The Government has released a 10-year strategy for rail investment throughout the country which promises a more resilient and reliable network for freight and passenger services.
The New Zealand Rail Plan includes legislative changes which allows KiwiRail to be funded directly via the National Land Transport Fund (NLTF) for the first time.
Launched by Transport Minister Michael Wood and State-Owned Enterprises Minister Dr David Clark, the Rail Plan aims to improve integrated planning and investment decisions across road and rail.
Crown funding to rail will continue both via the NLTF for the rail network, and directly to KiwiRail for its commercial assets.
Track user charges will also be established to ensure rail users contribute to the NLTF.
A Rail Network Investment Programme (RNIP) will also be released mid-year and will set out a detailed work programme.
KiwiRail is currently developing the first RNIP, which will be the basis of funding requests through the NLTF.
Over the last term, the Government has invested more than $6 billion in rail. This includes a $1b investment through Budget 2019 and a further $1.2b from Budget 2020.
Funding has also been provided through the NZ Upgrade Programme and through ‘shovel-ready’ infrastructure projects through the COVID-19 response and recovery fund.
The plan outlines strategic priorities for rail in two parts including:
- Part A: Establishing a new long-term planning and funding framework under the Land Transport Management Act 2003
- Part B: Investment priorities for a resilient and reliable rail network including investing in the national rail network to restore rail freight and provide a platform for future investments for growth, and investing in the metropolitan rail network to support growth and productivity in the largest cities.
Wood says rail is key to keeping New Zealand moving and supporting economic recovery.
“The disruptions to the supply chain due to COVID have shown how important it is to have a reliable rail network to keep freight flowing, which keeps our economy moving.
“The Rail Plan shows how we’re getting rail back on track after the former government let it slide into managed decline,” he says.
“Rail is worth up to $2.1 billion to our economy every year and reduces emissions and congestion. Annually it prevents 2.5 million tonnes of CO2 emissions and 26 million car trips in Auckland and Wellington,” Wood says.
Clark says investing in infrastructure like rail creates hundreds of jobs which is part of the Government’s COVID economic plan.
“KiwiRail’s work renewing the Northland Rail line supported more than 560 jobs, and work to replace the existing maintenance building at Hillside will support around 100 more.
“Our investments like the new Hamilton to Auckland service Te Huia meant 40 new staff and apprentices have been taken on at Hutt Workshops.
“We’re building a sustainable 21st century rail network and supporting jobs,” Clark says.
KiwiRail has ‘certainty’
KiwiRail chief executive Greg Miller says the Rail Plan sets the course for a resilient and reliable network.
“The beauty of the rail plan, and the related work programme, is that for the first time KiwiRail has certainty about investment in the network,” he says.
“For us, that means we can recruit staff and take on apprentices knowing that a 10-year pipeline of work is in front of us.
“It also gives us certainty about procurement because we know there will be investment in the network.
“Our customers also get certainty through this process, enabling them to invest confidently in their own businesses knowing which rail renewals and maintenance will be prioritised, and that the rail services they rely on will be reliable.
“Together, the Rail Plan and the [Rail Network Investment Programme] will support infrastructure pipeline certainty, more effective investment decisions and a reliable and successful service for growing freight and passengers,” Miller says.
“Rail has an essential role to play in our transport system given increasing freight volumes, road congestion and road maintenance costs and the need to reduce emissions.
“The COVID-19 lockdowns last year highlighted the value of rail to our supply chains and New Zealand’s economic recovery.
“Rail is playing a growing role in transport networks internationally and in New Zealand.
“We’re working for our nation’s GDP, working hard for our primary industry import and export partners as well as the larger road transporters in New Zealand, who are increasingly aligning with rail.
“Our customers here be very pleased with the Rail Plan. I am sure it will encourage a greater use of rail and make it a more attractive proposition for other New Zealand businesses, too. That’s good for our business, and for reducing New Zealand’s emissions,” Miller says.
