RAILWAY SERVICE

Evening Post, Volume CVI, Issue 106, 1 November 1923, Page 7

RAILWAY SERVICE

DEVELOPMENT OF THE COUNTRY

REPLY TO CRITICISM.

(BY TELEGRAPH— PRESS ASSOCIATION.)

CHRISTCHURCH, 31st October. Referring to criticism of the New •Zealand Railways Department in the "Financial Times" (London), as cabled earlier this week, the Minister of Railways (Hon. J. G.* Coates) stated to a deputation at Horrelvills to-day that it was often forgotten that the Railway Department considered the development of ~the country as well as the financial side of the service. Mr. R. W. M'Villy (General-Man-ager of Railways) stated that the Department always considered the development of the country. Although there had been a big deficit on the workings of branch lines, most of which were in the South Island, they acted as feeders to the main lines and also tended to develop iho country through which they passed. The Department was not always given credit for the manner in which it developed the country. The Minister said that Mr. M'Villy's statement in a measure provided a reply to the criticism of the - "Financial Times." The Department did not stick strictly to the financial side of the railway question, but considered the matter of the development* of the country. He did not think that the "Financial Times" quite realised this point of view. There were" limits to expenditure, but ! the Department was satisfied if it could earn 3J per cent.; in fact, Parliament had made a stipulation to that effect. The Hon. D. Buddo, who was present, asked if the Department earned more than 3| per cent, whether it would be able to give concessions. Mr. Coates: "I don't know about concessions, but we will be able to give a better service."

The "Financial Times," dealing with the report of the New Zealand Government Railways, said : "One of the features of the administration that will not be regarded with unmitigated satisfaction is the virtual subsidising of industry at the expense of transportation. Thus we find that many services are performed below cost, which means at the cost of other,users and of the taxpayers. Lime for manuring farmlands was carried 4,506,500 ton-miles for a trifle over a farthing a ton per mile. Butter, cheese, and road-metal, the latter being for the benefit of motor competition and entailing a loss of £50,000 per annum, were in much the sam 9 position. In many other instances exceptionally low rates were granted to assist in establishing industries which aYe now nourishing, but still remain in force although the-need for such help is past. The Minister of Railways states that any increase, in freight rates at this juncture to enable the railways to earn interest charges would lend to divert more traffic to the roads. We imagine that a solution of the problem could ibe found in ceasing to subsidise flourishing or competitive industries."