The Dominion. THURSDAY, OCTOBER 28, 1909. A BAD RAILWAYS YEAR.

Dominion, Volume 3, Issue 649, 28 October 1909, Page 6

The Dominion. THURSDAY, OCTOBER 28, 1909. A BAD RAILWAYS YEAR.

We must compliment the Minister for Railways on a certain amount of candour in his annual statement showing tho working" of the railways for the year 1908-9. .We regret, that we cannot congratulate him or the country on the results of the year's working. The previous year, when the system failed to balance by sonic hundreds of,thousands of pounds— when, indeed, the'-ypav's working was the worst on record from the viewpoint of sound finance—the Minister'statcd that he had imposed on hip "the pleasing duty of having to announce that the result of the yearV operations has been satisfactory." In x the current statement: Me. Millar has been more cautious, in the language chosen to sum up the position: "The, result of the year's operations," he says, -"when'compared,with those of the previous year,', have; pn 'the'; whole', been satisfactory," > We could hardly expect the Minister to go any nearer than this towards .confessing that. the results have been very unsatisfactory indeed; -There--, suits for 'W7-B.were the'worst then on record; tho results:forl9oß-9 are in many respects even- worse. The net returns, it is true; amounted .to £814,711 ag against £812,179 in the year 1907-8, but the capital ha 4. been largely increased, with tho result, that the return fell froin:s.'33 : pcr. cent, to 3.13 per cent. Writing on May, 20 last we quoted tlip-follov/ing.tablc;--: •;./•,;• Percentage of _;-;' ; ~'-,-. , \Eipouditurcpor nctlteturns lear. ,-. cent; of Revenue, to Capital. 1899', ;.....;„..„...;, 03.20- .'' '.":.'-3.29' " 1900.'.-,.'.,......„..;.;„.. ,'fii.Bo ' SU:! wot •■...: ..;...........■.....;; C 5.30 •.'. 3.47 "■ ISO 2 '..; :.......;;.......60.80'■• '"•■. a.W;'. 1903- -v;....,......-...;.;;. (38.05 ' ■' ■- a.30-v.. 1991 •-•-■.;;....;.-.-. , j...„V i r;..-..'„««5.98 ' •"■ :i.sß■■>■'». 1905 \ ~...;„..;;.1...„;....:„ (!7.58; ■! -3.30';^ 1906-v;..:..:....„....i„;..... ; ■ ki.oo - ' ••■■■■, 3.24 '■; isor- ;.::..,„..;.„...;„.....; C 9.00 :• ', 3.«-r----1908 V. ....;...U..........' R59 '•■ 3.53 .:■•; ISM ;_;.,..,....:..,..:„...,... -72.it) ■' -y \ \ r : ',- ~j We added that the unknown term rfipve-. sente.d hy. query mark could bo set down with safety as-not more than Ajs a 'matter of fact,it was 3.13 per cent.

:. v The:fi.gurcs for tliu currant year, bo far as.'it has : : gprie,.:we ; ''w ; c pjcased ' to note ma.kc a better shWingl. Tiie second half of the.year .has still bo go, and although Mr. Millae, we understand, is doing his best, by keeping down repairs and main.tenanee,- tomake a 'show of effective economy, it would be too much to expect that the current year .'will show anything but another -'heavy joss,-' of some hundreds of •thousands of pounds. The net: : revenue for 1908-9 increased by only £2532; it is ibply about onerthree hundredth/ greater than last year;,' This insignificant |n : due,: ofcourse,,to. the' fact, that (the expenditure grows as fast- as the revenue, has been-, obtajnpd by, running ;406,962 more train-miles/ by carrying ■700,428 jmoro' 'passengers, by " .using 209 more miles of lino, by setting nearly three, and a half millions sterling of extra capital •at work, and by employing 200 more hands. Tho Minister does not attempt to :give any reasoned explanation of the fact ,that the greater':the; amount of capital sunken tho railways the greater the loss :beco'mes. : The capital cost of. all lines !ssood at £29,052;432 on March 31, an increase of £2,317,292, but'as part of tho. ,new capital was .working only for a portion of tho year,, a correct estimate, for of investigation, would place. :'the-average capital at £27,40b,006. The ;interest'on this amount at'3| per cent, is .£1,027,040. ; The "net profit on working" was £814,711; fnd of courseythe revepue helped out' by relieving it of £398,097 ■''additions to'' open lines" charged to I capital 'account. If .these additions had: been paid for out', of revenue the net ; balance %quld : have been £416,614: 'The j apparent, loss fpr the year, therefore, of i £212,329 (the difference between the in'teresifc bill aad tho "net profit" out of ! which it should be. paid) is really ap ac-' [itual loss of much more.

■It;ig'■■not surprising, though none tho less'satisfactory, that the Minister, pericoiying' the drift of things, has been endeavouring to effect economics, : ; ; At tho .root of; Wie tpuble is the fact that the system been conßtrucbed with an eye to political advantages, but,:o?cnso,good management would otiable a different stoiy.to be ,tpld, and this without rajs: jpg the rates by a penny piece,. Thesecret of the railway deficit is mainly jn the extravagant cost of working, as 'the. following table comparing .the, Commissionmanaged system of.New South Wales 1 with the Now : Zealand system will make clear (the figures are in pence):— : _ .-.■:■■. ~ •: .'N.Z. ; •■'■' N.S.W. Per tram mile. • 1908-9 1908-9 Earnings- 01.00 80 : "Expenses. .....,,...;.... C 7.8? il '.'.;• 20.1 i .'[ $}. - Thc New Zealand railways take from tho public 17J per cent;, more per train-milo than, is the caso in-New South Wales, but prudent management: enables the Commissioners to show a net return more than 20 per cent, better than the result obtained here. Most.of tho year's loss is "due, as usual, to the poor return from tho.Southern; lines,; The net revenue from .the North Island main.lines and branches

is given '.inj.tW,statement as £400,212, or £3 15s. Gd. per cent, on capital; from tho South Island main lines and branches the return was £283,925, tir only £2 6s. Id. per. cent, on capital. For the current year Mr. Millar supplies an estimate which compares as follows with the actual results for the year 1908-9:— .'■.;. Results. Estimate •■■■•.•.' 1008-9. for 1909-10. - £ • £ B° vem |? t 2,929,520 3,050,000 Expenditure 2,114,815 2,113,500 The Minister expects, that is to say, a ''net profit" amounting to £906,500. But the railways will even then fail to pay their way by a certain £121,000, and by something like a concealed half million —for of course loan money, as in the past, will bo used to pay charges that should be borne by revenue. There is nothing cither in the statement, or in the conduct of tho system during.the current,year, which tolls in the, least against the everincreasing urgency of tho need for the establishment of non-pol.ical control of this vast State undertaking^