had never risked a penny in establishing Transatlantic steam-navigation,) on a totally dif- ferent Lewis to that offered to the public. They were offered a contract for one year—the favoured individual got it for seven; they were to com- mence immediately — he had time allowed him to build his vessels; a monthly mail was offered in the one case— twice a month given in the other. At that time 60,000/. per annum was considered a large sum; and Mr. CUNARD immediately sold the half of his contract for 25,0001 profit. Finding that the winter-voyages were not likely to be profitable, the Government, at his request, gave up a double mail for the four winter-months, the very lime when mast wanted to the mercantile interests which was equivalent to making him a present of 10,000/. per annum ; and finally, the very day before the late Government left office, they cancelled the contract, and entered into another, giving this fortunate individual 80,000/. per annum for actually doing less work than be contracted to do for seven years for 60,0001.* And further, in order to destroy all private competition, and to secure their favourite in the monopely of the line, they granted him a second contract of 80,0001. per an- num whenever be chooses to run four times a month during the summer and twice during the winter.

The Government patronage, however, has not enabled their favourite to equal the Great Western ; his packets having been (considering the dates at which they were respectively started) shamefully beaten by that vessel whenever they came in competition with her. As far as the opinion of the public goes, it was um quivocally expressed last week. The Halifax packet, carrying tier Majesty'a mails, sailed on the 19th with less than twenty passengers; the Great Vs eetern sailed on the 21st with sixty-seven; both charged the same passage- money ; the Great Western also took mails, hut did not get paid for them. Some large proprietors in the West Indies, naturally desirous to improve the value of their plantations, projected the Royal Mail Steam-packet Company ; and by calling in the assistance of some clerk in the Mail department of the Fos-office, who fancied the Atlantic could be as regularly and as easily traversed as a turnpike-road, laid before the Government a plan for delivering the mails on a given day m

and at a certain hour, (a. en. or p.., as the case might be,) at all the British, American, and West Indian ports between Hali- fax and Demerara, backwards and forwards ; touching here and stepping there punctually to the hour and minute set down in the guide-book, giving to all the inestimable boon of a post-communication with one another, and with the Mother-country once a fortnight ; all to be done by royal charter, exclusive privileges steam-vessels of 1,900 tons and 450 horse-power, and the small sum of 240,000/. a year. No wonder the Government could not resist such an offer. The contract was given, the vessels are at work, and the next six months will show what the result will be. It is hardly fair to prejudge, but God help them if her Majesty's Government keep them to their contract! They have the precedent of Mr. CUNARD before them, and I trust will make good use of it : indeed it was currently reported that the late Government were prepared to act towards them in the same generous manner, and surely Sir ROBF.RT PEEL will not grudge out of his expected surplus to do that which they did out of an ascertained deficiency : in the same ratio with Mr. COWARD, it will only be 120,000/. per annum additional, and dispensing with one-sixth of the work they have undertaken to perform.

The principle on which these two contracts were given to the contractors was that of avoiding all competition; both were sops to Colonial parties who had Parliamentary and other influence. The Mediteranean not being a Colonial interest, was an open one, and I have every reason to believe fairly con- tested : it can only be oljected to on other grounds.

Now for the results of the contract system. It is bad in principle. No one objects to her Majesty's Government carrying the mails in her Majesty's vessels. This exclusive right to collect and convey the public correspondence has been long asserted : but the case is widely different when the Government gives private individuals a bonus to oppose others, and strikes at the main- spring of our commercial greatness—" private enterprise "; and that, as far as steam-navigation is concerned, it has already most effectually destroyed. There is not at present a sea-going steam-vessel building for private individuals (non- contractors) in the United Kingdom. All the companies who risked their money in establishing the Transatlantic steam-communication are bankrupt ; not by any act of their own, but by an arbitrary act of the Government, which they could neither foresee nor prevent. And after the way in which they have been treated, no man in his senses will ever project an improved line of communication without a Government guarantee that he is not to be ousted, after trying the experiment, by some of the favourite contractors.

It is detrimental to improvement. Granting (which I do not) that the Halifax and West India packets are superior to any thing yet constructed, the Government and the public are tied down to use them for seven and ten years. Now, compare any of our steam-vessels built in 1831 and 1832 with a steam-vessel and steam-engine of the present day, and you have the state our Royal Mail packets will be in when compared with others in 1852. In this novel and rapidly-improving science, the public are tied fast for a term of years to the present standard. Does any one suppose that if a company had ten years since got a contract to carry the mails to Gravesend, that we should have had boats on the Thames this day going fifteen to sixteen miles an hour? Every company who have contracts for a term of years have a direct inte- rest (larger or smaller, in proportion to the capital invested in their vessels) in keeping back all improvement.

It is injurious to our naval service. In case of war with America, or any

sudden outbreak in Canada, we have not in the British Navy a single steam- frigate that could be calculated on, with any certainty, to carry a general, much less a regiment, to the scene of action in fifteen or sixteen days. It was tried in her Majesty's steam-frigate Styx, a new vessel cried up as perfection ; and Sir CHARLES BACOT was glad to get safe back to Portsmouth and embark in the Illustrious, 74. It is necessary to send an Ambassador Extraordinary in hot haste to the United States; and the quickest public conveyance at com- mand is not a steam-vessel, the newest and completest triumph of man's skill over the elements, but a fifty-gun frigate that takes two months to the passage. And why is this ? Simply because the Government vessels are never brought into competition with others. They have given up to contractors the arena in which they would have tried the speed and excellence of their vessels in competition with private enterprise ; and as every steam-frigate sails fast by herself, her commander reports in raptures of her performances, and the Government hug themselves with the idea that they have a fine class of steam- frigates, with their contract-vessels to fall back upon. The first naval war will awaken them from this dream. It was said of the donkey frigates, that they could neither fight nor run : it will be found, should a war break out, that our steam-frigates can fight but cannot run and our contract-vessels can run but cannot fight. A perfect steam-frigate should be able to do both, as it is evident that in steam-boat warfare the fastest vessel will always have an im- mense advantage over her opponent.

The contract-system is justified on the ground of its superior economy. It could be easily proved that it is not so; but, granting that a few thousand pounds are nominally saved, is it not bad national economy to adopt a system that paralyzes private enterprise, stops improvement, shuts out our naval offi- cers from the Atlantic—the finest field in the world for perfecting their educa- tion in the management of steam-vessels—prevents all comparison or competi- tion with private vessels, the best assurance for improvement, and has filled our naval service with such vessels as the Styx and the Gorgon ? If Government had kept the Halifax, West Indian, and Mediterranean mails in their own hands, the public would have insisted on vessels equal to the service being kept up; private individuals would have competed successfully with them ; and the finest class of steam-frigates in the world would have been created by that competition.

It is stated to be the intention of the Admiralty to turn a thirty-eight-gun frigate into a steamer by lengthening her amidships. This ingenious plan for spoiling a good sailing-ship and making a bad steamer has not even the merit of novelty to recommend it : it was adopted on a small scale in her Majesty's service years ago, when some gun-brigs were cut and lengthened, and acquired the bad properties of both classes of vessels. If I had not been deeply impressed with the importance of this subject, I would not, Sir, have troubled you with so long a letter ; but it must be evident to every person who reflects on the late operations in Syria and China, that the result of the next naval war will hinge upon the steam-marine ; that our national safety and honour will be dependent on the efficiency of our steam- vessels of war ; and that that efficiency is already affected and is likely to be more so by the contract system I think I have shown. I remain, Sir, your most obedient servant, CERBERUS.

• Note. —Mr. CUNARD'S contract, therefore, stands thus— Original contract for a mail twice a month to and from Halifax and Boston 00,000 per ann. The four winter-voyages given up by the Government,

in the most handsome manner, saved him at least 10,000 The additional grant announced the Secretary of the

Admiralty 20,000 £90,000 per ann.

If the combined characters of Mr. CUNARD and the late Government did not stand above suspicion, this would look like slob.