GOODS RATES MAY RISE

Sun (Auckland), Volume III, Issue 903, 21 February 1930, Page 10

GOODS RATES MAY RISE

RESULT OF DECREASING BUSINESS CARRIAGE ON RAILWAYS From Our Resident Reporter WELLINGTON, Thursday. If the carriage of high-rated ghods is taken from the railways by other forms of transport., there is a possibility that an increase will follow on low-rated goods. In a statement Issued by Mr. H. H Sterling, general manager of railways, he says that if the present tendency of people to take their highrated goods away from the department is not checked, it will either result in further retrogression in the financial returns from the railways, or it will necessitate an increase in the low rates.

“We have recently been giving much thought to the position that has been developing for some years as a result of some of our customers giving their high-rated goods to competitive forms of transport, while leaving their low-rated goods with the railways," he said. “It is the high-rated business which enables the railways to keep the rates on low-valued commodities down to the level that has hitherto obtained. “EASIEST WAY OUT" “We have now arrived at the position in New' Zealand where it is no longer possible from either a business or an equitable point of view, to postpone action. The easiest way out of the difficulty is to make a general increase on the charges on the lowerrated goods. Consideration of this proposition at once suggests the injustice that might result from raising the rates on theae goods for the many people who have remained loyal to the railways, and given us the whole of their business. “There is the factor also of the great desirability of keeping our low rates down to a minimum, both on general grounds and for the reason that, from the special circumstances of the Dominion, most of the low-rated goods have a bearing more or less direct on our principal industries. The obvious inquiry suggested br these circumstances is to consider whether some system could be evolved that would avoid penalising our customers who have remained loyal to us, while preventing those who have not done so from continuing to reap the advantages of the low rates, which, by their action, they are jeopardising. “The person who takes away from us the capacity to maintain the low rates can hardly consider himself entitled to those rates. We are, therefore, taking action that will prevent his doing so. The action is not only justified but even demanded by every reason of equity.

“Some mention has been made of the goodwill aspect of the matter, and it has been suggested that action along the lines I have indicated will cause the department to lose goodwill, with. I presume, a loss of business. The boot is rather on the other foot. Goodwill in the la6t analysis is worth the business it brings. The man who takes h s highrated goods from us and leaves hia low-rated goods with us, is not a customer because of goodwill, but rather the opposite. “The goodwill that is worth while and worth protecting and fostering, is that of the customer who remains loyal to us. lam quite satisfied that, as those customers see themselves being penalised through the actions of others, the goodwill of these “loyal” people—to the extent that we fail to take such action as lies within our power to protect them—will become a diminishing quantity.’*