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that in Mauritius the Railway is not charged with the interest on capital outlay, but as it is admitted that its continuance is necessary, in any case in the interests of the sugar industry, I do not think that capital charges should be brought in to the account in connexion with the passenger services only.
13. In short, I submit that the argument for the abolition of passenger services over all but the Curepipe-Port Louis section of the Railway is by no means so clear or decisive as the very con- fident conclusions of the Commissioners may seem to indicate, and that it may be found that the most economical stage of operation includes a certain provision for passenger services over the whole system. The main flaw in the Commissioners' argument appears to be that they left out of account the possibility of operating the present services much more cheaply than hitherto, a possibility which has been given practical expression in the current estimates. For other reasons also, I consider that in any case the reduction of the Railway to a goods basis should be carried out more gradually than they proposed, and I believe that the experience gained during the interval will show whether their view or that of the General Manager is correct. In any case the immediate burden involved on the Treasury when the additional outlay on pensions and gratuities arising from reduction to a goods basis is taken into account is no greater. I suggest therefore that the General Manager be authorized to proceed with his programme for the present in accordance with his plan.
14. There is one further point to which I may call attention before concluding the subject of the Railway. In paragraph 14 of their report, the Commissioners comment with some severity on a proposal submitted by the General Manager for the purchase of rail cars for cheaper operation of passenger services. I suggest that the reductions carried out already in the costs of passenger services and the possibility which I have discussed above that the economic minimum as regards passenger traffic may prove to have been reached, indicate that this proposal scarcely deserves the strictures passed on it. I quite agree that the position at present is much too uncertain to justify further capital outlay of this nature and it was by my, instructions that the proposal was left out of account in the schemes of retrenchment submitted with my despatch of the 4th November, 1931. If, however, experience shows that passenger traffic does not decline further, it may well prove worth consideration at a later stage to consider the adoption of one of the types of rail car which are so much more econoinical in operation than locomotive-drawn trains, especially over level stretches of line. I mention the point only to draw attention to the fact that, if it proves that the continuance of a restricted passenger service over the whole system is the most economical method of operation, there still remain means by which the cost of operation can be further substantially reduced.
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15. With regard to the question of relief works dealt with in paragraphs 7 to 9 of your despatch, I consider that as we have so far proceded without recourse to this expedient, it would be advisable to await further developments in regard to the sugar crop, the reaping of which is just beginning, before coming to a definite If the present decision as to the need for actual relief works. slight improvement in the position as regards sugar is continued, it may not be necessary to undertake any of these works merely on the grounds of affording relief from destitution, that is to say, to undertake works at a lower general rate of wage than the normal, simply in order to provide employment. The sugar crop in view is above the average, so far as can be judged, and should serve to improve the immediate position in respect to unemployment, though it should be realized that the effects of unemployment are more noticeable among the artisan and clerical classes in Port Louis than among agriculturists. Nevertheless a good sugar crop will probably provide some mitigation of the position even among these classes. If and when such work is to be undertaken, I consider that the scheme for reconditioning the drainage works around Port Louis would be the most suitable work if the Harbour Works are ruled out of consideration for the time being. The works on La Nicoliere scheme at Midlands reservoir are too far from Port Louis to be satisfactory as relief work and would not provide employment for those who need it most.
16. I do not press at the moment for reconsideration of the I fully agree proposals for extension of the Harbour Works. that it would be inadvisable to consider the raising of any further local loans at the moment, and the proposal for extension of the Harbour Works was dependent upon their being financed from the Colonial Development Fund. They were not suggested as relief works, but it was considered that if these works were to be ultimately undertaken, the fact that they would offer employment to a considerable number of men in the area and among the classes where unemployment is most severe, was an argument in favour of expediting the inception of this work in preference to others. These works are preferable from this point of view to La Nicoliere and have the additional advantage that they are in my opinion an economic proposition while the La Nicoliere scheme is not. I agree, however, that for the time being it is better that the question should be left in abeyance,
I have, &c.,
W. E. JACKSON
Governor.
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Reference
C.O.882/12
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