RAILWAYS ARE IN NEED OF REFORM.

Star (Christchurch), Issue 19238, 27 November 1930, Page 7

RAILWAYS ARE IN NEED OF REFORM.

“ VERY DISQUIETING FINANCIAL POSITION.” “The report of the Commission presented to Parliament during last session, after a very searching investigation of the affairs of the Railway Department, is anything but reassuring. It discloses, indeed, a very disquieting financial position,” says a statement issued by the Associated Chambers of Commerce. “On March 31, 1926, the total capital invested in the working railways of the Dominion amounted to £47,608,676, and on March 31, 1930, to £59,201,545, thus showing an increase of no less than £11,552,869 during the four years. This is disturbing enough in itself, but its effect is accentuated by the fact that the interest charges grew from £1,913,310 in 1926 to £2,132,324 in 1930, an increase of no less than £219,014. “Even this is not the end of the stor> by a very long way. There are at present a number of railway lines in course of construction—a large proportion of them unlikely to pay their way—which it is estimated-will add approximately £13,630,000 to the Railway Capital Account, and so bring it up to so huge a sum as £72,831,543. Even with so low a rate of interest as 4£ per cent, the annual charge upon the sum just mentioned will run into £3,095,341. “In spite of the large increase in capital expenditure upon the railways in operation from 1926 to 1930, the gross revenue lias not been proportionately maintained, while the gross expenditure has increased out of all reasonable measure. The following are the figures:— Gross Revenue. Gross Expend. £ £ 1926 .. 8,101,221 6,468,428 1930 .. 8,288,115 7,^8,858 “In other words, during the last four years the gross revenue of the Railway Department has increased only by £186,894, while its expenditure during the same period has increased by £890,430, which is equivalent to an extra cost of £703,536 to secure a negligible advance during the four years,” says the statement. “All these figures are taken from the official report of the Railway Commission, and can be accepted, therefore, without any reservation. This being the case, it is difficult to think of any more damning indictment of political control than is supplied in the Railway Department’s own figures. The Commission with its recommendations, has offered suggestions for remedying the position, but so far the Government appears to have ignored the Commission’s more important proposals so [far as the most important suggestion of all is concerned: namely the change in control from politicians to a general manager responsible to a commercial directorate.”