Labour: KiwiRail Plan “Miserly”


Labour is calling the government’s investment in KiwiRail “miserly.”

And other reaction is mixed.

Labour MP Darren Hughes says the Government’s “tentative support of KiwiRail is to be applauded but in the wider transport context it shows Transport Minister Steven Joyce remains obsessed with building motorways.

“The $750 million dollars for KiwiRail looks miserly when you consider Steven Joyce has committed $11 billion to build his ‘Roads of National Significance’.

He thinks National’s reluctant commitment to KiwiRail is a sign of a Government that would prefer to see more heavy freight on our roads than on rail. Labour also urges the Government to think very carefully when considering closing regional lines.

Many of those lines are vital in emergencies and are operating effectively.“

Rail must be a vital part of New Zealand’s future freight equation. National’s plan for KiwiRail suggests it won’t,” Darren Hughes said.

A KiwiRail critic, Stephen Selwood, Chief Executive of the New Zealand Council for Infrastructure Development says the Government’s ‘in principle’ agreement to invest provides the company the opportunity to prove it’s long term value as a key component of New Zealand’s logistics network.

“Investment now allows New Zealand to keep its options open for the future.

The key question is whether the amount invested today is sufficient to address the rail infrastructure deficit and how does this fit in terms of an overall freight strategy for New Zealand that optimises the capacity of road, rail, sea and air and our port infrastructure investment?

It is interesting to note that the federal government in Australia has recently launched a freight strategy.

There is no equivalent approach yet planned for New Zealand and it is difficult to see the overall relationship between investments across the modes. We now look to KiwiRail to clearly demonstrate the merits of its business case going forward and how this will sit in context of the overall logistics industry in New Zealand”.

The Contractors’ Federation calls the plan well thought out and well timed.

Federation chief executive Jeremy Sole said: “It is a very good time to do this. As the economy comes out of a recessionary period there are still lots of contractors in the industry with the spare capacity to do upgrade and maintenance work.”

Mr Sole said that the scheme would also provide a major boost for rail freight and its customers.

“The network has been maintained on a shoestring which creates a Catch 22 situation,” he said.

“If you don’t maintain or improve then customers won’t come, but you can’t get customers to come unless you do the improvements.

The minister” also recently indicated that he is flexible with regard to discussions about mothballing lines. If there is a cornerstone customer in the wind and a line looks as though it could run profitably then he will delay any such decisions. Collectively these measures should create enough certainty for many more NZ businesses to once again include rail in their freight strategies.”

The CTU has welcomed the announcement but says it’s only a fraction of what is needed.

Peter Conway, CTU Secretary, said: “The signal of government commitment to improve and retain the network is positive.”

In another recent development, the CTU is also pleased to note that the Expression of Interest document for the Auckland Electric Multiple Units includes strong wording to support participation by local industry including the existing rail workshops.
“The main thing now is to ensure that these commitments on paper translate into actual jobs and local industry participation in part of this major tender.”


Metrorail: Govt confirms fare increases

Government says investment in rail will help when oil prices go up

Union says rail privatisation has been discounted

KiwiRail CEO on what the plan means

Governments $4.6b KiwiRail turnaround plan

Mike Lee calls for more rail investment




  1. Jeremy Harris says:

    These announcements could be a lot worse, a reporter called me today and asked my opinion about the Government’s announcement that they were closing 4 lines..! What..! I said…

  2. Ian says:

    This is a buy off by the government. Give Kiwirail some money, (small, in contrast to the amount being pumped into roads), talk as if you are keen to see Kiwirail do well but close a significant amount of track.

  3. Paul says:

    Here’s what’s on the cards in Aus

    Budget 2010 Project Snapshot
    11 May 2010

    The Federal Government has announced that it would invest $1 billion into Australian Rail Track Corporation (ARTC) to build on existing investment strategies and deliver productivity benefits to the overall economy through investment in transport infrastructure.

  4. ingolfson says:

    Jeremy, in what capacity were you asked? For CBT? And did you “get back to him”?

  5. Joshua says:

    Paul - (First I’ll will be the first to say the funding between roading and rail has not been very balanced and rail is very underfunded), however $1 billion in Australia is also very ‘Miserly’, we have to remember Australia has a higher population greater land mass and greater amount of funds to pull from, comparing the investment the governemnt may argue that the two countries are taking simular approaches. Our arguement need to focus on the years of underinvestment rather than comparing with the likes of Aus.


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