The New Zealand Railways Magazine, Volume 1, Issue 4 (August 24, 1926)
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The Railway Department in its capacity as guardian of a substantial portion of the public revenues, is called upon to exercise some of the highest qualities of technical skill, of business acumen, and of state-craft. Faced with the challenging competition of motor vehicles on the roads, it might have chosen one of three definite policies. It could have stood pat, and calmly seen its business drift away, sure in the knowledge that what the Railway lost in revenue would be made good out of taxation. It could have cut rates to any extent necessary to defeat competition, thus saving its traffic but sacrificing its revenue. It could have abandoned the rail in the districts threatened and prosecuted a policy of cut-throat road competition. These were clearcut issues, but none of them exactly fitted the situation; for the economic factor varied so greatly between one place and another, that what might be right in the suburbs of Auckland would be wrong on the Canterbury Plains; what would suit for benzine might be of no use for potatoes.
The course followed, therefore, has rather been tentative; a compromise of policies to suit exigencies, pending the time when the relative suitability of rail and road for the different classes of transport work could be worked out on an economic basis.
By close commercial investigation the Railway has stood pat when circumstances appeared to warrant this course, and time after time has been justified by seeing first one competitor and then another wilt away. Again, after full study of the question, rates between special points and for particular commodities have been cut to a point sufficiently low to eliminate competition, but sufficiently high to be self supporting. The third alternative, that of meeting competitors on the roads, although a fullgrown railway policy in other countries, has hardly been touched in New Zealand. Yet, as the business of the Railways is the supply of suitable transport for the people and commodities of this country, and as the motor bus and the motor truck are natural modern extensions of the essential rail service, their functions should be definitely recognised by making them available to supply through services under one control. The fact must be faced that for small consignments over short distances the motor truck is in its proper economic field, and that the conveyance of passengers and luggage to and from the rail comes within the ultimate scope of railway activities.
Bearing in mind the venerable truth that where the treasure is there will the heart be also, and applying this to the fact that 25% of New Zealand's National debt, and over 50% of that portion of it which is directly remunerative, is represented by investments in the Railways, it is not surprising that public interest in the administration of this important Department of State seldom flags. The reorganisation which every branch of the service is now undergoing has therefore been closely followed, and it is seen that under the hammer blows of competition on the one hand, and progressive administration on the other, the Railway is being forged into an economically efficient transportation agency capable ultimately of handling the carrying business of the whole country.
The achievement of this end involves the free use of road motors for purposes of distribution from railway centres and within short-haul limits where this method is the most economically efficient. In order to prevent wasteful over-lapping which reacts unfavourably on transport costs, such services should be under a unified control, a service for which the Railways on account of their strong central position are particularly well adapted. Through service is the order of the day, and through service under the best economic conditions is what the Railways are now setting out to supply.