COUNCIL’S £414,000 LOSS

Sun (Auckland), Volume II, Issue 345, 4 May 1928, Page 16

COUNCIL’S £414,000 LOSS

Mr. Ford’s Estimate Questioned EFFECT OF BUS COMPETITION FE estimate by the tramways manager, Mr. A. E. Ford, that bus competition cost the city council £414,000 in lost revenue and extra running expenses was shown, before the Transport Commission, to be based on figures open to question.

When Mr. V. R. Meredith, counsel for several outside local bodies opened his attack on the estimate, he pointed out that in 1922 a 5 per cent, increase was shown in passengers, but in 1921 the figures were only for 344 days, as against 365 days in 1922. Mr. Ford: It would have been more correct to calculate it considering that. Mr. Meredith: I say it is absolutely incorrect not to calculate it that way. The real figures show a decrease of 1.2 per cent. As the £414,000 loss is based on figures for three years prior to 1924 which are wrong, the estimate is wrong. Instead of estimating on a 6.4 increase in passengers it should be calculated on 4.26 per cent. MILEAGES QUERIED Witness said he had taken the mileage in 1924 as a basis, and had calculated his working expenses on this. The extra miles run in 1925 were 497,218, which at 13d a mile meant £26,933. You told me this morning that you calculated to increase the mileage every year?—Yes. Do you call it fair, after that statement, to debit every extra mile run against bus competition?—Yes. I do under the circumstances. Mr. Meredith: Well, I’ll leave it at that. You debited every bus mile you ran against the loss by competition? —Yes. Witness said the buses were never run as the council had intended to run them, and the whole of the 110,445 miles run by all the council buses in 1925 were put in with the loss due to competition. Mr. Meredith: You still run some of the services you were running in 1925. They are legitimate now. Why were they not then? Witness said there was cut-throat competition then, and the buses were used to combat this. STILL RUNNING Why do you continue to run them?— We are maintaining our rights until there is some definite policy and protection. Then if you were sure that there would be no competition you would take them off?—That is open to question. “Then they are legitimate services and should never have been included as an item in the estimate of loss due to bus competition/’ remarked Mr. Meredith. He was referring particularly to Parnell and Buckland Road services. The bus miles in 1927 were set down at 1,346,317 miles, at a cost of £91,942, receipts being £60,350. Of this 700,781 miles at £47,857 was charged

against bus competition. This included the Buckland Road service. Mr. Meredith pointed out that the council had had a monopoly in Buckland Road, with no chance of opposition, but continued running the service. Witness considered he was right charging this service against competition. Mr. Meredith: Are all your estimates to the -council as good as this? Mr. Ford: My estimates to the council are all right. Bi;ing them along one at a time. I had several accountants look at this estimate, and they thought it was all right. Mr. Meredith: Well, you had better let them have another look at it. “FRAUD ON THE PUBLIC” Mr. Meredith then led the discussion on to the spending of the 1923 loan of £280,000 mainly raised for Remuera, Point Chevalier and other extensions, and practically all spent on other works, including purchase of omnibuses and Gaunt Street Depot. Witness said that at the time of voting the public knew that 10 buses were to be purchased, but they did not know about the remaining 20. They were advised by circular afterwards. Mr. A. H. Johnstone, for the City Council, said this was all on record, and was admitted. Mr. Meredith: We know that, but Mr. Ford has told you his opinion of why the £500,000 loan -was lost last year, and we are going to show you ours. Mr. J. Stanton, city solicitor, said the terms of the voting paper were very general. Mr. Meredith said that after what was put to the public the attitude in dealing with the loan authority as an open cheque was a fraud on the public. Mr. Johnstone said there was no fraud. The loan was taken in a bonafide manner, and the following circumstances altered the necessity. Part of the expenditure stood, and any about which there was a doubt was ratified by special act. RATEPAYERS KNEW BETTER Mr. E. H. Northcroft: It was attempted again and the ratepayers would not permit it. Mr. Johnstone: Do you suggest this was put forward with malafides. “I am not referring to the £280,000 loan now, but to the £500,000 loan of last year,” replied Mr. Northcroft. “Mr. Johnstone is speaking as the lawyer now,” remarked Mr. Meredith. Technically they could do it, though proper they could not.