D—2

Live-stock traffic decreased by 32,910 tons. Compared with the previous year, the number of sheep carried decreased by 651,047, or 6-02 per cent. The most notable -decrease —viz., 287,357 —was in the Invercargill district, and this and the general decrease ■can be attributed to the substantial increases in the number of sheep carried by road operators. This was offset by an increase in timber traffic, which reached the high record of 747,861 tons, an increase of 69,734 tons over the previous year. The most important items in the increase of 108,977 tons of " Other goods " were increases in the tonnages of benzine in tank wagons (18,087 tons) and manures (24,013 tons). EXPENDITURE The gross expenditure shows a rise of £1,989,697 to a record high peak of £19,700,594. The increase in operating expenditure accounted for £1,698,165 of the increase,, whilst £291,532 arose from the subsidiary services.. The following table sets out a division of the gross expenditure, with comparisons with the figures for 1947-48 :

The increase in wages paid can be attributed to the following causes : £ (1) Additional man-hours .. .. .. .. .. 226,198 (2) Increase of 2£d. per hour from Ist July, 1948 ; increase of 10s. per week from Ist October, 1947 (full year for 1949, as compared with six months for 1948) .. .. .. . . .. 771,112 (3) Miscellaneous concessions granted in awards and by Railways Industrial Tribunal .. .. .. .. .. 124,523 £1,121,833 The man-hours have increased in practically every branch of operation, with large increases in traffic transportation and the road services. The rise in the cost of locomotive fuels was due to the greater quantity of fuel oil purchased. Compared with the previous year, 6,441,125 more gallons were purchased, and this factor has caused the cost of this fuel to increase by £294,792. The amount of •coal imported decreased by 26,019 tons, with a resultant decrease in costs of £331,742. During the year the consumption of New Zealand coal amounted to 3,856 tons more than the previous year. With the general increase in traffic, an increase in consumption of stores and materials is to be expected. The main items of increase were £42,676 for road service fuels, £75,323 for way and works maintenance, including heavy purchases of ballast, and £80,869 for materials used on working-expenses jobs in the workshops.

7

— 1949. 1948. Variation. Wages -Coal and oil (loco.) Stores and material .. Depreciation and renewals Miscellaneous £ 11,497,192 1,891,393 2*, 974,208 1,593,057 1,744,744 £ 10,375,359 1,873,799 2,636,305 1,495,865 1,329,569 £ + 1,121,833 + 17,594 + 337,903 + 97,192 + 415,175 Per Cent. 10-81 0-93 12-82 6-50 31-23 Totals 17,710,897 + 1,989,697 11-23