Chapter XXIV (2)

Following, as heretofore, that mode of accounting which for the purpose of comparison it was still necessary to retain, viz., the one in use at the time when penny postage was established, the results, in round numbers, may be briefly stated thus:--

The gross revenue increased from £2,700,000 in 1854 to £3,300,000 in 1859; but as the cost of management increased in the same period from £1,500,000 to somewhat more than £1,900,000, the increase in the net revenue was somewhat less than £200,000.[155]

_Expenditure: Causes of Increase._

As already shown, the chief increase in the cost of management was referable to the following causes--increase in the staff, consequent on the great multiplication of correspondence (by that time seven-fold its original amount); increased salaries and allowances; the extension and ramification of the postal system (already affording collection and delivery to almost every village in the United Kingdom); the expense of increased facilities and conveniences afforded to the public; the costly acceleration of the more important mails; and, lastly, increase in the charge for mail conveyance consequent upon its transfer from mail-coaches to railway trains. It is obvious that several of these causes of expenditure have no reference whatever to Penny Postage, but must have arisen had the old rates been maintained.

It must be remarked here that the multiplication of sub-post offices and receiving-houses, implied in what has just been mentioned, would have been very much more costly had not the expense been controlled by established rules based on sound principles. It has already been shown that the old plan of considering every case "according to its merits," to use the official expression, that is to say, of fixing the salary of A without ever inquiring how much was paid to B, C, or D, for equal service, had been to a considerable extent superseded by fixed scales. But we now went fully into the matter and brought the system to completion, thus providing a satisfactory guide available not only for new offices but also for any increase of duty at those already established; an arrangement which removed many anomalies and also saved much valuable time. The care with which the work was done is attested by the fact that up to the present time the scales, so far as I am aware, have undergone little or no modification, and have even been used for higher offices than those for which they were originally intended. Like benefit was derived from a scale prepared, about the same time, for regulating the amount of security demanded from postmasters according to the extent and frequency of their opportunities for defrauding the revenue; a scale which is, I believe, still in force.

_Predictions Fulfilled._

It may be remembered that, in my evidence before the Parliamentary Committee of 1838, I expressed a confident anticipation that, if penny postage were adopted, the public would, after a while, expend as much in postage as under the old system, and consequently that the gross revenue would, in the end, be made good. This anticipation was more than realized in the year 1851.[156]

As regards net revenue, I expressed an opinion to the effect that the great increase of letters necessary to make good the gross revenue would require an additional expenditure of about £300,000 per annum, and, consequently, that the net revenue would be reduced by that amount, or to about £1,300,000 a year. The actual increase of expenditure, however, owing to causes already mentioned, far exceeded my estimate; consequently the net revenue of the same year (1851) was only £1,118,000,[157] and it was not till six years later that it rose to £1,300,000.[158] And though, as must be obvious to the attentive peruser of the foregoing pages, these results, but for almost endless obstructions, would have occurred at a much earlier date, it was with deep satisfaction that I at length saw my predictions fulfilled. I may add here that in the year 1862, the net revenue so far exceeded any expectation that I had held out as nearly to equal the largest amount obtained under the old high rates;[159] and that ever since that year it has greatly exceeded that amount. Of course these comparative statements are all based on the mode of calculation which was in use at the time when penny postage was adopted.

When, however, my predictions with regard to revenue were fulfilled beyond all question, we thought it would be well, while retaining the old mode of reckoning for the purpose of showing progress under the new system as compared with the old, to introduce a more accurate mode, for the purpose of exhibiting as nearly as possible, the actual financial results of postal operations; and the results thus arrived at were given, for the first time, in the Report for 1859. By this changed mode of reckoning, which is set forth in some detail in its proper place,[160] it appears that the amount to which the Treasury was actually benefited by the Post Office, though rather less than that arrived at by the old mode of reckoning, was still more than £1,100,000. Of course, when comparison with the past is not in question, the amount thus ascertained is the one which it is best to take. It may be added that the substantial part of this revenue, viz., about £1,000,000, was derived from inland correspondence; to which, as the reader may remember, I had always pointed as the main source of actual income.

STAFF.

_Promotion by Merit._

During this period the system of promotion by merit was brought into full operation. In the three metropolitan offices, when a vacancy occurred, application for appointment was open to all; the respective claims were carefully compared, and without the admission of any other consideration whatever, the claim which was adjudged to be best carried the day. How strict our practice was may be shown by the following incident. To keep our course free from disturbing influence, it had been laid down that any intercession from without in favour of individual officers should act, if not injuriously, at least not beneficially, on the advancement of those concerned; and, as the rule had been sanctioned by the Treasury, it certainly was not from that quarter that I should have expected its breach. It is much easier, however, to authorize the establishment of a rule than to bend old habits in conformity with its tenour, or even to remember its very existence; and, not a little to my amusement, I received an interceding letter from the very Secretary of the Treasury, my friend Mr. (now Sir William) Hayter. The following was my reply:--

"27th December, 1855.

"MY DEAR HAYTER,--We really do mean to carry out the Treasury
regulations as to promotion honestly and with an utter disregard of
all conflicting interests, however potent.

"With this view the inclosed circular has been issued, and every
violation of the rule laid down, even though it extend no further
than the suggestion of an application such as that which you have
forwarded, is punished by reprimand and probable degradation.

"Fortunately young ----'s conduct is so good, especially as regards
the observance of the rules of the office, that I feel justified
in assuming that he is not to blame in the present instance, but I
cannot communicate the application to the Duke, neither can I allow
it to influence any advice I may have to give him.

"I am sure you will concur in these views.

"I am, &c.,
"ROWLAND HILL.

"The Right Hon. W. G. HAYTER, M.P."

By the transfer to the Post Office of appointment to all the higher postmasterships, opportunity for promotion was greatly enlarged, and posts formerly bestowed for political services, now became the rewards of approved merit. This change obviously involved great improvement in the quality of the persons thus entrusted with powers and duties of no small importance to the public. In the provincial offices a corresponding improvement was, in great measure, secured by delegating the power of appointing their subordinates, under certain restrictions, to the respective postmasters; who, being themselves responsible for the good working of their offices, were naturally led to such selection as would best conduce to that end. This delegation, so far as related to clerks, was made, as already mentioned, on the recommendation of the Civil Service Commissioners; and, the trust being satisfactorily exercised, was subsequently extended to the appointment of letter-carriers also.

Of the inconveniences arising from confining admission to the service to candidates passing the Civil Service examinations, of which I have already spoken, some evidence is given by the following extract from a Report of Mr. Abbott, secretary to the Post Office in Scotland:--

"Considering the different duties of the account, the secretary's,
and the sorting branches, I am inclined to believe that the
examination should have more special reference to the vacancy the
candidate is to fill than to his general knowledge on certain
subjects proposed for all in the same class; more especially as
regards persons nominated to the sorting office, where manual
dexterity, quick sight, and physical activity, are more valuable
than mere educational acquirements."[161]

But, whatever might be the amount of inconvenience that in the first appointment arose from neglect of such criteria, the system of promotion by merit, being regulated entirely by reference to official services, was found to work exceedingly well. From the different departments of the metropolitan offices, and from the provincial surveyors, the reports of its operation were almost uniformly satisfactory. Officers were found to take more personal interest in their duties, to do more work without augmentation of force, to make up in some degree by additional zeal for the increased yearly holiday that was granted them, and to discharge their duties with more cheerfulness and spirit, knowing that good service would bring eventual reward.[162] In short, almost without exception, good conduct was reported on all sides.

From Sir Charles Trevelyan, one of the Commissioners whose recommendation had led the Treasury to adopt this beneficial change of system, I received the following letter. The italics are the writer's:--

"Treasury, 26th March, 1856.

"MY DEAR MR. HILL,--The good fruits of improvement described in
the Second Annual Report of the Postmaster-General, and especially
in the section headed 'Staff of Officers,' are a rich reward to my
brother Commissioners and myself for any assistance we may have
given in producing them; and it is especially gratifying to know
that the anticipated result of giving to this large body of public
officers a higher interest in their profession, and an increased
self-respect, and of bringing them more fully under the influence
of the wholesome stimulants to human action, has been attained.
We did what we could; but much the largest share belongs to Lord
Canning and yourself, and Mr. Tilley[163] and your brother, and
other distinguished officers of the department, who not only
cordially co-operated with the Commissioners of Inquiry in framing
the plan, but, what is far more difficult and important, _carried
it into actual effect_ with characteristic firmness and prudence.

"Sincerely yours,
"C. E. Trevelyan.

"ROWLAND HILL, Esq.,
"&c., &c., &c."

My own strong feeling of the value of the improvement I find thus expressed a year and a half later:--

Extract from a letter to the Duke of Argyll, dated October 2nd,
1857:--

"While referring to Treasury authority in justification of the
course adopted, I think it right to add that my own opinion
is entirely in accordance with that authority; nay, that I am
convinced that some of the more difficult improvements recently
effected--that, for instance, which has already had so beneficial
an effect on the London early delivery--could not have been
accomplished under the old system of promotion."

_Health._

In the midst of proceedings thus tending not more to the public good than to the true interests of the officers of the department, other measures were taken by which the welfare of the latter was yet more directly and obviously promoted. One of these was the formal appointment of a medical gentleman to take, in addition to some other duties, the regular charge of the health of the large number of letter-carriers attached to the chief office. The duties of this officer--of course with proper assistance--were subsequently extended to the homes of invalids, and also to the staff at each of the new district offices. Similar appointments were afterwards made at Dublin and Edinburgh. Means were also taken to supply the men with pure water. Serious mischief had arisen, especially in times when cholera or diarrhœa was epidemic, from their resort to a neighbouring pump attached to Goldsmiths' Hall; the water of which, though most attractive in appearance and taste, was found by analysis to be very deleterious in quality. In the erection of the new district offices much care was taken to avoid those bad internal arrangements--alike destructive to rapid action and injurious to health--which want of either attention or experience had introduced at St. Martin's-le-Grand.

The general health of the department was in danger of being lowered by the new standard of acquirement that had been established for admission to the service. The persons best fitted for letter-carriers' duties in a physical point of view are obviously those whose previous occupation has inured them to labour of body and endurance of weather; but such persons were, in effect, to a great extent excluded by the new educational requirements, which, on the other hand, gave, for the most part, easy admission to shopmen, clerks, domestic servants, and others, but little accustomed to out-door exercise. To remedy this, the Postmaster-General (the Duke of Argyll) requested the Civil Service Commissioners to adopt a somewhat lower standard of acquirement, and at the same time authorized the chief medical officer to subject all candidates for the office of letter-carrier to stricter test as regards bodily strength. The application of this higher physical standard caused the rejection of at least one candidate out of four.[164]

By all these measures, the health of the department, which, with every allowance for the favourable age of its officers, stood even at the beginning of the period in very advantageous comparison with that of London generally, was gradually raised to a very high standard.

One further improvement, however, seems very desirable, though the means of effecting it have not yet been found. In the year 1857, Dr. Lewis, the chief medical officer, having reported on the sanitary condition of the dwellings of the letter-carriers, sorters, and messengers attached to the chief office,[165] the Annual Report makes this comment:--

"It is painful to reflect how much sickness must be caused by the
small, close, and ill-ventilated houses or rooms in which many of
these officers reside; an amount of sickness much beyond anything
that can depend on the regulations of the department itself."[166]

A hope was expressed that, as the department had stated its readiness, in case of suitable abodes being provided, to give a guarantee against loss from arrears of rent, provision would be made by commercial enterprise;[167] but this hope still remains unfulfilled; and it must be admitted that no small part of the difficulty rests with the men themselves.

_Insurance._

Another measure for the benefit of the staff, and more especially its humbler members, that is to say most of its number, consisted in arrangements for facilitating life insurance, and for placing the security of such investment beyond all doubt; an improvement of considerable advantage to the public, as it tends to retain in its service a number of careful provident men. At an earlier period, a mutual insurance society had been formed in the London office, but owing to errors in the scale of premiums and payments, this society had fallen into difficulties, such as to show that it would, at no distant period, be unable to meet its liabilities. Attempts had been made from time to time to obtain assistance from the Treasury; thus, in the year 1849, at Mr. Tilley's request, I spoke urgently on the subject to Mr. Hayter; a recent application having been refused.

Amidst the labour and anxiety that weighed upon me during the period of the Sunday Observance agitation, I had no spare attention for the furtherance of this useful measure, nor was it until the beginning of the year 1851 that I was able to take the next step. Then, however, I spoke to Sir George Cornewall Lewis on the subject. I proposed that Government should give up to the fund the proceeds of the unclaimed money orders, which I estimated at about, £1,100 a year, and I explained to him a plan which I had in view for extending the utility of the association, by including not only life insurance, but also guarantees for the conduct of the insured. He agreed in the opinion that the association should be helped in its present difficulties, but, objecting to anything in the shape of charity, was not inclined to go further; and in this position matters remained for the time. On my brother's appointment, however, later in the same year, I directed his attention to the matter, and, in a short time, he produced a plan which, satisfying the Treasury, procured for the society its required assistance.

The first step in accordance with this sanction was to induce an office of undoubted stability to take upon itself the society's liabilities; and to this the Atlas Assurance Company assented upon receiving the sum of £2,000, which was drawn from the void order fund. It was arranged that thenceforth the whole of this fund, amounting at the time to about £1,400 a year, together with the interest on its previous accumulation, which constituted a principal of about £12,000, and lastly, all the money found in such "dead letters" as could not be returned to the writers, should be applied towards assisting officers in payment of insurance fees.[168] In this manner the association in question, "The Post Office Widows' and Orphans' Fund Society," was placed on a firm footing.

As, however, the demands thus made on these various funds were not sufficient, in the scale laid down, to absorb the whole, a portion of the void order fund was employed in rescuing from difficulties another society in the London Office, called the "Letter-Carriers' Burial Fund;" the rights and claims of which became perplexed and uncertain on the amalgamation of the two sets of letter-carriers; with only one of which the society had been connected. These measures had the effect of exchanging past contributions into payments for life insurance; and thus gave to every contributor the full benefit of his former sacrifices. The fund still being by no means exhausted, authority was obtained to apply the remainder towards aiding members of the service throughout the United Kingdom to insure their lives, by using it in part payment of the premiums; and, even from the best established insurance offices, a considerable reduction of fees was obtained, in consideration of the large amount of business thus thrown into their hands.

By the end of 1857 the total amount insured for was £280,000.[169] As might be expected, the greatest amount of providence was shown in Scotland, England at first lagging much behind, while poor Ireland was fairly distanced. Subsequently, however, England came up with Scotland, and even Ireland amended her relative position. Still, the number of insurers, when compared with that of the whole force, was at best but small: a defect attributed to the premiums having to be paid in quarterly amounts; an arrangement unsuited to men in the receipt of weekly or even monthly wages. It was therefore arranged that insurers should have the option of making their payments by means of a small deduction from their salaries. This improvement was found to produce the desired effect; the number of insurers increasing by about eighty per cent. within three months after the alteration.[170]

Another beneficial change arose thus. Of course, in these departments of the service where the officers have to be intrusted with the public money, guarantees are required of those who are appointed; a requirement necessarily producing either trouble or expense. Private guarantees were commonly procured, though some nominees got the security of the British Guarantee Association, the fees for obtaining which, however, although moderate, implied a considerable deduction from the smaller salaries. Mr. Banning, the postmaster of Liverpool, conceived the plan of a mutual guarantee amongst the officers themselves. This proving very successful at Liverpool, was subsequently introduced into the Chief Office, and extended to the offices of some other of the principal towns.[171]

_Libraries._

The following is an extract from the Postmaster-General's Report for 1858:--

"It is with much pleasure that I have witnessed the establishment,
among the clerks in the Chief Office in London, of an institution
called the Post Office Library and Literary Association. The
large number of clerks who have enrolled their names shows how
general among them are a taste for reading and a desire for mental
cultivation and pleasures of a superior kind. Besides much support
within the department, the institution has received many liberal
donations, both of money and books, from without--among others,
a munificent gift of £50 from His Royal Highness the Prince
Consort."[172]

In the following year similar institutions on a smaller scale were established at nearly all the London district offices, and also at Glasgow.[173] In the London office, the institution was aided by the delivery of lectures, a work in which several of the higher officials took part. On the occasion of the annular eclipse of 1858 I took my turn by giving a lecture on the subject of that phenomenon, and had the pleasure of addressing a very full and very attentive audience.

_Summary._

I cannot better close this account of the Post Office staff, numbering at that time more than twenty-four thousand persons in all, of which more than three thousand served in the London district, than by quoting the following passage from the Sixth Annual Report, that for 1859, issued as usual in the following year, and signed by the Postmaster-General of the day, Lord Elgin:--

"It is with much satisfaction that I contemplate the many
improvements made within the last few years in relation to the
staff of officers. The arrangement under which every person
who enters the service is placed on probation before being
fully admitted; the gradual increase of salary within the
respective classes according to each officer's good conduct and
increasing usefulness; the promotion from class to class, and
from appointment to appointment, according to merit and superior
qualification practically demonstrated, and irrespective of all
other consideration; the strengthening of responsibility and of
energetic management by giving to the postmasters the choice of
their own clerks and letter-carriers; the improvement that has been
made, where necessary, in the sanitary state of the post offices
generally, and the appointment at the Metropolitan offices of
medical men to attend gratuitously on all employed there (except
the higher paid officers), and thus to stop disease at an early
stage; the extension to all the servants of the Post Office of a
pension in old age; and the arrangement by which every man can
obtain aid in insuring his life, and thus provide for his family at
his death,--are excellent, and have, I believe, produced the best
effects.

"I have the less hesitation in giving my testimony to these
improvements, because as I have been but a short while in office,
most of them were effected during the time of my predecessors."[174]