RAILWAY FINANCE

Hokitika Guardian, 1 November 1927, Page 4

RAILWAY FINANCE

NEED FOR PROMISED REFORM

(Taxpayer)

' Happily the unsatisfactory conditions of rail way finance in Now South Wales and South Australia, as indicated bv the cables from Sydney and Adelaide published here last week, have no parallel 'in this country. Jn New South AY ales, it seems from a statement made by .Mr T. K. Bavin, the new Premier, the late Inibahintr Government, in fear “of the effect it would have on the public mind’’ suppressed a. mommemlation made in June last by the Railway Commissioners to The effect that the fares and freights on the State lines should lie increased to cover costs amounting to some £1.700,000. Probably it would not he unduly liarsn to assume that the Labour Governi meat's concern for the effect flic publication of the commissioners’ recommendation would have upon the public mind was not altogether unnssociated with the approach of a general election. In South Australia nothing quite so culpable appears to have happened ; but even here, if the cable j agent i-. to he trusted, the Government lias shown only a scant regard for constituted authority and none at. all, on occasions for the interests ol the taxpayers. Nearly two millions, wo are told, were spent last year ! without parliamentary sanction, and ' “passenger services, both in the metropolitan and country districts, were maintained at a heavy and increasing loss.’’ Successive New Zealand j Governments have perpetrated, in less or greater degree the latter ollenee ; ■ hut none of them lias over-run a de--1 parinvontal vote by even as much as a tenth of two million pounds. XEAKEK HOME. But while the New Zealand taxpayers may congratulate themselves : in ;t genera! way upon the integrity j and candour of the politicians who ’ administer the public affairs cl the i Dominion, they must not assume that ! the need for railway reform lies only jou the other side ot the Tasman sea. 'or still further afield. II is true Ilial the present Government is pledged In ! apply itself to this great problem j with increasing zeal; that gradually . it is preparing tTie way for the tv.tl- , isntinn of what is praeti:\thle in the j recommendations of the Kay-liaven

Commission, and that it has set tin local advisory hoards with the purpose of bringing the service into closer touch with the public. .All this is to the credit of tlso Minister of Railways and his colleagues, and if the critics are impatient it is because I lie w I tee Is of reform ap|H>u.r to move with wearisome deliberation. The Railway Statement pr.seated t * Parliament this session, though it contains a gaud deal of inter *,: lug (.niter, concerning what is to he atte.ql••(l within the C":ct iter;, !,■ nr oirers only the scantiest irumli ot c.*n;I'ort to the loiig-snll'oriitg taxi aterwho are hearing ' i'e burdens of today. By the Kaihvat Aniei'drucnl Act ol 1925 the Denarituenl was relieved ol all iiioi.u ial ti'speusibi Tv tn comn'ctinn with loses it tnctiiTcd u branch lines, the ; n, mo; ef thesi' .-s es being collected from He* ( ot -olid-iI . ed Fund, which wan; ol course, that it is being taken out ir the la'pryei-’ pockets. .now n is done. It. may he mD'i'esting to io'iov t his method of .:cc innl. |.(•( |. 11 ,<g a little liirlhcr. In the financial vc.tr

[ 1.925-26 the -RailwaY Depart in.■ n 1 ■ claimed to have made a profit, of -Ci8,172-1 Irom the operation of t Inline s under its control; hut as a malter of fact this sum was merely the residue remaining in its hands after £' 9..T1C had l,*.'en transferred to its credit Irom the Consolidated Fund on behalf of the 'branch lines. In the linanci.nl year 79,'26-27 there was a loss ol *£99.66(1 on the lines -till fiu-aiu-ed by the department and a loss ol £1*15.220 on the lira licit lines, making si. total deficiency of £511,880. yet the Department plumed it-elf upon having got through a difficult year with a loss of less than £IOO.OOO. A disturbing feature of these figures is that the losses on the branch lines lor whose finance the Department is no longer t esponsihle, rose I'romJB.'Io!)510 in 1925-26 to IM 15.220 in 1926-27, an increase of £807).681). A result of this kind was predicted when the Bill relieving the Department of financial responsibility in regard to these lines was before Parliament, hilt a, majority of 'the members, in their

simplicity, were persuaded that a. good purpose would be served hv disguising the real position of t’’e railways. It. is to he hoped that the cost c.f the process will not mount up at the rate of £35,000 a year, as it did last year hut all the exiting conditions are favourable to a greater or smaller annual increase. Management that lias not to account for its expenditure rarely is a whole-hearted exponent of the virture of economy. OTHER COXIERNS*.

In addition to the loss of the half million or so the Department is burying us far as possible out of sight in connection with the branch . lines ol i ailwa.v .there are other losses it is making which cannot he easily traced. Its experiments ill house-build-ing, for instance, undertaken no

doubt with the very best intentions involved it in a capital expenditure of about £BOO,GOO and a loss ol £Ol.210 in the financial year 1925-20 and a loss of C•"■1.182 in the year 1920-21. The Department sold from its Erankton House Factory to the Unit Valley Housing Committee 122 houses at the reported price of £025 each. In the Department’s report of 1925-2(5 the cost to the Government of a five roomed house was shown as £0155. It. would ho interesting to learn how the Government really fared in the Unit Valley undertaking. The Department’s sawmilling and housing business again c. a mystery beyond probing in a mere enumeration of this kind. The reserve fund, assoc iated with this undertak ng has been considerably reduced during the last two or three years by the realisation of sawmill pnrpertics, and last year the actual trading loss leached £8,062. The Department is cutting prices where it encounters opposition and yet freed from all taxation and enjoying exclusive privileges assuredly increasng the burdens of t’*e taxpayers as are its branch lines if railway. What the wul.lic is entitled to in this matter is a plain statement of the facts from the Minister in charge of the Department, who happens to ho no a less a person than Vo Right Hon. J. G. Coates himself.