D.—2.

Notwithstanding the changes which have occurred in the transport industry throughout the world as a result of developments during recent years, it is beyond dispute that the national interest is best served by adherence to the broad principles of the established railway-rating system. With the disappearance of the competitive aspect to the extent contemplated by the policy which is now being given effect to and the application of the principles of co-ordination, the way will be paved for a general overhaul of freight rates along lines which, whilst preserving the best features of the present system, will bring the classification and rates more into line with present-day requirements. PASSENGERS' LUGGAGE. A matter of considerable importance to those travelling by the steamer-express service between the North and South Islands is the extended facilities which have been provided for dealing with interIsland checked luggage at Wellington. Owing to the inconvenient location and the lack of facilities at the old Lambton and Thorndon Stations, the checking of luggage from Wellington to South Island stations and the receipt at Wellington of checked luggage from southern stations had of necessity to be undertaken exclusively at the luggage office on the Wellington wharf. The terminal facilities provided at the new Wellington Station have, however, permitted of arrangements being made for these services to be also undertaken at the station luggage-room, and this has proved very popular with the travelling public. Another aspect of the checked-luggage system which has engaged attention is in connection with passengers travelling to tourist resorts located beyond the limits of the railway. It has been recognized that passengers are put to some inconvenience in attending to the transhipment of their luggage at the railway terminal, and the objective has been to relieve them of this obligation. With this end in view arrangements have been concluded with the several interests concerned whereby visitors to the Chateau Tongariro may have their luggage checked without additional charge for the through journey by rail and road direct to and from the Chateau. It is the intention that the framework of this arrangement will form the basis of a general scheme of through-checking to other resorts so located as to render it desirable for the facilities to be given. TRUCK RATES. The application of the truck-rate principle to the Christchurch - Little River section of railway has been effective in bringing about a co-ordination of the services of the railway and the ChristchurchAkaroa goods road service, previously operating in competition with the Department, under conditions mutually acceptable to both parties. The general terms of the arrangement are 011 the same lines as those already adopted in certain other areas, where similar conditions have had to be met and which have been effective in securing to the railway a material increase in business. SUBURBAN PASSENGER TRAFFIC. As indicated in the last annual report, following on a comprehensive review of the whole position, certain adjustments in the fares and conditions of travel on suburban lines designed to remove inequalities as between different sections of the community were decided upon. The new scale of fares was brought into operation in May of last year and met with a most gratifying response from the public, whilst from the Department's point of view the results for eleven months up to the end of the financial year disclosing, as they do, an increase of 691,955 suburban passenger journeys compared with the same period of the previous year, are highly satisfactory. It is worthy of mention that the new lowpriced six-trip ticket, which was specially introduced to meet the needs of the casual suburban travellers, has proved most popular, no less that 197,223 of these tickets (representing 1,183,340 passenger journeys) having been sold in the first eleven months of their issue. HOUSEHOLD REMOVALS. The special service of house-to-house furniture removals, including, in addition to rail transport, cartage to and from rail and packing and unpacking, continues to show a steady expansion. The removals handled during the year totalled 1,231, compared with 971 for the previous year. No less than 72 per cent, of the transactions were undertaken on behalf of private individuals as distinct from employees of other Government Departments, thus clearly demonstrating that the value of this service, built up over a number of years, is fully appreciated by the public. FARMERS' EXCURSIONS. The improved economic position of the farming industry has resulted in a revival of interest in the special farmers' excursions so successfully inaugurated by the Department prior to the depression period. The purpose of these tours is to provide opportunity for those engaged in farming pursuits to study farming conditions and operations in various parts of the Dominion, and the itineraries provide for visits to the more important farming areas, agricultural colleges, and industrial establishments throughout New Zealand. The present indications are that.-parties varying in size from 80 to 300 members will undertake comprehensive tours during the winter season, and the Department's Business Agents are co-operating with the various farmers' organizations concerned in making the necessary arrangements. The successful establishment of the Young Farmers' Club movement in New Zealand has also resulted in a growing demand for transport facilities for parties of members undertaking educational travel, and several such tours have been organized during the present winter.

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