THE Wairarapa Age FRIDAY, MAY 29, 1936. REMOVING A HANDICAP.

Wairarapa Age, 29 May 1936, Page 4

THE Wairarapa Age FRIDAY, MAY 29, 1936. REMOVING A HANDICAP.

Some definite encouragement is to be drawn from the replies made ’By Cabinet Ministers yesterday to the representative Wairarapa and Welling ton deputation which interviewed them on the subject of the improvement of the Rimutaka railway. The deputation in effect was promised an immediate and complete examination of the total problem and a frank statement of the conclusions reached when that examination has been made. This is all that need be asked for, provided full and fair account is taken of the serious extept to which trade and development are hampered by the present state of our railway communications. The Minister of Railways (the Hon. D. G. Sullivan) urged that rail cars and the improved engines it is proposed also to introduce, should be given a fair trial. It is already obvious, however, that while the use of rail cars will greatly improve passenger services and the new engines may mark a considerable advance on existing facilities, the total effect of these innovations will leave a great deal still to be desired. There is no prospect of mere detail improvements in equipment providing the standards of efficiency that are essential if railway transport between the Wairarapa and Wellington is to prevail over road competition. On the other hand, 'if really good railway communications are provided, there should be no difficulty in concentrating traffic on the rail and putting road competition into a bad second place. The problem should be, and it may be hoped will be, examined by the Government and its experts from the broadest standpoint, placing the 'interests of this district as a whole, and those of the Dominion, above any sectional interest. The Ministers who were interviewed yesterday showed an alert appreciation of the disabilities arising out of the existing state of the Rimutaka railway. It may be hoped that the complete examination of the facts of the position now to be made will point the way to a plan of improvement which the Railways Department, as well as the people of this district and others concerned, will be able unreservedly to approve.

POWER BOARD LOANS, A question raised at the annual meeting of the Wairarapa Power Board yesterday regarding borrowing for the extension of services calls for very careful examination in its details. Two distinct issues were raised (1) whether the board should raise new capital for the extension of services instead of paying for them out of revenue and (2) whether authority should be sought to raise loans of moderate amount for the extension of services without taking a poll of the ratepayers. While one member of the board, Mr. W. A. Tate, objected on principle to any borrowing not expressly approved by the ratepayers, some weighty arguments were adduced in favour of the opposite policy. It was stated that if the money for extensions were borrowed instead of being provided out of revenue, charges to consumers could be reduced. Moreover, it was pointed out that the cost of a poll— £OOO or £7oo—was large in comparison with the amount of a loan of £5,000 suggested meantime for extensions. To this it may be added that the Local Government Loans Board no doubt might be trusted to keep a prudent check on limited borrowing for extensions, whereas a much larger loan authorised by the ratepayers to cover needs over an extended period might not be exp-ended to the best advantage. So far, the facts seem to run all one way and it may appear that a firstclass case is made out for borrowing for extensions in the manner suggest-

ed—i.e., in moderate amount from time to time without taking polls—and that, this policy is much to be preferred to that of making consumers pay for extensions per medium of charges higher, than they otherwise need be. Plausible as it is, however, the case thus stated is not complete. At an immediate view, borrowing for extensions instead of paying for them out of revenue plainly would permit a reduction of charges. Against this, however, each loan raised would impose charges on revenue for interest and sinking fund. Presumably the board before long would be in process of paying interest and sinking fund on a number of these loans. The magnitude of these obligations over a period of years, the calls they would make on the revenue of those years and the effect on charges to consumers must all be taken into account, and compared with the cost and effect of financing extensions out of revenue, in determining whether the cost of extensions should be a charge on revenue or on loan.