The Sun 42 WYNDHAM STREET, AUCKLAND MONDAY, JULY 22, 1929 MAKING RAILWAYS PAY

Sun (Auckland), Volume III, Issue 721, 22 July 1929, Page 8

The Sun 42 WYNDHAM STREET, AUCKLAND MONDAY, JULY 22, 1929 MAKING RAILWAYS PAY

TAXPAYERS ill this country are now paying- directly and indirectly about £1,000,000 a year to m&et financial loss on the working of the State railways, which are tax-free; in Great Britain and the United States, where railways are run by private enterprise, both systems pay heavy taxes, America’s contribution to the national exchequer being yearly no less a sum than £77,000,000 in taxation. Here, the country loses in two ways. These facts may not necessarily represent the difference in value between private and State enterprise, but the contrast surely is vivid enough to cause administrators and taxpayers alike to think seriously about the present financial plight of New Zealand’s railways system. Everybody knows the occasional unpleasantness of making comparisons, but there are occasions when it is perfectly fair to make them. But before anyone sets out to compare the Dominion’s railways with non-political railway service in other countries, full allowance should be made for the irrefutable truth that our system has suffered severely from political control rather than from inefficient management. Politicians in past years have spent millions of borrowed money on uneconomic lines', and the present* Government is determined to sink millions more in new railways which admittedly must be of doubtful economic value. The practical administrators of the debt-ladened railways cannot eseape being hampered in their improved business enterprise by this lavish, if not rash, expenditure. A pamphlet on the subject has been prepared by the Canterbury College Department of Economics. It is*, worth the serious consideration of business men, politicians and railway administrators. Some remarkable differences between State and private enterprise in the running of railways either for profit, which is the oldfashioned idea, or as a national institution giving appreciable service that cannot be demonstrated in terms of money—the newest idea in this country, a policy which has been explained ably, but not very convincingly by the competent general manager of the New Zealand Railways. Nine years ago, for example, the railways of the United States were released from war-time State control. Since then, striking progress has been made, notwithstanding colossal competition with motor transport. The American railways system now represents one-third of the world’s railway mileage. In six years, up to 1927, passenger miles declined 10 per cent., and ton miles increased 38 per cent. Despite subsequent reductions in traffic charges and slight increases in wages and numbers employed, operating expenses remained practically the same, while net revenue increased by 78 per cent. Then, consider the educative conditions in Great Britain, where the four railway groups provide the best passenger service in the world, and incomparably better than the best in America. Last year, under the stress of depressed industry and road transport competition, the receipts fell by nearly £8,500,000; but, as against that, the expenditure was reduced by more than £6,500,000. It js clear, therefore, that under private ownership and administration, losses are being met largely by business methods and rigorous economy. Here, almost in every way, through no fault of the management, which already has done splendid work in combating the worst effects of political control and tlie construction of political railways, the losses are consistent. Within the past eight years, according to economists, earnings per mile of railways have increased by £27, but expenses per mile have increased by £ll3. And there has been 30 per cent, increase in the total number of employees, from 14,252 to 18,451. The subsidy paid from the Consolidated Fund on “developmental lines” has leaped from £359,000 in 1926 to approximately £500,000 last year. In spite of that substantial help, the cost to the taxpayer this year probably will run to nearly £1,000,000. As the Canterbury economists’ bulletin quietly puts it, “manifestly the whole of these losses cannot he imputed to motor competition, nor to depression, for the country has had two years of very favourable conditions.” The real cause of the trouble is, of course, the fact that hundreds of thousands of pounds have been squandered on branch lines that cannot pay for axle-grease. Fortunately, we now have a confident assurance from Mr. Stirling that the railways are once more coming into their own. Let it he hoped that the politicians will not arrest the progress of the good times that are coming to the railways. Meanwhile, the taxpayer staggers under a grotesque burden.

A FIFTH-CLASS HIGHWAY!

SOME misgivings were recently aroused by the Matamata County Council’s action in declaring 13 miles of the main Mamaku Hills road to Rotorua a fifth-class road, and in bringing a successful prosecution against a Rotorua transportation firm for running buses of excessive weight: over that section. The principal point at issue is that a local body with a distorted view of its responsibilities toward the travelling public may cripple the communication system between two centres, as the Matamata County Council has, in this case, by severely restricting the types of vehicle that may make a through trip from Hamilton to Rotorua. Of the highway concerned, the county council controls only 13 miles out of a total of 69. Its present professions of concern for the private car-driver cannot be (•(•edited with sincerity in view of the fact that the Matamata County Council’s section of the Mamaku Hills was a standing reproach to the highways system until the Main Highways Board, assisted by a contribution of £I,OOO from the people of Rotorua, assumed responsibility for the improvement and maintenance of what is now a modern, tar-sealed highway. Though its only apparent contribution to the comfort of motorists travelling over the road is a paltry £2O a year from the rating account, the county council still has nominal control of the road, and hence is able to classify it and determine the class of vehicles that may use it. The fifth-class classification it has adopted allows it to prosecute all bus-drivers whose laden vehicles weigh more than 2-J tons. As a result, scores of people who might travel to Rotorua on one-day and two-day excursions may be prevented from doing so. But there is a wider question than that involved. The. Mamaku Hills road is part of the main network of arterial roads linking up the cities, the provinces and the provincial centres. It is one of the main communication routes between Auckland and Wellington, and is on the main road between Auckland arid Napier. If the county council has any reasonable grounds for fearing the stability of the road, and bases its classification on such a concern, then the position should be remedied at once. If not, then the county council should he made to surrender its rural prejudices, or else the control should be taken out of its hands. The Auckland Automobile Association has interested itself in the matter, but according to its latest information the Highways Board is inclined to sustain the county council’s classification. But by the grace of the United Government there is now an even higher court of appeal than the Highways Board. The time seems ripe for the fledgling Transport Council to show whether it has real or only imagined authority.