Matters Underground

Since early this year, a wage cut of 2½ per cent. on all earnings has hung over the heads of the employees of the London Traffic Combine. The need for reducing expenses owing to the crisis, and the falling off of traffic are the reasons given, and a desire to cut the suit to the cloth. In other words the employers are pleading their “poverty.”

It is generally admitted that the Combine is one of the most efficient and prosperous concerns in Britain, but before we condemn the cry of poverty as a fraud, it will do no harm to glance at the results of the past few years. For this purpose we will quote from a pamphlet, “The London Traffic Combine,” issued by the Labour Research Dept., Doughty Street, London, W.C., at the beginning of the year.

Let us take the District Railway first. It does not look too bad: —

1927 1929 1931
Profits in £1,000’s 369 490 458
Dividend % 4 5

Now for the basis (of control) of the combine —the tubes. Here no competition is to be feared, owing to their enormous cost and the need for Parliamentary powers, hence the dividend hunters and bondholders have swarmed round these like flies. Let us see the dividends paid and net profits of these concerns: —

1927 1929 1931
London Electric 4% 5% 4%
Central London 4% 5% 5%
City & South London 4% 5% 4½%
Net Profit in £1,000’s
1927 1929 1931
London Electric 633 695 636
Central London 210 188 187
City & South London 131 122 126

Also let us see the percentage of “working expenses per tram-mile” to “traffic receipts” : —

Company C.G.L. L.E.R. District C.L.R.
1926 54 60 68 66
1930 59 53½ 64 62

Such are the “mounting expenses” of the tubes and their poverty.

Now for the ‘buses; much the same story as before:—

1927 1929 1931
Profit in £1,000’s 608 671 740
Dividend, tax free 7% 8% 7¾%

Operating cost % of traffic receipts 94 93.3 93.1

In addition, the Combine has controlling interest in Overground, Ltd., and a working agreement with Tilling & British Automobile Traction Co., Ltd., and in the outer area it formed Green Line coaches to drive other operators off the roads.

Now for the trams. These consist of the London United, Metropolitan Electric, the Tramways (M.E.T.) Omnibus Co., and the South Met. Electric Tram and Lighting Co. All except the last have not paid a dividend on the ordinary shares for some time, probably owing to their being used as feeders to the tubes or the traffic being “squeezed” to the ‘buses; but the last-named concern has, since 1924, paid 5 per cent. This, on the face of it, looks bad, but the company controlling the tram undertakings (the London & Suburban Traction Co.) does not seem to he doing too badly; the profits during the last few years mounting steadily:—1927, £24,920; \ 1929, £60,864, and 1930, £89,640.

So far in our review, the net profits and dividends on ordinary shares have been shown. There are other shares as well, but we will pass them by for this article and have a look at the debenture holders, whose interest must be met before the others receive anything. In 1931, the L.G.O.C. loan capital totalled £5,561,000, and absorbed £276,500 for the year (4s. 3d. per week for every L.G.O.C. worker). But the tube bondholders draw the lion’s share. They carry a loan capital of over £36-millions, and draw an annual charge of £1,720,000 (or £3 6s. per week for every railman employed on the tubes). In addition, various means of speeding up and displacing workers are being resorted to with the view to increased profits : faster and heavier trams and ‘buses, faster and longer trains, with appliances for doing away with gatemen, liftmen, signalmen, ticket examiners, etc., and in view of this it can be safely said that the Combine’s plea of “poverty” is not made out.

Matters came to a head with a demand for wage reductions and further speeding up during September. The men declare that the speeding up is not safe, but the L.G.O.C. refused to withdraw from the position they had taken up. (Daily Herald, August 25th). After some negotiations the men’s delegates finally agreed by 39 votes to 21 to accept revised terms presented by the Company and recommended for acceptance by the Union. Although the demand for reduced wages was withdrawn, the new speed schedules will themselves involve some reduction in earnings. But according to the Labour Correspondent of the News-Chronicle (September 23rd) no one knows exactly what the effect will be. On one route, however, it is claimed that the new schedules will mean a loss of 8s. a week overtime pay. The Company promise to reconsider the matter in nine months’ time, but what exactly this means is not clear. The men fear that the acceleration will be used to reduce the number of ‘buses on the streets, and that the medical boards will get rid of redundant staffs by scrapping the older men.

We ask the workers in this and every other industry to note that such disputes will happen again and again so long as capitalism is allowed to continue. Why not set about ending the system that robs you ? Come to our meetings, hear our case, and question our speakers.

Get hold of our literature and think it over. Then, if you think we come up to what is required, join us. You will be welcomed, and will find plenty to do in the cause of Socialism. That is the only effective reply to the traffic or any other combine.

C. V. R.

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