RAILWAY FINANCES.

Dominion, Volume 4, Issue 1143, 2 June 1911, Page 4

RAILWAY FINANCES.

Last night's Gazelle gives particulars of the 'working of the railways for the first four weeks of the current year, and also tells us for the first time the capital sunk in. the system at March 31 last. Owing to the Easier traffic there is shown a good increase upon the first four weeks of the last financial year. The net return from the Northern system was £71,394, and from the Southern

system £77,436. We do not suppose our Southern friends will rejoice over the margin in their favour, for two reasons. In the first place their return is from a vastly greater system, and in the second place the initial advantage was with the South last year, which ended, as we all know, in the usual way, with the unprofitableness of the Southern lines as notable as the profitableness of the lines in the North Island.

The statement of the capital cost of the system at March 31 last—the first statement on the point that has appeared—is singularly interesting. \\hat has happened during the year can bo clearly shown in a couple of tables. First, as to the apportionment of construction:

lliles open. Mar. 31,1010. Mar. 31,1011 Increase Korth ... 1135 1173 33 South ... 1571 IGI7 43 Despite the increasingly urgent evidence of the injustice and the national unwisdom of sinking most of the money in the unprofitable Southern system, the excess of open railways in the South is greater than ever. As to the capital cost of these open lines:

Capital cost. Mar. 31,1910. ilar. 31,1011. Increase. North ... 13,077,258 13,480,157 405.899 South ... 15,382,152 16,068,290 6SG.U7 How does the public like that? If the Southern lines could pay, little objection could be raised. But they cannot. Anyway, they do not. Another point to be noted is the correction that these figures necessitate so far as the earning power of the system is concerned. The capital cost (opened and unopened lines) at the beginning of the railways year 191011 was £13,655,054 for the Northern system and £16,499,494 for the Southern system, and at the end of the year £14,229,041 and £17,099,658 respectively. The average cost during the year was therefore: North, £13,942,042, and South, £16,799,576. The average cost for the whole system was therefore £30,741,618. The total net revenue was £1,190,910, and this is equal to £3 16s. per cent. Comparing the two systems, we find that the at 3| per cent, on the average capital cost (opened and unopened lines), was in the case of the North £522,826, and in the case of the South £629,984. The net revenue was: North, £617,372; South, £573,538. We therefore have this result :

Net Interest Result for . Revenue. 13i!!. year. £ £ £ North 617,372 522,826 94,546 profit South 573.53S 629,984 5G,41G loss We expect that some explanations will be asked of Mr. Millar next session.