BUS FARES RAISED

Sun (Auckland), Volume IV, Issue 1024, 15 July 1930, Page 1

BUS FARES RAISED

P.T.C.’S PLEA UPHELD ACCOUNTANTS’ DISAGREE The Transport Board granted the Passenger Transport Company, Limited, permission this morning to make certain Tncreases in fares, in accordance with the report of Mr. G. C. Gorrie, an accountant, whp was deputed by the board to set out what he considered a fair increase. The question of a revision of fares has been under consideration for some months. Dissatisfied with Mr. Gorrie’s proposals, the company asked Mr. J. M. Elliffe, another accountant, to examine its books and state what in his view was a fair increase. Mr. Gorrie reported that to ensure a dividend of 8 per cent, on the company’s capital it would be necessary to increase all cash fares 12 per cent, and to ensure the same dividend it would only be necessary to increase all fares (workers’ weekly, concessions and cash fares) li per cent. Mr. Gorrie pointed out that users of the buses, once satisfied that an increase was necessary, did not restrict such increase to 8 per cent. They were agreeable to 20 per cent., allowing a dividend of 10 per cent, and an equal amount to be carried to reserve. To guarantee 20 per cent, the cash fares which Mr. Gorrie marked for an increase would require to be raised per cent. These rises would mean an increase of Id on fares at present from 2d to lid, a rise of 2d on fares at present from Is to is lid, and a rise of 3d on fares of 2s or over. The percentage of increase the residents were prepared to agree to, ran from 50 per cent, to 10 per cent., never less than 10 per cent., said Mr. Gorrie. “I would strongly recommend that the fares •be raised on these lines,” he said. “The residents would be satisfied, and every indication points to sucli increase augmenting the profits of the company to an extent which should also be eo«i* idered satisfactory from its point of view.” MR. ELLIFFE'S REPORT “In 1927 the company made a reasonable profit,” reported Mr. Elliffe. n’Jn 1928 the profit was reduced by one third, while in 1929 the profit almost disappeared, the accounts showing only £lO profit for the year. Accounts have just been completed which 1 show that for the period of six months ended April 30 last there was a loss amounting to £1,245. These last accounts were not available for Mr. Gorrie’s inspection, as they have just been completed, and it is posisble that, had he seen them, they would have affected his recommendations. “It seems to me,” Mr. Eliffe continued, “that the only equitable basis of adjustment would be to increase the cash fares as suggested by Mr. Gorrie and also increaes the workers' weekly and concession tickets.” Mr. Elliffe suggested that the amount of the increase in cash fares be the same as Mr. Gorrie proposed, that workers’ weekly tickets all be increased by Gd a ticket and that a similar increase be made on all concession tickets, which was one-half the increase the company desired. Attacking Mr. Gorrie’s report, the company’s solicitor, Mr. N. B. Spencffer, claimed that the accountant had only replied to questions the board had asked. There were several ways of making these reports and Mr. Gorrie had simply answered in a way suitable to his clients. BAD ON PRINCIPLE Mr. Spencer said the proposal to increase cash fares was bad on principle, economically. The company wanted concession tickets increased in price as the Transport Board had done when faced with loss. By increasing cash fares only, people would be driven to buying concession and workers’ tickets and finding other means of transport. Mr. Spencer hinted that if a sufficient increase were not made as proposed then the company might be forced to increase the price of apprentice!?’ tickets. The board unanimously agreed that Mr. Gorrie’s recommendations be adopted. If, at the end of six months, the company or the users of the buses felt the question should be reviewed, then the board would be pleased to - do so.