RAIL AND ROAD.

Auckland Star, Volume LXIV, Issue 172, 24 July 1933, Page 9

RAIL AND ROAD.

NEEDS OF PUBLIC.

FUNCTIONS OF MOTOR SERVICES.

APPEAL board judgment

Broadly, tlie primary functions of motor services are to serve areas not served by a railway, and to feed the railways; but they have a proper function also in supplementing (but not supplanting) a railway service that is not fully adequate, and, in extreme cases, in duplicating an entirely inadequate and inefficient railway service, even if such duplication may amount to supplanting it. This important statement of the attitude of the Transport Appeal Board towards motor services, in their relation to the railways, is contained in a comprehensive interpretation of the principles of the Transport Act, given to-day when the board delivered its judgment in the case in which the Railwaj s Board appealed against the passenger license granted Hodson's Pioneer Motor Service. The contention of the Railways Board, that the number of trips to be run on week-days by the motor service between Wanganui and New Plymouth should be reduced, was upheld. The board decided thai the number of daily motor trips each way should be reduced from four to two.

The chairman of the board is Mr, Justice Frazer, and associated with him are Mr. T. Jordan, of Masterton, and Mr. L. Alderton, of Auckland. Mr. Alderton disagreed with the finding of the other two members, favouring a retention of three motor services daily, and he presented a minority report setting out his reasons for doing so. Principles for Guidance. "The present appeal is typical of many," stated the board in its majority judgment. "In it the Government Railways Board asks for a curtailment of the time-table approved by the licensing authority, on the grounds that the number of trips provided for is in excess of what is necessary, and that the times for certain trips are too close to the times at which fast passenger trains are run. It is desirable, before we examine these grounds in detail, to 6ct out the principles by which we think we should be gui'ded in this and similar cases. "It is sufficient that these principles should be stated broadly, for we do not think it wise at this stage of our investigations to lay down detailed rules of universal application. If wo adopt principles that are too narrowly enunciated, we shall probably be confronted with cases thai, will require a modification or restatement of these principles; and, while it is desirable that a board functioning judicially should follow broadly defined principles, which must necessarily serve as a guide to the different licensing authorities as well as to the board itself, it is manifestly undesirable that those principles should, for the .present, at all events, be expanded into an elaborate code of rules by which the hands of the board and of the licensing authorities would be tied, or would appear to be tied.

Object of Legislation. . "The Transport Licensing Act, 1931, is intituled 'an Act to make better provision for the licensing and control of commercial road transport services other than tramways.' Ihe title indicates the underlying object of the legislation, which is the control and regulation of commercial road transport services. It has within recent years been the experience of nearly every country in the world that motor services for the carriage of passengers and of goods have entered into destructive competition with railways and tramways and with one another. Vast sums of public and private capital have been jeopardised or loot through competition of this nature, and the resulting economic waste has everywhere become a matter of national concern. It has been recognised almost universally that the existence and efficiency of so important a public utility as transport cannot, in the public interest, be allowed to be imperilled.

"Competition is often spoken of as a necessary stimulant to business, and as something to be encouraged, without restriction, for the public benefit. Geneirally 6peaking, this view is correct, but it has its exceptions. One exception is the case of a public utility such as transport. Let us take the simple case of a motor passenger service running along a route not sered by a railway. In the absence of any legislative provision for the licensing and control of motor services, it is probable that another operator will soon commence to run a competitive service along the same, route. He will naturally seek to attract patronage by cutting fares, and the original operator will retaliate by cutting his fares still lower. The public may derive a temporary benefit, but sooner or later fares will be cut below a payable figure, and both operators will make losses. Before long, one of three things will probably happen:—(a) One operator will be forced to discontinue the service, in which case the survivor will certainly raise fares to an extent that will at least recoup him for his losses; (b) both operators may, through lack of further resources, be forced to discontinue their services, in which case the public will be left for an indefinite period without any service; or (c) the two operators will form a combination, and proceed to raise fares to a higher level than is justifiable. In the meantime, the travelling public will have to submit to the dangers of excessive speeding on the part of the vehicles of the competing operators and to the risk of travelling in vehicles that, by reason of lack of funds, may not be maintained at a sufficiently high standard of safety and comfort. The public at large will be called upon to provide the increased cost of road maintenance due to unnecessary and wasteful use of the roads.

"From the public point of view it is undesirable, too, that money should be sent unnecessarily out .of the country for the purchase of motor vehicles and fuel from wliich no adequate return can be obtained. Benefits of Regulation. "It is obvious that if only a sufficient number of operators are licensed for a particular route, and if their fares and time-tables are regulated and the class and quality of their vehicles prescribed by a public authority, the public will be better, more economically and more safely served than under a system of unregulated competition, and, moreover, will have some guarantee that tlie service or services along the route will be continuously maintained. The licensed operators, too, will be placed in a position in which, they may expect to earn reasonable profits from, their under-

takings. The operators, under such a system, do net acquire an absolute monopoly of a public utility. Their licenses are granted only from year to jeai, and are subject to amendment or 1 evocation even during their period of cuneney, and the terms and conditions on which the licenses are granted are prescribed by a public licensing authority. Such a publicly controlled qiuisi-monopoly is better able satisfactorily to operate a public utility service than is a body of independent operators working under conditions of unrestricted competition.

"The Transport Licensing Act, 1031, requires a licensing authority to coneider generally: (a) The extent to which :i proposed cei vice is necessary or desirable in the public interest, and (b) the needs of the district or districts ats a whole in relation to passenger transport, and, if it is then of opinion that a proposed service is unnecessary or undesirable, to refuse to grant a license. The Public Interest. "The use of the words 'the extent to which the proposed service is necessary or desirable in the public interest' indicates that it is not required that an applicant shall establish the existence of an absolute necessity for his service. The licensing authority must have regard to the extent to which, in the public interest, the service its necessary or desirable. We take these words to mean that if, after balancing all relevant considerations, the licencing authority decides that the proposed ser"ice is reasonably necessary in the public interest, and that from a public viewpoint the advantages of licensing such a service outweigh the disadvantages, it may class it as a necessary or desirable service. "The words 'in the public interest' should be given a wide construction. The phrase docs not mean that publicly owned services, public capita! and public revenue snould recs'.ve consideration to the exclusion o!" privately owned ser vices, private capital and private income. The Act is not design'. ;! to give railways and tramways an absolute monopoly of passenger transport. its ~'jjeet is tc control and regulate, not to prohibit, commercial motor sei vi. ts Naturally, full consideration must be given to thceflect of the licensing of an undue number of motor services on the public revenue and on the continued existence, in an efficient condition, of a railway system that is essential fcr the needs of the Dominion.

"There appears to be a very definite idea in some quarters that the Transport Licensing Act has been specially designed for the protection of the railways and the consequent elimination, or at least curtailment, of motor services that are in any way in competition therewith. We cannot too strongly express our entire disagreement with this view of the intention of the Act. Parallel Routes. "It is unfortunate that there has been a tendency ill this country to develop motor transport services along routes paralleling the railway routes, instead of along routes not served by the railways. In our opinion, there is room for commercial motor services, and we are satisfied that the purpose of the Legislature, as expressed in the Act, is to define their sphere, and so to bring about the elimination of wasteful, destructive and uneconomic competition. "We think that the words 'in the public interest' are intended to mean, in the broadest sense, a balance of benefit in favour of the public. If a railway service is completely adequate for the reasonable needs of a, particular district, the licensing of a motor passenger service is obviously unnecessary. If the railway service Js not adequate, the licensing authority must _ consider whether the reasonable necessity or desirability of a supplementary motor passenger service is established. In doing so, it should weigh the needs of the districts to be served and the convenience of the travelling public against the probable losb in public revenue and a possible consequent reduction in the existing railway facilities." In conclusion, the judgment pointed out that the through traffic by the road services was practically negligible, averaging less than one passenger a trip, and that the intermediate passengers provided the principal justification for the existence of the road services. The majority of the board was of the opinion that a combined time-table catered adequately for the needs of the public, and afforded, the road service operators an opportunity of running a reduced service at a profit, in lieu of running a more expensive service at a loss.

Mr. Alderton's Finding. While agreeing with the principles enunciated by the other two members of the' board, Mr. Alderton stated in his report that the motor service from Wanganui to New Plymouth came definitely witlrin the orbit of an essential combined rail and road service. The road service, he held, was reasonably required to cope with the heavy intermediate traffic, and the inherent weakness of the rail service lay in itinflexibility and the necessity of having fixed stopping places. Every system of passenger transportation of any magnitude involved the running of necessary, but unprofitable, trips as part of the service as a whole. The Railways Board, by virtue of its opportunity and experience, had generally fixed train starting times at the most convenient and consequently the most profitable times of the day. The load services must therefore accept the less profitable times, and the Railways Board, by not challenging certain trips, admitted" the necessity of some combined service. "Can this board, then, ask such road service to cary out all unprofitable trips without some measure of compensation bv allowing other more profitable trips?" asked Mr. Alderton. He could not agree that the 7.30 trip from Wanganui, and a similar one from New Plymouth daily, were not reasonably necessary. Passengers travelling by early morning or evening services were usually travelling for a special purpose and required some consideration even to the point of running an unprofitable service as part of the°system. Mr. Alderton held that the motor company was entitled to at least three services daily each way between Wanganui and New Plymouth.