OUR RAILWAY FINANCES.

New Zealand Herald, Volume XL, Issue 12241, 9 April 1903, Page 5

O UR RAILWAY FINANCES.

y IE W3 OF MR. S. VAILE. DISCUSSION BY THE CHAMBER OF : V COMMERCE. «'ion of railway finance and the allosses on the working of vthe New ,1 d lines, which has been dealt with by ■i 9 Vailo in letters appearing in the New tijxo Herald from time to time, was ■ ,ITori un by him at yesterday's meeting f£o£J<* the Auckland Chamber of of the Chamber (Mr B. 't « in introducing the matter, said that statements made in the Heeald were 1 m the attention of the whole colony ° Tt % he directed to the matter, and if they «° UId true they should be publicly reHfr Vaile in sneaking on the subject, said J,} Hie actual loss on the working of the -i «s in 1*97 was £267,500, and in the .years following it was respectively fei! £3*6,142, £337,495, and £493,344, Ult;last year it was no less than £1,007,095. Be would ask the Council to appoint a comttee to inquire into his assertions and to »«M an accountant to assist them. His rfatPDient was that the Government had 'Treed to capital account the sum of £800 000, which" ought, to have been charged ? revenue account, and in this he was backed nbv the best English and American experts. ■ The "Government had been continually charg'L, to capital what should be a charge upon revenue and claiming at the same timo that the railways were, year by year, earning an increased rate of interest on their cost. He declared, however, that the New Zealand railways' had never paid a penny profit or interest on capital at any time. The annual In- on the Auckland railways had increased from £3000 in 1597 to £39,580 in 1902 (the total for the period being £98.267). notwithstanding that, tho Government said the rate of interest carried dining that time find increased from £2 6? to £2 18s per cent. On the Wellington section during the last, five years the annual loss had gone up from £91,4-10 to £438,462, making a total of '760 262. In this case tho Government bad said that the rate of interest earned had increased from £2 16s 9d in 1898 to £3 Is 6d D »r cent, in 1302. On the Hurunui-Bluff section the loss in 1897 was £29.270, and in 1902 this had increased to £331,467, the total for the whole period being £762,6+9, although they claimed an increase in interest earned from £2 17s 7d to £3 8s lOd per cent. He was now recognised in London and elsewhere is an authority on these matters, and he claimed to be able -to speak with knowledge On the subject. Messrs. Massey and Hemes, M.H.R.'s, had signified their willingness to act on a committee of investigation, and he would also like Mr. Fowlds to be a member of the committee. Mr. J. H. Upton said the question of whether a charge was rightly put down to capital account did nob require tho services of an accountant. It was a matter of business judgment on which their president would bo quite competent to express an opinion. Mr. Fowlds, M.H.R., said be had no wish to act on tho committee. The position to him was as clear as the noonday sun. The contention that the cost of additions to open lines should .be charged against the revenue account was as absurd as would be the contention that the Government should have borrowed only a £1 note in the first place and have built up the railways from the profits accruing from that. Ho would instance one of the most probable, items of expenditure for the next few years, viz., £300,000, for the duplication of the line from Auckland to Penrose. Mr. Vaile: That would be a new line. Mr. Fowl is said it would not be a new line, but an addition to an open line, and no business man would think of charging that against revenue account. When rolling stock, for example, costing £1000. was replaced by stock worth £1500, £1000 only of that should bo charged to maintenance account, the remainder going against capital account, and so in other similar instances which he quoted. He considered Mr. Vaile's statements the veriest rubbish he had ever heard. Mr. Vaile said that English and American Writers held the same view that he held. Mr. W. B. Leyland asked whether Mr. Vaile contended that additions to rolling stock, as well as ordinary repairs, should be charged against revenue. Mr. Vaile replied in the affirmative. Several members dissented from this view. It was resolved to refer the question to tho Railway Committee of the Chamber, and to ask Messrs. Massey and Homes to act with the committee.