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The New Zealand Railways Magazine, Volume 3, Issue 9 (January 1, 1929)

Railway Management

Railway Management

Our columns are at all times open to helpful discussion of Railway problems. It is with pleasure, therefore, that we publish the following letter from one of New Zealand's captains of industry and commerce, Mr. A. G. Lunn, (past-president of the Auckland Chamber of Commerce), giving a typical business man's viewpoint regarding the Railways as a commercial concern.

7/1/29.

To the Editor, “N.Z. Railways Magazine,” Wellington.

Dear Sir,—

It may be of interest to your readers to have the views of some business men in regard to the management of the New Zealand Railways.

Hitherto various forms of management havebeen in operation with varying degrees of success, but all have been subject to political influence, and this influence has not always been to the public interest nor an aid to the economical administration of the Railways.

Branch lines have been built which should not have been built, or at least should have been delayed for many years; with the results that the loss entailed has been accumulating until, with the proper reorganisation of Railway accountancy, these deficits have had to be recognized and shown as losses to be made good by contributions from the Consolidated Fund.

It is questionable whether sufficient allowance for depreciation of stock (rolling and other) has been made in the past, and whether necessary provision has been made for replacements.

There can be no doubt that whatever drawbacks have existed previously (the losses for which may have been sunk in the capitalized figures of the Railways) the time has arrived for a strict and businesslike administration of the service. No longer is the Railway a monopoly, with huge capital into which may be sunk the cost of errors of political lines and lack of business-like conduct to await the day of awakening to the fact that we have an interest bill which cannot be met by the Railway earnings. The competition of motor transport is becoming acute; and to save this—the largest business in New Zealand—from disaster, the Railways must be freed from political influence and kept in the hands of a capable manager, whose duty will be to see that it is run as an efficient public service, and that it meets the interest cost (if no more) of the capital involved. I firmly believe that on this basis economies amounting to hundreds of thousands might be effected, and when effected the man who could do it would be worth not £3500 per annum but £10,000 per annum. Give such a man the confidence and support of the men in the service and the public, and we should be on the road to success and should hear less of the foolish controversy, in Parliament and out, as to whether £3,500 is too much to pay for a good man.

Business men with less than one-hundredth part of the capital invested in our railways pay higher salaries than this because it is recognized that brains, initiative, organizing powers, and character are of higher value, and are the only means to success in the conduct of Big Business.

The Department has on its roll many men of great ability and energy, and under sympathetic and able management they would no doubt assist in the more economical and efficient running of the Railways.