EAST AND WEST COAST RAILWAY.

Grey River Argus, Volume XXXI, Issue 5249, 22 July 1885, Page 2

EAST AND WEST COAST RAILWAY.

* [prom our special reporter.] Wellington, July 21. At 3 o'clock this afternoon the Colonial Treasurer said: — I have a most important statement to make to the House. Intelligence has been received by cable from the delegates who went home to arrange for the construction of the East and West Coast and Nelson railway line that they have concluded an arrangement with Messrs Meiggs and Sons, whom they describe as of good standing and repute. They further say that powerful financial houses known to them promise support and are ready to take a substantial interest in the contract. Messrs Meiggs and Sons (a well-known firm of railway contractors and financiers) have agreed in writing to construct the railways, provided further concessions are granted. They ask, in addition to the land grants, a guaranteed payment of L 97,000 in excess of the working expenses per annum for twenty years, payable in London half-yearly commencing after the railways are finished ; and they state that it ia intended to finish them in from three to five years. The amount of L 97,000 is arrived at because of its being 2h per cent, on the cost, which is thus estimated. Actual cost of work, L 3,025,000, 025, 000 (which closely resembles our own estimate) ; interest during construction, L 400,000 ; engineers and administration, L 50.00 0; and expenses of underwriting;, L 385,000, making in all L 3,860,000, 860,000 ; 2| per cent, on which' would equal (within L 500) the L 97.000 asked for. In considering this proposal, it is desirable first to compare it with one for constructing the railways ourselves. By borrowing the money we should save the L 375,000, the last of the items I; have mentioned. The railways, would, however, cost us more for interest during construction. The L 400,000 is evidently computed on a basis of about four, years occupied in the construction, but if. we have to construct it ourselves we should be very unlikely to do the work in less than 10 years ; and calculating -interest at four per cent, for the mean period of 5 years, that would give "us L 615,000 as the cost of interest. Again, we should be out of the interest during construction, whilst under the "present offer we pay no'hing until the' whole works are concluded, and then, instead of paying 4 pei cent, on L 3,075,000, equal to L 123,000, we shall be paying only L 97,000. As regards the effects on the consolidated revenue, the difference is this : in the one case we shall pay nothing until the railways are completed. We shall have paid out of ordinary revenue L 615,000, and should have to continue to pass annually, L 213.000 a year. Again, as the L 97,000 will only commence after the railways are constructed, we shall begin with the reduction consequent upon receipts in excess of working expenses It may be said if we construct the railways they will be ours, but this will only be so because we are liable for the cost as well as the interest ; in other words, that we shall have raised a loan of £3,075,000 ; but under the present arrangement we are liable foi nothing but the L 97,000 foi twenty years, whilst we are to have the option of purchase at cost price less depreciation at any time. In every way therefore the arrangement has much to commend it, excepting that it might be urgent — the grant of land to which we are in this case pledged:; but as regards this land the circumstances must be considered. A vast tract of inaccessible land, which will almost be useless unless a railway is formed. I have supposed that as an alternative we shall be ready to construct the line in 10 years, but it might be the case that the line would not be completed at the cost of the colony in much more than ten years. Meanwhile, what is the use of the land. If it were the property of a private individual he would gladly give it to any person .who would construct the railway, half of it in alternate blocks, and that is what we have to do.. The alternate blocks we retain will be five times more valuable than the whole of it is now. Nor must we omit from consideration that whilst the line is being constructed we shall get mineral receipts on the sections between Christchurch and Springfield, between Greymouth and Brunnerton, and between Nelson and Belgrove. We proprose to ask the House to consider this most important subject in committee of the whole on Friday next. We will prepare a resolution approving of the proposal on the condition that after the works are completed, and when the payment of L 97,000 begins, half the cost, whatever it may be, and it is not likely to exceed L 60,000, for the railways should at least yield one per cent to begin with, shall be charged to the provincial districts of Canterbury (nortli of the Ransitata) and to the provincial districts of Nelson and Westland, as well as the entire cost of maintaining tho main roads berween Nelson, and Grey, and between Christchurch and Hokitika. As regards the mode of imposing the charge, we propose that it should be done by means of a property tax imposed within the districts ju3t maintained. I estimated that the maximum is unlikely to amount to onehalf penny in the pound) and that it Jwill

dwindle soon to very little if anything, as the line continues open. Supposing the estimate of one per cent, over working expenses is correct, the colony would have to pay about L 33,000 a year, and would save the maintenance ef roads that cost it now about L 16,000 per annum. As regards the three districts mentioned, the increase of the property tax would yield over the present amount. After the expenditure of all the money and the completion of the railways, the expenditure would ba such, that I consider they would not require to pay a tax of nearly so much as a half-penny in the pound ; but if they have to do so they will be well able to afford it in return for the vast benefit, direct and indirect, the railways will bring to them. In any case they must consider that it is unlikely the colony will continue to maintain the road in question for longer than the period of three or four years. Not, as regards the whole colony, this departure is of great importance. From all parts of New Zealand com© up requests for railways more or less desirable. As long as provision is not made for the East and West Coast Nelson Railways, the way is stopped to the fair extension of other lines or to fresh routes ; but if these great lines be provided for, and if they are to be constructed at no cost to the colony, excepting when they are completed, and then at a cost which, compared with their value, will be a mere trifle, the way is open to consider other lines and the plan to now adopt will be applicable to other parts of the country. • There are lines which we consider should be made on the responsibility of the colony, such as the main line to Auckland and its extension northwards; the extention of the Otago Central to Wanaka, and the extension from Hokitika to Grey ; but if Southland or Otago wishes to penetrate to the West Coast, if the Haketeramea are to be further extended, if Marlborough and Canterbury are to be connected, if Gisborne, Tauranga, and New Plymouth are to have openings to the main line, the same plan of the districts interested providiag half the annual cost can be adopted.