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86
supplying the metropolitan area with water, and. that these
provisional agreements failed to receive the approval of Parliament
in consequence of the high terms proposed for the
transfer. It has often been asserted that Sir R. Cross's
terms must be considerably increased when the undertakings
of the Companies are transferred to a public
authority. But a careful comparison of the figures would
seem to show that this is not the case. The terms of settlement
proposed by Sir R. Cross in 1880 are thus summarised
by the Select Committee of the House of Commons,
to whom the provisional agreements were referred:—
The amount of immediate annuities to be paid under the agreements
is £773,454; to this would have to be added deferred annuities to accrue
by way of increments at various intervals, amounting finally to £325,499,
making an ultimate annual payment of £1,098,953.
The value of tbe immediate annuities in 3.} per cent, stock, taken at
par, would be £22,098,700, and Mr. Smith estimated the present value of
the deferred annuities at £6,851,300, making the total value of stock
under the Agreements £28,950,000. If the deferred annuities had been
capitalized at 3½ per cent., the total amount would stand at £29,734,281.
In addition to this, it would have been necessary to make provision
for the debt charges, viz., Preference and Debenture Capital amounting
to £3,001,500, bearing an actual annual charge for interest of £133,913
and also for the Bond and Mortgage Debt, £223,055, with an annual charge
for interest of £7,807. These interest charges Mr. E. J. Smith
lated would, as well as the annuities,
be covered by the income of the Companies
when transferred under tbe
agreements. Adding these charges to
the total of the annuities granted as
above, the annual payments would
have been finally £1,240,073, and the
total capital value would have stood
at £33,018,836.
£
Value of Annuities - - 29,734,281
Preferential and Debenture
Capital 3,061,500
Mortgage and Bond Debt 223,055
£33,018,836
But in addition to this payment of a capital value
estimated at £33,018,836, the New River Company were