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With an increase in the size of locomotives and the load of trains, one would expect some increase in the consumption per train-mile. The consumption per 1,000 gross tonmiles, however, represents the consumption in relation to the total work done and should tend to decrease or at least remain constant. The falling off in this efficiency figure is attributable to three factors. In the first place, the staff shortage in the workshops (to which reference will be made later) has had the result that locomotives are not being maintained up to the standard of mechanical efficiency previously possible ; secondly, it is the later-type locomotives that have been converted to oil burning, and by far the greater proportion of the locomotives included in the table are of the older types where the lack of first-class maintenance has the greater effect; thirdly, the proportion of soft coal used has increased slightly and the quality of this soft coal in many cases leaves a good deal to be desired. On the cost side it will be seen that unit costs have increased since 1939 in much greater proportion than unit consumption. The reason for this is, of course, the heavy cost of the coal imported during recent years compared with the cost of New Zealand coal. Oil Fuel The number of oil-burning locomotives as at 31st March, 1950, was 73, as against 51 at the end of last year. The oil-burning locomotives comprise : Class J, 10 ; Class K, 28; Class Ka, 35. During the year oil-burning locomotives ran 31-91 per cent, of the North Island steam-train mileage as against 20-55 per cent, last year. The consumption of fuel oil rose from 12,216,520 gallons to 19,091,722 gallons (i.e., an increase of 6,875,202 gallons) and the total cost rose from £516,475 to £579,620 (i.e., an increase of £63,145). Due to various causes, the average cost per ton of oil fuel decreased from £lO Is. 3d. to £7 4s. 6d., a saving of £2 16s. 9d. per ton. The original programme provided for the use of 77 oil-burning locomotives, all for service in the North Island, and when the engines are shopped for major overhaul it is intended to convert 2" K" class and 2" J" class locomotives to complete the programme. STORES AND MATERIALS These rank as a heavy item of expenditure comprising 15-76 per cent of the total. The heavy increase of £272,812 was due to the greater quantity of stores and materialsused and to further rises in the prices of some items. The debit for stores used by the road services including fuel, lubricants, tires, and tubes rose by £69,667—mainly due to the higher mileage run. Way and works expenditure on stores rose by £48,520, while the total estimated debit for materials used on working-expense jobs carried out in the workshops was £119,880 greater than last year. DEPRECIATION AND RENEWALS The increase of £75,502 in depreciation charges was due to the increase in the total value of assets. The largest increases were £24,549 in respect of new road-service vehicles, £23,574 in respect of new wagons, and £9,100 in respect of operating buildings. MISCELLANEOUS A great number of items are included in this total, but the principal variations with last year's figures making up the total decrease of £94,981 were a decrease of £194,940 in the provision for deferred maintenance and an increase of £50,000 in the provision for annual l6ave in arrears.

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