FARE RISE APPROVED

Press, Volume CXIII, Issue 33386, 19 November 1973, Page 1

FARE RISE APPROVED

Revocation of the price freeze imposed on the fares and charges for the Wellington-Lyttelton ferry service has been recommended to the Government by the Price Tribunal.

On July 30, the Union Steam Ship Company announced increases in passenger fares and freight rates for passengers’ cars and trade! vehicles in the Welling-1 ton-Lyttelton steamer express service, but under a price freeze pro-' 1 mulgated by the Govern-: ment, the company was required to revert to its previous rates. Il

The tribunal was asked by the Minister of Trade and Industry (Mr Freer) to in-

[quire into this service and Ito determine the maximum (fares and freight rates. ; Announcing the tribunal’s (decision, the president (Mr K. R. Congreve) said the (company’s submission wathat extra costs in excess of ($680,000 a year were at pre I sent being incurred in respect lof the service. However, the (company’s formal application was based, not on a full recovery of these costs, but (upon the lesser sum of I $616,000. I The department recomimended an increase in fares lof $500,000 a year. Mr Congreve said the tribunal was not convinced that the arguments put forward supported such a reduction. and it had decided that the full amount of $616,000 was justified in terms of the Stabilisation of Prices Regulations, 1972, and [that the company's schedule of fare and freight rates appeared to reflect a reasonable spread and an accurate recovery of the extra amount of revenue claimed. Because the inquiry had been specifically directed to the Wellington-Lyttelton steamer express service, which was run as an entity, separately costed and accounted, within the total [operations of the company, the tribunal ruled that the over-all profitability of the company was not relevant to the proceedings. The tribunal has recomI mended to the Government that the price freeze be lifted, and has issued a decision I that, on the revocation of the freeze, the proposed schedule of fare and freight rates may be put into effect by the company. This schedule is deemed to be the maximum prices which may be charged by the company. The tribunal had, however, said Mr Congreve, required the company to submit, after three months, details of revenue increases resulting from any new fares.