RAILWAYS REVENUE IS HIGHEST SINCE 1929-30

Hawke's Bay Herald-Tribune, Volume 81, Issue 34, 3 November 1937, Page 9

RAILWAYS REVENUE IS HIGHEST SINCE 1929-30

— Press Association.)

MINISTER'S REVIEW

"Substantial Progress in AI1 Phases" STATEMENT PRESENTED

(By Telegraph-

1 WELLINGTON", Last mght. The Railways Statement was presented hy the Minister (Hon. D. G. Sullivan) in the House to-day. Mr Sullivan said: In presenting the following annual railways Statement, covering the first financial year of operation since I assumed the portfolio of Railways, I have the honcur to report that the financial year just closed has been one of great aetivity and substantial progress in all phases of railway working. The marked improveraent in the trading and industrial outlook of the Dominion which has manifested itself during the past year and the greatly improved economic conditions now prevailing generally are reflected in the financial returns of the department. The revenue earned Teaehed the high total of £7,790,651— £786,335 more than in 1935-36, and actually the largest earnings in any 12 months since the record year 1929-30. The surplus of Tevenue over expenditure — viz., £903,858— has been secured notwithstanding the concessions granted to the staff in the way of wage and salary restorations • and the general application throughout the service of .the principle of the shorter (40-hour) working week, Additional expenditure in respect of train-milage, stores, and man-hours was also necessary to meet increased tumover of business, while, in addition, the financial commitments in connection with the programme of improvements in the standard of ser•vioes and facilities upon which the Government has embaTked as part of its general railway policy have also been met from Tevenue. The infantile paralysis epidemic which broke out in the South Island in December of last year adversely affected the passenger revenue to an extent of not less than £100,000. The net revenue, although approximately £170,000 less than the average nett earnings in the preceding three years, when wages cuts and other measures characteristic of the depression years wero in force, is approximately the same as that earned in the 1929-30 year, before tho depression had settled down, and is approximately £100,000 greater than the average earned in the three yeaTS from 1931 to 1933. It should not be overlooked that up to March 31, 1936, the expenditure on wages and salaries was in the aggregate considerably reduced as a Tesult of the "cuts" authorised by the legislation of 1931 and 1932. The full effect of these "cuts" and the policy of compulsory retirements as appliod to members with not less than 30 years' service, on the working expenses of the department is now, I feel sure, fully appreciated, and in order to facilitate a true comparison of the position during the years the "cuts" were in operation — Le., 1932, 1933, 1934, 1935 and 1936— with the year under review 1 submit the following table setting out what the nett earnings would have been had not wages' and salary "cuts" to the extent of' £2,512,000 been made. The table also sets out for comparative purposes (1): the percentage pf working expenses to; gross earnings, (2) the operating earnings per train mile, (3) the operating expenses per train mile, and (4) the nett operating earnings per train mile. These figures show the results for 1937 in a most favourable light, and when the further fact of compulsory early xetirement,"affecting as it did 138 employees, with a further saving "Wf £37,700 per annuni, is taken into consideninou Ut position is still more satisfactory: —

The Government 7 3 policy in regard to railway development is grounded upon the belief that there is no adjunct of material progress that is so generally important and exercises so vital an influence as the railway system. Probably no country owes more to its railway system than does New Zealand, and certainly no country has made greatei use of railways in the furtherance oi general development. From the yea. 1863, when the first lines were openeci for traffic, until the present day our railways have been and still are . our first line of communication. They congtitute. in fact, the econonuc ftindation of our nation.al life.

The accruing to tho people of this or any other country through the operations of a great publiclyDwned and operated utility service such as the railways cannot be fairly measured in the summary of its annual balancesheets. It will, I feel sure, be freely conceded that the railway system of this Dominion in the first place was coa structed as a developmental ageBW, rather than as a profit-making fnstitution. It is beyond question that doWn through the years the country has reaped very material indireci returns from the existence of the railways by way of what may be termed "social service and betterment." The advance of settloment, the open-ing-up cf new country and the increase of its productiveness, the provision of ♦mployment for large numbers, the cheapening of the means of transport for both goods and passengers, and many other items, must all be reckoned as value obtained for the expenditure in addition to the mere monetary returns earned by the system? These facts should be clearly understood and appreciated if a true and proper interpretation of railway accounts is to be arrived at. In keeping with the opinions as expressed above and which coincide with those of the best-informed minds abroad, the Government has reflected its faith in the future of the railways of the Dominion as a means at hand for the further development of the country and as providing a method of transport which for general purposes, particularly in a country so dependent upon the marketing and transport of its primary produce, has an inherent and very definite advantage over other forms of transport. Road Transport. There can be no question that the advent of the internal combustion engine and its application to commercial road motor-vehicles has enlarged the outlook and scope of the transport industry very considerably, and that this development has had the effect of materially aading to the difficultiae associated with the administration of Tailway affairs in this and many overseas countries. Indeed, it can be said that no progressive railway policy could bo pursued to-day without due eognisance being taken of the useful and important part now p'layed by the road motor-vehicle in the field of transport and in the sphere of national economics. Probably no^spect of the many and diverse problems arising from the advent and rapid rise of the road motor as a major element in the transport ■ industry has proved more difficult of] solution by those charged with the; administration of transport affairs during the last decade than that of defining the economic sphere of each of the component parts of the transport machine and in evolving an equitable and workable plan for the co-ordinatipn of road and rail transport, based upon a right conception of the respective functions of each of these forms of transport. Unfortunately, and despite the obvious urgency for decisive action being taken in the ' matter, the question of the adjustment of the Toad-rail problem in this country was allowed for many years to be relegated to the background, and this neglect, coupled with the continued expansion of the business of the commercial road motor services at the expense of rail-borne traffic, brought about j conditions which progressed to the point J where the financial stability of the | national transportation system — the j railways — was threatened. • These developments, which were not j peculiar to the New Zealand railway system alone and are too well known to need further recapitulation here, inevitably increased the average cost of transport services, and no country, including our own, has been spared the necessity of enforcing xegulations aimed j at effecting some measure of control of | commercial road services and going I some distance towards eliminating, in ' the interests of national economy, the ; disastrous effects of wasteful duplicai tion of services and unbridled com- | petition in the transport field. ] The Government is firmly convinced i that, while the conditions of competition j prevailing in the transport industry of j this country are no doiibt advantageous ■ to some individual interests, a continuj ance of -such conditions would be seri- ' ously harmful to the national economy. The Government believes that the rationalisation of transport, ensuring that the railways and road motor* will be encouraged to function fully in their proper economic spheres and as complementary to one another rather than as competitive units would be in the best interests pf both systems, and certainly of the community as a whole. The Goyernment's policy of co-ordination of existing lines of transport on the principal routes throughout the Dominion and the elimination of redundant units with the application of principle* ®f rationalisation is directed towards this end. • Under the system of control «nvisaged, the whole of the services on certain routes will be under the control of the Railways Department, and, as the separate organisations will disappear, the necessary services by road will operato under one set of overhead ccsts. Moreover, the Railway* Department will be able to route the traffic in tho most economical manner in. the public interest, so that goods which are now unnecessarily being carried by road will be carried by rail, while, at the same time, where the public interest requires the continuation of any particular road service for the carriage of perishable or other lines of traffic, this will be provided. By this means the system of charging on the railway, which is one that has been found necessary in railways the world over, and also in road services that have grown to any dimensions, will not be deatroyed by the inroads of individual transport units which are unconcerned with the Dominion 's need for transport at low cost of basic raw materials, or with the problems associated with huge peakloads, one-way traffic, etc. j Improved Passenger and Freight Business. | Tho effect of the general policy of: | the Government is reflected in the in-

creased number of passenger journey* made by rail during the year; this increase of 877,000 passengers brings the total up to 21,235,000. As an additional 4,556,000 passengers wero also carried by the Department 's road services during the year, it will be seen that the Department 's tolal of over 25,500,000 passenger journeys is equal to 17 journeys with the raiiways for every inhabitant of the Dominion. The policy of extcasions and improvements in goods rolling-stock, facilities, and services has proved equally effective in giying increased satisfaction to the Department 's customers and increasing the quantity of business handled. The increase of the goods tonnaga by 625,000 tons to an aggregate of 6,81-1,000 rcpresents an actual increasfl jf 10 per cent over the tonnuge carried in the previous year. Track Improvements. An extensive programme of track improvements has been carried out during the year and further improvements have been authorised and are to be carried out during the year upon which we are entered. These include bridge strengthening to sarry the heavier types of locomotives md the replacement by steel structurea of the most modern kind of certain fvooden structures which have reached a stage of obsolescence. A hcuvy programme of relaying, with numerous deviations to secure cnsier graucs und curves which will mahe i'or the smoother running of trains and acsist in speeding up both passenger and goods services, while at the same time reducing haulage costs, is also in hand. With the same object in view, it has been decided to adopt a heavier rail for usa on the Department 's busy main lines, and in future the standard rail for such lines will be 851b per lineal yard instead of 701b as at present. As a matter of policy, the services of men on unemployment relief have been utilised -wherever possible in connection; with grade easement and similar works. Workshops Activities. It i3 pleasing to be able to record that very full use has been made during the year of the workshops organisation in meeting the heavy demands not only of the Department itself, but also in the manufacture of articles of various descriptions for other Government Departments. Illustrative of the scope of the work undertaken on behalf of other Departments, it may be mentioned that two steel Tadio masts 170ft and 210ft long have recently been constructed at Addington and Hillside for the commersial broadcasting stations at Christchurch aiid Dunedin. During the year the Government andertook to have fabricated in the railway workshops at Addington two large dredges to be used in gold-mining on the West Coast of the South Island and of a total weight approximating 6000 tons. The fabrication of these ; dredges would have been lost to the ' Dominion had it not been for the fact that the work could be carried out in its entirety in the railway workshops. That j alone was the reason which prompted the Government to make a departure from the usual policy of not undertaking ivork of a private nature in the railway workshops. The. work involved in the fabrication of the dredges at Addington has provided a very useful quota of employment for tradesmen and others and the building of additional dredges is likely to eyentuate. ] Additions and Improvements to i Rolling-stock. During the year a total of seven "K" ! class locomotives were completed at the 1 Hutt Valley workshops and placed in service, making tho total number of these locomotives now in operation 30. Provision is made in the current year's programme for the eommencement of a further 20 locomotives of this class in the North Island and six in the South Island. Another locomotive development has been the conversion of the "G" class locomotive to a type more suitable for bhe class of work required, and a number &f these will be brought into use in tho South Island at an early date. In order to obtain a definite indication as to the effect the use of speedrecorders will have on train operation In New Zealand, arrangements have been made to equip 25 "AB" class locomotives with apparatus of this kind. The 25 speed-recorders are in the first place being fitted for purposes of test, and the further extension of their use (vill depend upon the nature of the results obtained. As a means of increasing the safety factor to a point where track conditions will not readily disturb the equilibrium of four-wheeled vehicles, a programme for the purpose of fitting laminated springs to those vehicles at present equipped with coil springs has been ""decided upon. Approximately 12,000 goods wagons will be so equipped. The construction of 32 additional bogie vans for the carriage of chilled beef is in hand. These wagons are of a design embodying all modern developments for the satisfactory conveyance of this commodity. Tests made with this modern type of vehicle for the conveyance of chilled beef have shown that the temperature required can be maintained with little fluctuation over considerable periods of time, and the companies engaged in the trade have commented most favourably on the results obtained. With the placing of the 32 new wagons in service the Department will have available 75 specially fitted wagons for the conveyance of chilled beef. An extensive programme of rollingstock construction was approved by the Government in the financial year under review, and the additional cars made available materially assisted in dealing with the Christmas and Easter traffic, while the pressure on freight rollingstock was eased by tbe new stock which became available for the rush period of March and April last. But for delays in. the supply of material for these wagons from Great Britain, many more trueks would now be available. It is anticipated, howover, that the necessary material for all new wagons on order will be available at an early date. I Suburban Travel. In order to remove the distinction in rail transport conditions as between the 8 o'clock worker and the 9 o'clock worker, a discrimination which has been maintained for many years despite frecLuent agit&Mpa for. it* removalx a«d

in order to eifect adjustments m otj>er directions in connection with the chargcs for suburban travel, the introduction of a new suburban 12-trip weekly ticket to supersede the workers' weekly tickets previously uscd in suburban^ areas has been approved. "The effeet of this change is that both the 8 o'clock worker and the 9 o'clock worker in suburban areas, as well as other regular travellers, are able to use tho new 12-trip tickets at any time of the day from Monday to Saturday of each week. The new type of ticket, ^in addition to providing for unrestricted rights with respect to the hours of travel, will also be a more suitable and generally more useful class of commutation ticket than any previously available. As a further encouragement to the use of railway transport in suburban areas a new type cf bearer ticket, at rates- substantially below those 'for Drdinary single or return suburban tialcetSj has been introduced. The new bearer ticket is transferable, and is available for six second-class single trips in either direction at any time up to the end of the month following the month of issue. Timber Areas. In accordance with the Government 's decision to re-open the Department 's sawmill at Mamaku, milling operations were resumed on June 15, 1936, after a period of inactivity covering one year and 10 months. After meeting the nonrecurring costs associated with the reopening of the mill due to its period of inactivity, the "issue" rates to pnrchasing branches during the financial year ended Marcn 31, 1937, were approximately 14 per cent cheaper than , ■ Liie outside sale rates prevailing in the North Island. This result was achieved after including all costs applying i.o private trading concerns, with the exception, of course, of land and income tax, but in any case the inclusion of the latter would not have materially affected the issue Tates. It is gratifying to me to be able to' record such a splendid Tesult, which is undoubtedly due to the efficiency with which the sawmilling operations have been carried on and to the wholehearted co-operation of all the workers employ-, ;Od. ...... Due to the increasing demand for native timbers for use in connection .with the Department 's rolling-stock building programme and in respect of the general maintenance of railway station buildings, dwellings, etc., the output of timber from the Department 's mill at Mamaku will soon be insufficient j'to cope with requirements. The' Railways Department owns the jfreehold pf an area of approximately. >1500 acres of bush land situated 36. ;miles from Putaruru on the Putaruru;Taupo main highway and containing approximately 45,000,000 superficial feet of rimu, matai and totara timbers, and authority has been given for the erecjtiou of a mill on thi3 block in readiness for an early eommencement of cutting to supplement the supplies from ! Mamaku, which is nearing the end of !its productive liie. ; Mechanicai Office Appliances. The extension of the use of mechanicai methods in the compilation of statistics! aiid accounting statements within the Department has been pursued during the course of the year, For some years past the use of machines in the compilation of statistical data and-in accounting work has been largely resorted to in the head office, and it has now been decided to extend the use of such machines to other centres, and a battery of type-writer-book-keeping machines has Tecently been -installed in the Christchurch goods office for ledgeriaccount work. The machines will facilitate the early despatch of weekly statements to ledger account holders, and this, together with the clear typewritten statements which will supersede the hand-written accounts previously xendered will, no doubt, be appreciated by the Department 's clients. The introduction cf machine methods for this class of work is in keeping with modern commercial practice, and the system which has been installed in Christchurch will later be extended to other centres. The New Wellington Station. The opening on June 19, 1937, of Wellington. 's new station was an event of outstanding national importance. The building sets a new standard in the amenities provided by the railways in this country, and in the opinion of ' experienced travellers is equal to the best that other countries can offer in the way of convenience and comfort in transport terminal facilities. High praise is due to the railway executives, engineers,. architects, builders, artisans and workmen who were associated in the conception, planning, designing and construction of this truly magnificent example of structural beauty combined with utility and effectiveness for the purpose intended — the "capital eity's central depot and clearing-hpuse and headquarters of fhe Dominion 's national railway system. Great benefits have already been obtained from the new station in the facility with which traffic demands at peak periods can be met — • as, for example, on the occasion of tho first Rugby test match between New' Zealand and South Africa, but when the whole of the yard re-arrangement is completed, when electric multiple units are running on the Johnsonville suburbau line, and all-electric operation is functioning on the Main Trunk line between Wellington and Paekakariki, then the benefits conferred by these progressive developments will be seen to be not only beneficial for the passenger traffic of the Main Trunk and Wellington suburban lines, but will have ^favourable reactions upon the handling of transport and the general flow of traffic throughout the Dominion. Outlook for the Future. The coming year will see au impressive development of railway services generally. Construction works of many kinds throughout the Dominion, particularly in the provision of rolling stock requirements, havo been delayeu luring tho past year through inability ;o obtain materials from abroad, but ;ke New Zealand orders are now coming o hand more aatisfactorily, and during (Continued on Page 10).

RA1LWAYS ST

(Continued from Page 9). ttie perlod of the eurrent financiat yeai ihe iollowing major improvementg will >e well on the way to completioa:— ■ (1) Electrification of the Wellingtonfohnsonville line. (2) Electriflcation of the North fsland main-line section from Wellington via the Tawa Plat deviation to Paekakariki. (3) Air-conditioning in the ordiaary and sleeping cars of express trains chroughout the Dominion. (4) Completion of several deviationa co effiect smoother running for trains and reduction "of operating costs. (5) Progress with Guristchurch new station and yard re-organisation in that sentre. (6) Elimination of a number of the more dangerous level-crossings and other efforts to increase public safety, Lneluding completion of the important ramp for an aiternative road outlet between Wellington and the Hutt Val'ley. (7) A large increase in the number of passenger-cars and goods and live- ' stock wagons available for service to enable the traffie offering to be handled with greater satisfaction to shippers and producers during the coming busy season. (8) Further development of the antonatic train-control signalling system to make centralised train conti'ol more effective. " Oonclusion. In conclusioii, I wish to reiterate what has been in my mind since first accepting the portfolio of Eailways, and has been expressed by me on every occasion when, in the course of my comprehensive tour of the whole railway system, I had the opportunity of meeting users of the railways and workers upon the railways in every part of the Dominion — namely, that I see the railways as the basic transport industry of the country —the one upon -v/hich all production both primary and secondary has • been developed, and through which the main stream of the Dominion 's commerce ' circulates. My viewpoint in that regard is in keeping with the Government's policy in respect of railway development, which is based upon the belief that the railways of New Zea.-. ' land constitute a national asset of great value which can be developed by an attitude of helpfulness to make this " great State-owned enterprise perform a great ocial- service for - the benefit, advancement, and happiness of the^ people as a whole, and we intend to go confidently forward in pursuance of ■ that policy, which we believe is likely more than any other to bring about a lasting measure pf good to the peopie of these islands. Wo intend to improva the means of transport and wherever possible cheapen the costs of same, and &t the same time improve the general co-ordination of all forms of transport. The Government's efforts in this direction have been' ably assisted by a highly efiicient and enthusiastic railway itaff, to whose efforts in both divisions must be very largely ascribed the excellent showing made by the Department during the year. In this connec-> tion I wish to pay a tribute to the staff of the railways who, as a whole, have worked as a wonderful and wellorganised team to give satisfaation to the Department's customers. I wish to fchank the general manager, Mr G. H. Mackley, who, with his assistants, has set the standard of service on a high plane, and has applied his technical knowledge, great energy, and unfailingi Tesource to give effect to the Govem-i ment's progressive policy in relation to the Tailway service. ,

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The Government's Railway Policy.