£4m Profit On Railways By 1970 Forecast

Press, Volume CVI, Issue 31094, 24 June 1966, Page 3

£4m Profit On Railways By 1970 Forecast

(New Zealand Press Association)

WELLINGTON, June 23.

The Minister of Railways (Mr McAlpine) said tonight that by 1970 New Zealand’s modernised railway system should return a profit of between £4 and £5 million.

Mr McAlpine, speaking in the Budget debate, reviewed the uses to which borrowed money had been put by the Railways Department.

He cited the diesel traction fleet, which moves more than twothirds of today’s railway traffic.

The diesel was Ideal for New Zealand conditions because of the economies it could make, Mr McAlpine said. Each diesel mainline locomotive saved £BOOO per annum in operation costs. Since 1960, 1100 new goods waggons had been built in railway workshops and 4500 had been purchased overseas, he said. The Railways had developed several new types of waggon.

Track Renewed Mr McAlpine said that more than 4000 miles of mainline track and 60 bridges had been renewed, up-to-date signalling equipment installed, and 217 level crossings equipped with automatic warning devices.

The indications were already that a third Cook Strait ferry would be rerequired, Mr McAlpine said. Operations of the Aramoana and Aranui would be studied, and as soon as the figures showed a need for a third ferry, a ship would be ordered.

Mr W. W. Freer (Opp., Mt. Albert) said the number of railways employees was now less than it had been for years. The number of clerical workers, on the other hand, had increased.

"Are we running the railways from behind desks?” Mr Freer asked.

“Ham-Fisted” Budget

“What has been done in the Budget is a ham-fisted way of doing something which should have been done years ago,” said Dr. A. M. Finlay (Opp., Waitakere). Through the sale of overseas securities in New Zealand the sale of motor-cars under the noremittance scheme had inaugurated an era of “commercial debauchery and licence peddling.” The no-remittance scheme was a “dismal failure,” Dr. Finlay said. It had been admitted in open court in Auckland that more than 80 per cent of no-remittance transactions were fraudulent.

“This was not denied by the customs officers present,” he said.

Dr. Finlay asked why the Minister of Finance (Mr Lake) had not made concessions in travel costs for the working man instead of providing tax deductions amounting to only one penny or twopence.

At present the working man received no travel concessions. But he had to watch executives drive around in company cars, entertain and travel to overseas conferences —all of which were tax deductible.

“Poor Impression”

Turning to tourism, Dr. Finlay said that the permanent terminal at Auckland Airport was still not completed. Tourists arriving in New Zealand late in the evening must gain a poor impression of New Zealand because the terminal’s bank was closed and they could not change their money. “There is no better advocate we can get for New Zealand than a satisfied tourist,” said Dr. Finlay.

The Prime Minister (Mr Holyoake): Hear, hear. Dr. Finlay: 1 am glad to hear the Prime Minister comment. It shows he is awake.

He asked the Minister of Finance (Mr Lake) for an assurance that the Budget would not be succeeded by another budget before the General Election.

Capital Gains Tax?

The Minister of Education (Mr Kinsella) referred' to “Labour’s great plan for estate duties.

“This was the party which increased estate duties in 1958 by 40 per cent." he said. “Suddenly it becomes solicitous with regard to those who pay estate duties.”

The latest figures showed that under the Opposition’s proposal 200 widows would benefit, Mr Kinsella said. “Those 200 widows will be given £1,300,000 under a Labour Government,” he said. The Labour Party would be giving away to a relatively few people in a high income bracket a very large sum of money.

The proposal was completely contradictory to traditional Socialist philosophy, the Minister said.

Mr Kinsella said he would lay even odds that after a Labour Government put its

estate duties plan in operation, the country would have capital gains tax.

Comments from the Opposition benches forced the Speaker (Sir Ronald Algie) to call for order. “Well, the Minister should not sound like a bookmaker,” interjected a Labour member. When attacking the Government for borrowing the Opposition always gave the figures of total gross borrowing, but never mentioned what amounts had been paid back, Mr Kinsella said.

Mortgage Rates Mr C. J. Moyle (Opp., Manukau) said the Budget had done nothing for the householder except cause higher rates for his property and higher costs.

“Mortgage rates are bound to rise because Government interest rates set the pattern for the rest of the country,” he said. “It is even doubtful whether State Advances will be able to continue lending at 3 per cent as it has in the past.” Mr Moyle said that in 1960 a married man with two children could earn £l5 a week and not pay income tax. Now he must earn £l7 8s a week to sustain himself at the same standard of living. But because he earned more money he had to pay more than £l6 a year in income tax.

“This Government, which claims it has not raised income taxes, should pay this man a tax rebate of over £l6 to keep him on the same level,” Mr Moyle said. Mr Moyle criticised the Government for not using some New Zealand industries and financial concerns to their utmost; for selling New Zealand interests to overseas concerns; and for protecting the “Dominion” newspaper from overseas competition.