THE RAILWAYS.

Taranaki Daily News, 22 September 1922, Page 5

THE RAILWAYS.

THE YEAR’S OPERATIONS. DEFICIENCY EXCEEDS A MILLION. REASONS FOR THE LOSSES. (By Wire.—Parliamentary Reporter.) Wellington, Last Night. The railways statement which was presented to the House to-day states that the operations for the year ended March 31 last have resulted in a deficiency of £1,021,156, allowing for interest at the policy rate of 3| per cent, on the capital cost. This result represents the economic effect produced tby the war. The causes which have contributed to bring this about are a decline of traffic, resulting from the business depression, an increased price of coal and other material, together with the advance in wages. The circumstances have, however, been so exceptional that too much importance cannot be attached to the results obtained. The department should be judged not on the results of a single exceptionally bad year. The department since 1910 has been operated on the basis of securing a return of 3J per cent, of the capital cost, p.ny surplus earnings being returned to th? users of the lines by reductions in charges or increased services Many reductions were made up to the time when war conditions compelled, a halt. In the aggregate these reductions in rates granted as a matter of policy represented a revenue of over £2,000,000, of which £1,400,000 went to farmers and pastoralists. During the period 1910 to 1922 the department earned £1,667,968 in excess of the amount required by the policy. If the calculation is ’based on the average rate of interest of the public debt, instead of 3| per cent., the deficit in the past 26 years has been £1,250,257, an average of £47,933 per annum. This figure represents the cost to the community of having the convenience of means of transport by railway. The railways are performing many services at less than actual cost. In many instnees exceptionally low rates were granted to assist in establishing industries which are now in a flourishing condition. The need for assistance per medium of an unprofitable railway rate is no longer apparent. Included in the list of traffic carried at a loss is roadmaking material for local bodies. The loss to the department on the actual cost of the haulage of this materia], used largely for the upkeep of roads to enable motor lorries to compete with the railways, is over £50,000 a year. The lose in respect to other unremunerative services is £130,000 a year. The concession made in railwnv rates to school children amounts to £25,000 per annum. The general manager states that the expenditure during the year on works authorised by the Railways Improvement Amendment Act of 1914 was £62,069; making a total expenditure on the scheme up to March 31, 1922, of £761,062. Although the country is at the present time passing through a period of depression the ’business that has to be handled is very much greater than that done in 1914. No material improvement has, in the meantime, been made and considerable difficulty is daily being experienced at terminal and subterminal stations in dealing effectively and economically with the traffic now offering. It would be a fatal mistake to postpone the completion of the 1914 scheme until the country again enters on an era of prosperity. Such postponement would be disastrous to the operations of the department and the business of the country. Preparations for the increased business which the railways will inevitably be called upon to deal within a comparatively short time should be made during the period of depression and the necessary works should be vigorously prosecuted and be completed in readiness to meet the inevitable demand that will arise. DISCUSSION IN HOUSE. MINISTER’S REPLY TO-DAY. By Telegraph.—Press Association. Wellington, Last Night. The Hon. D. H. Guthrie laid on the table of the House the annual report of the Railway Department. Mr. J. S. Dickson (Parnell) pointed out that two of the principal officers of the service were now over 60 years of age and had from 40 to 45 years* service. He asked if it was the intention of the Minister to retire these public servants, they having reached the retiring age. The Hon. J. A.. Hanan (Invercargill) asked the Minister to say whether the railways were still losing money, and whether he did not propose to try an experiment of reducing fares. Mr. W. A. Veitch (Wanganui) asked what was the position of the commission paid to Sir Duncan Elliott. He had been trying to get this information for some considerable time.

The discussion was continued until 5.30 p.m., when, on the suggestion of the Leader of the Opposition, the paper was laid on the table and the Minister agreed to postpone his reply to the points raised during the debate until to-morrow.