THE RAILWAYS

Evening Post, Volume CVIII, Issue 76, 26 September 1924, Page 11

THE RAILWAYS

MINISTER'S STATEMENT "A SPLENDID SYSTEM" FACILITIES FOR BETTER SERVICE.' The Railways Statement for the year ended 31st March, 1924, was presented to the House of Reoresentatives by theHon. J. G. Coates "Generally speaking," "says the Minister, "I am convinced that the Dominion has a splendid railway system, and that, if given necessary facilities, it can be made to pay a reasonable interest on .the capital invested, and render more satisfactory service to the community." The' Minister states that he has certain proposals under consideration with reference to decentralisation of responsibilities of district managers. "There can bo little doubt that district managers, in concentrating on the primary problem of coping with the ' traffic usually available, are' prone -to overlook the vital necessity of seeking to stimulate business, and thus swell the revenue by rendering improved service. If has become apparent in many instances that some officers have been influenced too much by precedent, and have hesitated to exercise their own initiative as fully as "the conditions justify. My remarks dealing .with the establishment of the commercial branch will indicate more fully how I hope to overcome this tendency. DEVELOPMENTAL' • "Although the railways have never : been regarded or run as a profit-making concern, there is no doubt in my opinion that the time has arrived for the finances of the Department to bo placed on :m-entirely different footing. . , .■ The necessity for and advantage obtained by developing the Dominion by means of transport facilities. are apparent, but at the same lime there does not appear to be any good reason why the accounts should, not be arranged in coniormity with recognised commercial methods, and at the same time ensure I that full credit is given to the railways for the services they perform, besides showing how far they meet their proper obligations. Tho system followed insists that business life and daily transactions shall conform to stereotyped accountancy methods, instead of the accountancy methods being adapted to business requirements. ."It is _ well known that many'of our branch lines are not paying their way, l>u. t. ty counteracting competition, and utilising a cheaper transport method I am of opinion that the working expenses can be reduced to a minimum, and the revenue substantially increased and a more effective service rendered to the public. The new policy of constructing new lines, whereby the estimated cost of. construction, revenue, and working, expenses, ■ etc., are very closely scrutinised-by the, Public Works, Railway; 'Agriculture, : and other Departments, concerned,, will eliminiate as far as it is possible tKe construction of, uneconomic' lines. In my opinion no line should bb undertaken unless it is shown that interest can be earned on the capital outlay within a reasonable time of "completion. Evory "care is now taken to sea that new lines will be paying propositions before any expenditure is authorised." ...

THE TARIFF On the subject of the" railway tariff, the Minister says that an examination of the returns for the last financial year showed that the net revenue resulting from the Department's operations was. just sufficient to pay the policy rate of ■ interest,. 'and . the gross revenue; had not'increased to a very marked, degree. There appeared to ha nothing in' the. circumstances at present existing to warrant the belief that the position so far as the natural increase of traffic in the country was concerned would be materially different during the coming year. The likelihood of any'sub-; slantial reductions' in expenditure dur-' ing" the coming year was very remote. It was believed, however, that such reductions might bo made in the railway rates as might eventually bring such a. volume of increased traffic as to counterbalance the loss.- involved in the rate reductions. Apart from the considerations of motor competition, it did nob appear that there was the same pressing necessity for reduction of a general nature in the case of the passenger fares as-in the.case of tho goods rates. In' regard to the goods traffic, the position was that the total quantity of goods required to be carried in New Zealand had not very substantially increased during the last few years, and if the Department was to obtain the y increased traffic which would enable it to recoup itself for reductions in rates it must obtain such traffic from its competitors. Competition with motor traffic claimed very serious attention. There was little doubt that a reduction in the rates on' wool would tend to counteract competition, and he.considered a lower rate was justified.

Without, going into details, the immediate extent to which rates would: be used for the purpose of meeting motor competition would involve suitable reductions on benzine, household removals, and the commodities that were listed in the higher classes of the railwaytariff. He proposed to submit recommendations to Cabinet along these' lines _within the next week or two, the reduc"tions in the aggregate amounting ? n all probability to approximately £200 - 000 per annum. A very_ definite course of action had been outlined to cope with tho inroads that were being made on the Depart- I merit's revenue due to the loss of traffic I that was being carried by road. TRAIN SERVICES The Statement states that .it is proposed U; provide improved facilities in many sections of railways.in the South Island as soon as the new rail- motors are available for use, as it is considered that working expenses on many sections in the South could be very considerably reduced by the running of self-propelled cars, and at the same time give a move frequent service. There was every reason to believe that with the advent of the self-propelled rail..cars tho running of mixed trains could bo reduced, and more ■ elastic services provided by means of rail motors, thus enabling goods trains to more efficiently copo with their proper task. : Much valuable material had been collected with regard to the electrification of. certain suburban sections. The consensus of opinion-' had been that the • time iiad not. yet arrived to oonvert any of our lines from steam to electricity. Public agitation continued in various localities, however, for the. electrification of suburban sections, and a report was being obtained from a, well-known London engineering firm as lo the wisdom or otherwise of electrifying any particular section or sections. Regarding level crossings, (he Statement s.'iys\ that negotiations have taken place- with local bodies with regard Lo souvcrting (hem by menus of • subiviu-s and overbri'Jgos, but satisfactory, results

are often rendered difficult by unwillingness on the part of local bodies to assist in any way to defray the cost, expecting the Department to carry the work out at its own cost. OTIRA TUNNEL Regarding the Otira Tunnel, the Minister says:—"Notwithstanding the higher rates in operation from the 4th August, 1923, until February, 1914, under the Public Works regime the, net result of operating the tunnel was a loss of £27,----305 for approximately forty weeks. In February, 1924, the rates were reduced by charging fares and freights on continuous mileage. The effect is strikingly illustrated by the figures showing the results of operating the line for the three periods the line has been operating since the altered system of charging was invoked. This shows a net loss of £13,----32 4; and it will be noted that the work-ing-costs have exceeded the actual receipts for the three months ended on the 16th August by £379. The question of improving the financial results on this section has been engaging the serious attention of the officers of the Tariff and Commercial Departments, who have been investigating the representations made by the Canterbury Chamber of Commerce and other bodies for the inauguration of back-loading freights between Christchurch and the West Coast, the object being to offer such reductions in freights as will encourage a considerable increase in traffic. It is contended by those interested that the additional traffic secured by the reductions would materially assist in reducing the loss on this section, as at present a large number of trucks which bring coal from the West Coast are hauled back empty. lam particularly desirous of finding means of securing a larger amount of back-loading on this section, but from the information before me I find it impossible to definitely decide that the claims put forward for the special rates are likely to materialise, and until it has been established to my satisfaction I do not propose to decide the question one way or the other." AFTERMATH OF STRIKE The railway strike is reviewed at some length. The cost involved in the extension of hours from 44 to 48 per week is set down at £63,500, but with the increased output and certain other changes made it is estimated that the balance in favour of the Department will iimount.to £17,008 per annum, w.hich wil) be increased'as surplus labour is absorbed in about a year's time.

COMMERCIAL BRANCH In tho matter of securing new business the officers of the Commercial branch will inquire into the following points: 1. Offering' additional facilities to travel in connection with race meetings, sports, shows, and other large public events. 2. Arranging excursions and house pic nics, school picnics, especially at lar«o£' centres. 3. Approaching' chambers of commerce, agricultural and pastoral associations, farmers' unions, and so on, to secure their business. ■1. Judicious advertising. 5. Through inter-island Roods traffic and passenger tickets, including boat and railway. 6. The consideration of the question of back-loading: rates. Those attached to the branch will organise conferences with the staff at | larger centres, arid with outside organisations such as chambers of commerce, farmers' unions, industrial associations, progress leagues, and others. Fluctuations in or loss of business will bo promptly dealt with, and cases of dissatisfaction with services rendered will be gone .into on the spot with those concerned. In fact, everything that will tend to improve financially tho Department's operations, and extend a. more satisfactory service to the public will come within the scope of the Commercial branch. The Department is out to seek business as well as to recover that lost. Business agents -will visit the various localities where largo events are being held with the object of co-operat-mg with the governing bodies to provide facilities that will encourage people to travel to tho events by rail. FINANCE With regard to finance, the Minister says that ho is ' definitely of' opinion that the -Railway finance and accounts should be brought into lino with commercial practice as far as possible, and not be merely a cash statement in regard to receipts and expenditure. Tho hvst and most important step, in this direction is the establishment of a sepa-rate-Railway Account, in which all earnings will be paid, and out of which all working expenses met, as well as superannuation subsidies, actual interest on fixed and floating/ capital, and renewals and replacements. On the other hand, the Railway Account will be credited with all services rendered .by it including the loss on operation of unpayable lmes.