Rail is back on trackDeputy Prime Minister
“Rail is back on track”
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It is a pleasure to be here tonight to make a small announcement which plays a part in what was a very large announcement made in the Budget yesterday.
In summary the message is this – rail is back on track.
This is not an empty statement, or hollow words.
But a statement of facts, figures, and more importantly, the dollars to back it all up.
And it is a massive forward step for regional development and economic growth, especially for Northland.
First to a small but significant piece to the revitalisation of rail plan.
It’s a pleasure today to confirm that the geo-technical and engineering investigation into the Marsden Point spur line is fully complete, and KiwiRail is making progress with plans to revitalise rail in Northland.
In Oakleigh last January we marked the last of drill required for the geo-technical survey.
And now KiwiRail has a far better understanding of the ground conditions on the route to Marsden Point and Northport.
In conclusion, the survey found that the improvements needed to bring the 100 year-old year Northland line up to standard are relatively straight-forward.
The survey also found that the engineering work on the route will need care in certain areas, but is well within the normal range of expertise held by local domestic design and construction firms.
This means the work on the spur line and the Northland line can be done by KiwiRail and other New Zealand companies.
Completing this investigation - giving us a clear idea of where we stand - is important for when the Upper North Island Supply Chain Study and the Ministry of Transport’s plan for rail investment are finalised around September.
From there the Government will be making decisions about rail investment in Northland.
As KiwiRail’s Chief Executive Greg Miller likes to tell people – 30,000 container loads leave Northland by road each year for the ports of Auckland and Tauranga – and rail is missing a huge opportunity to take some of that freight.
And in yesterday’s Budget the Government made a very large announcement and has secured the big picture for rail.
It secured more than a billion dollar investment in KiwiRail.
It is a milestone moment towards rebuilding the rail system New Zealander’s deserve.
Through Budget 2019 the Government is investing $742 million over two years and has earmarked a further $300 million for regional rail initiatives through the Provincial Growth Fund.
This is about setting up KiwiRail to deliver effective rail services. It’s about addressing the appalling history of under-investment in our rail system over the last three decades, and enabling growth that will ensure rail is sustainable.
The one billion dollar package includes:
- $331m to go towards addressing legacy issues. That’s much needed investment in existing tracks, signals, bridges, tunnels and maintenance facilities to ensure rail is reliable and resilient;
- $375m to go towards replacing the 40 to 50 year-old South Island locomotives and 900 aging container wagons; and improving the layout at the major maintenance depots to set the right conditions for growth;
- $35m for progressing procurement of two new, rail enabled ferries that will replace Interislander’s aging Aratere, Kaitiaki, and Kaiarihi ferries; and
- $300m earmarked for potential investment through the Provincial Growth Fund, allowing for even greater rail growth and supporting economic development and greater connections in our regions.
The Government has already committed more than $260 million through the Provincial Growth Fund.
Projects include improved tourism services in the South Island; reopening the Napier-Wairoa line for forestry and upgrading the Whanganui Line; and funding towards establishing a new, hi-tech road-rail freight hub near Palmerston North to help manage increasing North Island freight volumes over the coming decades.
We know there is a lot more potential for rail in our regions.
We have secured the funding base – and now we need to roll out the plan.
Our Government has a bold vision for rail to be seen in our New Zealand Rail Plan, which will be released later this year.
The plan will lay out our vision for rail over the next decade and the level of investment needed to get there.
It will look at how rail fits into national and regional transport planning, and how rail infrastructure can be funded sustainably.
Through the Budget, the Ministry of Transport is receiving $1m to lead the implementation the necessary changes across the transport agencies.
The fact is we need to get past over-thinking roads as the solution to everything.
Our Government is thinking about the transport network in a strategic and integrated way that will see us well into the future.
We want to see “mode-neutrality” – how you can have the right combination of roads, rail, shipping and the like that works for business and makes people’s lives easier.
So, for Northland the good news is that we are “on-track”.
You might just stay the planets are about to be in alignment.
There are opportunities arriving.
You will be aware the Coalition Agreement signals a significant investment in regional rail
The next steps require KiwiRail’s effort.
It now needs to prepare its application to the Provincial Growth Fund to get the Northland rail line properly back up and running.
And there is not a moment to be lost.
We know that without investment, the Northland rail line would have to close in three to five years.
KiwiRail needs to show that making the necessary improvements to the rail line will translate into regional growth, better connectivity with New Zealand’s largest city, and more jobs.
But we started this process, and signed the Coalition Agreement, because we know the case is compelling in places such as Northland.
And while difficult to prejudge an application to the PGF it is hard to see a contrary argument on developing the Marsden Point link, or even a future when the rail links are entrenched to further North to Otiria or through to Dargaville.
The Government looks forward to receiving Kiwirail’s PGF application.