RAILWAYS & PUBLIC WORKS

Waikato Times, Volume 94, Issue 14756, 21 September 1921, Page 7

RAILWAYS & PUBLIC WORKS

WANTED BUSINESS CONTROL. “LOOK BEFORE YOU LEAP." (Contributed by the Welfare League.) We have chosen in this Dominion to enter into a good deal of what some call “State Socialism,” others ‘‘Slate Capitalism," and others still (wilh a cynical turn) “Government vote catching enterprise,.” Leaving it to our readers lo choose their own dolinil.inui we would yet affirm lhal up tilt now there has been more Slate politics than national business. With a Reform Government in power there ought lo be some real changes from, the bad methods of the past. A "gelling down lo business” is what the country requires, and the Government that will do it properly is “Reform," no matter what name is given lo it. Railway Finance. The recently enforced "cuts” in the I rain service lias brought the question of railway finance forcibly to all cf us. There is no doubt that the high operating costs are rather seriously effecting the paying capacity of our Government railways. During the years JUKI to J'.)2 o the railways were being financed on more favouraolc conditions than at any previous period in (heir history, the average yearly return on Hie capital invested during Hie live year period being £-4 Iss 2d per cent. The entirely favourable conditions could not he expected lo continue. Last year the revenue reached the record total of £0,1)08,531, which was £1,156,0 4 4 more than 1020. But the expenditure which rose by £1,531,53 4 absorbed Hie whole of Hie increase and £375,400 besides. The Department attributes the increase in expenditure to the following causes;— (1) The rc-cstablishment of the pre-war train service. (2) Increased cost of operating due to advance in wages and working conditions of staff. (3) Increased cost of material, particularly coal. Running Costs Compared, In 101-4 the running costs per train mile were -4s 2d. To-day they are more than 12s. The rc-cstablishment of the pre-war services increased the train-mileage by 1,80-4,781 (approximately 1,00,000 miles in Ihe North Island). The operating costs increased 12Id per train mile in Hie North Island, and Od in the South,-but the receipts showed a declirne of 3ld in I lie North Island, and Is 10 Ad in Hie South. Tiie big drop in the case of the South Island necessarily reduced the margin between receipts and expenditure, the latter absorbing 00 A per cent of the revenue. Roughly speaking, £37,000,000 lias been expended on Hie railways on capital account. Taking 3;J per cent us cost of capital investment that involves an annual charge of £1,487,500 which must bo met before there can be any talk ol “profit” on our railway system. As Hie excess of revenue over expenditure last year only amounted to £1,271,901 it follows that Ilicrc was an actual loss on the working railways last year of £2 15,559. This year’s results have shown considerably worse than anything previous, and no doubt that is what lias impelled Hie Government 1" lake action. We learn that during Ihe sixteen weeks lill July 23rd (ho expenditure has absorbed 99.77 per rent nf ihreceipts, leaving only a balance of £4OO 1 to meet the interest charges. ‘Pile revenue in all lines amounted to £2, IT 4,7-42, and the expenditure t”, I 19.8 4 1. South Island lines showed an excess of expenditure over reeeipls nf £66.975. Hero are HIC |>rTf ll • 1 11 ; 1 1 causes:—Goal is costing Die Department £2 -is per lon more than during the lasi two years. The Wages Bill. The wages bill last year meant an additional increased expenditure of £910,685. and an increase of Is per day, with the 4 1-hour week, is given In Hie tradesmen employed uy the Department from March Ctli, 1921. For the four weeks ended July 23rd Ihe expenditure was greater than Hi” revenue disclosing an actual loss in working nf £19,125. All reasonable jM’iqile will recognise Hi atsucii a stale nf affairs might imi in continue. The Government has done rigid in culling nut some nf liie dead nr 11011-pa'ing

were expected In pay from Hie time they were liisl. laid down. That is aimiher story which we purpose dealing wßli in annlher arliele. r |‘lin fai‘l is lhal mir railway linanec Is in a parlous slide, and Hie i.nverninenl deserves credit for f eHng the actual position instead of simply "putting off Hie evil day." Flmrf running on several lines must be enforced unless some means are found |,, ,-nduee llm general expenditure in Hie way nf high running costs. The question of limuieing very slack sections should he considered from Die standpoint of Imw far they serve Hi" needs of development, bid Ihey ought not to be left, merely as constant burdens upon the financing of oui i ailway system as a whole.