North Island Service.

Star (Christchurch), Volume LXVI, Issue 20239, 24 February 1934, Page 8

North Island Service.

Mail Contracts

Large Savings Made on Renewals. (Special to the " Star.”) WELLINGTON, February 24. ALTERNATE YEAR the contracts for the performance of the principal mail services and rural deliveries are subjected to tender, and this process was applied recently to the North Island services, which have been renewed as from January 1 at a very substantial saving to the department. “ The savings on the renewals are over £13,000,” stated the Postmaster-General (the Hon A. Hamilton). ‘‘This reduction is equal to 16 per cent, the highest savings ever effected.” To show the contrast between the new figures and those for the subsidies paid on the contracts which expired on December 31 last, the following figures are illuminating: Contracts expired December, 1933 £82,881 Subsidies on contracts made from January 1 £69,793 Savings this year £13,088 “ A saving of only £8430 would have been effected if the tenders had been accepted as originally submitted,” added the Minister, “ but by negotiating with tenderers a further reduction of £4(358 was made On the occasion of this re-letting, which is for a two-year period, the department had more information at its disposal than formerly, and consequently intensive efforts were made towards reducing costs, which were considered still too high, having regard to present-day conditions. A Grouping Tendency. " Many of the services were keenly competed for, but the large increase in the number of ‘ block ’ tenders for groups of services was particularly noticeable. The greatest reductions were achieved in this connection. The Transport Licensing Act, 1931, had, in some instances, a great bearing on the tendering, as it limited the tenderers to one or two persons who alone had licenses. But except in a few noticeable cases, the tenderers refrained from taking advantage of the situation by stipulating high prices. In the few cases which did occur, they were referred to the Licensing Authority for decision, when the department received very fair treatment and, generally speaking, was satisfied with the decisions given. Some Improvements. “ Improvements were effected in many districts—in particular there was established a through night service by motor between Gisborne and Taneatua railway station. This service, together with the Napier-Gis-borne night service, provides Gisborne with a mail connection second to none. Except in a few minor cases where conditions warranted the action, no reduction in mail facilities resulted from the big saving in costs.” The Minister added that the work of reletting such a large number of contracts each year is heavy, and the officers had to work at high pressure during the time tenders were under consideration. “ The keen and intelligent interest they again displayed,” concluded Mr Hamilton, “ was appreciated, and it was gratifying to record such good results from their efforts.” South Island mail tenders are subject to re-letting at the end of the current year.