D.—2

VII

of 0-75 d. per train-mile. The net earnings per train-mile were 30-21 d., against 30-od. for last year, an advance of 0-21 d. per train-mile in the net earnings for the year. This can be considered as satisfactory, having regard to the additional services run to meet the public convenience. The gross earnings per average mile of railway declined by £6 per mile, but the workingexpenses decreased by a similar amount, leaving the net earnings per average mile open at £408, the same as for last year. The return from the Lake Wakatipu steamers amounted to £6,851, an increase of £60 on the earnings for the previous year. Arrangements are in hand for placing this service under closer supervision, which I am convinced will lead, to more satisfactory financial results. The net return , £1,185,002, was equal to 3-53 per cent, on the capital invested in the lines open for traffic, and 3-28 per cent on the capital invested in the open and. unopened lines (£36,133,155). Expenditure. The working expenditure for the year amounted to £2,920,455, an increase of £40,132 on the year 1914, but a saving of £109,545 on the estimated expenditure, which was £3,030,000. The ratio of expenditure to earnings was 71-14 per cent., a decrease of 0-10 per cent, as compared with the figures for the previous year. Expenditure. Per Cent, of Revenue. 1915. 1914. 1915. 1914. £ £ Traffic .. .. .. 870,392 838,222 21-20 20-73 Locomotive .. .. ..1,183,013 1,154,309 28-82 28-55 Maintenance .. .. .. 738,550 763,207 17-99 18-87 Management .. .. .. 122,415 117,539 2-98 2-91 2,914,370 2,873,277 70-99 71-06 Lake Wakatipu steamers .. 6,085 7,046 0-15 0-18 2,920,455 2,880,323 71-14 71-24 The increased expenditure in the Traffic Branch resulted from the improved scale of salaries, the extension of the lines open for traffic, improved train services, provision of staff for additional stations on the new lines, and the extension of the train-tablet, signalling, and interlocking arrangements, and other safety appliances, which involve the employment of additional labour. In the Locomotive Branch the increased expenditure is due to the extension of train services, working of new lines, and to the material advance that has taken place in the cost of fuel, stores, wages, and repairs. The advance in the Head and Departmental Office expenditure resulted mainly from increase in salaries under the Classification Act. In the Maintenance Branch the expenditure has been curtailed in respect to works usually debited to working-expenses, and a saving has been effected through the curtailment of mileage relaid. The expenditure per mile of railway, £254, against £267 last year, represents a decrease of £13 per mile in the cost of maintenance. A considerable number of works of miscellaneous character and representing additions and improvements to lines, structures, and rollingstock, aggregating £14,035, which could fairly have been charged against capital, have been carried out during the year and debited to working-expenses. £217,006 was spent in the Maintenance Branch on works charged to capital account under the heading of " Additions to open lines." These comprise extension of signalling and interlocking, block working, station yards and sidings, additional watorservices, houses for staff, purchase of land, erection of new station buildings, goods-sheds, engine-sheds, social halls, wharf-extensions, reclamation, overbridges, tunnel-duplication, and grade-improvements. In the Locomotive Branch £307,385 was spent in the provision of additional, rolling-stock, tarpaulins, pneumatic coaling-cranes, fitting cars and vans with steam heating-gear, purchase of petrol electric car, fitting Westinghouse brake and workshops machinery. The total expenditure under " Additions to open lines " was £524,391. The rolling-stock in respect to which, the charges were incurred comprised 22 locomotives, 35 carriages, 5 brake-vans, 84 bogie wagons, 882 four-wheeled wagons, completed on 31st March, 1915 ; and 48 locomotives, 75 cars, 28 brake-vans, 102 bogie wagons, and 1,268 four-wheeled wagons in hand but incomplete on that date. Duplications. The double line between Dunedin and Mosgiel was brought into operation on the Ist June, 1914Th c Parnell new double tunnel was completed on the sth March ; one line of rails was laid and brought into use on the 28th March. The completion of this work will materially assist traffic operations in busy seasons, and the line through the old tunnel will give additional relief during periods when traffic is congested. The loads of north-bound trains from Mercer to Auckland have been materially increased as the result of the grade-easements already completed up to the end of the year. When the deviation of the line from Pacrata Station northwards, a distance of 3 miles 65 chains, which was in hand on the 31st March, has been completed, the grade against south-bound trains will be reduced from 1 in 40 to 1 in 100. This will enable south-bound trains to take considerably heavier loads, ensuring further economy in operating. Deviation and grade-easement at Kakariki is in hand. On the Picton Section grade-easements between Koromiko and Tuamarina have been completed with beneficial effects on the working. The expenditure incurred during the year in connection with grade-improvements north of Mercer was £28,828. Reclamation at Auckland. Considerable progress has been made with the Mechanics Bay reclamation, which has been carried out by the Auckland Harbour Board in conformity with an agreement with the Department. The expenditure, including the sum involved in the purchase of land, was £37,999. Arrangements have been