THE RAILWAYS

Hokitika Guardian, 9 April 1932, Page 6

THE RAILWAYS

TRANSPORT PROBLEMS

HOARD: CHAIRMAN’S REVIEW

■ WELLINGTON, April 6

Scime important aspects of New Zealand’s transport problems "lore presented to /members of the Wellington Rotary Club by Mr H. H. Sterling, chairman of the Government Bailways Board. Mr Sterling emphasised thatfho was not speaking in an official capacity, but as a student foi many years of transport problems. Air Sterling maintained that transport was and always would lie the basic industry of commerce, and were there was instability in transport it would effect every other industry 1 in the country. Railways were necessary because they were the largest unit in transport, and for that reason were likely to be the backbone of industry. He said he need not go back further than railways in transport, as they were operating when the j Dominion was in its infancy; hut I what he would like to convey and emphasise was the vital part they played in the development of New Zealand. They had played a vital part in providing the facilities for the development "of a district, and wore essential to it. Yet for such service only a “policy” rate of interest was allowed for developmental value.

COM M ERCIAL[SAT lON ORDER In 1925, Mr Sterling continued, came the order, that all Government departments had to he commercialised; 'they had to produce a balance-sheet each year. , That was unfortunate from the railways point of view, as it was under this method impossible to allow for developmenal value; sound enough perhaps in a strict business sense, yet inequitable and unjust really from the railway point of view. So the railways and their losses intensified by competition from a new order of transport, the motor vehicle, began to loom in the public eye. 'Many began to say that the railways were clone and the new form of motor transport was the one to favour. Air Sterling, said parenthetically that fie did .'not wish to convey the idea that the motor did not have its place in tmnsoprt, as it was a very valuable aid, and in certain situations exactly suited.

REDUCING COSTS. Then came the task of reducing costs, lie continued, and so thoroughly j was the job done that the savings were | £500,000 last year, and, carrying on, the drop this year would lie £1,250,(100 or a, reduction in two years of | £1,,'50,000, m mii fcS'iiy expenditure,. J and although there had been a drop I in revenue the department- would be j able to show an increase in net rev- ! eime on the previous year, j That must be regarded as satisfactory, said Mr'bSt'crli'ng ) '"ns £6 per cent, of the cost of running the railways i comprised fixed costs and tile other JO per cent, was not very sensitive to fluctuations in traffic; so that looking nt tile railways from a community point of view the disadvantages lay ;iu wasted capacity—the work they i could do yet were not being required to do for the same amount of energy. "Viewed in that light any duplication in services was. prima lacie, wasteful and uneconomical.

NOT A PARALLEL. At present the state of the industry was .chaotic, Mr Sterling continued. Many people asked, “What are the railways howling for? They superseded the stage coach — now its the motor’s turn.” But that analogy was not a fair one, lie said. 1 lie railway not only superseded the stage coach but it extended much faster services in all directions and stirred the whole country into lit i*, so tlie analogy was not a parallel. “.Look at the tonnage” lie said. 'W by is there some tonnage tlie motors do not want and will not touch.” He gave the example of Britain and her iron ore and coal freights, carried at 2.10 d per ton per mile.

A WAY OUT. It was no good his saving that the railways as an industry Were in a stale of chaos unless lie could suggest Miule way out, and lie though he saw n chance by proceeding on the lilies of our legal judiciary iu its recent ref-oiiiniomlntions as t<> the settling of disputes- There was no reason why all parties concerned in transport services could not come together by the exercise of somewhat similar machinery". He could foresee an economic judiciary which might straighten I Idngs out. The rudiments of it were in the Transport Act of last year, but. the blemish in that Act was that local bodies in the centres were created the licensing authorities! He Thought that by pursuing such a course they might he able to get stability where