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The New Zealand Railways Magazine, Volume 5, Issue 9 (April 1, 1931)


The importance of the railways in the life of the community was never more certainly established than at the present time, when it is freely admitted that the whole scheme of public finance in New Zealand must be regulated according to the returns from this national transport service. It is not so to such a marked extent in countries where the railways are privately owned; but even there the State has to take serious cognisance of their operations. And now, from both sides of the Atlantic, comes the plea for protection of this industry on account of the interests involved and also on account of the fact that, for the general welfare of the country, they are required to work under very definite State regulations which do not hamper the operations of their road competitors to anything like the same extent.

There are two principal causes of the present situation upon most railways. These are depression and competition. While the former cause is, in general, beyond the control of railway authorities anywhere, it has been thought that the latter—competition—might have been allowed, in the case of privately-owned lines at least, to work out its own salvation. But Mr. D. Willard, President of the Baltimore and Ohio Railroad, and a recognised authority upon railway thought in America, points to an element which makes such a solution inequitable.

In addressing the Board of Trade of Washington, he said:

“I think the highways should be free for the private use of all individuals—free with the exception of such charges as may be necessary for police purposes and may be collected in the shape of license or gasoline tax. I am opposed, however—because I think it is unfair—to the unregulated use of such Government-built facilities without charge by individuals or corporations engaged as common carriers, in competition with Government-regulated railroads.”

The feature of unfairness to which Mr. Willard draws attention is the free use of Government-built highways by private operators for competitive commercial purposes, against privately-built railways. The demand in this case is for the Government to treat private competitors alike. When the State is in competition with private operators, as it is in New Zealand, equality of treatment appears to be equally necessary. This need would be seen with even greater clearness were the State running road services in competition with privately-owned railways. From the trend of recent discussion effective regulation which will aid in producing a rationalised system of transport throughout the Dominion appears to be one of the possibilities of the near future.