Fabian Tract No. 


LIGHTfNG by gas has become a necessity of the life of a great 
city; nevertheless some persons who advocate the public supply 
of water hesitate to apply the principle of municipalisation to their 
local gasworks. Few of these, however, can be aware of the rapidity 
with which the public supply of gas is increasing. Already one-half 
of the gas consumers in the Kingdom burn gas which they themselves 
as citizens have had made through their local governing bodies ; 
excluding London and its neighborhood, the proportion is, indeed, 
over two-thirds. The number of local authorities undertaking the 
gas supply has grown from 148 to 173 in seven years. No public 
authority in the United Kingdom having once municipalised its gasworks 
has ever retraced its steps or reversed its action. 

But London, along with Liverpool and Dublin, Sheffield and 
Bristol, and a few other large towns, still leaves this essentially 
public service in the hands of private speculators. 

London's gas supply has now fallen, by successive amalgamations, 
into the hands of three colossal companies (in 1855 there were 20), 
whose capital outlay, including past competitive waste and lawyers' 
bills, exceeds £11,000,000. On this amount they manage to obtain 
a handsome profit, the annual surplus being over 

A MlLLION AND A QUARTER, 

m· over eleven per cent. So abundant, indeed, is the profit that 
huge salaries and pensions are paid, and unnecessary renewals 
executed, merely to avoid returning a larger surplus. For, unlike 


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the water companies, our gas proprietors are " limited" by Act of 
Parliament as to their dividends, according to a sliding scale (the 
largest company paid 13 per cent. in 1890), and any excess is now 
partially devoted to a reduction in the price of gas. The largest 
company now charges 3/1 per 1,000 feet, as against 5/-in 1874. 

Particulars for the years ended 31st December, 1888 and 1889 
(Return No. to the House of Commons. Price 3~d. 

Capital. Receipts. Expend. Surplus.

1888. 
Gas Light and Coke 8,405,500 3,148,160 2,038,286 1,109,874 
South Metropolitan 2,034,022 927,698 617,747 309,951 
Commercial 680,000 321,661 212,460 109,201 

Total 11,119,522 4,397,519 2,868,493 1,529,026 
1889. 
Gas Light and Coke 8,405,500 3,170,549 2,199,426 971,123 
South l\Ietropolitan 2,034,022 911,172 707,217 203,955 
Commercial 680,000 321,478 223,137 98,341 

Total 11,119,522 4,403,199 3,129,780 1,273,419 

Notwithstanding a net profit of nearly a million sterling, the Gas 
Light and Coke Company raised its price in 1890 by 10 per cent., 
and in December, 1891, by a further 12 per cent. (from 2/6 to 3/1 per 
1,0CO feet), in order to maintain a 13 per cent. dividend to its ordinar.v 
shareholder3. This involved an additional charge upon two-thirds 
of London an:ounting to over half a million a year. 

Here again there is no legal monopoly; and the County Council 
can obtain Parliamentary powers to construct a competing supply, 
unless the companies consent to transfer their works on equitable 
terms. The London works could undoubtedly now be constructed 
for much less than the total capital outlay of £11,119,522; but, 
assuming the whole of this amount to be reimbursed to the share_ 
holders, the interest payable by the Council would only be £350,0CO 
a ye1r, as compared with over £1,273,000 now paid to the share and 
bond holders. The resulting profit of £823,000 annually would coYer 
two-thn·ds of the net expenditure of the London School Board. 

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·' 

J\l[anchester, supplying gas at 2j6 per one thousand feet, made 
£21,994 net profit in 1889-90; Birmingham, with gas at 2/3 per 
1,000 feet, made £70,337 profit in the same way; after paying 
interest on gas loans. Why should not London do the same, and 
ensure, at the same time, the fair treatment of London's ten thousand 
gas stokers? 

The pecuniary profit to be made by completing the municipalisation 
of the gas supply is, however, of less importance than 
obtaining complete control over this essentially public service. At 
present but little is done to bring the comforts of gas, either for 
lighting or cooking, within the reach of the poor, and even in 
London only every other house has gas laid on. Little attention 
will be paid to lighting the poorer streets, the public stairways, 
or the slums and alleys of our great cities, so long as every cubit 
foot of gas is jealously charged for by a capitalist company. Our 
gas, moreover, is practically our winter sun, and no private considerations 
ought to be allowed to stand between us and our main 
source of light. Even the electric light can never replace gas for 
beating and cooking, for lighting the vast majority of private 
dwellings, and for many minor public places. We need not fear 
that our municipal gasworh.s will become obsolete for many generations 
to come. 

Hence insigt on the ltfunicipalisation of the Gas S1tpply.