RAILWAYS STATEMENT

Nelson Evening Mail, Volume LXI, 6 August 1926, Page 5

RAILWAYS STATEMENT

DEVELOPMENTAL LINES In pursuance of the policy previously announced, an investigation has been made into the finances of branch lines and isolated sections of railway which were built in order to encourage settlement and to develop the resources of the country. The outstanding facts disclosed are the low earning-capacity of these lines and the high ratio of fixed capital to revenue. At the present stage of development the earnings could not be materially increased even if the railway had a monopoly of the traffic. Since the investment in railways consists mainly of loan-moneys, the capital charges cannot be reduced, as even if the lines were closed the capital charges would still have to be met. The only method by Which any appreciable improvement can be effected is by the reduction of the workingexpenses. In order to reduce traffic and locomotive charges experiments are now being made with light rail-cars of various types, while maintenance charges are also being reduced to the lowest point consistent with safe work- j ing. The best that can be expected of such means is, however, the reduction of the gap between operating revenue and expenditure. In very few cases is there any immediate prospect of obtaining any net revenue to meet capital charges. The problem of providing adequate transport facilities in sparsely settled countries is not peculiar to New Zealand. Investigation shows that the practice in other countries is to pay the railway authority from the public funds for* remunerative services involved in the working thereof, it being recognised that the benefits accruing to the State as a whole far outweight the cost to the State. In New Zealand the payment made to the railways lias been confined to specified branches and to isolated sections of line not connected with the main system. The payment is so regulated that every improvement effected in the results on unassisted lines must automatically reduce the payments in aid of the branch lines, and in a lesser degree of the isolated sections. TARIFF After full discussion with representa-, tives of the various industries affected, the revised tariff was brought into operation on the Hist August, 1925, and was therefore effective for seven months of the financial year tinder review. Locally grown fresh fruit shows an increase'of 14.50 per cent, in tonnage and 52.99 per cent, in revenue, attributable to-the record crop of apples and the increased charges. The freight on fresh fruit is still very low, averaging only I.B(id. per ton per mile. In view of the perishable nature of the traffic, necessitating the use of special trucks and rapid transit, and involving much empty haulage, light loading, and frequent handling, the rates are unprofitable to the Department. It is hoped that the development of the export trade will soon place the fruit industry in a position to bear a charge more iii proportion to the value of the service rendered. A decrease of 1.24 per cent, in the tonnage of sheep handled was set oil by an increase in the average haul. The small increase in the rates resulted in an additional revenue of O.Ood. per ton per mile. . i An important matter in connection 'with the tariff which is now engaging my attention is that of adopting cheap rates to induce traffic in the "off" season. It muft be borne in mind that the Railway Department requires to maintain a'plant throughout the year which will be practically sufficient lo meet the maximum demand at any time of the year. For instance, in connection with' passenger traffic, the Department must be in a position to cope with the very heavy demand at such periods as the Christmas and Easter holidays. The result is that a very large amount of plant is lying idle for a great part, of the year. In the past there has been from time to time a demand from various representative bodies of farmers for facilities of this nature, and I. have therefore had no hesitation in concluding that an experiment along these lines would be amply warranted. After the close of the year such an excursion was run, and the results were distinctly encouraging. I propose during the coming year to pursue this matter further iiot only in connection with farmers' excursions, but in all other ways, both as regards passenger and poods traffic, that will enable our facilities to be made revenue-earning during as great a portion of the year as possible. WORKSHOPS REORG ANISATION Since last year's report considerable progress has been made in the direction of bringing the workshops of the New Zealand Railways up-to-date. Considerable progress has been made

A YEAR OF VERY SATISFACTORY PROGRESS REVIEWED BY RIGHT HON. J. G. COATES "HEARTY CO-OPERATION OF EVERY MEMBER OF THE SERVICE" CARDINAL FEATURE IN DEVELOPMENT POLICY "PROMOTION OF CLOSER RELATIONSHIP WITH PUBLIC" (By Telegraph—Special to The Mail) WELLINGTON, This Day. The Railways Statement was laid on the table of the House of Representatives yesterday afternoon by the Minister of Railways (the Right Hon. J. G. Coates). This is his fourth annual Statement and he is pleased to be able to record "a year of very satisfactory progress." "The net revenue amounted to £1,992,333, which is equal to 4.35 per cent, on the capital invested in lines open for traffic, including expenditure on rail-way-improvement works which have not yet reached the stage when they are revenue-producing. The results of the year's working must on the whole be considered to be very satisfactory. Nearly all classes of traffic show an increase in both volume and revenue, due not only to the natural growth of business, but also in a large measure to the spirit of enterprise which, has actuated all ranks of the staff in fostering traffic and catering for the requirements of the Department's customers.

towards the modernising of the workshops machinery. The state of obsolescence reported on last year has been dealt with by a three-year programme of replacement. The machinery being ordered during the first and second year consists only of that which can be profitably utilised in existing workshops pending the erection of the new workshops; that included in the third year will be heavier machinery which will be placed directly into the new workshops. Good progress can.be reported in the reorganisation of existing workshops management, methods, and services.

A branch in which substantial progress has been made in the work of reorganisation during the year is that relating to stores. I am fully sensible of the fact that in no branch is there greater necessity for an efficient organisation and a strict adherence thereto than in this branch. It must not be forgotten that stores are money's worth, and there is no difference between a leakage therefrom and a leakage from the cashdrawer in a booking-office; nor is there any substantial difference in the loss incurred through maintaining unnecessarily large stocks of stores than there is in keeping a large amount of money locked tin and unused. LOCOMOTIVE SUPPLY AND TRACTIVE FORCE A committee of Railway officers is now going into the matter of enginepower generally with a view to evolving types most suitable for the varying duties to be performed, such as shunting, working branch lines, heavy grades, etc. Arising out of the matter of tractive capacity of locomotives and the strengthening of draw-gear, inquiries are being prosecuted by the Transportation Branch regarding the actual need of strengthening draw-gear in connection with trairiloads, having regard to yard accommodation and crossingloops.

TRAIN SERVICES AND GENERAL OPERATING The reorganisation of train services was continued during the yeai - , and the general rearrangement of services was incorporated in the summer time-table which came into operation in November last. . . East through goods trains were inaugurated between Christchurch, Dunedin, and Invercargill, and btewcen Wellington and Auckland, Wellington and New Plymouth, Wellington and Napier, and Auckland and Okaihan. These trains enable goods to be convoyed between the terminals in cither Island with a period of only one work-ing-day in transit. They also afford fast transit for perishable and urgent traffic which cannot be accommodated on express trains. Close and constant touch will be kept on country and town requirements, and I have expressed a Avish that every effort be made to study the convenience and requirements of the Department's clients. RAIL-MOTORS Experiments with self-propelled railcars have been continued during the year, and although a certain measure of success has been attained a thoroughly satisfactory vehicle has not yet been produced. A project to develop a suitable vehicle by fitting a motor-car engine into an ordinary railway carriage has been abandoned. The Sentinel steam-car has been tried during the year on the Welling-ton-Melling line. Its construction dons not admit of a speed in keeping with the requirements of suburban traffic, and its usefulness is in consequence", limited. Arrangements are being made to place the car on the FranktonThames section at an early date. The Clayton steam-car has been under observation, and after various modifications it shows some prospect of developing into a fairly satisfactory service vehicle. On a recent trial run. after the fitting of a larger boiler, this car gave promising results. Further extended tests have since been made, and the car still gives satisfaction. It is proposed to try this car in regular service on the Kurow Branch, and arrangements are being made lyExperiments arc also in progress with four-wheeled road-vehicles, converted to run on rails. These cars seat eleven passengers, and have been sent for trial on selected branch lines in the South Island whore the passenger traffic is light. Their working-expenses are low, as they can he operated by one man, and their fuel cost is small compared with that of a steam-engine or any other power unit required to deal with the same number of passengers, The Edinson electric storage-battery ?arriagc has been prepared for trial between Christchurch and Lyttclton. The necessity for recharging the batteries at regular intervals limits the

scope of a car of this type. The question of extending the limits of the car by the provision of an extra set of batteries is being gone into. The. vehicle should provide comfortable riding and, being smokeless, should prove popular on the tunnel journey. ORGANISATION During the year I have been giving considerable thought and attention to the question of the organisation of the Department, particularly in relation to the system of divisional control. During the course of the year we have had some experience of this form of control, with results that have confirmed the conclusion then arrived at —namely, that this was an improvement on the organisation under which the Department had been previously worked. Much railway literature has been written in recent times on the question of divisional versus departmental control, and the subject has been one of keen discussion among railway authorities. Generally speaking, it may be said that divisional control was most favoured, and was earliest developed in America, while departmental Control has had the longest survival in Great Britain. PUBLIC RELATIONS A cardinal feature of the policy in the development of the railway business has been the'promotion of a closer relationship between the Department arid the public: in other words, the creation of a good-will in favour of the Department. With the rapid improvement in motors ag a mechanical form of transit, together with the steady improvement in our roads, the sphere of motor competition will become more and more extended, and as this occurs the matter of good-will will assume proportionately greater importance. The problem of improving the public relations may be said to present itself in two aspects—(l) improved service; (2) co-operation of the public. As to the first, a close survey of t'he situation discloses the necessity for substantial improvements in the facilities at the Department's disposal to enable it tot give better service.

Unquestionably with the increased spending-power of the people there has been a greater demand for service. As to passenger traffic, the maximum degree of comfort and speed that can be obtained consistently with safety is demanded, while similarly with goods traffic the demand is for promptness in transit. This has required extensive revision of time-tables, providing for faster train services. A further aspect of the problem of better facilities is to be found in the greater measure of contentment among the staff, which has its direct reflection in better personal service given by the staff to the public. It is a fact that a staff working in comfortable and congenial surroundings with efficient machines will work with an enthusiasm and a will for service to a much more pronounced degree than under other conditions. The attitude of the staff generally towards the public, £ am assured, has been a considerable factor in promoting the success of the past year's operations; Dealing with the problem of public relations under the second aspect—and one which from many points of view is the more important—namely, that'of securing the co-operation of the public, I am happy to be able to say that in this direction very considerable progress has' been made. Realising at the outset the necessity for setting up a closer personal relationship between the Department and its customers I had established a Commercial Branch, which has now become a very important branch of the Department. The work of this branch is twofold in its nature. It requires in the first place that the commercial officers shall go out among the. public, establish personal contact with the Department's customers or potential customers, and advocate the cause of the railway, pointing out that the Department has. both the will and the means to give, good service, that the service is economical as well as efficient, and, more particularly, that the constant caro of the Department is the client's interest. The other aspect is that, within the Department itself, it must plead the public point of view. Necessarily its ideas will generally be in advance of the ideas of the transportation side and it will be constantly urging the public demand for extended service.

Good work has been performed during the past twelve months, and much of the business previously lost by competition has been recovered, and a good deal of new business has been secured. In this respect it has been ascertained that revenue to the extent of £133,000 has been directly due tot the activities of the Commercial Branch, together, with the co-operation of the station staffs. This is very gratifying, and 1 hope with the keenness displayed by all ranks of the service that even better results will be shown next year. A further channel through which it is considered that public co-operation might be secured in an active way is by the establishment of District Advisory Boards. These Boards .will be representative of the various interests using the railways, as incorporated in Chambers of Commerce, Farmers' Unions, etc., and will operate within defined districts. At the meetings of these Boards discussions will take place on the various problems that will be remitted to them affecting public relations with the Department, and there can be no doubt that the clearer understanding that will arise from these discussions and from the operations of these Boards generally will lead to a closer co-operation between the public and the Railways that will be for the material benefit of both. These Boards will, as their name implies, be advisory in their nature, as must necessarily be the case when as in State-owned railways the final responsibility to Parliament must r.est with the Minister. This, however, need not i n any W av restrict the usefulness of the Boards, "for there is undoubtedly a field for their operation wliich will be ample to justify their constitution. They will act as a means for bringing together the views of the Railway Department and its customers, and will be a step towards ensuring that tlie Department's decisions shall before being finally settled have at their foundation a proper knowledge of the point of view of the customers'. Let me emphasize, in • conclusion, that we aim at not only a passive acquiescence on the part of the public in our doings, but their active co-operation and assistance to make our services better and better, and I am satisfied that it is only by taking our customers fully into our confidence and placing all the cards face up on the table, that we can hope to arouse the fullest measure of active co-operation in them. In that way will we secure the public good-will and only along that way lies the path of progress. ROAD COMPETITION A problem which has engaged my attention during the year and which is, of course, likely to'be the prime problem of our railway system for some years to come is that of road competition with the railways. The efforts of the Commercial Branch have undoubtedly tended to keep this competition within limits, but we still find that at various points road carriers are maintaining their business. The whole question, of course, resolves itself into one of economics, and if transport can be carried on

more economically by road, then undoubtedly the business will go by road; but it is necessary in considering this matter from the point of view of a Qoh vernment policy affecting the railways to regard it, not as the road carriers and their customers almost invariably donamely, from the point of view of individual interest—but rather from the point of view of what is best for the community as a whole.. The difference between these two points of view_ is very material in deciding the policy,because the community owns the railways, and regard must therefore be had by the. community to the capital that has been sunk in the railways. It must not be forgotten that, generally speaking, the railway. rolling-stock is available to do the work that is being performed by road and is lying idle wh'en that work is diverted to road transport. A community must, therefore, make due allowance for this capital arid for the plant that has been provided in making comparisons of relative costs as between road and railway transport. But if. after making these allowances, it is still found that transport by road is the more economical, then there can be- no justification for doing other than utilising the road transport for.such traffic. In other words, even if the traffic is available for the Railway Department, it seems to me that if it can be dealt with more cheaply by read transport the proper course is to deal with it by that method. The question then arises as to whether the Railway Department should hand over the traffic to a competitor by road or should itself undertake the transport of of the goods by means of road-vehicles. Cases have . already come under my notice, and particularly in connection with the casual traffic between the peak loads in the morning and evening on short runs, when undoubtedly the work now being performed by the Railway Department could be more cheaply performed' •by road-vehicles, and 1 therefore desire to state as a declaration of my personal policy that whenever this can be done 1 propose that the Raiiway Department shall undertake" the. work, either.by it- - self or by arrangement with private enterprise. In doing so I recognise that it may be said that the Railway Department is trenching on the field of private enterprise, but a careful analysis of the situation seems to me to show clearly the fallacy of this argument. The traffic, in the first place, was railway traffic,. . and in keeping the traffic to itself the; ; Railway Department is but holding . what has always been its own and is not taking the traffic that originally : belonged to private carriers. The. advantages of large-scale work have up to the • present lain with the railways because' of the extent of their fiekl of operation, and I think the same considerations, though possibly in a less degree, might. be held to justify the Railway Department in endeavouring to undertake at ' least such road transport work as will enable it to reduce its working costs. I do not regard road and rail transport as necessarily antagonistic/ Undoubtedly road transport has come lh as a new factor and has its rightful place in our economic life. That place must be conceded it in any policy that has . regard to the true economic interests of the community, but equally in suoh po- - licy must road transport be, kept within its proper sphere, if this is done the position is not one of antagonism,, but. one of co-operation and co-ordination. X can conceive no' better medium for co-or-dinating the transport work of the community than that organisation which, has already been charged' with that' work or the. greater portion of it —namely, the. railways. Tnere will still under tnis policy be a large field for private enterprise in those portions of the country where it would .be no,great saving to the railways to undertake transport work by road. Such occasions occur to me as transport on roads that arc feeders to the railway. There is, I believe, sufficient outlet for the energies of those who-desire to adopt that cJasa of business for many years to come. The railways are ever willing to co-operate in the fullest measure with any such persons to facilitate their business as far : as the Department may do so and generally to co-ordinate their, efforts-so-—as to reduce working-costs and give better service.

Summing the position up in this connection, I desire to say that my policy will be for the Department to utilise read transport eitiier itself or by arrangement with others wherever it can effect economies in its work by so doing, or can increase the potentialities for service of its present operations. In this connection I may say that the financial aspect of many of our branch lines has for some time been the cause of much concern, and consideration is now being given by the. operating ofiV cers to tn© question of establishing definitely whether it would not be more economical and make for greater efficiency to run services by road, either in addition to or in substitution for services by rail. SHUNTING ACCIDENTS Owing to the number of shunting accidents which were occurring during the past year it was decided to set up a itailway Shunting Inquiry Board for tlie purpose of inquiring into the conditions ot work oif shunters as affecting the hazard involved in the performance of their duties. All matters,, reported upon have either been adjusted or are in the course of further investigation. LEVEL-CROSSING PROBLEM policy in regard to the level-cross-ing pruolent was clearly set out in -the Railways Statement presented to Parliament last session as being one for the "elimination of the.more dangerous level crossings and provision of warningappliances at others.' 'that policy has Deen, and is being, carried out. Information from other countries where level crossings constitute an even more formidable problem than in New Zealaifd goes to snow that the .tendency is to do away with gates and gate-keep", ers and to itepend on warning "notictS, visible or audible"signals, and the. good sense of vehicle-drivers for securing safety at the crossings. This applies to such countries as Italy, where on the State railways there are. 13,000 public level crossings; Holland, nearly 4,000; France, 30,Uud; and the United States, 256,000 on first-class lines. The expenditure of several million pounds on unremunerative works, which a programme for the complete elimination of the level crossings in New Zealand would call for, could not be justified to the taxpayers. If the rail-users were called upon to pay interest on this expenditure all railway charges would have to be raised, making it still more difficult for the railways to compete for traffic with the road-users, and throwing an additional burden on the taxpayer through losses on account of railway operations. The Railway Department is now working as a business concern, and must be given an opportunity to carry on its operations under fair competitive conditions. It would not have this opportunity were its present disadvantages of track-cost and upkeep increased by heavy unremunerative expenditure entirely for the benefit of road-users. It must be borne in mind that the roads and the railways of Npw Zealand were built by the State to meet its transport needs. In nearly all countries where level-crossing problems exist'it is recognised that, no matter whether the lines are privately or State-owned, the cost of eliminating any crossing should be apportioned between the Railways and the public authorities representative

of the road-users. Each should share the burden of the expense incurred tor public well-being at the crossing-places Of road arid rail. In this regard the Railway Department has always wilhng"*ly borne its share of the cost of eliminating level crossings at those points whe'ro.ldcai bbdies have agreed ta pay Uietr lair jprWportiod of such cost. '' Wi6d iho\ institution of tiio Mam ftjlftttayl Board We" Railway DepartifiW Jfe «ois3 been working in co'njunc- - Hon with that body in carrying out proposals for improvements a't road and railway intersections. 'The principle of making each level crossing as safe as possible for careful roitct-users is incorporated in the existing policy of the Railway administration, and is being put into effect as finances permit and other interested bodies are willing to co-operate. USE GP NEW ZEALAND COALS ON RAILWAYS The matter of making more extended use of New Zealand coals on the railWays was fully referred to in my last Statement. The Board of Inquiry therein mentioned finds that generally most of the types of New Zealand coals the use of which was advocated are not by themselves .suitable for present-day conditions, but that various mixtures of . New Zealand coals could be obtained which would satisfactorily meet requirements. It is obvious, as the Board of Inquiry points out, that the utilisation of New Zealand coal in place of imported coal would result in a general improvement of the labour and financial situation within the Dominion. This is the objective in view, provided it can be attained without a compensating loss on » the operation •of the railways. J "'.ln,' accordance '• with the recommendation that a Fuel Engineer be appointed, applications • were called for the posi- • tion. . , .It will be. the policy to utilise New Zealand coals and restrict the use of , imported coals to a minimum, and ar- • rangements are already in hand with L tnis object in view. 2 HOUSING '*'.. As mentioned in my last statement, special consideration has been given to .' the matter of placing the Railway Department's house-llactory at Frankton >' : Junction on a satisfactory financial basis. ' lii this connection it has been necessary to review • the question of rentals paid by the employees. Having regard •■- to the expenditure involved"in providing -";, the nouses the rentals have been quite inadequate, aiid it will be absolutely ■■ necessary to make a slight increase if ■'• the Department is not to continue to, w make a substantial loss on its houses. At '■' the same time it is recognised that it is « extremely desirable to have the staff "* Well housed at a minimum of expense to **-. iheih, and it is not expected or intendtl ed/to make any profit out of the hous- ■» iiig of the employees. «* • Three hiiridred five-roomed houses :'•■'» Were cut at Frankton Junction Factory Z during the year, and of these 251 have ;» t'eeft erected. } r STAFF RELATIONS £■ Relations with the staff during the •-. year under review have been of the hap~l_ pie'st, and there has been realised to a greater and greater extent the spirit of '.,*", „ co-pperatfoh Which is the foundation of • p'olicy.' I aim at greater efficiency ■J in tlie Department, not only by pro- ' yiding the staff with better facilities to - Be* used by them in connection with ,:; their Work, but also by providing for • them the means of.becoming more effi- "*' dent ' railwaym-en in themselves. In this latiei*cc/unectioii I have- in course of development a scheme of staff train- " iiig gilder Which I hope, to give every -- member of thg Department the'oppor- '*"" tunity to" make manifest his abilities in • their fullest extent, and also to give him 7 facilities for qualifying' himself for the « highest positions in the Department. tAs a commencement there have been established correspondence classes in !•:": elementary traffic-working, and the r ready response that has already been '■ iriade by the staff shows that there was ;' a';■ Widespread demand for facilities of • this nature. Under this arrangement ','; opportunity is afforded of receiving a ■'■■: special course of training by thoroughly qualified instructors in such subjects as '- tariff charges and regulations, station acand the elements of train-work-' 'ing: l There are also included special • -talks oh business-getting, courtesy, be- .; haviouf, health, habits, self-reliance, - and ambition, the purpose in this con- *- neetidn being more particularly directed ';to moulding the minds of the young beginners in such a way as will induce inj.thein a proper attitude towards the public, to make them useful citizens and ■ capable business men, with sustained - .interest in and enthusiasm for the Welfare of the service. During the coming year I intend to ~ develop this policy .still further, the • operations being carried on up to a certain point Within the Department it- ' self, but ultimately stretching beyond that Jimit into our universities. It has within recent times been more and . more realised that transportation is a science requiring careful and systematic - :v3tudy, no less than the other sciences Which now form a portion of the curriculum in our higher educational system. . My policy aims to raise the standard of attainment right throughout the service. . . Only by effort and careful study properly directed can the principles of transportation science be thoroughly master- ■ ed; and the scheme which I have in view is designed to afford not only the means of study but the necessary direction towards the proper end. ..Already in the older .countries the B&ilway authorities are working in the closest co-operation with the universities to raise the status of railwaymen, so far as the samo may be done along the line of educational attainment, while in Great Britain there has been established an Institute of Transport along the lines of the Institutions of .Civil and Mechanical Engineers, with the same object in view. The result is that the work of Railway executives is being more and more regarded as professional ?n its nature, the object being to place the railways in a position to rank witii the professions in attracting the best' brains of the community. Not only do I aim to raise the standard of knowledge and to develop the latent abilities of railwaymen, but I desire to give every employee in the Department equality of opportunity. Much has been heard in the past of a so-called ''division barrier." Much of this fnay have been quite unjustified; but it is undeniable that, among the Second Division at least there has been a good deal of belief in its existence as a factor tending "to hinder their advancement. Anything that can be done to eradicate this feeling is, I believe, a step in the right direction, and I am hopeful that in the development of my proposals for staff education the members of the Second Division in particular will understand my desire in this direction and take the fullest advantage of the opportunities that may be afforded tliern. A further section of my policy in relation to the staff is that which takes the direction of utilizing the combined knowledge of the staff in the solution of every problem that arises within the Department. I found my conclusions In this respect on the principle that the man who takes an interest in his job should be able to make a valuable contribution—especially in the practical aspect—to any discussion about that job. to attain the end I have, indicated I have encouraged the convening of conferences of business agents, for instance

arid others, with a view to having ' round-the-tnblo" discussions in the freest and frankest manner possible of all the problems (hat touch the daily work of those concerned. At these conferences there is an exchange of ideas and an analysis and .synthesis of knowledge, which must lead to sounder decisions than would otherwise be the case. Moreover, such a, procedure, .through giving a better understanding of the reasons underlying decisions, must niake those decisions more acceptable to (hose whose work it will be to carry them into effect. It is plain also that exchange of ideas among many must result in a. greater richness of ideas among all, and this, I believe, is the surest road to the removal of misunderstandings. 1 have found as I have moved about the system that the railway staff in general adopt n thoughtful attitude towards their work, and evolve ideas which appear to them to represent improvements on the present practice. The difficulty up to the present, however, seems to have been one of communicating their ideas to those who would have authority to order their adoption, and it is with the object of overcoming this difficulty that I have made it a part of my policy to encourage the controlling officers to confer freely with those under their control. SUGGESTIONS AND INVENTIONS COMMITTEE Another means which was designed to the same end was the establishment of a Suggestions and Inventions Committee. Since tho inception of the committee on the 15th June, 1925, up to the 31st March, 1926, there have been received a total of 858 suggestions and inventions for consideration. Of these sixty-two were recommended for adoption, six are on trial, 165 are still under investigation, and 625 were not adopted.. The suggestions and inventions dealt with cover an extremely wide range, and include suggestions advanced by members of the general public in addition to ; those forwarded by railway employees. i Matters referred to the committee have embraced suggested alterations to books and forms, improved workshop facilities, labour-aiding devices, safe working-ap-: pliahces, improved mechanical and elec- ] tiical apparatus for power-house and, overhead gear, alterations to the lay: out of station premises and yards, improved signal apparatus, devices for pre- j vehtioii of accidents at level crossings; and accidents due to slips, improved traffic-working, reclamation of scrap ' material, improved methods in connec- j tion with refreshment services, and many ! other matters. " j The majority of the suggestions and I inventions have emanated from employees associated With the branches concerned in the respective remits; and, although no considerable financial advantage has yet resulted, it is pleasing to record that the setting-up of the committee has encouraged a spirit of cooperation and interest in the Department's affairs. TRAINING APPRENTICES In addition to the arrangements above outlined for the improvement of the

| qualifications of our railwaymen, careit'tii attention is being given to the training of our apprentices. The policy in this connection is not only to make the aprculircs first-class tradesmen so far as ! e>.'affsiiiansi;ip is concerned, but also to develop in them those qualifications of leadership which will fit (hem to take controlling positions. I think it must bo admitted "that our tradesmen are ;u3 cm\ ciemfc from the point, of view of manual I .skill a,s any tradesmen who hive served ' their apprenticeship outside, the rajli way workshops. But in training Our 'young men in our organisation regard must bo had to more than manual skill. . Wo have to provide the future controlling officers for our workshops, and so ■ must educate them in the work of controlling men, laying out work, and goneI rally bring to tiiein a knowledge of the ! requirements of the position of a leader of men. Up to the present there has ' been no systematic activity along these I lines, and wo have therefore had to rely on our men gaining the necessary qualij ficationa after they have been appointed I to the higher positions. This does not i make for efficiency, nor is it altogether fair to the men. That we have come through as well as we have is probably more of a tribute to our men than most of us realise. 1 think, however, that this blemish on our system should be I removed, and definite steps are being i taken in that direction. Arrangements j arc already in course of completion for [ tiie establishment of a permanent school- , room for apprentices at each of our main workskhops, and instructors have been appointed. I It is intended at the outset to give each apprentice, during the first thret; years of his apprenticeship, three hours' class-work per week for the purpose, of teaching him to read and understand working drawings, instructing him in the various branches of locomotive maintenance, and tending generally to make him a better and more efficient tradesman by the time ho completes his apprenticeship. A higher standard of attendance at regular technical (schools will also be demanded, and inducements in the form of scholarships will be awarded. STAFF DISCIPLINE Tn my last statement I referred to the intention to adopt a new system of staff discipline, the essential features of which would be the abolition of monetary fines for irregularities, misconduct, etc., confining the suspension of members to cases where it is fairly certain that the offence would result in dismissal, and providing a system of merit and demerit marks in which a member would, in consideration of disciplinary measures for miiscdnduet, have placed against his delinquency the record of his previous meritorious conduct. It is believed that the new

system will be much more equitable in it.- operation, and remove much cause cf discontent that has been engendered by tho methods of discipline adopted in tiie past. This, we hope, will be instituted without any loss of disciplinary effect in our system —and indeed we look for an even greater measure of meritorious conduct by reason of the fact that due oh-'d't will be given ,to ■employees therefor. The proposals were submitted to the respective organisations and representatives of the railway staff, and have, generally speaking, been approved of by them. The regulations to give effect thereto are now being finally drafted, and il is hoped to bring this 'system into operation in tho very near future. ACQUISITION OF INFORMATION FROM ABROAD A matter that has impressed itself on me, during the course of my connection with" the Department is the tendency that we have to become insular in our ideas, this no doubt being t!ie natural result of our comparative isolation from other railway systems. The effect of such insularity must result in a poverty of ideas, and! am just afraid that we have been under some handicap in this respect in the past. I think it, very necessary that we should keep in closest touch "with modern thought in the railway world, in order that wo may know the practices that are being found desirable elsewhere, and that wo may know also the conditions under which such practices exist. I have found that in the organisation of the Department there has not been any officer whose duty it was to obtain information from abroad, collate, it, and compare it with tho information obtained within the system itself, with a view to seeing whether wo are getting the best that we can get from the efforts of all concerned in the railway world, and particularly from bevond the confines of our own system. Another aspect of tho policy of keeping abreast of the times in the railway world is the sending of officers abroad. Since my last statement a number of senior officers have been sent overseas, and .have returned with a good deal of valuable information, proving the advantage of the scheme and the diligence of the officers concerned. I propose to continue this policy, which I am convinced is on sound lines. RAILWAY MAGAZINE With the object of facilitating the interchange and dissemination of railway knowledge amongst the employees of the Department, and of making tho Kill-using public better acquainted with the aims of the management and with tiie services available, I have recently arranged for tho issue of a monthly magazine. This is being distributed free to all employees of the Department, members of Parliament, business people and shippers trading with the railway, and to the public libraries, etc. The development of good-will among the public and team-work among the staff is felt to be tho best .way to make the Department render the fullest measure of service to the community, and tho issue of a magazine such as we have decided upon is, in my opinion, one of the best methods for achieving the purPOB °THE OPAPA DERAILMENT

The regrettable accident which occurred near Opapa station on the 22nd September, 1925, was the subject of a 'Board of Inquiry. After a thorough and exhausive investigation the Commission report, inter alia, as follows: "We find that the derailment of the Wellington-Napier express train on the Cpapa' bank on 22nd September, 1925, was due to excessive speed, and that this was the result of the engine-driver failing to take precautions to reduce speed when approaching the curves near which the derailment took place, in accordance with the regulations which are issued to engine-drivers and others." And "We also find that the presence of a third person on the engine, and the taking of liquor on to the engine by that person during the ojurney, were factors which helped to bring about the derailment." It is therefore satisfactory to note that in so far as the Department itself is ■concerned no blame attaches. The Board of Inquiry made a number of suggestions which have already been adopted or are under action. RESULTS OF WORKING The following is a summary of the I working for the year ended 31st March, 1920, as compared with 1925: Year ended 31st March

For the current vcar T anticipate the revenue will reach £8,250,000 and the expenditure £6,475,766. Note.—-The figures shown above for 1925 have, where necessary, been adjusted so as to make them comparable with the figures for 1926. as prepared under the new accounting system.

Particulars. 1926. 1925. Total miles open for traffic _ 3,138 3,085 Average miles open for year 3,103 3,067 Capital cost of opened & unopened lines £53.,71G,455 £50,833,500 Capital cost of open lines £47,608,676 £44,570,746 Capital cost per mile of open lines £15,172 £14,448 Gross earnings £8,460,762 £7,276,761 Working-ex-penses £6,468,428 £5,709,652 Net earnings £1,992,334 £1,567,109 Interest charges £1,913,311 £1,654,845 Appropriation for betterments £58,000 Li nappropriated surplus £21,023 *£87,736 Percentage of total working-expenses to gross earnings 76.45 78.46 Percentage of net earnings to capital invested 4.35 3.55 Railway operating earnings £7,589,274 £7,014,649 Railway operating expenses £6,164,570 £5,533,136 Net railway operating earnings £1,424,704 £1,481,513 i ercontagc ot railway operating expenses to earnings 81.23 78.88 Operating earnings per average mile open £2,446 £2,287 Operating expenses per average mile open £1,987 £1,804 Net operating ear.iper average mile open £459 £483 Operating earnings per train-mile 176.51(1. 185.33d. Operating expenses per train-mile 143.37<1. 146.19(1. Net operating earn111 P"u npv i t*n in mile 33.14d. 39.14d. Passengers, Ordinary 11,813,480 12,424,012 Season tickets 600,292 537,554 Total passenger ' journeys 27.653,414 26.106,859 floods tonnage 6,808,603 1 a vo-si orlv t( ij 1 — 6,602,607 nage 447,539 430.852 Train-mileage 10,319,407 9,083,623 lingine-mileage 14,657.039 12,854,287 i