Districting and the consumer movement
The 1840s were a time when the gas
companies – hitherto a operating in a free for all plus marginal fraud – began
to be regularized, began to work towards their eventual image of staid and
boring.
South London was no different. As we have seen South Met. had been set in an
area previously served solely by the Phoenix Company, based on Bankside and
with another works in Greenwich.
They
had been joined by a Deptford Company which had originated as the Greenwich
Railway Gas Works. It lay alongside the railway on the Surrey Bank of Deptford
Creek. All three were competing for
customers and there was a fortune to be made by those who got it right.
Districting.
Supplying gas to customers meant the gas
companies had to build long lengths of expensive mains. Competition was expensive
and often ruinous and this was recognized from the earliest days of the
industry. In the early 1820s William
Congreve for the Government to implement recommendations on were called ‘districting
arrangements’ between companies north of the river, although as it happens he was
an interested party with financial involvement in some of the companies.
However ‘districting’ meant an arrangement for each gas company to only supply
in its own exclusive area into which the others would not venture.
In South London Phoenix had had a more or
less their own way until the arrival of South Met. The two companies then covered much the same
area. The Deptford Company made the situation
even worse and in the west of the area the new London Gas Company was putting
pressure on Phoenix. In 1844 Thomas Livesey was involved in setting up an arrangement
was made about areas of supply in Deptford and Greenwich exchanging mains and
customers between South Met., Deptford
and Phoenix.
At the same time customers - many of them
the parishes who bought gas for street lighting – began to complain about gas
prices. While the districting arrangements might save money for the gas companies
it also allowed them to set up price fixing deals. In 1843 meetings were held between the gas
companies in South London and lower prices were agreed.[1]
This system was to work for only a few
years before the agreed arrangements were disrupted.
In 1848 when he was 14 George Livesey went
to a public meeting.[2] It was one of a series of meetings held
locally ‘by consumers’ which challenged the local gas companies, their policies
and their profits. Events there
influenced him with a set of ideas which led to his work in changing the way
the industry was conducted. Here George heard John Thwaites, future Chair of
the Metropolitan Board of Works, [3]
expound on the unfairness of the gas pricing structures and the competitive,
but price fixing companies. George
believed that the agitation continued because the gas companies would not
sacrifice their profits and give into calls for lower prices. He also saw the
waste caused through competition.
Gas consumers were in effect the local
authorities who were the major purchasers of gas for street lighting. Thus what
became the ‘consumer movement’ was largely made up of aspirant politicians. in
London this meant that not only were the local vestries – the local authorities
of the day - involved but also those whose interests were much wider, in
particular the City of London Corporation. The Individuals involved were often
involved in all aspects of London political life - the vestries, the City, and
Parliament. They were also influenced by the policies of their own political
party’s ideas on competition and pricing.
Many of these politicians were also represented on gas company boards or
as major shareholders. They were also
represented in the City Livery companies which control the Corporation and much
beyond its boundaries
One
result was the setting up of a ‘consumer’s’ gas company in Rotherhithe.
The Surrey Consumers Gas Light Association
set up their works in 1849. It was
initially designed by Stephen Hutchinson one of the more flamboyant of the
early gas engineers.[4] When the project collapsed in disaster the company
transferred control to Angus Alexander Croll one of more flamboyant of a younger
generation of gas engineers.[5] Hutchinson’s on-site engineer Tom Hedley barricaded
himself in the Rotherhithe works[6]. Young George Livesey must have known all
about the resulting battle and ensuing court case. The early gas industry was rarely dull.
Croll however colourful, was the leading
exponent of ‘consumer’ gas works. He was
also involved in setting up another ‘consumer’ works on Bow Common, built with support
from people in the City of London who wanted by a gas supply which was not
totally dependent on a privately owned company.
Foremost in this was the City solicitor, Charles Pearson, who was also
involved in railway, sewers, power supplies integrated in the Victoria
Embankment and allied with politicians like John Thwaites.[7] Thus gas supply as a service industry was
caught up in a political movement which involved both the City of London and
the movement to set up of the Metropolitan Board of Works and, forty years
later, the London County Council. George
Livesey was a boy learning about how the industry he had been brought up in was
caught up in a wider political movement. One day he would see what he could
add.
In the 1840s South Met was largely outside of
this political situation but, like Phoenix, it was soon to be under pressure
for its pricing policies. However this small works on the Old Kent Road needed
to build its works and customer base, and pull away from the troubles of its
early years,
The opening
of the Surrey Consumers Rotherhithe works meant that the initial arrangements between
the gas companies broke down in 1851 and the mad scramble of the early 1840s
was renewed. The older companies - South
Met., Phoenix and the London Company – tried to buy up the Consumers Company but
could not do so. Negotiations continued
however and by 1853 all companies had agreed on areas of supply. One result of this was a setting of a standard
illuminating power for the gas together with a maximum price. This was to be
monitored with a meter tester and a referee to test gas quality.
The gas companies wanted to legalise their
arrangements on districts with an Act of Parliament but this was opposed by their
customers, the local authorities, and did not go ahead.
South Met was to emerge from this process
with some advantages due to the negotiating skills of Thomas Livesey and Board
member. By 1874 the Chairman was Thomas Simpson, who explained then how in 1834
it had been impossible to get ‘an entry’ for South Met into Southwark for the
supply of gas. Using his political influence
he managed to change this. He went on to boast “I got you the district that was
the making of you.. There were very few who could have got it but myself”. [8] This meant that South Mt had got an area of
supply which was particularly profitable.
Much of the negotiation was carried out by Thomas Livesey who ‘contending
the houses down one street … in the hope of getting a lot of district as
possible in the suburbs”. In this period
vast amounts of new housing were being built in South London on developing
estates – where gas mains could be laid as new roads were built, and a permanent
customer base gradually built up.
In 1875 by George Livesey describes this
process to a Select Committee. Once the district
was secured prices had to be the kept down because ‘the lower the price the
more secure and the property and the dividend’.
There was also a need to maintain profits to shareholders and to manage available
capital rationally. If the customers
were happy then prudent financial management would secure profits because it
was competition which led to expenditure.
The suburban area was the key because it was growing and the customer
base would expand while the mains could be laid cheaply as areas were opened
up. [9]
It was said of Thomas Livesey in later
years that his intention was to ‘take the lead’ and thus they needed a good
district. He stressed that this could be
done with prudent finances and the freedom to develop away from the pressures
of competition. It was an aim which his
son was to inherit in due course. It was
part of George’s apprenticeship that his indirection to work was as his
father’s assistant during the critical period f these negotiations - and why ultimately
George was always more of a politician than a Gas Works manager
[2] Liberty. History of Gas Lighting
[4] There are articles in most issues Mechanics Magazine 1837-39 on the
career of Stephen Hutchinson – many of them; it turned out, written by his
father.
[5] Croll’s career is covered in most issues of
the gas press of the day. Scottish, he had come to London, set up chemical
works and worked for the gas industry. He was involved in endless litigation
with other industrial chemists, as well as also gas industry episodes like ‘The
Battle of Bow Bridge’, and much else.
[7] Much of this is
covered in the gas industry press of the day. For e.g. Gas And Water Times 27th
September 1884
