FREIGHTS ON FARM PRODUCE.

Otago Daily Times, Issue 19002, 26 October 1923, Page 4

FREIGHTS ON FARM PRODUCE.

CHEAPER TARIFF URGED, CONFERENCE WITH RAILWAYS MANAGER. MR ATVILLY’S REPLY. (Pea United Press Association.) -AVEIJ.tv.~TON, October 25. HViritiers ot ino executive of the Farmers’ Union and representatives of the dairy industry held a conference with the General .Manager of Railways (Mr R. IV. MA'illy) to-day regarding railway freights on farm produce, etc. Mr Poison presided. Mr H, ,1. Middleton (president of the South Island Dairy Association) maintained that the present "tariff was excessive, and lie pointed out that its a result of the war there had been an increase of 150 per cent, in the railway charge on the carriage of dairy produce. The policy of the railways was driving the traffic to the roads. Mr G. L. Marshall (Marten) drew alienMon to (lie freight on chaff. He said that if the freight were reduced by 10s per truck the farmers would bo enabled to compete i'ilh Melbourne. The charges on beef, "iml, live slock, and dairy produce wit, m the farmers' opinion, all too high. Air A. E. Harding- (Auckland) urged an all-round reduction on the carriage of beef to tbo ports. -Mr A. A. Ross said an immense advantage to the farming industry would result from cheaper carriage of fertilisers. Mr Marshall thought- that special arrangements and rates should be made for tbo carriage of high-class stock. Air R. W. Dutfield (Waikaio) and Mi Ross (Auckland) drew attention to (he extra charges on imported goods which were in effect a protective duty levied in addition fo ordinary Customs tariff. A reduction by one-third on the freight on benzine was urged by the Southland executive. Mr Leadley (Mid-Canterbury) thought Mmt on a number of articles the department should revert to (he 1915 tariff'. Air MA illy, in reply, said the department was out to give the best service it could to every section of the community. Every individual in the community had au equal stake in the railways, and the department had to do its duty fearlessly to every section of the community. “Every person.” said Mr APVilly. “who gets service rendered to him at less than cost is merely escaping his liability to pay for what service so rendered, and individuals who have not received any benefit from the service have to foot tiie bill at the end of the year. As the administrative head of the department he was in the position of a trustee ol every individual who was a part owner of the railways, and his duly as general manager was to administer that trust faithfully and zealously and to the best of his ability. At the present lime, with (be charges, the cos's of operating, wages, coal supplies, and tho cost of all material they "ere using, it was impossible to make any wholesale reduction in the rates. Every request on the order paper before him was a request to reduce the earning power and revenue of iho department.

A'oices : No ! no ! All' AIA illy said that every business man knew that the first thing he hud to do before be could reduce his earnings was M> get back his expenditure. That was what the department had been trying to do ever since tho war. Take the general position of the tariff, he said. In 1895 the’ basis rate of wages was then 6s per day, and the hours of work were 54. but the men worked frequently up to 60 hours. The tariff rates were based on the capital expenditure ou flip railways at that time, and having regard to the working costs on the 6s basic wage until the war broke out and the country hud to face heavy financial liabilities in connection therewith, the railway rates had never been increased. Tho tendency all the time had been to reduce tho mtes. If the actual figures wero not reduced the goods were removed from one class to another of the railway tariff, and a reduction was made in that way. Then when they lied to meet the demands of the men for increased wages, and when they had to meet, the increased post, of .all .materials, whar happened ? They had to balance their finances in some, way, and they hud to do what every business concern and what every individual had done —they hud to charge more for the services ihey were rendering, hut they did not increase the railway charges by 100 per cent, or anything like it. They started out by putting lu per cent, on, and when they found that was not sufficient two years after they put on a second 10 per cent. Subsequently, in order to adjust the balance as between revenue and expenditure, they were compelled to put another 20 per cent, on to the rates, 'the total increase on the railway rates was 40 por pent. Thorp was no oilier country in the world where the people had had tlie railway fates raised to such a small extent us they had in this country. Tbo British railways increased their rates by up to 236 per cent. Passenger rates wore increased up to 150 per cent. The American railways increased their rates by 150 per cent, and their inereaso over the pre-war was still higher than tiie 40 per cent, wo were paying at the present lime. Thai was, broadly speaking, the position'with which the department was faced.

As a result of the war our operating expenses were up on one side, and we had still to consider our £40,000,000 ou which ne were expected to get 32 per cent., and which, by the way, we did not get last year or for the two years before that. Tho position last’ year was better than it was the year before, but that resulted, not from increased revenue, but from economies which had been effected in the working expenditure. AVhat they were trying to do to-day was to get on the right side of the ledger by economising wherever they could, and when they got to the position he had indicated then they could talk of making a reduction in the 40 per cent increase caused by tho war. The whole question came to this—it was a matter of service rendered and the cost of the service. No one could afford to render service at less than the cost. The whole ihing simply came down fo a question of economics, and it was not sound to perform a service in an institution in which the country had invested £40,000.G00 of capital without getting from that service some interest on the capital invested. As a matter of fact, if the interest were, not obtained as a result of tho railways operating—in other words, if tho people who used the railways did not pay sufficient for the service rendered to meet the working expenditure and the interest of 3j per cent, on the capital, then the general taxpayer had to make up .the deficiency at the end of the year. That was as certain as that night followed day.