C. P. SKERRETT.]

179

D.—4.

is the case of an existing tram-line which has been running for the past thirty years at least, functioning, by the consent of the Railway Department, with the Government line at Himatangi, and, so far as that section is concerned, having the advantage of running-arrangements. Your Honour and members of the Commission, I think it is a fair inference to suggest that long ere this the tramway would have been extended to Marton, either with or without the connection with the Government line, but for the cost of bridging the Rangitikei River. It was that river which, no doubt, prevented the previous extension of this tramway. Now, I only mention that this tramway has proved of great utility to the district: it has conserved its roads, it has provided a means of getting its supplies and getting away part of its produce, and has also been useful in providing metalling for its roads. There is only the question of five or six miles which remain, and it is to complete an incomplete thing that this application is made. Now, your Honour, I submit that prima facie the desire of the district to extend the tramway to Marton and afford some form of connection should meet with the approval of the Commission unless the Department can show some substantial grounds for opposing that extension and refusing any connection. , Now, your Honour, it is clear that the Railway Department does not object to an extension of the tramway to Marton provided a distance or a hiatus is left between Marton and the railway-station. It could not do so, but it is clear that the cost of constructing the extended tramway would not be justified if cartage and double handling is to be involved. I understand the objections may be put upon three grounds ; but before stating those grounds I desire to refer to the statement made by Mr. McVilly in his evidence when he said the Department offered no objection to the carrying on the local railway of the local traffic purely- —the local traffic from Wellington to Marton and from Marton south ; and I think if you look at the evidence you will find Mr. McVilly made that statement. The objections, as I understand them, are threefold. The first is that the proposed extension and connection will carry a considerable amount of traffic to and from stations north and west of Marton—that it will carry, in point of fact, through traffic. Your Honour will see that this objection is founded on and arises from the existence of Foxton as a port. Without Foxton this diversion of through traffic would not be possible, and there could be no possible objection to the connection between the two lines. My learned friend Mr. Myers appeared to recognize this in his address, because he said the two questions were not disconnected. It is quite plain that it is the possibilities of the Port of Foxton which created the suggested fear of the diversion of through traffic. The second ground suggested is that the through traffic may be diverted from the Port of Wanganui to the Port of Foxton. The third ground is a perfectly general ground. It is this: that if some form of connection is effected, then the Department will be unable to resist pressure either to grant running-rights or, indeed, to itself construct the line from Marton to Himatangi or Marton to Foxton. Now, those objections are all made in the interests of the Department as a Department. They are made avowedly in its interests as a commercial concern. Now, it is not a commercial concern pure and simple : it is, as the learned President has said, a Department which has been granted an absolute monopoly of railway administration throughout the whole Dominion, and it is a Department that has thirty millions of money lent to it by the Government at the rate of 3| per cent. I have no doubt there are two gentlemen on the bench who have had the control of large private and large local institutions, and I venture to say that many of their worries would have been relieved if they could have acquired their capital at the rate of 3f per cent. ; but those advantages, your Honour, were granted to the Department because it was not regarded as a mere commercial enterprise. It was regarded, it is submitted, as part of the Government administration of the country, and part of the machinery for the development and progress of the country. Now, there is this to be observed: the Railway Department has no incentive to initiative. Its policy, as a rule, is to show a return upon its existing lines up to the amount which it is the policy of the Department to produce. Left to its initiative alone, I venture to say there would be very little development of existing lines. I point out to your Honour that it had not the initiative to construct the Wellington-Manawatu Railway line, although even at that time- —-— The Chairman : The Railway Department had begun it. It was the Commission who came in and intervened. Mr. Skerrett: Tlie Commission intervened perhaps largely influenced by the Railway Department. Mr. Chairman : Ido not know that it was the Commission that did it. The work had been commenced. Mr. Skerfett: Perhaps lam wrong. At any rate, I was only about to surmise that the Railway Department would have said about the time of the construction of the Manawatrx Railway that that railway could very well have waited for a century or a century and a half. Now, your Honour, I want to point out —and. this is an important point I am leading to —that the claim is put forward by the Railway Department that it has a monopoly of all business which can be carried on its line. Mr. Hiley speaks of all business which can be carried on its line as its business, and he describes as piracy any attempt to divert any part of the local traffic, even though it may be more advantageously carried for the benefit of the district. He does not put it, Sir, as we submit is the true test, the balance of convenience between the advantages to the particular district and the loss of revenue incurred by the construction of the proposed local railway-line. I have pointed out already that the Department does not raise objection against the diversion of purely local trade, and I submit it could not and ought not to do so, because a terminus at Marton, even though not connected with the railway-line, would serve one branch of the local trade, although it would not serve adequately the other branch of the local trade. Your Honour and members of the Commission will observe that there are two trades which affect the Sandon district: one is the trade from Sandon to Wellington, the other is the trade from Sa.ndon north and from north to Sandon. The first class of trade would not be affected particularly by want of connection with the railway at Marton, but the trade to the north and from the north would undoubtedly be seriously affected by the non-connection with the railway-line. Your Honour