Municipal passenger services have suffered striking losses of traffic since the Second World War. In 1950–51, 198 million passengers were carried; by 1955–56 the total fell to 163 million, by 1960–61 to 137 million and by 1963–64 to 127 million. The decline has many factors, the most important being the greater use of private motorcars. In March 1951 there were 251,000 private and business cars on the road; 13 years later, in 1964, there were 674,000. These run a considerable milage in towns and not only reduce the demand for public transport but also, by contributing to traffic congestion, increase its cost of operation. The falling off in passenger traffic and increases in the costs of operation have caused municipal transport to lose money in recent years. In 1963–64, of the 10 undertakings, two only made profits on the year's working and in each case the profit was very small. Eight made losses ranging from £1,435 to 249,558, which had to be borne by the ratepayers. This state of affairs is by no means confined to New Zealand. Future prospects are not bright. The managements of local body transport are bedevilled by many problems, not the least being their inability, because of local political pressures, to supply only those services which are justified by purely business facts and judgments.

by Norman Frederick Watkins, M.COM., Research Officer, Transport Department, Wellington.