RAILWAY FINANCES

New Zealand Herald, Volume LXX, Issue 21579, 25 August 1933, Page 10

RAILWAY FINANCES

[ The predictions and part realisation of better results from the New Zealand railways are strengthened by recent returns of revenue and expenditure. The net revenue for each of the four-weekly periods in the current year has been higher than for the corresponding period last year; and of the four, two instalments have been substantially better than the comparable figures in 1931. The last return to be issued illustrates the improvement quite strikingly. For the July period of this year there was a net revenue, or working profit, of £20,034, compared with one of £4*167 in 1932, and a loss of £28,223 in 1931. Similarly, for the first 16 weeks of the past three years the excess of revenue over expenditure has been: 1933, £232,052; 1932, £196,720; 1931, £183,519. In the two completed years of the three the final returns of net revenue exceeded Budget estimates, and were both better than the result for 1930-31. There is reason to hope that once again the railways will make an improved showing, and contribute a little more toward the cost of interest on the capital invested. The most hopeful feature of the outlook is that remarked upon by the chairman of the Railways Board in a recent statement, when he noted 'hat higher working profits were the result of increases in the gross revenue. The revenue side, he said, provided the key to'the future financial position of the railways. The truth of his statement is undeniable. For many months after comprehensive efforts to arrest the alarming decline in railway finances had begun—efforts which were increased in intensity after the board assumed full control—improved returns were almost wholly the result of reductions in expenditure, which more than compensated for the accompanying fall of revenue. The value of these economies was inestimable but they must necessarily have their limits. If, with expenses cut to the bone, retrogression had continued, to reduce services drastically or bear the losses were the only alternatives. Fortunately better revenue returns are now coming to the rescue. If they can be maintained, the outlook for the railways will be much brighter than could possibly have been expected three or four years ago.