THE RAILWAY YEAR

New Zealand Herald, Volume LXXI, Issue 21874, 9 August 1934, Page 10

THE RAILWAY YEAR

The actual figures showing revenue and expenditure for last year, given in the annual report of the Railways Board, were known before it appeared. Nevertheless, there are features in the statement which are worth considering. The board justifiably emphasises the increase in gross revenue to which improved results were primarily due. When it took over management of the railways and arrested the alarming decline in net returns by a process of drastic pruning on the expenditure side, it was a salutary and necessary process, but it could not, in any sense, be called recovery. It was obvious, as was then pointed out, and admitted by the board, that reduction in expenditure must have a limit, and that if revenue continued to fall when that limit had been reached the outlook would be by no means reassuring. Fortunately the fall has been checked, and, though an upward curve in expenditure appeared last year, the net result, in comparison with 1932-33, was an improvement in the net return of 4.94 per cent. This is a distinct achievement, and the management is entitled to full credit accordingly. At the same time it is to be noted that the estimates for the current year do not promise a result equal to that of 1933-34. A fall in net revenue of £79,360 is forecast. Revenue is expected to be only £24,259 better than last year, but an expenditure £103,617 higher is anticipated. It may sound like carping to point this out, after the great improvement already effected, but a glance at the capital figures shows there is still much scope for effort in bettering what has already been done. With the Stratford Main Trunk line taken over, the capital liability of the department now stands at £53,909,347. The net revenue returned last year was £1,196,807 short of the interest charges on that capital. It is true that the net revenue amounted to approximately 2 per cent on the capital employed, a result which compares very favourably with the yield from railway enterprises in many other parts of the world. Yet the stubborn fact remains that a sum of £1,196,807 had to be found out of general taxation for interest on railway capital. So long as a deficiency of such dimensions remains there can be no relaxation in the effort to increase the net return from the system's working. • «.