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The Pamphlet Collection of Sir Robert Stout: Volume 68

The Railway Reform League and the Commissioners. — Memorandum in Reply to Messrs. The New Zealand Railway Commissioners

The Railway Reform League and the Commissioners.

Memorandum in Reply to Messrs. The New Zealand Railway Commissioners.

As with your letter of the 7th instant, you were pleased to forward some printed correspondence between yourselves, your Auckland solicitors, and your local traffic manager, the League presumes that this is intended to be part of your reply.

You commence by stating that the League has for one of its objects the total abolition of differential rating, and then say "It is somewhat difficult for those who have studied and dealt with railway rates extensively, and who understand the magnitude and intricacy of the subject, to understand the precise nature of this object, as the term 'differential rating' may cover a large field. In English law relating to railways such an expression is never met with; nor is it in American law, which is very extensive both in the individual and general State legislation."

The first portion of this paragraph clearly implies, if, indeed, it does not state, that those who have had most to do with railway working have the greatest difficulty in understanding what is meant by differential rating. It appears to the League that this is one of the strongest arguments why such a pernicious practice should be at once abandoned. It is evident on your own showing that it must be a serious drawback to the successful working of our railways, for no one if they can help it will attempt to do business under a system that neither they nor you can understand.

You next state that "In English law relating to railways such an expression" (as differential rating) "is never met with." This may be, but it matters little to us. It occurs in our colonial law.

For the wording of the Government Railways Act of 1887, there can be no doubt that you are largely responsible. What meaning then did you attach to the words when you allowed them to appear in the following by-law:—"(m) For imposing differential rates and charges for the carriage of passengers and goods upon any railway, and the circumstances and conditions under which the Commissioners will make special rates for the carriage of goods in quantities." The League may also point out that one of your number, Mr. Maxwell, in his report for 1884, argues that "differential rating" is not arrived far enough in this colony. He at any rate should have a clear idea of the meaning of the term.

The League now, however, has before it your official declaration that you do not understand the meaning of the words "differential rating," and also the fact that you have applied to your solicitors to interpret them for you.

The following paragraph appears to the League to be a very extraordinary one:—

"As it appears that one of the members of the firm of Devore and Cooper, the solicitors employed by the department in Auckland, is a member of the Railway Reform League, it might be as well to request the firm to give the Railway Commissioners a brief opinion as to the meaning generally of the term 'differential rating' as applied to railway traffic. This opinion is needed to enable the Commissioners to obtain an accurate view of what is involved by the total abolition of differential rating, and to enable them to judge whether the substitution of what is termed 'the stage system' will bring about the total abolition of such a style of rating."

You here state that Messrs. Devore and Cooper's opinion as to what the term "differential rating" means is necessary to enable you to judge whether the substitution of a stage system for a mileage system will secure the abolition of differential rating.

In the first place, the League has to remark, without intending any disrespect to that firm, that it fails to see how Messrs Devore and Cooper's opinion can affect the question either one way or the other; and, in the second place, it says that the absurd suggestion that the adoption of a stage system would secure the abolition of differential rating did not emanate from the League. The League's propositions with reference to these two matters are very clearly and distinctly laid down, and are as follows:—
1.The total abolition of differential rating.
2.The abolition of mileage rating, and the substitution of a stage system.
3.The stage system adopted must be of such a nature as to give special facilities to districts and set tiers far removed from a market.

These are all separate and distinct propositions, and, we think, stated in language that should have prevented the confusion of ideas that has evidently arisen in your minds.

page 20

We may, however, remark that the adoption of a stage system such as the one proposed would do away with the only legitimate excuse for differential rating—namely, bringing the distant producer closer to his market.

Further on you say: "The objectionable practices such as are known as unjust discrimination, undue or unreasonable personal preferences, drawbacks, rebates, discounts, allowances, secret rating, &c., are not in operation on the New Zealand Government railways, and never have been."

This statement is perhaps correct, but the League would direct your attention to the fact that the Act of 1887 legalises and gives you the power to enforce them. You may firing them into operation any day at your own pleasure, and the public has no appeal either at law or to Parliament.

The League says Great Britain and America have found it necessary to suppress these practices by very stringent legislation, and the League further says that power to enforce them in New Zealand ought never to have been given to any man or set of men.

The League directs your attention to the fact that these practices, which have been made legal in this colony, are now punishable in America by fines up to £1000, and two years' imprisonment.

You quote certain fares under the proposed system, and state that they "make a local preference to an extent quite unknown in ordinary practice."

The reply is that under the proposed system the existence of the mile is ignored, as it is in postal and telegraphic practice, and all fares and rates are based on average cost and population.

On the 42 miles referred to as between Buckland and Henderson, and for which the first-class passenger fare is 3s 6d, there is a population located of between 65,000 and 75,000; while on the 42 miles between Mercer and Frankton the population is probably less than 1200.

The facilities for doing business over a district containing 75,000 inhabitants are so great as compared with a district of similar extent, but containing only 1200 inhabitants, that it appears to the League to be a sound policy to charge a higher rate in the thickly-populated district, and to give the lower rate in the thinly-populated one, in order that people may be induced to settle there and utilise the land.

We presume you desire to make it appear that the system the League wishes to have tried is a differential rating system. The League has good authority for stating that it is not.

The minutes of evidence taken before the Parliamentary Committee which inquired into this system were sent to Mr. Charles Waring, of London, and he was asked to say if it is a differential system. He replied

as follows:—"In answer to the specific question put to me, I hardly see how any system in which rates and tares are established on a fixed basis can be properly called a differential rating system. This is not what we, mean when we speak of a differential system in England, and describes, indeed, the exact reverse."

This is Mr. Waring's opinion; he is an undoubted authority, and as you have publicly stated that you do not understand the meaning of the term, the League is more than justified in accepting his opinion in preference to yours.

As examples of what is done under the present system, we direct your attention to the table on page 89 of Parliamentary Paper I-9, 1886. This shows that on the Auckland section of railways, during the year ending 31st March, 1886, 424,914 passengers travelled, and that they paid collectively £39,909 in the following proportions:—
Travellers of distances of No.ofpas-sengers. Percentage of number Am'unt paid. Percentage of reve'ue.
£
10 mites and under 292,949 68.9 9,597 24.1
Over 10 and not exceeding 50 miles 107,203 25.3 15,647 39.2
Over 50 miles 24,762 5.8 14,666 36.7

It appears to the League that such a state of things is neither fair nor desirable in the interests of the community generally.

As instances of "local preferences" now in existence, the League directs your attention to the following examples:—
First-Class Passenger Fares. Per mile.
Avondale to Kingsland, 3 miles 1s 0d=4d
Auckland to Remuera, 3 miles 0s 6d=2d
Avondale to Newmarket, 6 miles 1s 4d=2.66d
Avondale to Auckland, 8 miles 1s 0d=1½d
Auckland to New Lynn, 10 miles 1s 10d=2.20d
Avondale to Onehunga, 12 miles 2s 6d = 2½d

For the worst examples of these "local preferences" you are solely responsible. The three miles of railway between Anckland and Remuera is used by the richest portion of the community, and they are charged at the rate of 2d per mile.

The three miles between Avondale and Kingsland are used by the poorer portion of the people, and they are charged 4d per mile, or just twice as much as their richer fellow-colonists.

Passengers from Avondale to Auckland must pass Newmarket, and yet you charge them 1s 4d, while for carrying them past this station, and two miles further on, you charge only 1s. It appears to the League that "local preferences" like these are not only unjust, but senseless and injurious to the best interest of the community.

Such things could not occur under the proposed new system.

It is the object of the League to introduce a system that shall be alike fair to every section of the community.

Auckland,