FRIDAY, SEPTEMBER 26, 1924. COMMERCIAL METHODS

Evening Post, Volume CVIII, Issue 76, 26 September 1924, Page 6

FRIDAY, SEPTEMBER 26, 1924. COMMERCIAL METHODS

The new financial method proposed by the Minister of Railways will certainly be of advantage if, as the General Manager stipulates, it is the expression of the result of activities conducted on the same principle. We ■ have previously pointed out that the insistent demand by some classes of the community for commercial methods is weakened by their equally insistent demand for privileges, concessions, and reductions >vhich cannot be justified if the railways are regarded as a commercial undertaking. It is difficult at times to draw tho line dividing'that which is commer-1 cial from that which is political (meaning the concession which should be given at the expense of the body politic). For example, iv times of drought or distress in particular districts, the New Zealand Government Railways are called upon to carry stock free or at a considerable concession. But a private railway would also do its best to meet its clients under similar circumstances, realising that a bad setback to the producers would reduce its own freightearnings. No private railway, howover, would continue to carry lime and manures cheaply for farmers who sent their wool and other produce to tho market by motor.

A commercial system of accounts, wisely framed, will help to show where the railways are being unfairly used, and will check that Use to some extent. There will not be the same readiness to promise freo or low carriage of goods if the cost must bo met not from tho Railway Accounts but by a vote charged to some other Department of State. At the same time euro must be exercised to see that the Railway Service is uot dominated by tho double-entry bookkeeper. There must bo no attempt to pass on every concession, even such as a private railway would make strictly for business purposes. Tho commercial idea must be held reasonably, aud not allowed to become an obsession. Possibly there will be many complaints if the commercial method is used to any extent. The railways will be accused of oppression and monopolistic tactics. The proposals for meeting motor competition have already called forth such condemnation in some quarters, and. the complaints are not likely to diminish now that the Minister proposes to make the competitive pace, hotter. But we hope that the public, and especially business organisations, will not enter hastily into judgment.

It must be remembered that the railways have had a long term of competition under a handicap, the capital and maintenance cost of the permanent way. The permanent way for the motors has been provided at the public expense; and the very producers who have put a few shillings into their pockets by having benzine or wool carried by motor have had to pay out much. more in heavier county rates necessary to repair the roads after the motors had passed. We have often urged that it would be wise to place the; road-a-epaiv charge more directly upou the motor traffic, so that the motor-carrier customers would pay their account in one sum (not part to , the carrier and part to the- County Council), and would thus be able to compare it with the railway charge. That is not now being done to any appreciable extent, and the Railway Department is forced to adoptother methods to keep its traffic. Before condemning those methods wo hope business mon will study

statement of the railway case. They must remember that the motors are under no obligation, as the railways are, to maintain unprofitable lines of service. They can simply pick the eyes out of the carrying trade. Is the Railway Department, then, to allow the easy traffic to be taken.from it, so that it is left with nothing but the trade which must be continued at a lossf In the end such a loss must be borne by the general body of the people. It is in the interests of the people, therefore, that transport should be placed on the soundest economic basis, the railways performing that service which they can perform best aud the motors j co-operating.