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The New Zealand Railways Magazine, Volume 7, Issue 3 (July 1, 1932)

Cost Of The Railway Works

Cost Of The Railway Works.

(Photo, W. W. Stewart.) Oiling up. A typical night scene on the N.Z.R.

(Photo, W. W. Stewart.)
Oiling up. A typical night scene on the N.Z.R.

On 7th April, 1868, Mr. Moorhouse advised the Provincial Council of his intention to resign the position of Superintendent on account of the pressure of private business. At the consequent election, on the 22nd May, Mr. W. Rolleston was elected Superintendent.

There had been some criticism in the Provincial Council regarding the cost of the railway works, and the manner in which they were being carried on. From time to time questions were asked, resolutions moved, copies of vouchers and correspondence called for, and proposals made for enquiry by the Council, particularly as to the manner in which the contract for the Great South Line was being performed. Finally, on the 19th February, 1868, a select committee of the Council, consisting of Messrs. F. E. Stewart (Provincial Secretary), Hawkes, Wylde, Maskell, Ormsby, Wynn-Williams and J. E. Brown, was appointed to enquire into and report upon the expenditure on the Canterbury Railways. The Committee reported on 26th March, and on 1st April the Council resolved that a respectful address be forwarded to His Honour the Superintendent praying him to give effect as soon as possible to the recommendation of the Select Committee that a Commission be appointed to investigate the matter.

The Commission and its Report.

Mr. Rolleston summoned the Provincial Council to meet on the 4th July for the purpose of dealing with the question of settlement of the claims of the contractors for the Lyttelton-Christchurch Railway. The Superintendent, having obtained the necessary authority for the expenditure, came to terms with the contractors. Then, in response to the address of the Council, he appointed, on 20th July, Mr. Thomas Paterson, Civil Engineer of Dunedin, a Commissioner to report upon the Railway expenditure. Later, Mr. Robt. Symington, merchant, of Christchurch, was added to the Commission, mainly with the object of dealing with the accounts.

The main features of the order of reference were:—To examine and report upon: (a) the expenditure on the construction of the Canterbury Railways; (b) how far the works on the Lyttelton to Christchurch Railway were a faithful carrying out of the contract of 1862, and wherever any deviations from the contract had been made to give an estimate of the cost of such deviations; (c) the page 50 present condition of the line, rolling stock, and buildings, and to give a general estimate of the value of these works; and (d) the system of accounting and the manner of payments, noticing especially any case not in accordance with the arrangements originally contemplated.

The Commission's Finding.

The Commission's report, dated 23rd October, 1868, gives a comprehensive review of the matter under investigation, and is supported by appendices showing the various items of expenditure in detail. It explains that the important character and extensive scope of the enquiry caused the proceedings to be of an arduous and protracted nature. The investigations connected with the engineering division of the enquiry were rendered especially complicated owing to the large expenditure incurred without any regular contract or agreement, and in many cases without drawings or specifications, also owing to the difficulty in obtaining the detailed statements originally appended to the vouchers. Many of these statements appear to have been mislaid or lost. Oral evidence was, however, obtained from several gentlemen, who, from their official positions or immediate connection with the construction of the Railways, were most conversant with the circumstances and arrangements. Members of the Executive Government also gave every assistance and facility.

The report states that the first agreement, dated 1st June, 1861, for the construction of six miles of line for the sum of £240,500, the work to be completed in five years from the date of agreement; that is, before 1st June, 1866. The formal contract in the same terms was signed on 2nd April, 1862. In addition to the main line, sidings were to be provided at three stations. The contract covered all works except the station buildings, and provided for the maintenance of the line and works for twelve months after completion. Subsequently it was agreed to pay £5,000 additional for the work required, to give at the Lyttelton end of the tunnel, a straighter entrance than that shown in the contract plans. The line was not opened for traffic till December, 1867, and the work was not entirely completed when taken over by the Provincial Government on 31st July, 1868.

The Commission stated the actual expenditure on the line (omitting interest and the cost of raising debentures, and the revenue obtained from leasing) as follows:—

£ s. d.
Under contracts 254,964 10 7
Extras 4,304 17 0
Stations and plant 49,847 8 3
Land 23,870 19 3
Law and engineering, etc. 15,006 8 0
Miscellaneous 317 16 10

A total of (say) £348,312.

The Great South line to Selwyn cost £186,758, including extras of £15,008, chiefly the cost of rebuilding the Selwyn Bridge after it was demolished by flood.

The Ferrymead Branch cost:

£ s. d.
Line 6,188 18 6
Station and wharf 12,936 16 0
Land 1,650 0 0
Total 20,775 14 6

The Ferrymead Branch was not a portion of the original contract. On the resolution of the Provincial Council that the line should be constructed from Christchurch to Ferrymead, the Super-intendent agreed with the contractors to pay for the branch portion at the schedule rate for the main line. A contract was let for the wharf, and certain buildings in connection with it, for £6,000.

A sum of £12,341 had been spent upon the Lyttelton to Christchurch line before Holmes and Co. undertook their contract.

With regard to the buildings, it was pointed out that with the exception of a goods shed at Christchurch, built under contract by Bailey and Henwood, all the main line stations and buildings had been built by Holmes and Co. without formal contract. No plan for stations and buildings had been adopted at the outset. The works were executed piece by piece on no uniform system, and only as urgently required. For some portions the Government page 51 accepted a price offered by the contractors, and for others paid on a basis of 15 per cent. in addition to the outlay. In this way the cost of the works was increased extravagantly.

The rolling stock was obtained through the contractors, and for this also a charge of 15 per cent, in addition to the landed cost was made. The Commissioners considered this charge excessive, and illustrated that view by quoting the cost of three locomotives supplied on 30th June, 1868, viz:—

Where Goods Are Handled With A Maximum Of Efficiency. (Rly. Publicity photo.) Interior of the inward goods shed at Auckland.

Where Goods Are Handled With A Maximum Of Efficiency.
(Rly. Publicity photo.)
Interior of the inward goods shed at Auckland.

Invoice price £7,474 18 11
Freight and lighterage 755 2 2

To this was added merchant's advance 10 per cent., and engineering supervision 5 per cent., in England and contractor's commission 15 per cent., bringing the price up to £10,694 17s. 5d. The total cost of rolling stock was £43,435.

After referring to the various points of view from which the value of the Railways might be considered, the Commissioners gave a general estimate of value of £456,200 for works which, according to the returns, had cost £520,455. Reference was made to various matters requiring attention. The bridge over the Heathcote, at Opawa, required protection, the piles having been scoured, the Christ-church yard required to be drained, lifted, and ballasted, and the South line had been damaged by running engines weighing over 30 tons on the 65lb. rails. It was recommended that a lighter type of engine be run on the South line.

The station and jetty accommodation at Lyttelton was stated to be inconvenient and inadequate, and until means were provided whereby the cargoes of foreign ships and steamers could be discharged and received direct into and from trucks, the benefits of the railway could not be fully developed. The present incomplete arrangements led to heavy expense in working and added indirectly to the working expenses of the whole railway system.

The engines and carriages were stated to be in fair order, but the wagon stock was urgently in need of overhaul, some of the wagons being hardly fit to run at ordinary speeds. The Commissioners referred to the absence of suitable workshops and machinery for undertaking repairs, and recommended the provision of same at a cost estimated at £2,500.

page 52

The Contractors State Their Case.

When this report came before the Provincial Council and was made public, Messrs. Holmes and Co. addressed to the Superintendent a letter, which they asked should be made public, stating their explanation of the matters criticised in the report. They pointed out that when Mr. Paterson was appointed a Commissioner they offered to place at his disposal their records and documents, or alternatively to appoint an engineer of standing to confer with Mr. Paterson during his enquiry. Neither of these proposals was accepted by the Government, though it was apparent that the contractors were intimately concerned with the result of the enquiry. They pointed out that with regard to the buildings they were subject to the supervision of the Railway Engineer, and their prices had to meet with his concurrence. In many cases they were called upon to undertake works which were urgently required and for which materials were obtainable only with great difficulty and expense. With regard to the rolling stock, they were not furnished with drawings and specifications, and had consequently to have these completed in England from such particulars of the requirements as they
The World's Fastest Train. Cheltenham-London “Flyer,” Great Western Railway (77 ¼ miles in 67 minutes).

The World's Fastest Train.
Cheltenham-London “Flyer,” Great Western Railway (77 ¼ miles in 67 minutes).

could furnish. Owing to the distance from the source of supply and the infrequency of communication, they were obliged to obtain the services of some local firm to deal with the calling of tenders in England, and in every case the most favourable tender had been accepted. Further, they had to accept the entire responsibility of lighterage, insurance, and the risks of conveyance over the Sumner bar, which the shippers absolutely declined to undertake, and usually three months' interest on account of the lapse of time between the receipt of the documents and the landing, erection, and acceptance of the goods. Further, much of the work had been undertaken at a period when wages and other charges were very much higher than at the date of the report of the Commission, so that any estimate based on the latter prices was entirely misleading. They claimed that taking all the circumstances into consideration the Government had received good and substantial value for its outlay.

The secret of success is concentration; wherever there has been a great life, or a great work, that has gone before. Taste everything a little, look at everything a little; but live for one thing.—Olive Schreiner.