RAILWAYS AND THE BUDGET.

New Zealand Herald, Volume LXVII, Issue 20759, 30 December 1930, Page 6

RAILWAYS AND THE BUDGET.

The provisional statement of railway operating results for the four weeks ended December 6 shows a net improvement of £2OOO, which will be slightly increased when the accounts for the subsidiary services are added. It is not a remarkable achievement, considering that the previous return revealed a recovery of over £21,000 and that the full effect of the successive instalments of economy should now be apparent. The Minister remarks that the total reduction in operating costs in the last five four-weekly periods, in which economies have been in operation, has been £295,000. But railway operating revenue has declined by £300,000, so that at the beginning of December the financial position was worse than in July. Over the whole working account, for eight months, the net revenue Is still about £75,000 less than for the corresponding period of last year, the final result of which was a loss of £1,200,000. This year the acknowledged loss will be substantially less, because the Railways Department is not being asked to pay the full interest charge on its capital liability. The latter has been increased by £3,250,000, but provision was made that the railways should contribute to the Consolidated Fund only the actual amount of net earnings. This was estimated at £1,380,000, so that in the last four months the department would have to earn £1,171,000. Considering that last year its net revenue in the period was only £644,000 and that it has never earned a million of net revenue in the December-March period, it appears more probable that there will be a deficiency of fully £500,000 in the Budget receipts from the railways. That estimate is made without any allowance for the reserve provisions recommended by the Royal Commission. As there is also a prospective deficiency in customs revenue of £600,000 and the Government has stated that revenue from other sources is also falling Bhort of the estimates, the outlook for the Budget is far from promising. Something may be achieved by the recently appointed economy committee, but since the Government has always insisted that it could not reduce expenditure when the programme for the whole year was before it, the committee cannot be expected to save a million in three months.