There is included in this total, stock to the nominal value of £198,000,000, or approximately 15 per cent., which represents nominal additions made on consolidations and divisions of stock, and commonly known as “watered” stock. It will be noticed that the present net revenue of £48,000,000 only represents an average of about 3½ per cent. on this total paid-up capital. The total paid-up capital in the returns recently published for 1912 is £1,334,963,518. The Railway Nationalisation Society has prepared heads of a Bill in Parliament, providing that the price to be paid for the whole of the railways shall be calculated on the basis of the Act of 1844. No doubt this would be opposed by holders of railway stocks and shares, having regard to the fact that the result might be in effect to merely return the capital, no account being taken of profits. If the purchase of the railways is to be considered as “a business proposition” it will be necessary to look fairly at both sides of the question, and endeavour if possible to arrange terms which will not prove an injustice to the present owners, and at the same time will be such as can be provided for out of the ordinary revenue of the railways without financial loss to the nation. It must be remembered that shareholders or their predecessors invested their money with the reasonable and proper expectation of having an adequate return for it. No doubt they put down their capital with the primary, possibly the sole, object of benefiting themselves, but the fact remains that their capital has been the means of providing the splendid net-work of British Railways now available for the nation to purchase. On the other hand, railway stock and shareholders must recognise that their position under the present system is by no means an enviable one. Many of them have for years been in receipt of no dividend whatever. In no case has there been any attempt at repayment of capital moneys, nor does there seem any prospect of it. The average net annual receipts now earned by the whole of the companies is only a fraction over 3½ per cent., and this percentage (which is less than before the year 1870) has for the last few years been practically stationary. The working expenses have been increasing to such an extent by reason of the increase of wages and price of materials that last year the companies decided on an all-round increase in fares and rates. According to the latest returns this has already been to a large extent counteracted by a decrease in traffic.