MIDLAND RAILWAY COMMISSION REPORT.

Greymouth Evening Star, Volume XXXI, 4 July 1901, Page 4

MIDLAND RAILWAY COMMISSION REPORT.

(PER PRESS ASSOCIATION.) Wellington, July 2. The report of the Koya! Commission on the New Zealand Midland Railway was la ; d on the table of the House this afternoon. The Commissioners report that under tho first order of reference (datod 31st January) that they found tho company had made tho following expenditure upon the lino: Stillwater to Reef ton and Brunnerton to Jacksons ((19 miles 49 chains) £926,042. Belgrove to Norris Gully (6 miles 31 chains), £90,078. Springfield to Pattersons Creek £02,507. Making a grind total of £1,108,628, of which £454,217 had been expended in supervision, commissions, salaries, interest, etc. Answering tbe question as to whether the sums so expended exceeded the amounts which, with proper economy and supervision, would have beon necessary for the due construction and equipment of theso lines of railway, the Commissioners state that they had abundant evidence that the English contracts for the sections from Stillwater to Reefton and Brunnerton to Jacksons had been let at rates far in advance of Colonial contracts executed about the same time, amounting in the ; case of tho formation works to fully 25 per cent. The Commissioners deducted tho sum of £44,172 from these contracts a 3 representing the sum in excess of Colonial rates at the time. With this and one two other minor exceptions tho Commissioners decided that the balance may be passed as a reasonable cost of the actual construction. Turning to the cost of supervision, administration, commissions, salaries, interest and other incidentals, the Commissioners find the enormous sum of £385,749 chargable to this section. They are of opioion that five per cent (£21,720) on the reasonablo cost of construction was fully adequate under this heading. With regard to the interest on capital during the progress of construction, the Commissioners having in view the fact that at lease a moiety of funds provided might prudently have beon invested on fixed deposit have Bomputed interest for the full amount of each contract at 3 per cent per annum, counting from a date three months prior to entering on each contract until the issue of final certificate, and have allowed twelve months interest at the same rate on the importation of railway material and for minor works. This represents in respect to this section a sum of £30,884. The reasonable cost of this railway the Commissioners therefore fix at £550,020. In regard to the work carried out by the Company on the Belgrove to Norris Gully section, the Commissioners think that the construction work was economically done, but tho charges for supervision, interest and finance are out of all proportion to the value of the work done, and they fix tho reasonable cost of the line at £61,585. They also find the charges for supervision and salaries too high on tho Springfield to Pattersons Creek section, and fix its reasonable cost at £63,178. Summarising these sums, the Commissioners fix the reasonable cost of tho construction, equipment, supervision, administration and interest on capital during the construction of these sections at £674,714, as compared with tho cmpany's expenditure of £1,108,628. The report deals fully with the condition of the permanent way and rolling stock of the vaii jus sections at the date when the colony took over tho line. With regard to the selling value of sectio i from Stillwater to Reefton and from Brunnerton to Jacksons the Commissioners have considered that traffic may reasonably be expected to increase 5 per cent ©or annum during the next 10 years, and vthat of this increase two-thirds will bo absorbed by working expenses based upon theso conclusions. Tho Commissioners tiud the selling vnluo of the liae to bo £192.843. They find that the Belgrove to Norris Gully and Springfield to Patterson's Creek sectionshavo no soiling value. No 12 section of the order of reference of the Commission contained the following:—"The said lines of railway having been constructed by means of moneys provided partly by the shareholders in the said company, partly by moneys raised upon debentures, and partly by moneys provided by the Government of the ..colony by our said grants of land and out of our colonial treasury, in what proportion should the money value of the said lines of railwayestimated by you as aforesaid be apportioned "among the three contributors to the cost of construction." The Commissioners answer this by apportioning thel selling value of £192,833 as follows: To debenture holders £126,788, to the company nil, to the Crown £66,045. Under tho extended order of reference of June Ist the Commissioners further reduce tho selling value of the line to £153,633, and tho sum total of the value of the lauds and moneys provided by tho Crown being £350,749, they report that under this process nothing remains for the debenture holders or shareholders.