STATE SHIPPING

Dominion, Volume 12, Issue 192, 9 May 1919, Page 9

STATE SHIPPING

THE NEW AUSTRALIAN SCHEME

COMPETITION WITH EXISTING . SERVICES . (By tho Shipping Correspondent of the Loiuion "Times.") . London, March 11. A situation of immense interest lor merchants ami shipping companies has been created by the decision of the Commonwealth ■Oovovmnent to accept general cargo for Australia in the steamer Bulla independently of iiie existing shipping nr•raiiKements, beginning' at Middlesbrough to-day and in London ■ on about March The Bulla, qf Sflflfl tons gross, wns one of the German steamers seized in Australian ports, and shn is being put on the berth as one of the Commonwealth ■Government Line of steamers. Points of imieh importance are that ■Uii!.Commonwealth- Government "proposes ■to. institute, with this sailing, a regular . cargo service between Ih< , United'King■iloni pud Australia; and thnr it does not inleml to grant rebate?. As the rebate cvfitem- is maintained by tho shipping lines, there is.lierc'a clear line of cleavage between tirivate and Slate enterprise. It cannot be said that fo far as inMiimes have gone the proposal seems to have excited enthusiasm among merrtumls in the city of London, while naturally the shipnine cmipiinies could lint In; expected to look with favour upon ' FACTS OF THE CASE. The following are factors in the situation:— I. When Mr.- Huplav. tiie Commonwealth Premier, bought 15 British steaniora in .Tune, 1916. to form the nucleus of the Commonwealth Government Line, the vessels were removed from the TJiiHed Kingdom register. Since then their earnings have bepn very Inrue, and these, profits have not bean subject to excess Di'ofits duty." While- lliis was an excellent arrangement fm.incinllv for the Commonwealth Government, it threw into relief. the much less favoured posilion of the British shipping/lines, whose ships were, reiiiiisilionod by the British Government, at'comparatively low Blup-hook rates,, and whose earnings were subject .to" very, high 'excess profit taxation. There is an undoubtedly strong feeling that, if..keen competition is now to ensue, this favoured start which the Commonwealth Government Line received as compared with the s'hippinp; companies should, in the interest of fair play, be remembered.

11. 'J'ho Commonwealth Line is also eonsidoreu to have benefited from tho fact that, for a time, five of its .vessels ■were employed in Pacific trade and so were removed from the submarine danger zone. The arrangement was made ami justified on the ground that the vessels nnrricd Australian wheat to the Pacific Coast of North America, which enabled other wheat to be released from .the Atlantic' Coast for shipment to Europe. '

}]]'. British merchants have been for months past, and are,now, striving energetically to eecuro the freedom of their businesses from State control. . They could not be expected, while imploring the Imperial Government to relax its hold on commerce and leave them the management of their own businesses, to extend a warm welcome; to other Government Departments to enter business.

IV. Immediately the shipping companies ivero promised tho early return o? their, vpssels from State requisition they reduced the , -rates of freight very siilariiiitiiilly. Yet the outward trade to Australia is still very quiet, and Hie supply of cargo fipaco■ already available is believed to be ample. Tlie relations between the shipping companies and the exporters are good, and, apart from the tangible tio of the rebates, there ia a BtronK bond of loyalty between tho two. V. The Bulla is known to be schcauled to carry a largo amount of cargo for the Australian Government. Both shipping malingers and merchants seem prepared to admit tho suitability of this arrangement, but the feeling is widespread that tlie proper vessel for tho transport of goods exported by private enterprise is a ship worked by private as distinguished from State enterprise. VI. For the conduct of commerce sta-l-ulily of freight rates is very desirable. This has been emphasised lately in losses caused to merchants' in respect of (lc-preciated stocks, by the reduction of freights after the signing of the armistice, which was inevitable, and in an assurance the shipping companies lately gave that tho now freight rates would be maintained for a period of. six months in order that- traders might niiike their calculations of costs on that basis. Any clfer of. reduced freights which the Com-m-mwealth dovcrnnient Line might rnaKo m order to attract cargo would, therefore, be a bait' of very doubtful value. . • Tho outcome of the present development of Commonwealth Government enterprise will bo followed with keen interest, especially as the Lino /ins in its suvico at present a largo number of vessels, and, having earned very large profits during the war, which have not' been diminished by excess profits duty, the Commonwealth Premier might consider himself justified in spending a proportion of these in an endeavour to make a success of tho new service.