PROBLEM OF THE RAILWAYS

Dominion, Volume 22, Issue 210, 1 June 1929, Page 8

PROBLEM OF THE RAILWAYS

AN EXPERT’S VIEWS DOMINION PRESS COMMENT The authoritative views backed by definite and impressive figures, expressed by Mr. F, J. Jones, late chairman of the Railways Board of Management, in an interview in “The Dominion” last Tuesday have been featured in the Press and have commanded widespread Interest. They have been the subject of editorial comment from Auckland to Invercargill, the consensus of which indicates a feeling of doubt as to the wisdom of incurring further heavy liabilities on new railway construction. “The Unanswerable Counter.” After remarking that “all that has been said in favour of the railway construction programme which the Government proposes to prosecute has been mere assertion, with no accompanying proof,” the “New Zealand Herald” (Auckland) goes on to say: “At this stage of public affairs, the contribution made to the railway argument by Mr. F. J. Jones, formerly chairman of the Railways Board, and befope that head of the Department’s civil engineering branch, deserves careful study. It is in some ways particularly unfortunate that the • two works the Government has stopped are in the North Island, and the two most debatable on its programme for bmpletion are in the South Island. An appeal to insular prejudice or an assertion of insular prejudice is so easy in the face of criticism. There can be no such refuge when Mr. Jones attacks. He is not associated with interests in either island, he can speak with authority as an experienced and highlyqualified railway man. His case, moreover, rests on no geographical considerations, but on the solid ground of estimated construction costs per mile, and possible revenue return per mile. His figures may not be sustainable in either respect—though from their very source they must be regarded with respect—but until the Government can refute them in detail they must stand. Some of them are easily recognisable as being already officially on record as the result of inquiries by departmental officers. With these facts undefeated, criticism of Sir Joseph Ward’s railway programme cannot be,-dismissed as inspired by either ignorance or prejudice. ' It stands founded on all the evidence available. It can be overturned only by the production of other and more credible evidence in rebuttal. None has yet been produced. There has been no attempt to produce any. The main argument used by the Prime Minister is-that while the construction of short lines and branch railways is not justified, the completion of main lines will be sound and profitable business. To this Mr. Jones offers the unanswerable counter that, if a main line does not pay now, adding to it another section which on the available data will return an annual working loss running into six figures will not make it pay. He also shows that the main line concerned is not nearly so badly hampered bv non-paying branches as has been suggested,”but fails in itself to return enough to justify its proposed extension. ...”

“A Contradictory Policy.” “A weak reply has been made by the Prime Minister to expert criticism of the Government’s contradictory policy in regard to railway construction,’ says the Auckland “Sun.” “Several days ago, Mr. F; J. Jones, formerly chairman of the Railways Department’s Board of Management, not only condemned the decision of the Ward Administration to construct the Nelsdn-Jnangahua* line and complete the interrupted Main Trunk railway throilgh the South Island, but declared bluntly that it would be cheaper to subsidise motor transport to carry goods at railway rates than to pay the losses on these projected lines. So far, Sir, Joseph Ward’s answer is anything but a convincing argument in support of the Government’s policy. He assumes that Mr. Jones argued that ‘we ought not to have any railways in the country nt all.’ That is nothing better than a silly assumption, for Mr. Jones did not argue anything of the kind. He merely demonstrated with perfect fairness that time had wrought many changes in railway construction and national transport. . . . The Government has stopped and abandoned two railway projects in the North Island on the plea that such enterprises would not pay. It purposes constructing two lines in the South Island on the argument that, if they should fail to pay interest on their capital cost, it must be recognised that ‘a railway is not taken absolutely on its face value.’ . . . The question that overburdened taxpayers want answered deals with the pertinent point whether it is'the politicians who are stopping railway construction in one place and beginning new railways somewhere else, or whether the policy has been determined by the experts. Hitherto, the public has been kept in the dark. It is the right of the taxpayers to know exactly what authority is responsible eitKer for wisdom or nonsense.” ,

Railway Losses. Arguing that although the Prime Minister’s remarks in reply were as general as Mr. F. J. Jones's “very striking statement” upon the finances of the railways was “particular and specific,” “The Press” (Christchurch), which . has consistently advocated the completion of the South Island Main Trunk railway, goes on to say“ Railways must not be judged—so'we may summarise his argiiment, with which we have always agreed —by a consideration, only of the revenue and expenditure. In a young country in the stage of active development, a railway which does not show a profit on working may be the begetter of national profit, in the shape of increased wealth and production, far outweighing the debit in the Department’s books. Until the Coates Government altered the method of showing in the public accounts the result of the year’s working of the railways, the losses incurred were never made perfectly clear to the public in the quarterly or annual returns. That losses were the rule was, of course, generally known, but Sir Joseph Ward in "the'days of the Liberal Administration used to say that it Was ‘the policy’ of the Government to earn a net 3 per cent, on capital. He meant then, perhaps, what he means now, but his manner of expressing himself allowed the Department to run itself very badly and to debit the losses to the policy.’ Nowadays the losses are clearly visible, and what they cost the taxpayer is clearly stated. This is a valuable reform. But the facts of railway traffic remain, and how troublesome they are was made clear by Mr. Jones. . . . After dealing with some of Mr.. Tones s figures, “The Press” concludes: “But it will strike most people that the trouble is that the Dominion has built railways ahead of its means or its needs. And the Government is proposing to spend more millions on railway building; and this at a time when the development of the petrol-driven machine using the highway Is making Governments and local authorities everywhere adopt a very cautions policy indeed.” The Taxpayer’s View. “Nothing more condemnatory has been, or could be, said respecting the Government’s proposal to spend £7,500,000 — ‘only £7,500,000’ were the words employed by the Prime Minister at Blenheim I la it week—on the completion of certain

unfinished lines of railway than has been said this week by Mr. F. Jones, , who retired last year from the Position ot chairman of the Railway Board, remarks the “Otago Daily Times ‘(Dunedin) “Mr. Jones is not a politician, and, now that he has retired from the public service, can have no interest other than as a taxpayer in the railway policy of the Government. He has, however,' had a long experience in the railway service and has ah intimate knowledge of its operations, and upon such questions as the cost of working particular sections of railway and the revenues necessary to ensure the Department against loss he speaks with an authority that is not excelled in the Dominion. The “Times” goes on to say that the taxpayers “know in the first place that the unfinished lines, upon which the energies of the Government are to be concentrated, are to be constructed upon the most extravagant of nil methods through the employment of a great deal of unskilled labour at standard rates of pay. And they know, secondly, what they must all along have suspected, that the lines, when completed, not only will not earn their working expenses, but will be fun at a tremendous annual loss. And, necessarily, the losses incurred on these lines of railway will eventually fall on the general taxpayer. It may be perfectly true that, as Sir Joseph Ward says, the argument employed by Mr. Jones is an argument against the construction of any fresh railway lines. The whole question of railway construction policy has assumed a complexion which could not be foreseen when the Government commenced to build the unfinished lines, and a full perception of the altered conditions of transport must be brought to bear upon any proposal that may now be made for the construction of railways.

Invercargill Views. An Invercargill paper, the “Southland Daily News,” argues that the Prime Minister made an “effective reply” to Mr., Jones, and goes on to say that “so far as the South Island Main Trunk line in concerned. Sir Joseph Ward’s advocacy dates back to 1902 when he made a statement which must be regarded as prophetic in the light of present prospects.’ That statement was to the effect that a scheme for a through line from Invercargill to Picton was “bound to come; nothing can stop it.” Replying to this view, .the “Southland Times” says that “between 1901 and 1911 there was anjple time to take up this matter, . . . but the link was not completed. . . . Why? Was it not because, the railway experts did not think the line, could pay? That view has been confirmed since, and Mr. Jones, who may not be a big political figure, is yet entitled to be regarded as a railway expert, and his view he delivered in emphatic terms, .. . Any examination of the scheme leaves one with the suspicion that the main purpose of this section of line is to please the voters, for it cannot pay. and it will not provide a service as cheap or ns satisfactory ns the one now in being.” >