Petrol Tax Raises Bus Costs by £1,430

Sun (Auckland), Volume II, Issue 337, 24 April 1928, Page 15

Petrol Tax Raises Bus Costs by £1,430

KOHIMARAMA SERVICE PLEA FOR INCREASED FARES It is claimed by Leonard John Keys, proprietor of the City-Kohi-marama bus service, that the operation of the 4d a gallon petrol tax will increase his annual expenditure by £1,430 and transform a small profit into a substantial loss. His appeal against the decision of the No. 1 Licensing Authority in not allowing him to raise his fares was heard by the Transport Appeal Board this morning. The increase in fares which was proposed did not affect cash payments, but the appellant sought to raise the weekly tickets as given below: —Men, 6s 6d to 7s 6d; women, 5s 6d to 6s 6d; children*, 3s 6d to 4s; 12-trip concession cards, city to Meadowbank Road, 4s 9d to 5s 3d; Purewa, Cs to 7s; Public Works camp, 7s to Ss; St. Heliers or Kohi, Bs’ 6d to 9s 6d. The appellant declared that, owing to the operation of the petrol tax and other circumstances materially increasing the cost of giving the service, it had become impossible to conduct the time-table at existing fares. It was declared by the appellant that, based on last year’s petrol consumption, the petrol tax would mean an additional expenditure of £1,430. SMALL PROFIT Mr. V. Meredith appeared for the appellant, Mr. Goulding for the City Council, as successor to the Tamaki Road Board, and Mr. J. Stanton for the City Council. Mr. Meredith told the board that the profit from Mr. Keys’s service last year, withoLit allowing anything at all for himself, was £1,211. His services were considered to be worth £l2 weekly, which would leave a substantial deficit upon the operation of the tax. A strong protest was registered by Mr. Meredith against a request by private residents in the district to inspect Mr. Keys’s books relating to the business. Every facility would be given the members of the board, however, to investigate the accounts of the appellant, and all possible information would be produced. figures produced to four decimals showed the cost a mile of Mr. Keys’s service to be Is 2.5713 d and the revenue Is 3.0039 d, leaving a margin of .4320 d a mile. The City Council’s own estimate of a minimum guarantee for a payable service in any district was Is 6d a mile, which was much greater than Mr. Keys’s revenue. The chairman intimated that the members would investigate the bal-ance-sheet, and if it were considered essential an outside accountant would be invited to assist. It was shown by Mr. G. E. L. Alderton, a director of the North Shore Transport Company, that the cost of the bLises on the other side of the harbour was Is 4*d a mile, including 7 per cent, capital charges, and Is 3d exclusive of any capital charge or income. With the exception of “Spite Gap,” near Belmont, the whole of the company’s route was over concrete roads. Mr. A. M. Goulding suggested that it was unfair for the bus proprietor to raise the concession fares, and leave the cash fares at their present figure. It was from the concession fares that the proprietor derived his chief source of revenue. No accurate compfluftion of fares takings had been made, as apparently there was no definite system of issuing tickets. He asked for an independent accountant to investigate the financial statement of the company further. The appellant pointed out in evidence that concession cards were being raised in price because cash fares were already high, while the reduction on concession tickets was more than usual in such circumstances. Mr. F. C. Jordan, chairman of the local ratepayers organisation, gave evidence showing* the hardships imposed upon the people by high fares. The people would rather have a curtailed service. The chairman: But the proprietor has to put on sufficient buses for the peak load. Mr. Jordan: We think the position should be thoroughly investigated. No figures were available. Mr. G. Grey Campbell: Do you suggest Mr. Keys is covering something up ? Mr. Jordan: I would not go that far: but I say that the most thorough investigation should be made. The chairman: I take it that it is an economic proposition. Mr. Keys: I have never been asked by the Tamaki Road Board to produce figures. The chairman intimated that the board considered the balance-sheets of the appellant were fair and honourable. It was unquestioned that the petrol tax was a charge that a bus owner was entitled to pass on. unless his profits had increased to such extent as to be offset against the additional cost. This had not been so in the case of the appellant. The board was satisfied that the percentage for depreciation allowed by Keys was not excessive. It was felt, also, that it would be uneconomic to increase the cash fares on account of the summer cash traffic. These were dropping already, and a further burden would not assist concession ticket-holders ultimately. The amount which would be denied from increased fares would just about offset the petrol tax payable, and the board did not perceive anything unreasonable in the proposal.

The appeal was allowed, the board stipulating that the licence of the appellant must be reviewed annually, so that if a substantial reduction in costs occurred, a reduction in fares could be insisted upon-