RAILWAY FINANCE

Nelson Evening Mail, Volume 79, 27 May 1944, Page 4

RAILWAY FINANCE

BUSY PERIOD LAST YEAR RECORD REVENUE AND EXPENSES WcilWoii. . j- •; Financial results of railway, operations in New Zealand during the year ended 31st March, 1944. were announced last evening by the Minister of Kail ways, the Hon. R. Semple. He said it was the busiest year in the railway history of the Dominion. The net revenue was £2.567.970. The Minister said that the gross revenue reached the record figure of £ls. 325.306 and exceeded that of the previousl year by £1.196.313. or 8.47 per cent. Had it not been necessary to impose restrictions over the last three | months as a result of the shortage of j coal, it was anticipated that the gross , revenue would have reached £16.000,-] 000. The marked rise in gross earnings was brought out by a comparison with the last pre-war year ended 31st March, 1939, when the gross revenue was £9.345.387. The figure for the year just ended represented an increase of nearly 64 per cent, over that amount. All sources of revenue had shown an increase. Both passenger and goods traffic had been heavy throughout the year, the revenue derived from these sources showing increases of £564,973 and £434,824 respectively. Miscellaneous and subsidiary services revenue showed an increase of £146.414. INCREASE IN EXPENDITURE The expenditure for the year was £12,757,336. an increase of £1,454.923 or 12.87 per cent. This increase was largely due to the additional cost resulting from the handling of the increased volume of traffic, rises in material costs and higher wages costs due to improved staff conditions. It should also be noted that the traffic lost through the imposition of the restrictions could have been carried with comparatively little addition to the expenditure figures as a considerable proportion of railway costs was constant and the whole expenditure did not react to reduction in services as quickly or in the same ratio as the receipts. A factor in the expenditure which warranted special mention was the pro-, vision of £410,500 for deferred maintenance, said Mr Semple. It was fell that the best policy to adopt was to absorb out of war-time revenue an amount estimated to meet maintenance expenditure which would have been incurred but for war time conditions rather than to make a very favourable showing for the present and load such costs on to the post-war period. As a result of this policy, the net revenue for the year was £2,567,970. a decrease of £258,610 compared with the year ended 31st March. 1043, and, allowing for an increase in the average capital invested in open lines, the return on such capital was approximately 3.71 per cent, as compared with 4.31 per cent, last year.