What is the Answer to Rising Costs ?
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All-round Increases in Expenditure and Demands of Workers for Greater Leisure During Duty Periods Place Heavy Burdens on Finances of Municipal Transport Undertakings 0 N the traffic side the 44-hour week was a far more costly innovation than was expected, and there was a tendency in municipal transport to pile up administration charges, said Mr. Cooper. He quoted the following figures, supplied by four operators, which emphasized the relationship between increases, in two years, in the wages of traffic staff and engineering employees.
Dealing with traffic expenses, a mere comparison of basic wages before the war and afterwards showing a rise of 58 per cent. was, he said, misleading. In fact, the added cost per mile was generally about 100 per cent. The 44hour week had involved little increase in engineering staff, but with uniformed employees the longer week had had to he continued at enhanced rates for overtime, or aciclional staff had had to be engaged.
Higher Speed: Lower Cost Because of the heavy capital outlay per employee, it was vital that the Utmost use should be made of every vehicle to reduce thea cost per passenger carried. CostS could: best be cut by increasing aVerage. speeds, suggested Mr. Cooper. The rising demand for longer terminal layover periods could be the greatest source of loss in a municipal department's activities,
"The general leaning towards the introduction of a greater proportion of idle time in industry is recognized," he said, "but unhappily the proved value of a short break in a lengthy period of work is being pressed to an absurd limit when three or four minutes in every half-hour are being demanded."
Having -regard to the high cost of drivers' and conductors' wages, Mr. Cooper wondered whether enough importance was attached to the preparation of traffic schedules. A schedule that was not completely effective often repeated its inefficiency over a long .period, because of the obligations and the difficulties attached to any change. "Does it not behove the industry," he asked, to pay greater heed to the education, training and recompense of the schedules man ? "
Like Mr. Fitzpayne, Mr. Cooper was concerned at the great waste of money in training staff during these days of high labour turnover. He quoted a case in which, during seven months ended April 30 last, 172 men and women conductors were engaged at a training cost of about £3,500, and 165 resigned. Forty-nine drivers left and 32 were replaced by conductors trained at a further cost of, say, £1,250, . In four selected undertakings, the cost of holidays per man per annum had risen from £6 2s. 2d. in 1937-38 to £16 6s. 11d. in 1948-49. Likewise, evidence from six operators showed that the cost of sick pay per man employed per annum had risen from Li 12s. in 1937-38 to £7 10s. in 1948-49.
Big Increase in Wages
Excluding spread-over payments, overtime within the standard week, superannuation-equalization . charges and sundry enhanced rates applied in many undertakings, the cost of employing a municipal bus driver per week had risen from £4 Os. 6d. (Is. 8d. per hour) in 1938 to £6 I6s. 2d. (3s. Id.) in 1949.
Apparently, the labour cost of repairs and maintenance had increased by 78 per cent., and taking a national figure the total cost of this work had advanced
by 127 per .cent. per, bus-mile. The increase in material costs had been much steeper than in labour charges. "The fantastic rises in the prices of certain -chassis parts .make one feel that a little, of the pre-war competition from independent, producers would bring" things back to earth," Mr. Cooper remarked.
Complaining of the high incidence of purchase tax on materials, he commented: "The preponderance of passengers comes from the working classes and the burden of fare increases falls with greater proportionate weight on the budgets of the lower-income groups. May we not be reachiag a stage when our purchase-tax payments _ are being used to aid the less-well-6ff worker, to pay purchase tax, directly . and
indirectly? Is our industry, then, an instrument just to take it from one of his pockets so that it may be put into another?: If . so, has not, the time arrived for road passenger transport to be excused from payment of purchase tax?"
Although income had more than doubled in 10 years, it had . not kept pace with costs, and evidence available showed that this tendency was emphasized in the current: '.year.. Gross anomalies had been created by allowing fares sYstems to be influenced bY the principle of charging what the traffic could bear. The most glaring example was the so-called workman's fare.
"There does seem to be a possibility," said Mr. Cooper, " that in the general fare increases that are taking place, an opportunity presents itself to get back to a fare system which is a system, not that recent experience shows that we are likely to get much help in the vexed question of workmen's fares."
A year ago, more than half the municipal undertakings had increased fares since 1938, and to-day the figure was nearer 75 per cent. Generally, it was the small and moderately sized municipal undertakings which had not had to raise charges. In Mr. Cooper's opinion the main reason was that before the war they had a greater margin of spare seats per vehicle. In many cases, doubledeckers could be substituted for singledeckers without increasing mileage.
Dealing with capital charges, the speaker said that between 1938 and 1949 the cost of a tram had risen by 175 per cent., of a trolley bus by 125 per cent, and of an oil-engined bus by 112 per cent.
In 1937-38, municipal' operators owned 8500 vehicles, costing nearly £14,000,000; depreciation or debt charges amounted to £1,359,000. By 1947-48 the fleet had increased to 12,000 vehicles, with a capital value of £26,500,000, yet the comparable depreciation—obviously influenced by the number of old machines being operated —was lower at £1,255,000.
Allowing for the higher capital cost per bus and assuming that the total number of vehicles did not increase, it seemed that the asset value would have increased from £26,500,000 to £42,000,000 and the depreciation charge would be over £4.000,000 per annum. After allowing for Working expenses and depreciation, the balance of receipts at March 31, 1948, was £2.600,000. During the year just ended, this figure would have been drastically reduced.
" It seems clear, therefore," Mr. Cooper declared, "that there is not the slightest possibility, on 1948 fare tables, of municipalities as a whole being able to meet their debt charges at a normal pre-war rate when vehicles are replaced as they should It seemed that with the upswing of costs, municipal fares must tend tO rise. Something could be done to ease the impact.
Doubts on Nationalization If the Transport Act were mandatory in its attitude to. _municipal transport, "we should get ahead with all speed," he said. if, on the other hand, it were permissive, and nationalization was continuously to hang over the heads of municipal undertakings as something that might happen, the situation created would not he -in the hest interests of municipal transport. -Mr.-Coimar asked for a quick and sure answer to this
miestion. . : ,••
He also declared that the time had come 'to : relieve; through -4661 or national • taxation, the unreasariable obligations and .heasiy...Ananeial-thUfdens on' tramwaSTs and trdlle'YbUses.