The Tramway Board.

Press, Volume LXVI, Issue 20097, 28 November 1930, Page 12

The Tramway Board.

The new Tramway Board bears so strong a resemblance to the old that the election result must be regarded as a vote of renewed confidence. It can also be said at once—without any kind of reflection on the solitary new member, who, though he has been lucky, is to be congratulated on his victory—that the dropping of Mr John Wood will be widely regretted. Mr MeLachlan has been lucky'enough to be elected on a purely personal appeal, and after a very frank personal admission of ignorance and lack of experience. Mr Wood has been unlucky enough to have his knowledge and experience forgotten—a common enough misfortune in a democracy. But the- real significance of the election—apart from the size of the poll—is the fact that the public refused so definitely to trust the trams to Labour. Mrs McCombs is of course to be congratulated on her comfortable return, but the other Labour candidates were defeated decisively enough to Buggeßt that the facta of the tramway situation are at last being faced. For the system is fast approaching a very critical period the dangers of which no one can estimate. All we know is that people are becoming less and less dependent upon the tramways and that the value of the undertaking as a revenue earner is rapidly declining. There is the further serious fact that at a time when no one realised how rapidly other forms of transport were being perfected, the tramway system waa developed in advance of the reasonable needs of the community. Now the whole undertaking, judged by the diminishing demand for its services, is heavily over-capitalised, as will be discovered in 1934 when debentures totalling £778,750 become due for payment; and in 1944 a further sum of £311,050. To meet these liabilities the Board has a sinking fund of only £199,934, "which by the year 1934 will have increased to £253,000. The Depreciation Fund, if we may assume that no further withdrawals are made in the meantime, will provide an additional sum of £285,000 to assist the sinking fund, and there will therefore be available a total of £538,000 to meet maturing loans of £778,750. Under the most favourable circumstances therefore a redemption loan of a quarter of a million will have to be raised in 1934, and a much larger sum ten years later. Unless the Board so conducts its business that the genuine economic value of the system in 1934 and 1944 will be not leas than the difference between the amount of the maturing loans and the amount of liquid reserves available for repayment, there will be very serious trouble.