THE RAILWAYS

Evening Post, Volume CIX, Issue 8, 10 January 1925, Page 13

THE RAILWAYS

♦ QUESTION OF SELLING STATE OWNERSHIP V. PRIVATE CONTROL . (By Coleman Phillips.) The. chief sting of the Railway Commissioners' report is contained in its tail—v^viz., Sir Sam Fay's question:"of replacing State ownership by private control, and that he would find a j^irehaser, should , the Government decide to sell tha lines." I presume the whole of the evidence given to the Commission will be, p U bij s h e( L If sOj I would/ ask' the Hon.. Mr. Coates to see that my evidence (containing the reasons for selling), of 24th October last, be included. The one mistake I appear to have made (according to. Sir S. Fay) was the suggestion to sell the lines to an American syndicate. I .am quite willing to amend that, -if- Sir S. Fay thinks ' a British syndicate can be found with the necessary capital to buy them. . . Hut the question of sale I lately proposed has now been supported, and vastly strengthened by another English railway engineer "expert's views, viz., those 01 Mr. a\ H. tf, Boutell, who I for fifty years has been managing the privately-owned Argentine railways. ,'JL'Ws gentleman completely negatives our present Government's views of retaining the lines as State railways,, and supports, my views .to the echo. I had the Argentine lines well in mind when pointing out that neither, the U.S.A., Canada^ nor' Great Britain believad in State-owned, railwayg. ■ .'■ . ■ ,-.. ■ ' ■,• . Mr. Coates'a refusal of ,the Governmen to consider the question: of sale as contained in his reply of 29th. August last to me does not carry weight now in -face of Sir S. Fay and Mr. Boutell's; opinions, and . I would ask him to reread his reply,-as Mr. Boutell is to-' tally against all he says. ' That gentl*man states: "In my opinion State ownership of railways is a mistake. You will find that railways that are privately owned are under better control by the. jState than Government-owned lines. The reason is that the Government can by law enforie a better service from railways owned by private concerns than it the case- if they are owned by the State. They found that out m the Argentine) We have very strict. railway laws there, obliging us to do esrtaui things in the way of providing for the public—a rapid service, excellent time-table, arid improved accommodation for passengers, 'especially for long distances. For instance, for any distance over. 100 miles we have to provide very good dining-carg and sleeping, cars of th 6 best _ The coniiti6b { laid down by the Government and are very, stringent;" . ; i : . 1 I wish to add that the Minister i« wrong.in basing his objection on the sale question 0f;.." additional interest charge upon capital." A private syndicate would effect such saving and economy of working all round that the difference on interest ".'questions " wouldj not arise. Moreover, true development would be so much increased under private control that we should hardly know ourselves, especially »' Wellington Province. '! .'.' ■■■'•■ Furthermore, under Government control, the rank and'--file refuse to work more than 44 hours a week; and bur able men, at the top, are usually attracted elsewhere by higher salaries. A private., syndicate would pay its' best men liber^ ally, which the' Government dare not do. ; and all hands according to merit. j;'.' WHERE THE STATE FAILED. Note again what Mr; Boutell says on this point: "Let me■■ give you an explicit example of where the State failed, and private' enterprise succeeded. In the province of Rids the. railways were owned by the r Government, and were built frpm.two English loans.--''The Government ran them' very, badly. I happened to represent the shareholders for the loans, and when the Government defaulted on their loans I was asked to advise the best course in the circumstances. I had no hesitation in advjfirigthat the loans be 1 taken over by the bond-holders. After ten. months' negotiation I was able to do this, arid an English company was formed. The Government handed the-lines over' to me, and I managed them for several months, until-I got a manager from' England. I was Jocal director for 22 years, and can say that the change in control has been the chief, feature in making the province of Entre .Eios one of the most prosperous "provinces in the Argentine Republic. Land values went up, and the development was simply marvellous. The railways are now doing well, and under a stringent law are giving excellent service to the people." '■• And this is just what would happen to Wellington city and the province if a private English syndicate took over the lines and constructed the Wainui deviation. It would look at this deviation in a totally different light to that of the Railway Department, "which does not swish to disturb existing arrangements," and ..totally jettison sush ■■ a narrow- outlook. It would regard it as 'the greatest new development line in the Dominion, and say: "The city wants a good milk supply ;■ plenty of level building suburban land; its 4000 to 5000 square miles of' real hinterland land opened up; an East Coast Trunk line— Wellington to Auckland; and a^i mile electrically worked tunnel, via Wainui, as opposed to a 5j steam worked tunnel via Cross Creek, which no person with any sense would travel by. For every sound reason we will adopt the Wainui deviation, as it will cost less than the one by Cross Creek, and save us at least £45,000 a year upon present working expenses, which. will provide the, interest upon its cost. BOLSTERING THE STATE SYSTEM. Should the Government, after what has lately happened reconsider 'file question of selling the lines, I would ask the Minister:— • .... (1) To acquire any options over {lie land required for the Wainui deviation. (2) Stop the City Engineer putting in his contemplated third Wainui dam. (3)' Survey off and acquire the land options over the first great section of the Wellington to Auckland E.asi' Coast Trunk line, viz.:—Western Lake to Martinborough and north toDannevirke or Waipukurau. Then hand all this over to the private company (as part of the £60,000,000 sale price,; the lines only having cost us £49,000,000), under conditions to complete these two sections within five :years; a matter which would vastly help the city and province in every possible way. Let the same thing be done for the railway requirements in the South Island, and every province. The Tawa Flat deviation, of course, to he provided for. The Railway Commission duly reported upon tho Pahxterston North deviation. The syndicate to provide a. sum of, say, £15,000,000 to complete necessary development works in,eight years, and it will readily do so. I certainly, do not think there ;s a hope of Mr. Coates being able to carry out his schedule himself. No matter how the Railway DepaTtqm* ftfctwu^te to ftvoig U» e g>Ui, tkers is

now Sir Sam Fay and Mi-. . Boutell's opinions to be swallowed, "that private control is better than State-owned railways." My view also is, that it is an utter blunder : for the Government to have so many thousands State employees, who are. much better con-' trolled in private hands. All the Minister's alterations in the service will prove a complete waste of time and effort, as the Government had much better take the medicine these two ■ able English experts have advised, as'the only true method for running the lines, in face of the growing opposition from motor traffic. I would, of course, 1 ask the Minister to accept my criticism in good part, as it is made in the best interests of the Dominion,: and in support of my original suggestion to sell the lines. , ' What New Zealand requires from him to-day is good motor roads, not bolstering; up a State-owned railway system, which is only trying to make a silk purse out of a sow's ear and never can succeed. That policy should never;have been entered upon m New Zealand,' as, John^Brogden and Sons offered ■in 1870 to construct and control all the lines JNew Zealand should require by private enterprise (see their first contract offer). I put it to the Minister that the btate . ownership is now condemned by Sir Sam Fay, Mr. Boutell, and, I think also by Sir Vincent Raven, three of the very foremost of the world's railway experts: and. New Zealand should be guided by their opinions. For in this matter; the Argentine-beats us hollow, a B it does in beef supply, and will shortly in butter, „ but never in cheese. I notice, as -I write, that the Australian railway hands are striking again m support of the seamen. This proves also how harmful it is for any Government to .own State ',- railways. Some months ago I-strongly, advised the Sydney people; to sell their lines as quickly as possible, and it is now being considered there. '