HIGHER-RAILWAY REVENUE

Southland Times, Issue 23498, 3 May 1938, Page 6

HIGHER-RAILWAY REVENUE

Gross Receipts Show Increase YEAR’S EXPENDITURE ALSO MORE COST OF STAFF’S BIGGER WAGES (United Press Association) WELLINGTON, May 2. “The gross revenue of the railways for the financial year ended March 31, 1938, amounted to £87,634,186. the greatest amount earned by the railways in any year,” said the Minister of Railways (the Hon. D. G. Sullivan) in a statement tonight. “Differing from the position in other services and commodities, the rates of fares and freights have not been increased. The revenue earned clearly points to record traffic handled by the Railways Department during the past 12 months. The gross revenue is £843,535 more than the amount earned in the year ended March 31, 1937, and £346,070 higher than that earned in.the financial year 192930, which was the previous record. “Expenditure totalled £8,001,389, leaving a net revenue of £632,797 or £271,061 less than for the year ended March 31, 1937. The increase in expenditure, amounting to £1,114,596, was principally due' to wages increases totalling £739,000, of which £442,250 was for providing improved wages and conditions for the staff and £296,750 for the cost of handling increased traffic. The remainder of the increased cost was because of the higher price of coal (£100,000), the greater consumption of coal in hauling the increased traffic (£41,000), increased material used in the repair of rolling stock (£44,000), the increased cost of expanding subsidiary services such as road services, refreshment service and bookstalls (£88,000), and other expenditure due to increased traffic and the increased prices of commodities (£102,596).

MORE MEN EMPLOYED “The 40-hour week adopted as one of the Government’s policy measures for creating' more employment,. gave work to an additional 1668 men in the Railways Department during the past year. The cost of the 40-hour week and other improvements in staff conditions, such as the restoiation of wages to the 1931 level, had the effect of reducing the profit on operations by £442,250 for the year. The net revenue would have been higher by this amount, or £1,075,047 instead of £632,797, had these improvements in wages and conditions not been made or if the cost had been passed on to the users of railways. ADDITIONAL COSTS “On this point comparison with the financial year 1929-30, the previous record year of gross revenue, is particularly interesting,” the Minister said. “In that year the net revenue was £929,257. If, in 1929-30, the Railways Account had been called upon to meet the charges due to additional wages and exchange that the 1937-38 Railways Account has to bear, the net revenue of the 1929-30 year would have been only £223,007 or £409,790 less than the net revenue of 1937-38. “The backwash of the depression policy is still affecting the financial position of the railways, but not only has the accumulation of work postponed during those years been largely j overtaken, necessarily at considerable expense, during the past two years, but a policy of advancement and service to the business and industrial community throughout the whole system has been carried out. “Another factor which has adversely affected the net revenue position this year is the delay in delivery from England of steel for constructional requirements. The repair and maintenance of rolling stock generally have been advanced ahead of schedule and purely constructional work has been retarded through lack of material. “For the last four-weekly period of the year which ended on March 31 there was a decrease of £106,492 in the net revenue compared with the corresponding period last year, £lOO,OOO of which was accounted for by the provision in the March period of a sum to cover the cost of the deferred regrading of salaries for the whole year in accordance with legislative action taken in 1936, the removal of certain anomalies created by the introduction of the 40-hour week and an improvement in the wages of the lower paid men. The period was also five days less than the corresponding period of last year. Also, there was no Easter in the 1937-1938 year.

MORE PASSENGERS “Passenger traffic for the year showed a revenue increase of 5 per cent, over the 1937 figures and a substantial increase in the total of ordinary passengers and season tickets,” the Minister continued. “Goods tonnage reached the remarkably high figure of approximately 7,517,000 tons, an increase of 1,305,000 over that of the previous year and 2,500,000 tons more than the total carried in 1933.

“From the aspect which is the most important the financial results of the railway year are very satisfactory indeed, the net revenue being £102,000 in excess of the final 1937 Budget estimate.

“I cannot conclude this reference to the financial results of the year’s working without a word of thanks to the management and the staff of this great organization for the good service they have given during the year to the people of the Dominion,” Mr Sullivan added. “Finally, I wish to reiterate that a State transportation system cannot be judged purely from its financial figures. The Government’s policy is that the railways should be administered not necessarily as a profit-making institution but as a public department of State, giving direct value to the community in social service and betterment.”