BRANCH RAILWAY LINES.

Press, Volume LX, Issue 18265, 26 December 1924, Page 10

BRANCH RAILWAY LINES.

LOSSES ON OPERATIONS.

QUESTION OF OTIRA TUNNEL,

In :hc report of the Railway Com mission (Sir Sam Fay and Sir \ intent appears the following comment on the losses made in operating the branch railway lines of the Dominion :—The loss upon the working ot i certain sections of railway Ls published f in tho account*, and there is also spo- ! cinl reference to the loss upon the Otira Tunnel section. In tho case of the latter we do not regard these fi-ures as indicating fairly the result of construction of this very W™*?* tunnel, H mite in length, wiUi iw machinerv and equipment tor electma working.' To pick out nine "'«*"; line, im-hsdins tho tunnel, and show the loss upon that small *** l ° n l ,"* ? throughout run between Chnstchurch and Grevmouth, a distance ot Uo mile? does not exhibit a true picture. inasmuch as traffic conld not bo c>nveved from one side oi the South Island to" the other but for tunnel-construc-tion. A real figure of value ran only be obtained by Ulan*; the earnings and expenses between Christchurch and Grevmouth districts and applying: thorn to the cost of construction ot tno throughout route. In "calculating losses upon brancti lines, no credit is given for earnings upon trunk lines from traffic passanc to and from the branches. A branch line may, taken by itself, show a loss, whereas the earnings upon the main line duo to branch-line construction may be sufficient to turn the loss into it profit. A ease in point is the Fairlie line, which in 1923-21 shows a dehcits (including interest) of £3Bl, but, the mile-ace earnings from the traffic on the mainline were £15,«07. In all countries there are sections of railway which do not pav their way, and New Zealand is no exception. Any country with its transport system not fully developed mav be expected to have for manv rears portions of line regarded Iby the Railway Department as nonpaving, especially if they are not connected up with "the Main Trunk sys- | tern, although from a State point ot view the developmental value of such lines, apait from Crown land and forest improvement. n-mply justifies their construction. There is a further advantage to the State in which railway revenues do not share —i.e., increased taxable income, not only adjacent to new lines but generally throughout the State, due to the onen-ing-up of the country by transport facilities. It is a question for consideration whether or no the Railway Department should bp relieved of any loss bv aid from consolidated revenues. If the State decides to undertake the construction of more than a certain number of developmental lines within a given period, it is clear that railway finance may break down, followed by high charges and inefficient services as a result, of pressure to economise. New Zetland's prospective railway system in the North Inland is a linking-up of through routes, and there are few dead ends. It is different in the south, where there are many branch lines with no early prospect of forming them into through routes to and from more prosperous localities. It is not unreasonable that some share of general State increment should go to the agency producing the result, where the absence of revenue is calculated to restrict transport facilities, not only in a particular area but throughout the country. We recommend, therefore, that loss on new lines should be borne by consolidated revenue, unless such lines form a connecting-link between two sections of the main system, and with the further proviso that the loss be reduced, in so far as liability on consolidated funds is concerned by the value of traffic (less 70 per cunt, work-ing-expenses} contributed to the main line. It will bo seen that tho mileage opened during tl» past ten years has been small, Imt in the next decade there will be a considerable number of" lines coming within such an arrangement as we propose. If an arrange- - ment on the basis mentioned had been in operation during 1923-24 a credit to the Railway Department would have arisen of £136,064.