What has been done in Hungary.

It will be seen that the effect of adopting the Stage System, even in this faulty form, has been to quadruple the traffic, and double the revenue.

One of the most important results obtained in Hungary is the great extension in the average distance travelled by each passenger, which is from 71 to 130 kilometres, or over 83 per cent. It is easy to see what an influence this must have, not only on the railway revenue, but on other items of revenue, trade, commerce, and social conditions generally. My finance is based on the assumption that the average distance travelled will not be less than 15 miles, and the average fare not less than one shilling. It is obvious that, no matter what may be the system, the average fare paid must depend on the average distance travelled.

If, then, we secured an extension in the distance travelled equal to that obtained in Hungary, our distance would be 24 instead of 13 miles—the distance actually travelled,—and I should expect the average fare to be 1s. 8d. instead of the 1s. calculated upon.

Last year, 1897-8, the average fare paid by each traveller in New Zealand was 1s. 8½d., consequently, if we secure the same extension of distance that the Hungarians have, we should obtain the same revenue without carrying a single extra passenger: and if we increased the number of our travellers as they have increased theirs, and my estimate of the average fare should prove to be correct, then our passenger revenue for the year would be £1,597,000, instead of £399,000, as it was last year, and I believe there is every probability that we should realise this amount.

Startling and incredible as these figures may appear, they are not more so than was my proposition when made 16 years ago to carry people 436 miles for 12s. 8d., Our railway experts laughed me to scorn, but six years later in Europe they commenced to carry people 457 miles for 3s. 4d., and have done so ever since, with great profit to the State.

In order to discredit my finance, Mr. Maxwell gave evidence that my average fare for all distances not exceeding 10 miles "could not be more than 4½d, and that in the country districts the average fare is only 4½d. for 50 miles." His own accountant has since shown that my fare for 10 miles and under would be 5.66d., and for the country districts 1s. 5¾d., instead of the 4½d. Mr. Maxwell said it would be in both cases. Surely our great expert was far enough out in his calculations.

A reference to the accompanying table will show that all my averages were correctly and safely calculated, while those of the officers were wildly astray.

It is not necessary for me to point out the enormous relief it would be to the country, to say nothing of the cheapness of travelling, if we could only get out of our railways enough to pay interest and working expenses. I have never wavered in my belief that not only can this be done, but I am certain that we can also get from them enough to go on with railway construction without further borrowing.

I wish to direct attention to the first column of the table. It shows that those who use the railways for distances of over 50 miles are less than six per cent, of the whole, but they have to pay nearly 37 per cent, of the revenue.

It will be seen that the country interest, under the present system has to pay 76 per cent, of the railway passenger revenue while the city interest only pays 24 per cent.; and this unjust and ruinous inequality will apply to a much greater extent to goods traffic revenue, of which the country interest probably pays nearly the whole. This it is that has taken the value out of country land. How is it possible for the country to be settled under these circumstances? This is the great blot in our transit system, and until it is removed it is useless to expect any real permanent prosperity in either town or country. The adoption of the Stage System would alter all this, and give both town and country an equal chance.

I wish to draw particular attention to the fact that I had no chance to use this table at the inquiry of 1886. The officers took good care that it should not be produced till after the work of the committee had been concluded. It completely proves my position.

I could say much more on the evidence given by the officials, but have said enough for the present.

From the above statement it will be readily understood why the officers of the Department have exerted themselves so much to prevent a trial of the new system or any further inquiry into it. The men who could descend to giving such evidence, certainly would not hesitate to waste public money in a trial, if they thought that trial would prove me to be wrong, and the Stage System a failure. They know it will be a great success, and that is the sole reason why it is not tried.

Evidence Produced at the Parliamentary Enquiry into Vaile's Stage System in 1886.

What the Government Railway Accountant Proves Would Be the Financial Result of Adopting Vaile's System of Railway Fares and Charges.