Untitled

Press, Volume LXI, Issue 18310, 18 February 1925, Page 8

One effect of the visit of the English railway experts to New Zealand was to awaken public interest in the operation of other railway systems, and there is a valuable article in a recent issue of the "Economist" on the railway services of Canada. Most people, if they were asked to say what had impressed them most about the railways of New Zealand and Australia, would probably say the obvious engineering difficulties and more obvious antiquated service in New Zealand, and in Australia the broken gauges and the Transcontinental. In Canada they would perhaps be impressed most by the long and romantic journey across a Continent. Yet there are features about the Canadian railway situation that make it, in the opinion of the "Economist," one of the most remarkable in the world."

In Canada there are two railway systems, the C.P.R. and the Canadian National Railway. From the Atlantic to the Pacific Ocean they run paraHsl to each other, and at hundreds of points across the continent private and State enterprise fight for traffic If their competition resulted in cheaper fares and telegraphs and telephones, whieh in Canada are run by the railways, Canadians would not mind how long the fight lasted, and how .fierce it was. But unfortunately it only amounts to a dispute as to who provides the best wireless service for the parlour cars or keeps the best dinner table, and the chief result is waste in the form of duplicated services. "In every important town," we are told, "there are to be seen the C.P.R. and C.N.R. offices next door to. each other soliciting custom. The situation is also viewed with dissatisfaction in Canada, because in the meantime the State system is losing fifty million dollars a year, which the heavily loaded Canadian taxpayer has to make good.

Four possible remedies have been suggested. The C.N.E. may succeed in taking sufficient traffic from the C.P.B. to enable it to pay its way; net receipts may increase through an agreement with the C.P.B. for the elimination of wasteful competition, through better organisation, or through an increase in population and trade. The Canadian Government so far has resisted the temptation to appeal to Canadians to support the State railways because, though it is bad enough to have the national trains still showing a defiicit, "it would be extremely bad for Canada to cripple its greatest private corporation." Working agreements between the two systems are impossible yet because of popular opposition, and it is considered that Sir Henry Thornton, an English , Great Western expert, who is manager of the Canadian National Railways, has done as much as can be done in the way of internal reform. AH that is left is the hope of increased population, which would mean more business for the railways to share.

In connexion with the huge deficit for which the C.N.E. was .responsible,, the comparative returns of the two systems are worth studying: C.N.E. C.P.R. Mileage ».. ~ 21,851. 13,658 Million Million Dollars. Dollars. GrOM earnings .. 263.8 195.8 "Working expenses ..'• 249.8 158.4 Net income .. 13.5 37.4 Fixed charges .. 65.2 t 13.5 Net wsult - —51.7 +83.9 The most striking facts revealed by the table are the greatness of the national system, measured in mileage and earning power, the superiority of the inferior CP.&. as disclosed by its net income, and the heavy burden which the State lines have to bear in the' form of fixed charges. This is due to the fact that the system is absurdly overcapitalised. The C.N.B. is a combination of several former systems, and as the Government had guaranteed much of their bonded indebtedness the surplus capital cannot be written off. The financial position of tho national system, in spite of this burden, has improved since Sir Henry Thornton took over the' management, the net income having increased, since 1922, from 1.5 million dolllars to 13.5 millions. But the whole history of the C.N.R. is a shining - example of how simple it is for a Government to offer guarantees and to lose money over them.