Chapter XXXV: Appendix: H

[See p. 347.]

UNIFORM PENNY POSTAGE.

_Facts and Estimates as to the Increase of Letters._

The only point connected with uniform Penny Postage on which there appears to be any material difference of opinion is as to whether or not the revenue will suffer by the proposed reduction.

The plan will stimulate the increase of letters in two ways. First, by the increased facilities of despatch of letters;—second, by the great reduction of postage.

INCREASED FACILITIES.

Many facts were proved in evidence before the Postage Committee which render it clear that even at the same or higher rates of postage, increasing the opportunities of despatching letters, and the rapidity with which they are transmitted and delivered, always increases the number sent.

1. Palmer’s adoption of mail-coaches, though accompanied with repeated _advances_ of postage, increased the number of letters three-fold in twenty years. And

2. The new facilities of transmission afforded by the Manchester and Liverpool railway, increased the number of letters between the termini nearly fifty per cent. in six years; postage remaining the same.

3. Although not substantiated before the Postage Committee, it is understood that the recent establishment of a morning mail from London to Brighton has produced a similar effect.

4. It appears from the valuable work of M. Piron “_Sous Directeur des Postes aux Lettres_,” that a reduction in the time of transmission from Paris to Marseilles, from 118 to 68 hours, has doubled the number of letters.

REDUCTION OF POSTAGE.

This is relied upon as by far the most efficient cause of increase in the number of letters.

It has been found that the decrease of price in any article of general demand, so far from lessening the amount of the public expenditure on such article, has always increased it.

1. “The price of soap, for instance, has recently fallen by about one-eighth; the consumption in the same time has increased by one-third. Tea, again, the price of which, since the opening of the China trade, has fallen by about one-sixth, has increased in consumption by almost a half. The consumption of silk goods, which, subsequently to the year 1823, have fallen in price by about one-fifth, has more than doubled. The consumption of coffee, the price of which, subsequently to 1823, has fallen about one-fourth, has more than tripled. And the consumption of cotton goods, the price of which, during the last twenty years, has fallen by nearly one-half, has in the same time been fourfolded.”—_Post Office Reform_, p. 70.

2. The sale of newspapers for the twelve months before the late reduction in stamps was—

35,576,056,[379] at an average price, say of 7_d._, costing the public £1,037,634.

For the twelve months subsequent to the reduction, it was—

53,496,207,[379] at an average price, say of 4¾_d._, costing the public £1,058,779.

3. The annual number of advertisements before the late reduction in the advertisement duty, was—

1,010,000[380] at an average price, say of 6_s._, costing the public £303,000.

It is now—

1,670,000, at an average price, say of 4_s._, costing the public £334,000.

4. The number of persons paying for admission to the Tower was, in the ten months prior to the late reduction—

9,508, at 3_s._, each (including the Warder’s fee), = £1,426.

In the ten months subsequent to the reduction it was—

37,431, at 1_s._ each, = £1,871.

The rule established by these facts, viz., that the demand for the article increases in a greater proportion than the price decreases, so that if one thousand are sold at 1_s._ many more than two thousand would be sold at 6_d._, is, it is believed, without exception. Certainly the article of postage does not furnish one.

“The reduction of the Irish postage rates which was made in 1827, was immediately followed by a considerable increase in the Irish Post Office revenue, though precisely to what extent it would be difficult to state, owing to a transfer that was made at the same time of certain receipts from the English to the Irish Post Office revenue. An alteration was made in the year 1831, which was equivalent to a partial reduction, by exempting the correspondence of a portion of the metropolis, which had paid the General-post rate, from paying an additional Twopenny-post rate. Consequent on this reduction, though at first attended with some loss, the Post Office revenue was improved to the amount of £10,000 a year, instead of there being a loss of £20,000 a year as had been expected by the Post Office. A reduction made in 1835, on the rates of ship-letters, has been followed by a considerable increase in that branch of the revenue.”[381]—_Third Report of the Select Committee on Postage_, p. 29.

PRACTICAL EFFECT OF REDUCTION TO ONE PENNY.

The postage of letters between Edinburgh and the adjacent towns and villages was, in 1837, reduced from 2_d._ to 1_d._ In rather more than a year the letters had more than doubled, and were on the increase when the last returns were made.[382]

Postage between Stroud and Nailsworth in Gloucestershire was recently reduced from 4_d._ to 1_d._ The number of letters has already increased about sixfold.

FUTURE GROSS REVENUE OF THE POST OFFICE.

There seems, then, no rational ground of fear that the gross revenue of the Post Office will be diminished.

On the contrary, its increase might be safely predicted, even if no other change was contemplated than the proposed reduction. But taking the proposed additional facilities for the despatch of letters into account, the increase of the gross revenue may, at no distant period, be fairly expected to be considerable. Many persons, competent to form a sound opinion, think such increase will be very large.

FUTURE EXPENSES OF THE POST OFFICE.

The proposed changes will operate partly to increase, and partly to decrease, the cost of the Post Office.

The _increase_ will arise out of the additional number of letters passing through the post.

The _decrease_, chiefly from the postage being paid in advance, by means of stamps.

The _balance_ will probably be a comparatively slight augmentation of expense, which, it is confidently expected, will be more than compensated by the increase of the customs, excise, &c., produced by the stimulus to commerce, consequent on the cheapness of postage.

_There is, then, no just reason for believing that the proposed reduction in Postage will at all diminish the revenue of the country._

Below I have drawn out an estimate of the course which things may probably take after the proposed change, on the supposition of the gross revenue remaining the same as at present. I have perhaps undervalued some sources of increase, and overestimated others. I do not place much reliance on the details, but I have great confidence that the general result will hereafter be found below the truth.

_Estimate of the Mode in which the required Increase of General
Post Letters may be presumed to take place._

_From the present Letter-writing Class_—

Present number of chargeable General Post Letters, call this 1

Contraband Letters, and evasions by writing in newspapers,
&c. (Estimated by many at double the Posted Letters,
but consider it equal only) 1
---
Total of Letters now written 2

Assume the rate of increase to be only 2 to 1 2
---
Estimated Return General Post Letters, from the present
Letter-writing class 4

Invoices—(Estimated by Mr. Cobden, and other mercantile
men, as equal to the present Post Letters—say half only) ½

Additional printed circulars, catalogues, small parcels, &c.,
say ¾

Letters from numerous classes, who may now be said not to
use the Post Office at all, say ¾
---
Required increase of General Post Letters to sustain the
gross revenue (Vide _Third Report_, p. 55.) 6

That is to say, an addition of five fold.

ROWLAND HILL.

Bayswater, July 1, 1839.