ROAD TRANSPORT

New Zealand Herald, Volume LXXIV, Issue 22775, 8 July 1937, Page 15

ROAD TRANSPORT

CONTKOL OF SERVICES STATE PLAN CRITICISED ' « COMPARISON OF EARNINGS RAIL AND HIGHWAY COSTS " The reply by the Minister of Transport, the Hon. H. Semple, to the criticism of the Government's single ownership policy of long-distance rail and road freight services, must appeal as <i pathetic attempt to justify the socialisation of this vital link in the national transport system," said Mr. S. Bailey, chairman of the New Zealand Road Transport Alliance, yesterday. " It is clear that the arguments he uses and the facts ho outlines have a much closer relationship to hope than to practical application. "it is interesting to have the Acknowledgment of the Minister that the Government does not intend to take over f] ie road services under discussion and suddenly cease operating them. It is more interesting to read that he recognises that these services have become grafted'into the national transport system and "that alterations to them will have repercussions in industry and trade. With this statement, 1 find myself in complcto agreement, and immediately ask, why mako the alteration ? ,

Revenue From Railways

" Under State monopoly we are promised a substantial increase in railwav revenue with a comparatively small increase in expense, thus improving the railway finances and reducing the amount required from general taxation," he continued. "If the whole of the reveriue from these services was transferred to the railway, but this is clearly stated to be contrary to Government intentions, the total revenue would be increased by approximately £300.000. The supposition that this increase.. would mean a large percentage of net profit ,is not borne out by past results. " In 1936' the railway operating earnings were £335,455 more than in 1935, but the profit in 1936 was £49,150 less. It would appear, therefore, _ that the m greater the railway earnings, the greater the operating costs and the greater the loss. Can we look for a reduction of taxation under this heading.'' Road Service Returns "The capital cost of open railway lines for the financial year 1935-36 was £54.253.059. The capital cost of roads is considerably in excess of this figure. If we take the railway earnings over the past five/years, 1932 to 1936,. we 'find a net average result of 11.1 o per cent of turnover toward interest and , sinking fund 'on capital expenditure. "'The -earnings- of the. licensed -services under discussion is 20 per-cent of turnover toward interest and jinking i funds on capital expenditure on roads. Mr. Bailey said. "To take, a sure 2Q pert, cent from one national- system and put it into another national system with a problematical 11.15 per cent- return, surely cannot reduce the general ij burden of taxation. ' National Transport Bill " What a sorry picture the Minister paints of 197 vehicles operating over several thousand miles of roads in >.ew Zealand, crowding out other transport and increasing the risk of personal accidents. It is clear, therefore, that instead" of the result as stated by the Minister being a reduction in the national transport bill with a fully efficient, service to the public, a single j 'ownership policy" will mean a definite] • increase in the national transport bill, j .with.a. less efficient service, and that a Government monopoly of this interest can only mean that the public will-pay dearly for this misguided incursion in the realm of State ownership. " The" question of better service to the public under the personal interest of private enterprise, as against the service offered under a monopoly, . either private or State, is so well known" that it does not even form the basis of discussion."