The Southland Times. PUBLISHED EVERY MORNING. Luceo Non Uro. WEDNESDAY, JULY 8, 1914. RAILWAY MAKING.

Southland Times, Issue 17697, 8 July 1914, Page 4

The Southland Times. PUBLISHED EVERY MORNING. Luceo Non Uro. WEDNESDAY, JULY 8, 1914. RAILWAY MAKING.

Mr Hunt’s suggestion that the State should ease the burden of constructing new railways by appropriating to itself the additional value which accrues to land through which a railway passes makes an appeal to the business instincts of the community. In most countries in which new railways are constructed by private enterprise the State, in the interests of the community, gives encouragement and assistance to railway companies in the form of large grants of land along the route of the proposed line. In Canada, for instance, the Government has given great tracts of land to the CanadianPacific Railway Company, and the profits derived from the sale of this land after construction of railway lines enable the companies to make a reasonable return to their shareholders upon the money provided for investment. Where the State has made a monopoly of railways there seems to be no valid reason why it should not use the land in the same way, namely, as a means of reducing the capital cost of the lines or of adding to the earnings of the railway. The direct and immediate result of constructing a railway line through a tract of country is to make a very substantial increase in the value of land, and where railways are built by State enterprise with money raised on the pulbic security this addition is in the truest sense of the term a community-created value. That is to say, the additional value accrues without any effort on the part of the private owner and without any expenditure of money on his part The mere provision of the railway by the public at the public expanse adds something to the value of every acre. On the broad principles of justice, therefore, the State has a right to this added value. Further-

more, *.u this- country we have recognised that the interests of the individual must he subordinated to those of the community by giving the State power to resume compulsorily privately owned lands. The Government is empowered to take the most highly improved estate in the dominion at a price to be determined, and where this right is exercised no exception can be taken to a proposal which affirms the right of the State to acquire land through which it intends to construct a railway in order that the value which the railway will inevitably create will be retained for the public. If our recollection serves the Hon. W. Fraser made a statement some time ago that the Government intended to adopt this policy. We think he made his announcement with special reference to the Napier-Gisborne railway. Whether that is so or not. however, it is obviously to the advantage of the State to make the land through which the new line will run public property, so that when the land is sold after the completion of the railway the profits of State enterprise will be kept for public use. It will quite readily be believed that had the Government resumed possession of a strip of land twenty-five miles wide along the route of the North Island Main Trunk line, at a price fixed by the value of the land before there was any railway near it it could have made a profit by selling the land after the construction of the railway which would have paid the whole cost of the line, of reading and subdivision and the land would still have been made available to the settler at a reasonable price. It is emphatically not right that this increment or added value created by the enterprise of the community and by public money should pass into the hands of private individuals. It properly belongs to the State, and it is obvious that if the State paid, or partly paid, for its railways as they were made by this means it would be able to build new railways much more rapidly and to accelerate the development of the dominion’s resources. The suggestion is one that deserves the fullest discussion, and we shall be surprised if it does not sufficiently interest some member of the House of Representatives to induce him to bring it under the notice of that body.