Pine Bluff daily graphic., 1917-12-24
HOW ENGLAND HAS
 SOLVED RAILROAD
 PROBLEMS Of WAR
Carnegie Peace Endowment Published Report of In-
 vestigation of Methods.

Washington, ID. O., Dec. 23.-How England has relieved her railways of { financial difficulties during the war and left the managers free to devote I all their energies to moving the great volume of traffic, is to be told in a l special report on the English railways in war soon to be published by the i Carnegie Endowment for Interna- tional Peace. The study has been made by Prof. Frank H. Dixon of Dartmouth and Dr. Julius H. Parme- lee of the Bureau of Railway Eco nomics. Because of the measures about to be taken by the administra-| ton to unify American railway opera ton and provide for the financial necessities of the carriers, an advance abstract of the Carnegie report is re- leased for public information.
 The essential features of the Eng fish railway mobilization plan in clude operation of the lines by the same officials and employees as be- fore the war with the exception, of course, of the men called to the colors cabinet officer at the head of committee of railway operating officials, in existence before the war, under an act of Parliament more than 40 years old; the transport of all government business without the ne- cessity of routine payment for each specific service; the guarantee by the government to the railway com+ panies of the same net earnings that they had in the last year of peace; l the equitable settlement of all labor disputes by the payment of war bonuses.
 The merit of the English plan, as stated by F. A. Mckenzie, a British financial authority, is that the in | terests of the railway shareholders having been assured, the companies were able to devote themselves to the
 work of economical and efficient dis l tribution, without worrying over the usual and unusual financial problems.
 Operated by Railroad Men.
 England declared war on Germany August 4, 1914 At one minute after
 midnight on August the railroad
 systems of England, Scotland and
 Wales passed under the control of
 the Central Railway Executive Con-
 mittee vested with governmental
 powers under law put on the statute
 books in 1871.
 At the head of the committee is the
 chairman of the Board of Trade, a
 cabinet officer leading the department
 roughly corresponding to the United
 States Department of Commerce and
 Labor. The active head of the Brit
 ish committee, however, is a railway
 executive. Sir H.~>A. Walker of the . London Southwestern railroad. . Net Earnings Guaranteed. The law under which the govern . ment took over the railroads required : it to render them full compensation ! for loss or injury sustained because . of government control. To carry out this provision of law the government , made an agreement with the railroad t companies, the principal features of ! which are:
 1. That the railroads place their t entire organization at the disposal of 3 the military authorities and handle { traffic in accordance with, directions <. from them.
 2. That the government periodical i ly pays to each road such sums ot 2 money as are necessary to make Its net income for the period equal to :: it's net income for the period equal tc <. it's net income for the corresponding period of the calendar year 1913. In :. other words, the last year of peace .. was taken as the basis of payment. New Capital Provisions. Several notifications of the agree < ment have been made. The first modification covers the question o1 fixed charges on new railway capital i invested during the war period ! Fixed charges are, of course, paid out of net revenue. Under the agree <. ment as originally made company s compelled by military or other exi. gency to enlarge it's facilities would automatically be placed in worse < position than a road on which nc such exigency occurred. Accordingly early in 1917 the government agreed {. to allow per cent interest on all capital invested in new railway prop {. erty since August 4, 1914.
 { The second modification covers the s question cd deferred maintenance E Under war conditions the English t roads found it difficult to maintain normal maintenance either on way and structures or on equipment. Yet deferred maintenance was properly < chargeable to the expense account O1 the year, during which the wear and ] tear of service made the maintenance { necessary. Accordingly, early in 1917 the English government permitted . the railroads to enter reasonable ! charges for maintenance in their operating expense accounts. If such . maintenance charges were not wholly expended the deferred portion was
 credited to reserves to be drawn upon
 later
 Efficient Operating Results.
 Despite the loss of some 100000
 employees who enlisted for service
 at the front, the physical operation
 of the British railroads under the
 agreement with the government has
 been a success. They have furnished
 the largest amount of transportation
 in the history of the country, with a
 smaller and less skilled labor force.
 Radical measures to improve the
 car service situation were not under