1948-1949 — Page 4

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all types, and of them no less than 20 are over 30 years old. The most ancient are 7 of 39 years, 7 of 38, and 6 of 35 years; 2 are 29 years, and 6 are 27 years old. It is not surprising, therefore, that maintenance costs are heavier than they should be and that the need for new rolling stock is urgent. The serious accident at Pu Kut in Chinese Territory on September 3rd, 1948 referred to later in the report, resulted in the total destruction of a second class coach, for which compensation was received at its book value. The loss was offset by the purchase of two Wagons-Lits underframes and their reconstruction as second class coaches for an inclusive cost of $137,245.61.

6. The running costs with fuel oil gave some concern. At the beginning of the year the cost was $141.90 per ton. From this figure it increased to $154.30 in July, dropping again in the same month by $8.00 to $146.30. Again in August the cost rose by $5.00 and descended to $141.90 in January 1949, and finally to $133.90 at the close. Under these fluctuating price conditions, it would have been more economical to have used coal for the through express work; but unfortunately this was not possible since the Hulson grates, rocking bars and ash pans for the coal- burning 2-8-0 Austerity locomotives had not arrived from the United Kingdom. However, the greater experience gained by the locomotive crews in oil-firing enabled economies to be effected and the final results were not unsatisfactory.

7. Relations with the Chinese Section have been cordial, but have contributed little towards any improvement in operating, because the Canton-Hankow Railway's system is centralised at Hengyang, and there is no one at Canton with power to take decisions on matters of importance to the British and Chinese Sections.

8. The local passenger traffic exceeded the revenue estimate by some 5 lakhs brought about, as explained elsewhere in the report, by intensive short journey travel across the border and back. The figures constitute a new record.

9. The formation of a Railway Police Unit recruited, trained and selected from the Colony's Police has justified itself from every point of view. Not only has Railway property been effectively safeguarded and good order maintained, but increased revenue has been secured as a result of its assistance on surprise train checks in the company of the ticket inspection staff. unit is in charge of a Chinese Senior Inspector who, since his appointment in October 1948, has been responsible for no less than 152 convictions up to the end of the financial year.

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10. The credit figure for locomotive haulage by British Section engines was reduced from that of the former year's sum of $150,674.94 to $2,525.25 since the Chinese Section had requested that the ratio be kept as near 4 to 1 as possible. They were the better able to carry out this programme due to their obtaining an improved quality of coal. Another consideration was their desire to incur as little expenditure as possible in Hong Kong dollars.