THE Evening Star. MONDAY, AUGUST 16, 1869.

Evening Star, Volume VII, Issue 1959, 16 August 1869, Page 2

THE Evening Star. MONDAY, AUGUST 16, 1869.

It is a common saying that lookers-on see more of a game than the players themselves. On this ground it may be that the Corporation may not have weighed all the pros and cons of the gas question. The Councillors are each good business-men, accustomed to tot up the chances of profit and loss connected with commercial and manufacturing undertakings, and their election to the office they now fill proves the estimation in which their integrity and abilities are held by their fellow-citi-zens. We have no wish to say one word to destroy that prestige. We do not believe that the mission of the press is to detract from the merit due to others, nor to impute unworthy motives to those, who, at much loss of time and at no little convenience to themselves, accept the honor of conducting Civic affairs, and brave the abuse that not uncommonly awaits their efforts. When such motives are apparent and unmistakable, we shall not spare those comments which so flagrant an abuse of public confidence deserves. In any discussion of this question, therefore, we

disclaim all party feeling. It a question of facts and figures, and can be treated much more satl.-;iactorily as a purely business affair, than as a party question. The prospects of success of a new undertaking can be estimated by the application of the usual business principles, and on those grounds we confess to not being so sanguine as the Municipal Corporation that the City will gain by manufacturing its own gas. It seems to us that the assumption of profit is based on Mr A. K. Smith s estimate of the minimum consumption, which that gentleman sets down at 12.000. cubic feet annually. This is the ground work of his estimate. In the first place, it must be observed that this quantity is in excess of the present actual consumption of the City—--9.000. cubic feet—by 3,000,000. The cost at which gas can be manufactured, therefore, involves the hypothesis that the construction of new works and the manufacture of gas by the Corporation will at once insure an increased consumption to be supplied solely by the City Gas Works. But this evidently involves another supposition which is open to grave doubt, and that is, assuming the demand to rise to 12.000. cubic feet, will it necessarily be supplied from the City ■works'? The whole estimate is based upon the idea that, to supply Dunedin, only one manufactory will bo at work, and that, as soon as the Corporation gas works are constructed, the old works will be closed. Now this is scarcely warranted by the knowledge that between twenty and thirty thousand pounds have been expended in the construction of works, and laying pipes through the whole length and breadth of the City by the present Gas Company. It must not be forgotten that excepting by special Act of Parliament, no monopoly of the supply of gas can be claimed by the Corporation ; and were application to be made for such an Act, according to precedent, and in fair and open justice one of the conditions would be that those who are injured by the monopoly should be compensated to the extent of the injury sustained. It follows, therefore, that without such an Act the Corporation can only faixly calculate with certainty upon supplying the public lighting of the City ; and that private consumers will have the option of purchasing gas either from the present Gas Company, or from the Corporation works. Taking tlila view of tho ease*—‘.tnrl we believe that it is only a reasonable one—-what warrant is there for the assumption that the demand at the City works will reach 12,000,000 cubic feet? Mr A. K. Smith’s estimate for the use of the City lamps is “2Gogas lamps, each consuming “ 15,390 feet per annum, 4,000,000” cubic feet. Estimated “ consumption “in houses, shops, hotels, banks, “ churches, &c., &c., at double that “ quantity, 8,000,000." It is perhaps only fair to assume that, should new Gas Works be constructed, the present Gas Company being excluded from the City lighting, and being thrown exclusively upon supplying private consumption, will at any rate equally divide the supply with them ; and thus, for a small city like Dunedin, with a consumption not likely, on an extravagant estimate, to exceed 12,000,000 cubic feet, there will be two expensive estalishments each capable of doing more than twice the work they are called upon to perform, and each requiring eighteen shillings and four pence per thousand as a selling price to enable them to pay a dividend of ten per cent, upon an outlay of LIB,OOO. In making this statement we take as data Mr A, K. Smith’s own figures for he puts the case thus, under tho heading “ How quantity affects both cost and “ selling price—

This will be easily understood I say that with plant of a given value and capacity the cost of producing gas to sell six millions per annum is the same as for twelve millions, as far as superintendence and management are concerned ; while the labour, tear, wear, &c., are reduced in a much smaller ratio than the comparative quantities, and only to such an extent that the cost would be increased from 7s to 9s, but the amount required to be added to the 7s when twelve millions are sold, to pay a fair dividend, &c., &c., as before stated, was 5s 3d (5s (id). In the cane of six millions, this sum requires to be increased to 9s 4d per 1000 feet, thus making the selling price 9s plus 9a 4d or 18s 4d per 1000 cubic feet when six millions arc manufactured. With these facts in view, it seems questionable whether, notwithstanding the agitation on the subject, a surer way of obtaining a cheap supply of gas may not be found by arrangement with the" present Company, than by constructing works with the moral certainty that on the data given it cannot be reduced by either company to a lower price than that at present charged. To us the deductions we have drawn seem unanswerable; and as it is just possible this view may have escaped the Corporation, we place it before them for their calm consideration.