Figures made public in Auckland on July 4th by Mr. H. H. Sterling, Chairman of the Government Railways Board, indicate that notwithstanding a decline in revenue the railways in the past financial year made a net revenue gain by reason of the economies effected in expenditure.

Mr. Sterling said the past year had been an exceedingly trying one, and difficult in itself by reason of the complications inevitably associated with the continuation and intensification of the depression. In addition, there had been of course, a tremendous volume of work inseparable from such a radical change in the control of the business of the Department as had taken place with the constitution of the Board. Practically every major question affecting the Department's working had been, or in the near future would be, brought under review by the Board, and this had placed a heavy burden on the organisation, having regard to the fact that the routine requirements of the business called for the greatest possible vigilance in order to secure the best results. That those results had been secured seemed to be amply justified by the figures for the last year's operations.

Reduction in Expenditure.

Without going into details, Mr. Sterling said he was pleased to be able to indicate that, notwithstanding a drop in revenue for the year of £1,070,000, the Department had actually been able to achieve an increase in net revenue. That, of course, was the result of the efforts which had been made to reduce expenditure, the figures for the year showing, in comparison with those of the previous year, that expenditure had been reduced by approximately £1,200,000. Compared with 1930, expenditure showed a decrease of £1,687,000.

“This result,” Mr. Sterling continued, “has been attained without reducing the service below what would be regarded as a reasonable standard from the customer's standpoint. The Board realises, of course, that there is a point below which expenditure cannot be reduced without a disproportionate sacrifice of the standard of the service. This requires a very nice balancing of the factors involved in the consideration of this question. The Board is steadily pursuing the policy of economy, but it will be realised, in face of what has already been achieved in the reduction of expenditure, that further reductions become increasingly difficult. Especially in such an institution as the railways, a point must be reached where service must be regarded as at a minimum, so that further reductions in expenditure are not really possible as a business proposition. For instance, between main centres express train services have to be maintained, and while revenue may drop to half, the expenditure is practically stationary as regards that service. So in relation to other phases of the Department's activities, such as goods service, refreshment rooms, etc. The Department has at all times to be in a position to meet the fluctuations that take place, and it is the peak of fluctuations that, generally speaking, determine the strength of the organisation that has to be maintained in order to give a service that will be free from complaint.”

On Sound Business Lines.

Mr. Sterling said it was impossible to foretell with any degree of certainty page 24 what lay immediately ahead in the matter of trade revival, but without wishing to appear unduly pessimistic, he thought it would not be wise to count on any very substantial improvement during the current year. Indeed, said the Chairman, the figures of the Department's business for the first two months of the present financial year showed that revenue was still dropping, but notwithstanding the increasing difficulty of obtaining reductions in expenditure, it was satisfactory to note that expenditure had been reduced to an even greater extent, so that for the first two months there had been an improvement in the net revenue. True the sum was not great, relatively speaking, being £2,000, but in the circumstances it was gratifying to know that the Board had been able to show a credit balance, small though it might be.

The public, Mr. Sterling added, could be given a full assurance that the Board during the current year would be unremitting in its endeavour to run the affairs of the Department on sound business lines, and to realise what it considered to be its true objective to provide the community with the service it needed at the lowest possible cost.

When The Lights Peep Forth.
(Photo, W.W.Stewart.)
Auckland station platforms by night.