THE RAILWAY RATE.

Lyttelton Times, Volume LXI, Issue 7226, 28 April 1884, Page 5

THE RAILWAY RATE.

DEPUTATION TO THE PREMIER, A deputation of gentlemen representing tho Chamber of .Commerce, tho Industrial Association, the Corn Exchange, and the Agricultural nod Pastoral Association, waited on tho Hon the Premier on Saturday afternoon, at tho Provincial Council Chamber. Tho following gentlemen composed tho deputation :—Mosers Macphor--8011, Chvystftll, Meares, Bruce, Keen!,. Pavitt, J. E. Parker, Howland, Peryman, Henderson, Stead, and Higgins. There wore also present tho Premier’s private secretary, Mr Blundell, and Mr F. Back, Traffic Manager of Railways.

Mr Macpherson, President of tho Chamber of Commerce, having introduced the deputation, spoke as follows: —Major Atkinson, let mo thank you on behalf of this deputation for your courtesy in agreeing to receive us, notwithstanding your stay in Christchurch is so limited. Tho main object of this meeting is to ask you respectfully to hear some arguments in favour of the resolutions that were passed at tho largo public meetings held in Christchurch, on tho subject of tho railway tariff, which resolutions were forwarded to, and acknowledged by, you. One of'the principal of these arguments is that there has been no satisfactory evidence put before the Canterbury public to show that the carriage of grain on tho Canterbury railways, at the rates of the late tariff, did not pay. Any evidence that has been obtained goes in a contrary direction. As you are aware, a return was laid on the table of tho House of Representatives in August, 1882, to Mr Wright’s order, showing tho approximate cost of construction and equipment of tho different sections of the Hurunui-Bluff railway, and tho amount of interest accruing on each. The Christchurch section was there shown to be earning a profit of £l l9s Id per cent on the total cost of the line. And although some of the branch feeding lines . were runnfhg at considerably less profit, the profit earned on the whole Canterbury system averaged about 6 J per cent. Presumably the reduction made in the carriage of grain in the following December, was a consequence of the Government concluding, after careful enquiry, that they could afford to relax the charge upon agricultural produce, and since then, whatever reason may be adduced for an increase of the tariff, it cannot be said there is any diminution in the volume of traffic. Mr Stead, who represents the largest interest in the Canterbury grain trade, is of opinion, based on bis very large experience, that the carriage of grain on the Canterbury railways must in itself be the most remunerative portion of the traffic, and need not have been handicapped by a return to former higher rates. With respect to the comparative cheapness of haulage on the Canterbury lines, allow me to quote to you from the evidence given before the Railway Commission in 1880 by Mr Allison Smith, Locomotive Engineer, who says:—“ The principal way of making the railways pay would be by having differential rates in proportion to the cost of taking the goods over different sections of the line. I know it costs three times as much for locomotive power to take goods from Oamaru to Palmerston as it does to take goods from Oamaru north.” And this can be easily understood when we find that he also states that “ the best engines we have got working on theplains will haul 363 tons.” This view of charging differential rates is also supported by Mr Back, the Traffic Manager. In his evidence before the Commission he says: “ In places where there are heavier gradients and disadvantages, which, on the Canterbury Plains are not met with, I think the higher rates should have been retained. It will cost, to work grain between Oamaru and Port Chalmers, I should say, 30 per cent more than on the level lines.” The Commissioners themselves, in the 21at paragraph of their report, “ urge most strongly that the system of a uniform tariff should be abolished, and the railways conducted on commercial principles.” It seems to us, and to the farmers of Canterbury, quite inconsistent with commercial principles that the Canterbury farmer should pay under this cast-iron tariff, the same scale of charges, pro rata, on a 40truck load train of grain as others are doing, where only about ten trucks can Tje moved at a time. The third resolution passed at the public meeting tallies exactly with the recommendation of the Railway Commission of 1880, which was as follows: —“ That a Board of Management should be instituted, consisting chiefly of men of business knowledge and business habits, and free from political influence.” You were good enough, in acknowledging receipt of the resolutions, to say that this last matter would be for Parliament to consider. But we respectfully solicit some expression of your views as the head of the Government, more especially as there has been ample time since 1880 to have matured an opinion on the question. We further wish respectfully to ask you if, previous to the late alterations in the tariff, Government had before it undeniable calculations to show that the carriage of grain on the Canterbury Plains was in itself unremunerative at the then prices of haulage. It was a very serious matter to suddenly assess the farming industry with what is practically 2% per cent, not on a farmer’s income or profits, but on the capital value of his produce of the year. Every farmer, situate 40 or more miles from the port of shipment, suddenly found that, in addition to paying the last year’s rate of carriage, he was this year, when everything was against him, suddenly pounced on by the Government putting its hands into the railway trucks and practically (for that is the effect) taking one bag out of every 40 of his produce to pay the additional im ? post. I hope I have not wearied you. Major Atkinson assured him that the statement was very short and interesting. Mr Stead did not know that he had anything more to say beyond what he had already briefly stated in public. Major Atkinson had read all that very carefully. Mr Stead looked upon railways with a broad view, and felt that farmers were not entitled to any special consideration, and should pay for services rendered. He had always contended that grain paid the best of anything carried on the Canterbury lines, though it was difficult for him, as a private person, to prove it. He had watched the railway traffic from the old Provincial days, and was convinced that were the grain traffic withdrawn the best portion of it would be lost. He, of course, did not allude to the passenger traffic. He thought it unreasonable, therefore, that when the Government found it necessary to increase the earnings of the railways, they should increase the rates on the class which already gave the best returns. He was not prepared to say that, even at the old rate, the grain, paid enough; but it paid better than any other class, and, therefore, should not ho increated the other classes. He did not believe ai any antagonism between Canterbury and Otago, or between tho North and South Islands. He contended that at any time, but more especially at a time like tho present, it was very hard that the farmers should have to pay an increase of something like 40 per cent—in one instance it was oven 50 per cent—on tho old rates, when other classes were not increased in tho same proportion. Major Atkinson remarked that on no class had there been previously made such a reduction. ‘ Mr Stead argued that no class of goods was so easily handled and carried in such large quantities. Major Atkinson: For three months in the year. Mr Stead, from his experience, would say that it extended over the twelve

months, though the gvoat rush was for three months. .. Major Atkinson said the rolling stock was kept up all the yoa*moot those three months. ~ Mr Stend said it was tho same thing Major Atkinson understood that wool did not require such an enormous number of extra trucks. . , . Mr Stead said that tho department did not jmovido as many trucks _ as wore required, but met tho extra strain by working overtime. ... Major Atkinson pointed out this was an extra expense. Tho extra shifts did not work ns much, and cost more. Mr Stead believed that at times of extra pressure tho men really worked harder thanat ordinary times. It should also bo remembered’that there would bo an indirect loss were tbo traffic in grain to fall off considerably in consequence of raised rates. Ho knew several farmers who paid over i!5000 a year for wages alone, and when it was considered what class of mon drew those wages, it would bo soon that their expenditure must affect tho Customs revenue. It might bo contended that a penny a bushel increase in the rate would not decrease the product- of grain, but ho knew many men to whom it would be the last straw, and whom it would induce to abandon tho growing of wheat. Tho Id per bushel was really 2| per cent on the gross value, and if the farmers were already paying a fair price for tho services rendered they were little able to bear any increase beyond what was absolutely necessary. No one who wasnot behind the scenes, could have any idea of the state of depression abong the farming class. It was something distressing. He had had strong, able-bodied men coming with tears in their eyes and assuring him they had had to pawn their watches to find bread for their children. He knew that between Ashburton and Rakaia there would be 15 to 20 per cejxt less wheat sown next season than this. Ho did not say that this was entirely due to the increased freight. Mr Meares asked if the Government was prepared to publish the figures referred to from time to time, showing that the grain was carried at a loss. People here were under the impression that it was carried at a profit. Major Atkinson would notice all these points as soon as the members of tho deputation had finished speaking. Mr Stead did not suppose that Major Atkinson would cave in in the same way that Mr Lowe had done with regard to the match-boxes at Home.

Major Atkinson would be very glad indeed if he were in a position to do it, but he was not.

Mr Parker wished to know whether the tariff had been increased because of the falling off in the Customs revenue. Major Atkinson: Clearly not, though it was incidental to it. Two or three years ago representations were made that the tariff on grain was too high; or, if not too high, that, at least, its reduction would lead to a larger net revenue. As no doubt the deputation knew, railway companies sometimes carried goods at a loss, and so it might have been that Government might find it desirable to carry at a loss in order to obtain indirect advantages. The revenue at the time was elastic, and the Government was in a position to try experiments. The rates were reduced, but the increased revenue did not follow. When the revenue began to fall off it became a serious question whether the rates should not be raised, and whether the Government were not bound to use the authority Parliament entrusted to them. Government hoped against hope, and delayed matters to the last moment. Though it had been said that Parliament ought to have been called together he dissented from that view, as no greater blow to the credit of the Colony could be given than by taking such a course. Government had looked upon the railways, as he trusted the gentlemen present did, as being the property of the Colony, and not of any individual district; and the question for them to consider was what was a fair rate, and what could people afford to pay for the services rendered. When they came to consult their officers they found that the grain was carried at the lowest rate except minerals. He would jbe happy to see the deputation’s figures and then to show them his. He was quite prepared to say that there might be a time when grain should be carried at a loss, but no railways could do this unless they had a large suburban passenger traffic. He had gone very carefully into the figures, and, as far as be could see, the old rate of carriage was giving practically no profit whatever. Mr Stead asked if this referred to the main line.

Major Atkinson averaged He could not admit that the Canterbury lines should have any advantage. Mr Stead did not want any advantage, but contended that where grain paid there was no reason for increasing the rates upon it, particularly when by doing so the production would be decreased. He would remind Major Atkinson that there had been a large increase in the production since the reduction in the rates. Major Atkinson admitted that there had been, but this had brought no increase in the nett revenue, as had been expected. Mr Macpherson remarked that many farmers were laying their land down in grass. The railways would not get much revenue from that. Major Atkinson said that dairy farming would be more profitable to the people. They would get more per acre, and would have a more certain market than with wheat. Mr Macpherson could not agree with the Pi’emier, when the best Akaroa cheese was selling at 3 ad per lb. Mr Stead had been unable to help laughing when he heard Major Atkinson speak of dairy farming paying. Mr Peryman said that first-class butter was bringing 84s in London. Mr Stead pointed out that cheese factories in Canterbury had proved to be an utter failure. Major Atkinson thought that if wheat was going to fail, and there was nothing for the farmer but ruination, the sooner everybody cleared out the better. Mr .Stead said that was his opinion.

Major Atkinson did not, however, agree with iMr Stead, and intended to stick to New Zealand.

Mr Higgins had understood that the Government had put off the increase to the last moment, and had increased the rates to meet the deficiency in the revenue.

Major Atkinson: The railway revenue. Mr Higgins could see no necessity for raising the rates before the meeting of Parliament. It would have been wiser not to have increased the tariff, and to have let the Parliament take tho necessary measures. Government being prepared, of course, with a scheme to submit to the members. The tariff had clapped a heavy burden on the farmers. Major Atkinson had said that the tariff was still lower than it had been some years ago. Tho argument was not a happy one, because wheat at the earlier date was worth onethird more than at present. He thought it would have shown greater consideration for tho people had Ministers mot Parliament with a deficiency. Major Atkinson said that was a point for which the Government was responsible. Tho financial year ended on March 81. and tho revenue was only £300,000 on an expenditure of 12. j millions. So that there would have been a very largo deficit before Parliament mot. Canterbury did not pay more than its fair share of the increase. Wheat in Canterbury gave only £16,000 out of the total increase of £IIO,OOO. Mr Stead questioned tho accuracy of tho statement as to Canterbury. Major Atkinson might bo wrong, Mr Meares reminded the Premier that

ho had not given tho figures he had promised.

Major Atkinson had been cut short. He was going to say that the commercial principle was to get os much as possible without driving traffic off the road. Mr Meares supposed that this meant differential rates.

Major Atkinson understood so. He held that the Crown lands and tho whole of tho country belonged to Now Zealand, not to any ono district. There was a saving of two millions a year effected by tho railways, and tho whole country—or rather those who used tho railways—reaped that benefit.

Mr Stead hoped tho principle would bo carried out. If tho railways had increased the value of tho lands, the amount thus gained should bo credited to tho railways.

Major Atkinson could understand that the railways might bo looked to for only 1 or 2 per cent, find tho balance bo expected to come from tho general revenue. He thought the railways wore national property. Of course, they should bo so worked as to encourage traffic rather than check it.

Mr Howland pointed out that tho rates were so high on native coal and manufactures as to drive traffic away. Major Atkinson said the results showed that this was not tho case. There might be defects in the system, and, if possible, these should bo avoided. Upon the increased tariff it was estimated that the revenue would bo under £400,000. Last year the estimate was .£384,000, and the results were only £306,000. The decrease on Class E had got out of all proportion to the tariff on other classes.

Mr Macpherson pointed out that the Canterbury railways on the plains had cost less per mile than all the other lines. Major Atkinson understood that, reckoning the tunnel and bridges, they had cost more than other railways. Mr Stead thought the question'was, was the Government killing the goose for the sake of the golden eggs P A large proportion of the land in Canterbury was not suitable for dairy farming. Major Atkinson could not believe that Id a bushel, which was not 2s 6d per acre, would ruin the trade in grain. If Canterbury people were unable to bear this in consequence of their being mortgaged up to their eyes, the sooner they cleared out the better. Mr Stead said the whole of New Zealand was in the same position. Major Atkinson believed that New Zealand had ample securities, and if her land were put into the market, it would realise far more than her liabilities. Mr Howland suggested a protective policy. Major Atkinson thought that was a question which was coming sooner or later. Mr Reese alluded to the timber tariff as affecting Canterbury considerably. Whatever increase was put on should have been put on all the .distances. Major Atkinson thought it was clear that the districts which were non-producers of timber would scarcely gain by an increase of rate. The tariff had been increased wherever it could be done without destroying the traffic. That was the general principle which had guided the Government throughout. Mr Meares again asked for the figures to which Major Atkinson had alluded. Major Atkinson was not prepared to produce the figures, but would be happy to receive the figures showing that the grain traffic was profitable. He did not think it possible to show what the Canterbury railways had returned. Mr E. G. Wright bad moved for a return, which necessitated the compiling of millions of weigbbills. Mr Chrystall thought that the returns published in 1882 showed the best results in Canterbury, and those returns were published after the first reduction upon grain. Major Atkinson looked at the whole country. Canterbury carried only about half the traffic in Class E.

Mr Stead called attention to the questions of reckoning by truck instead of by ton. All the allowances for depreciation, &c., would he found to be in favour of grain, as compared with other goods traffic. Mr Meares understood that the figures would be published. Major Atkinson said they would ultimately, no doubt, but he was not prepared to name a date for this. The carriage of grain paid nothing to the railways. What paid was the suburban passenger traffic. Some classes of merchandise also paid. Mr Meares understood that the grain was not carried at a loss. Major Atkinson was not going to state .that positively. He only gave it as his opinion. Mr Meares remarked that in the North Island, where no grain was carried, the lines yielded l - 72 per cent; and in the South Island, where there was grain traffic, the lines yielded 3 - 25 per cent. Was it not possible that there had been had management, and that there was required a thoroughly experienced man to deal with the matter ? Had the Government considered this F Major Atkinson understood Mr Meares to mean that a good man should he imported from England. Mr Meares had not said that. ' Major Atkinson said the Government had not thought of it. It would cost several thousand pounds. Mr Stead supposed that something had to be done to raise the revenue. The question was the best way of doing this. Major Atkinson said that was the object the Government had in view. Mr Meares suggested that improved management might have served the purpose of increasing the tariff. Had the Government considered this when increasing the tariff P Major Atkinson said the Government had carefully considered this, and, relying upon their officers, could not see their way to any reduction in expenditure on management. Under present circumstances the railways should he worked at a profit, hut not necessarily at the largest possible profit. Mr Peryman pointed out that the increased tariff was forcing grain to be shipped at Timaru, and preventing its carriage over the Canterbury lines. Major Atkinson was not aware of this. Mr Meares asked if the Government had considered tho question of non-political Boards. Major Atkinson did not know what Government was meant. Was it Sir John Hall’s or what P He would like to know what a non-political Board was to do. Mr Stead said it was to adjust tho tariff. Major Atkinson doubted Avhethor _ there would he a non-political Board. In Victoria it was not non-political. _ Was tho Board to take the place of the directors of a com- ** Mr Stead said they should take tho place of tho Minister of Public Works.

Major Atkinson understood that tho Parliament would tell the Board to realise so much from tho railways, and leave it to thorn how to get it. This system would not avoid political influence, unless a Board of three or four autocrats were established. In Victoria the Go% eminent Commissioner had full power to over-ride his two colleagues. When the non-political Board’s time of office was near expiring, the members would bo desirous to make themselves popular. , , , The deputation having thanked the Premier for granting them the interview, Wl Aa dr thc'v W oro leaving tho Chamber, Maior Atkinson, in reply to Mr MacpherS liUd th“t tl.o Whole of tho i.hmd« toted to by the Homo aoternmont had been visited in search of tho Loch Fync.