widely; and an intermediate set. Two narrow groups gained most. First were
those whom the railways employed (or bought materials or equipment from).
Members and ministers were intensively lobbied for patronage jobs—the NSW
railways became‘a kind of out-door relief establishment for those who cannot
obtain work elsewhere’(Wettenhall 1961, p. 22); the same in other colonies.
The other‘narrow’interests were those of landholders nearest to where a
line was built and operated, who put pressure on the decisions about whether,
where, and when to construct and run lines. This reached a peak in Victoria
during the lead-up to Duncan Gillies’ 1884 ‘Octopus Bill’for the construction
of about 1,500 km of lines:‘Backed by their local railway leagues, the training-
grounds of so many politicians, the country members whose lines were in
jeopardy rallied for the fray.’The commissioners reported favourably on most
of the proposals and, in the event, parliament authorized even more lines
(Serle 1971, p. 36).^19 ‘Although Gillies referred all questions to the board for
decision and conscientiously refrained from interference, he failed to protect
the commissioners from the demands of other parliamentarians’(Beever
1972).
Intermediate, in terms of size and salience of interest, were classes of cus-
tomers charged less—sometimes considerably less—than the cost of service, or
less than comparable services elsewhere in the system.
There were also two diffused groups affected by the enterprise, thefirst
being the broad mass of citizens with an interest in reaping the wider benefits
that railways created through their stimulation of economic and social devel-
opment generally; and the second being the taxpayers, who had an interest in
thefinancial results of the enterprise that loomed so large in the public
accounts. For both, the efficient and effective operation of the railway enter-
prise generally was imperative, and the appropriate capture of some of the
benefits as railway revenue in Treasuryfinancial accounts.
9.2.7Decline in Patronage
The political‘dilemma’facing MPs and ministers was the result of the trade-off
between, roughly, maximizing aggregate net benefits, versus the creation of
benefits to narrow interests, of a kind that generated a palpable pay-off for the
individual MP or minister. The terms of this trade-off changed over time.
In the second half of the nineteenth century, governments were formed
around often-temporary coalitions: the party system did not then exist.^20 The
(^19) The bill also mandated the end of the patronage system, so that its subsequent and not
infrequent use was illegal. 20
There were at least thirty-one changes in the political head of the department in charge of
public works in NSW from 1856 through 1891 (Butlin 1964, p. 352).
Socialism in Six Colonies: The Aftermath