TRANSPORT BILL

Hokitika Guardian, 25 August 1931, Page 2

TRANSPORT BILL

ipROF MURPHY REVIEWS LATEST PROPOSALS.

CASE FOR REGULATION.

“I consider a prima facie case for regulative control of the industry exists, because the motives of private interest and free competition are not working for the protection of the consumer or the avoidance of national |r waste, and arp in fact working the other way,” states Professor B . E.

Murphy, Professor of Economics, VicI toria College, in a rnemoraindum on the Transport Licensing Rill, 1931, prepared for the guidance of motor interests. Professor Murphy says that as a general rule it niay bo accepted that when free : competition can bring relief costs down, the case for State intervention is not made out, but that where unregulated private economic activity either causes waste, or fails to .protect the public, a case for regulative control arises, or at all events is worth consider'ng. In such . instances, of which es'-ftblished monopolies and public service industries were typical i* l modern times, competition gpye .wa'y to regulation and social control in the interest 3 of the community ' in general and the consumer in particular. “Motor transport i» in quite a different category | from the conduct of ordinary trading activities, and it makes use of important and valuable property, belonging to the people ( namely, the publio road®, while ipoidentally it has to be linked up with the railway system, in which the public are materially interested as psers and taxpayers,” states Professor Murphy. “The motor industry further embodies a' huge capital, which in the publio interests should be used as economically as possible/ even though it does belong to private individuals.' Unnecessary competing motor services over the same routes are as wastefuljy consumptive of national wealth as would be competing - gas installations in a town, or . compeffrig trams or drains down the same ptre t.

. EMPTY- WASTE. ■ ; ■' “If competing -/services in excess of traffic offeriug#ppe.rata over the-, same routes, the.reeiiit W under-utilisation qf availabe ppwpr and. space, in/yqhjojep, and a higher/ovirJieijtd for ‘ equipment and operation, .tftan' is economic. |n j-qe circumstances, -fe tlferp isiunused Wfit accommodation. or unemployed facility, this 1 has to 'be paid for: by somebody; ■ ■eifhbr i; by a lower standard of service/! or' by /diminished profits lower wages'/, / jar fares than rationalisation '.ypuld'"-. permit. -This «.is social waste", limVa' foal "thought broad ■ sense, and stfch: waste howeyOr/it may be distributed: amphg'lndividuals, in a lo's tp the' ; lkun%i ons ' at a - time, when it can ill. be afforded.” r The memqranjjmn - states that voluntaiy be impossible, *aj^'any' s eoriouß l^v^rnpi' to jjpve effect to it, by exdstipg jnetyr interests woi}ld bo met ; by.'..% dryi|thftt « mbnop)y was boihg attempted, |cTo be effective ooordination would/have be imposed from without': Thv .typo of regulation /proposed by tfip would allow ' 'pervi'pes! Where justified, but fpotition. ; / -professor Murphy adds:— ; : rationalisation to eliminate waste 'Blitfjiid so reduce costs as; to enable to be lowered, and the licensing authorities, with the expert assistance of the Transport Department t > back them, are. there to see that charges , are in fact kept at a reasonable level. The. incidental; service, of inspection is an important aspect of the / Bill. Much preventive danger arises out of chaotic competition conditions, . meaning unduly high speeds, and excessive journeys by an over-tired driver, which have been responsible for many accidents. There is also the necessity to ensure comfort and safety of travel, and safeguard the publio interest in the roads, the construction rOstß of which fall on the public. These costs are enhanced at present by lack of speed regulation in the case of large and heavy vehicles. “This regulative system is not analogous to the protection of an industry by tariff or bounty. It is the reverse. It is designed not to protect the service companies, but to safeguard the public; and just as other public utilities are regulated in the public iinter- , est as regards safety and standards of service, so should the motor industry. The to the service com pa ires should be considerable, but they are incidental, and not the object of the Bill, which is to protect the consumer, and not, like a tariff, to protect the producer. ‘

NECESSARY REGULATION. “Thq objection.to 'more Orders-in-Couneii’ begs the question. Whether we like it or not, government by Order-in. Council has come to stay, and will increase rather than diminish in area, because it is the only practicable way of coping wiih the complex functions of the , State to-day. Modern economic life, especially the development of cities,- industry, and transport, has forced bn the Government entirely new fields of necessary regulative control,

in which action must he both detailed

and flexible.' Experience j shows that. „ this field cannot be regulated by formal Acts of Parliamentary enactment is not suit°d for detailed administrative purposes. “Regulation of national motor traffic by local authorities is unsound in principle, for two main reasons. In the first place, they are interested as motor operators themselves, and no man or body of men, except the State itself, can be judge and jury in its own case. In the second place they are with local adminis-

t,ration, and localised in outlook and area of operation, while it is not expedient to give local authorities jurisdiction outside their territorial limits. Economic ard administrative areas should ooincide, and that means a nation-wide authority. The principles of the Bill are m accord with sound economic standards. The measure is of course tentative and in a sense experimental, and may require amendment in , the light of accumulated -administrative experience. It is in line with modern thought and practice in the field of motor transport in .most advanced countries. The case is reinforced by the urgent necessity at the present time of eliminating or reducing preventive national waste.”