BRANCH RAILWAYS.

New Zealand Herald, Volume LXVI, Issue 20255, 15 May 1929, Page 12

BRANCH RAILWAYS.

Alarmed at the possibility that the Waiuku railway might be included in a general policy of closing branch lines, a deputation has suggested to the Minister of Lands that as the capital cost was inflated by its construction during the war the Government should be satisfied with interest on half the capital expenditure. If that proposition were taken seriously, the district would have to support the railway much more strongly than it has done in the past. According to the departmental accounts for 1927-28, the line's net earnings, including allowance for its feeder value to the main trunk, were only £63, whereas even half the interest charge would have been £4450. Nevertheless, in a list of 29 branch lines, in respect of which subsidy is payable, the Waiuku section has. the distinction shared by only three other branches, of earning working expenses. A serious determination to eliminate unprofitable branch lines might spare the few that produce a working profit. A substantial saving would be effected by closing all the others—four in tho North Island, aggregating 86 miles, which fail by £12,000 to earn working expenses, and 21 in the South Island, representing 624 miles, on which the loss, excluding interest, is £82,000. The very fact that almost all the unprofitable branch lines and the bulk of the losses are associated with the South Island railways is probably sufficient confirmation of Mr. Forbes' reassuring statement. Indeed, it is doubtful whether in his apparent condemnation of branch railways the Prime Minister meant nfbre than a declaration against building any more "short lines," while his criticism of the present subsidy system seems to be merely the prelude to a reversion to a policy, long since discredited, of accepting whatever the railways may earn. That is the only possible conclusion from the following statement made by him at Waitara last week:—

Referring to railways, Sir Joseph declared that short railways had to give way to the motor. At present heavy losses were being made on the short-length lines. If railways could not earn 4 per cent, they should earn per cent.., and if not that then 3 per cent.; then tho country would know where it stood.

The subsidy system was strongly opposed from the outset because it is inconsistent with the principle of operating the railways as an independent commercial undertaking, and perpetuates a hopelessly unprofitable weakness in the system. Evidently, the Prime Minister would abolish both the principle and the anomaly and return to the old arrangement under which no attempt was made to make the rail-, ways pay and the deficiency charged against taxation was completely concealed.