RAILWAY REVENUE.

Dominion, Volume 2, Issue 483, 16 April 1909, Page 6

RAILWAY REVENUE.

OTACO CENTRAL AND LAWRENCE- . ROXBURGH. EXPLANATION BY THE PREMIER. (BX ISLEOBMB—SPECIAL COURESPONDENT.) - ■ Dunedln, April 15. , Sir Joseph Ward has communicated to the "Star" a statement as to the LawronceRoxburgh Railway. Tho statement contains the following passages:— "In arriving at a deoision concerning tho stoppage of work on the Roxburgh-Lawrence Railway, with a view to consulting Parliament, tho Government wero guided entirely by the facts—(l) That, with the whole- of tho information available, the completion of tho lino from tho present point at an additional cost of a littlo over £300,000, exclusivo of rolling stock, would result in a ve,ry heavy annual loss; and (2) the experience of the actual results of last year over the Otago Central Railway, tho net earnings of which on' the capital cost resulted in the abnormally low result of 6s. per cent..: In other words, the line produced £3845 to pay interest, upon tfie low. basis 0f..3 per cent., amounting to £34,568 per annum./ If the Otago Central Railway, had returned 3 per cent, upon the capital cost, it.would have enabled.the. whole of the .railways ;of the Dominion to return £3 10s. per cent, lastyear. The distressing outcome of the Otago Central Railway returns caused Ministers to further examine into the position of the Rox-burgh-Lawrence line, and I regret to say that upon the capital cost of the new portion of this work, making full allowance on, a liberal scale for an increase of traffic to an extent which does not appear at all probable, it is.found that, after allowing for suoh increase, the result would provo nearly as disastrous as the Otago Central Railway... If tho whole of the traffic and passengers from Lawrence to Roxburgh l last year were to go over the new portion of the railway, it is estimated it would have amounted, after making a liberal allowance in favour of the railway, to a.total revenue of £1400. If this estimate is .doubled, it would produce £2800. Providing a train were put on.once a day each way, andat the same average cost.per mile for running .of .trains throughout New' Zealand, the .cost would amount-to about. £7000 per_.annum, taking nothing into account for rolling' stock upon the line or interest upon capital invested. '.The cost of the Roxburgh Railway, if, .completed, 'inclusive of £10,000 for necessary rolling stock, would amount to £370,000,-which at 3 per cent, would represent £11,100 per annum. This added'to the aptntkl. cost or the running, of a train daily would amount to, £18)100, and the revenue, estimated'as the. result of careful inquiry, would not produce over £1400 per annum. But even giving it the benefit of double -tie estimated revenue, Bay £2800, it will be seen that.the direct loss would run into £15,300 per annum, thus producing almost as bad a result as the Otago Central Railway, though every effort has ;been made by the Railway Department to economise with, a view to getting a better return for that line. It is not intended to allow the , formation upon the Lawrence end of -the tunnel—viz.) about seven and a half' miles—r-to remain unused. .It. Ie intended to ballast the.whole length and complete the railway line to the tunnel entrance,, and. to provide a terminal station near - the tunnel, as well as two flag stations, which would cost, without the rolling stock,-about £8000. . This, with .the amount already expended upon the Roxburgh-Lawrenco: Railway, will.bring.'the expenditure up to; about £58,Q00, so-that, amount, as hae been suggested .by some of. those' who, have 'communicated .'.with , .me,:;iß.Tio;t going. .to be thrown away. The line will be utilised, and, a, train seme* will be run to the point indicated." ■ Since the above telegram came to hand the Prime Minister has' handed to us a copy ipf the full text, of the message. From that we publish additional extracts'as follow:— . ■• ■■, : ;■ ..,, ■ "I desire tol point Out that. the : position is too serious to justify the Government in considering any consequences as to the attitude of either friends or opponents in the district concerned. The suggestion which has been made that southern influences have been responsible for this action is. baseless and entirely without warrant in any way whatever.-No representations whatever havo been : made to the Government by anyone in other localities, nor has the. steppage been made with the idea of forwarding , the interests of any other railway. , The further wretched suggestion that this, has been done to punish any .district because of its: nonreturn of a member to support the Government, is almost too. contemptible to be counted in a serious matter of , this kind. I,have only to, say that the Government has not adopted; such a policy in any portion of the pominion. I had no desire to make a public statement upon this subject, preferring to wait until the matter had been carefully considered by Parliament, as I am anxious in erery fair and reasonable way. te help the district of Otago; but the results upon the Otago Central railway line for last year are so disastrous that to allow another railway in the same province, to be, prosecrfted at a further cost of:-, about £320,000 beyond that'already expended, with .what the Government/upon the-information before' it, believes would be neariy as disastrous as the Otago Central Railway, would inevitably cause a recasting of the rates upon. these • lines in order to produce reasonable Tesults even upon tho low basis of. 3 per. cent., and would probably prove unbearable to the people whom the railways are intended te serve. In.other words, it would tako ten. times the present rates on the Otago Central Railway to produce the necessary, revenue te pay the interest upon the capital invested at the low rate of 3 per cent., and such a course would necessarily greatly - reduce the traffic." • (by temqraph— pbess association.) , ".. ■ ' Dunedln, April 14. a. meeting, of-the. Dunedin branch of. the Lawrence-Roxburgh Railway League today a motion was adopted asking the Governm?L *° reoona ider, its decision in connection with the.suspension of work on the line -A publw meeting of .protest will be held next w«ek. . ,