Dunedin's Hillside Workshop will receive an $85 million boost for new facilities to assemble wagons.
The funding, part of the 2021 Budget announcement made this afternoon, will see the workshop assembling about 1500 wagons.
State Owned Enterprises Minister Dr David Clark said the investment meant local jobs, rebuilding expertise, youth training opportunities, a boost to Otago’s economy, and a more self-reliant railway.
“The Hillside Workshops have been an important part of Dunedin's history and economy for over 100 years and we’re building off the nearly $20 million investment we made in 2019 to re-establish them as a mechanical hub.''
Transport Minister Michael Wood said about 445 jobs would be created between Hillside and a new South Island Mechanical Maintenance Hub in Christchurch.
The Hillside investment alone will support up to 150 construction jobs and up to 45 operational KiwiRail jobs, including apprenticeships.
“Covid-19 supply chain disruptions have reinforced the importance of having a resilient and reliable rail freight network.
Mayor of Dunedin Aaron Hawkins welcomed the announcement, calling it "great news . . . for rail and engineering in Dunedin".
"Ever since Hillside was brought back to life by the PGF investment, we’ve been waiting to see the plan for it.
"This is a credit to campaigners like Clare Curran and Jim Kelly, who refused to give up the fight for its future.
"Rail has to be a bigger part of a climate friendly transport network, and where better to do it than at the spiritual home of rail in the South?"
The move confirms a pitch made by KiwiRail in December, which the Otago Daily Times revealed earlier this month.
Leaked documents showed KiwiRail wanted $90m for Hillside, comprised of $55 million for the premises and assembly plant, and $35 million for operations.
KiwiRail predicted it would create an estimated 150 construction jobs, 40-50 assembly jobs, and up to $21 million in indirect and direct economic benefits.
