DEVONPORT FERRIES.

New Zealand Herald, Volume LII, Issue 15976, 22 July 1915, Page 4

DEVONPORT FERRIES.

WORK OF THE PAST YEAR. REVIEW BY CHAIRMAN. INCREASED WHARFAGE CHARGES. REDUCTION IN PROFITS. The annual general meeting of the shareholders of the Devonport Steam Ferry Company, Ltd., was held at the Borough Council Chambers, Devonport, yesterday afternoon, Mr. E. W. Alison, chairman of directors, presiding. About 20 shareholders were present. In moving the adoption of €he report and balance-sheet, published on Tuesday, Mr. Alison said :— I regret that the net profits from the company's operations during the past year have been insufficient to enable the usual dividend to be paid, or to make any nddit'on to the insurance or reserve accounts. As you -will observe from the profit and loss account, the net profit for "the. year amounts to £4946 2s sd, which is £983 6s 4d short of the sum required to pay a 10 per cent, dividend. The directors, however, recommend that the usual dividend be paid, and that the amount required to enable this to be done be taken out of the balance standing to credit of profit and loss account brought forward from last year. I am quite in accord with the recommendations of the directors, and trust that the game will be endorsed by shareholders.' You will naturally be anxious to be informed of the causes which have brought about the reduction in profits during the past year. Harbour Board and Company. " In the first place, with the exception 1 of the Kohimarama and St. Heliers Bay service, which shows a. slight increase, ' there has been a considerable falling off in the receipts from all other branches of the company's trades, the tailing off being most pronounced in the excursion traffic, and on the Northcote and Birkenhead lines. In the second place there has been a decided advance in the working expenses, one oi the principal items being an increase in shipping wharfage charges payable to the Auckland Harbour Board, the new scale of which came into operation in February last. Shareholders are doubtless aware of the intense feeling which was caused by the decision of the Harbour Board to impose enormously increased shipping wharfage charges on the ferry companies. For your information, I may here state I that "the total shipping wharfage paid by I our company for the year 1913-14, amounted to £606, the then by-law providing for j rates varying from £1 to £5 per wharf, or stage, per steamer per month. The board, on the recommendation of a special committee, resolved to rescind this bylaw and enact a new by-law, whereby the passenger steamers would be charged wharfage on a system of toll, viz., at per trip, per steamer per wharf, and the vehicular and cargo steamers at per I steamer per stage per day, instead of at per month. Under this proposal the company would have been called upon to pay £5289 13s per annum —an increase of £4683 13s. The Case of the Peregrine. " Each passenger steamer would have been called upon to pay from Is 9d to 3s 3d per trip, and the vehicular steamers 25s to 35s per day. This system, in operation, would not only have proved detrimental to the company, but would also have detrimentally affected the interests and welfare of the several districts to which the company's steamers run, and would have discouraged additional trips being made to meet the public convenience. This will illustrate how this new by-law would have operated. Take the Peregrine, which, under the old bylaw, paid £4 10s per month, or £54 per annum. This steamer would, under the new by-law, have paid £2 7s per week day, and £1 14s 3d per Sunday, a total of £824 12s per annum, or for this one steamer alone a sum of £218 12s in excess of the total amount paid for all the company's steamers for the previous year.

The Special Night Service. " Then again, take the Kawan, which is running on the special night femce. The payment for wharfage last year was £54. Under the new by-law it •would ha*e amounted to £200 14s 3d. And I may j here mention that the total earnings from j the special night service last year only I amounted to £372 17s, so that had that charge been enforced more than one-hal? of the total receipts from that service would have been absorbed in the payment of wharfage charges, in addition to which the cost of running the service, including wages — alone amount to £500 per annumcoals, water, stores, and other charges, had to be met. This service has always been run at a loss, but the directors have held the view that an all-night service is necessary to meet the public convenience, but if the excessive wharfage charges had been insisted upon by the board, the company would have most reluctantly been compelled to wholly discontinue the service. Proposals Amended. " Along with the local bodies and many other objectors, tne company emphatically protested against the new by-law, and maintained that the proposed charges were not only inequitable and injurious, but a monstrous imposition, and markedly disproportionate to the wharfage charges payable by all other shipping, which amounted the previous year to £6707, for the use of the whole of i.he rest of the wharves of the Auckland Harbour, a sum only £1418 in excess of that which this company would have been cal'ed upon to pay. 1 It is not, therefore, surprising that the i proposed exorbitant charges, coupled with I the provision that each steamer Lie' charged at per trip per wharf, created I an intensely strong opposition from, not | only the ferry companies, but the public on the northern shores of the harbour. | Deputations from both companies and | from the several local bodies, waited upon the boarcT and eventually the question was referred back to the committee, which reported to the board recommending that the rates be reduced. Under the reduced scale this company would have been called upon _ to pay £3820 per annum, as against J05289 13s, as previously pro- ■ posed. but the toll system was to continue, the charge stii'. being at per trip per steamer per v. hart. Strong objections by all interested were again raised, and the principle of charging per trip was persistently opposed. Tire amended recommendation, however, was adopted by the board, and a special meeting was called to confirm the same. The special meeting, however, was not held, as the chairman, moved by notice of motion to rescind the by-law as adopted, and to enact a by-law fixing the charges at per steamer per'day. Again tho amended by-law was adopted by the board, and again objections were made by the company and the local bodies interested, and a largely signed petition of protest was forwarded to the Minister for Marine, asking that the whole question be inquired into. The Royal Commission. " The Government appointed a commission, which, after a lengthy inquiry, reported upholding the by-law," and also that the new charges were not unfair or unreasonable as regards those who mav be called upon to pay any necessary increase in fares. I do not concur in the view held by the commission that the charges are fair and reasonable. If, for instance, the wharfage charges under this by-law are compared with those of the Otago Harbour Board, it will be found that whilst a steamer similar to the Peregrine would, at Dunedin, be only charged £75 per annum for shipping wharfage, in Auckland

the same steamer "would have to pay £456 5s per annum, or 500 per cent, higher in Auckland than in Dunedin. and other steamers in like proportion. You should be informed that in addition to the large sum payable for shipping wharfage, the company last year paid to the board for water, port charges, licenses, dock dues, and rents, the sum of £2000, so that the combined charges payable by the company to the board to enable it to carry on. its business amounts to a sum in excess of the company's net profits for the year. Increase in the Faxes. " There can be no question that the shipping wharfage charges now imposed upon the ferries in the Port of Auckland are exceedingly heavy, and, contrasted with the charges imposed upon all other shipping, are widely disproportionate. However, as the new by-law has been approved, the company has no alternative but to pay. To partially meet the additional charges an increase in the concession tickets was unavoidable. It was with great reluctance that the directors made the increase in the rates, as tlie policy of the company has always been a liberal one— endeavour being to provide an efficient service at a minimum rate and in increasing the fares they have made them as low as possible, One company bearing a full proportion of the increased wharfage charges. As I mentioned before the new by-law came into operation early in February last., but pending the result of appeals to the Harbour Board, and subsequently of the decision of the commission, the directors decided to continue the issue of concession tickets i at the then existing rate, but- only issuing quarterly, half-yearly, and annual tickets at a pro rata rate from month to month, jo that from February to May, when the commission reported, the company paid the full amount of the extra charges withoutincreasing its fares in any way. Low Concession Fires. " It is unquestionable that the concession tickets issued by the company have been exceptionally low, and provide undoubtedly the cheapest travelling in the world. Even at the increased rates, I think, this can still be asserted. For instance, take the annual family ticket: Husband and wife, £5 per annum, or about Is lOd per week ; first child, 12s 6d per annum, or about 3d per week; second child. 10s per annum, or about 2jd per week ; third and all other children, 5s per annum, or about lid per week. The maximum amount for a family annual ticket, including husband and wife] and all children under 21 years of age is fixed at £8. All concession ticket-hold- j ers have the right to travel as frequently i as they choose week-days or Sundays. ! In this connection the commission in its report stated : 'The passenger fares charged by the Devonport Company under the head of concession tickets are stated to be extremely —as low as anywhere in the world, it was said, for a similar service. The company's policy had been to encourage settlement on the north side by the attractiveness of its faxes. This is most marked in the case of what are called .family tickets issued on the Devonport, Stanley Bay, and Northcote service. Thesii cost £5 each, and entitle all the members of a family, however, numerous, excepting sons of 21 and over, to travel when and as often as they please except on the special night service. On the basis of a family of three and one return trip every day in the year except Sundays, this works out at two-tiiirds of a penny, and in the case of a family of six at onethird of a penny per trip. Monthly | tickets of this class are issued for 15s. Then there is a ticket for £4 a year, issued to a man and wife, giving the same privilege of travel. A single annual ticket to a man with the like privilege of travel may be obtained for £3. This works out at Is 2d per -week. Weekly tickets for ladies and apprentices cost Is 6d, and school children under 18 get weekly tickets for Is. In the case of St. Heliers Bay, Kohimarama, and Orakei, the fares are higher. The distance to be travelled is greater and the traffic is less. The annual family i ticket to the North Shore has been in I force since the company started in 1895, i and the settlement there has been largely : promoted by this concession.' And the j commission further states : 'No doubt the persons who have hitherto been accustomed to the low fares will for that reason feel it a hardship now to be called on to pay more, but it is submitted respectfully that they cannot properly expect, to enjoy the public utilities in question at an undue cost to other public utilities.'

) " Not Making " Htage Profits." I "It is well that you should know that in the evidence submitted to the commission by the Auckland Harbour Board the impression was sought to be made that the company was making huge profits and had built up a large reserve out of profits and paid a 10 per cent, dividend upoh- its capital. This incorrect representation was combated. and the commission informed as to the true position, which, as you are all aware, is that the company has not made huge profits, or even high profits. At the rates at which the public is carried., and the efficient service provided it is impossible to make large profits. As to the reserve account, this has not been built up out of profits, for out of tihe reserve account of £15,867 10s a sum of £14,019 19s 6d has been provided by the shareholders by the premium paid by them on new issue of sharer, from time to time, so that the reserve account has been practically built up by shareholders' capital. The dividend paid by the company is not 10 per cent, upon the capital invested, but only 10 per cent, on the nominal value of the shares issued, viz., 20s per share. Hotor-'bus Service. "You will also no doubt wish to be informed as to the result of the motor-'bus service for the year. The returns have been fairly satisfactory, but owing to the bad condition of the roads the cost of maintenance has been heavy. I informed you last year that two new motorwere under construction to provide for extension of service, and that they would be ready for the summer traffic. The 'buses were completed, but as the roads were in such a neglected condition, and as the passenger traffic had fallen off, the directors decided that it was inadvisiable to utilise thorn. "The steamers and plant have beer, well maintained and are in good order, and the year's working has been comparatively free from accident. I am glad to inform you that the harmonious feeli ing which has obtained for so maav ' years between the company and its employees still continues. We have a capable and loyal body of employees, and that commendable spirit exists" between them and the company bv whidh each is interested in the other's behalf. You can rely on this: That the business of the company is capably, attentively, and economically handled, and the convenience and welfare of the travelling public carefully studied. Effects of the War. " Although the operations for this vear are disappointing, shareholders must" remember that, we are passing through a most critical and difficult and unprecedented period. There can be no doubt that the falling off in receipts is wholly due to the existing war conditions, whicSi are seriously afTccting business undertakings generally. It is unfortunate, too, that the working expenses are also there increased, and that an extra burden o"f extreme wharfage charges should have, been cast upon the company and upon t he neopleby the Auckland Harbour Board. We look forward to a speedy termination of this most stupendous and disastrous war, and I trust that when we next meet itwill have ended, and that the accounts then submitted to you will be of a more satisfactory and encouraging nature." Mr. Alison's remarks were received with applause. Shareholders' Views. Mr. John Clare stated that a man had told him it was impossible to buy shares in the company, and that, the company was making huge profits. The speaker offered him £50 if ! he could show that- he was unable to secure shares on the market. Later the man admitted that he could obtain _ the shares from sharebrokers, but insisted that the company

paid 10 per cent. Mr. Clare said he offered him £5 and a considerable h™/* if he could demonstrate his rtafe 8 His emtio lhad been silenced. 4enie nt. Mr. W. Cooper said he had b»n shareholder for 17 years, and he Y j never received 10 per cent, on the of his invested capital. When Ww became a shareholder he paid 35 3 share, and his dividend amounts to " little over 6 per cent. The onlv persoi* receiving 10 per cent, on t&e ckpital vested were the original sharehoM«J-' who had retained their shares. Th ' were very few in number. " * Mr. Alison expressed his pleasure at hearing the remarks made, and add A that there wag a prreat deal of misrei>rc sentation in regard to the affairs 0 th company. The average Shareholder » ceived 6 per oer.t. to 61 per cent J his opinion 10 per cent., would not be " high return on a shipping investment. 4 The report an balance-sheet w ' ere adopted. re Mr. E. M. Coleman was reflected ♦„ the directorate. Messrs. Thomson and Gray were re elected auditors at a remuneration of "VI guineas. A vote of thanks to the chairman directors and employees of the companv '"as carried by acclamation. *