Important Financial Agreement.
With considerable satisfaction was the news received of the financial agreement come to between the Government, the four group railways and the London Passenger Transport Board in respect of the war-time control of the undertakings. The arrangement provides for the operation of the railways under unified control on an economic basis, with appropriate payment for all Government traffic handled. The main clauses set out that the receipts and expenses of the controlled railways shall be pooled. Out of this pool, the railways are to receive annual payments equivalent, as regards the trunk lines, to the average of their net revenue for the three years 1935, 1936 and 1937; and as regards the London Transport Board, to its net revenue for the twelve months ending June 30, 1939. These payments, totalling approximately £40,000,000, are guaranteed by the Government. Should the amount in the pool exceed these guaranteed net revenues, it is provided that the railways shall retain in full the first £3,500,000 of excess: beyond that sum, the Government will take one-half of the net revenue until the point is reached where the railways arrive at their standard revenues, after which the Government acquire the whole of the balance in the pool. The agreement provides for standardising charges for maintenance, for dealing with the problem of war damage, and for bringing the receipts and expenses arising from
“Carrying On”: A typical Railway War-time Poster in Britain.
the requisitioning of privately-owned wagons within the pool. There are also provisions covering the adjustment of conveyance rates, fares and charges to meet variations in war-time working costs.