An important railway witness whom we
examined expressed the opinion that increased expenditure could be
recouped by increased rates. Perhaps that is still true. If it is, the
railways of Australia are happier than most of the railways in Ireland.
The railways of New Zealand belong to and are worked by the Government.
For many years the Government, looking upon the railways as an adjunct to
the settlement and development of the country, only expected them to
return 3 per cent. interest on the capital expended. In 1909 this
policy, however, was modified, 3.75 to 4 per cent. being then regarded as
a proper result, and this result was accomplished. Water power in New
Zealand is so abundant that the adoption of electricity for railway
working has been engaging the attention of the Government. Many, well
qualified to judge, were satisfied that it would prove more economical
than steam locomotion.
In both Australia and New Zealand, borrowing for railway construction had
been by means of general loans raised for all kinds of Government
expenditure. We came to the conclusion that if loans for reproductive
works, such as railways, had been segregated from others, it would have
helped the raising of capital, and probably secured easier terms.
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