Cabinet hasn't discussed Interislander replacements - Willis

Public Service Minister Nicola Willis. File photo
Finance Minister Nicola Willis. File photo
By Jo Moir of RNZ

No discussions or proposals for replacement ferries have gone to Cabinet in the nine months since the coalition government cancelled the new fleet.

The government has been considering advice on replacement options for the Interislander ferries since June.

Finance Minister Nicola Willis says a decision will be made by the end of the year.

All three coaltion parties have differing views on KiwiRail and the types of ferries needed, but Willis said it would be "premature" to blame the time taken to make a decision on a lack of consensus.

On Monday she told reporters ministers were continuing to "take advice" and the governing parties were "all engaged in the process ... testing proposals and asking questions".

On Tuesday, ACT's David Seymour revealed there "hasn't really been a discussion amongst the parties" on the issue.

"The Minister of Finance is mainly responsible for this as the shareholder for KiwiRail, and I expect she will bring some proposals to Cabinet and we'll debate them like anything else."

Asked by RNZ to clarify the discrepancy between her comments and Seymour's, Willis said she had been referring to discussions between ministers happening outside of Cabinet, and no proposal had yet gone to Cabinet.

She refused to say whether the ferry replacement options had been discussed at Cabinet committee - the step before full Cabinet where issues are ironed out.

David Seymour. Photo: RNZ
David Seymour. Photo: RNZ
Willis confirmed a formal proposal exists "and it's being discussed between ministers". She told RNZ she had several conversations with Seymour about it.

His view was New Zealand had a "shortage of money" and every dollar spent on ferries needed to be assessed against a cost-benefit analysis.

"The government is broke too, I'm afraid to say, and every time we spend a dollar on a ferry we can't spend it on a classroom or a hospital."

ACT's long-standing position is that state-owned enterprises like KiwiRail should under be a mixed ownership model.

"That way it's up to the private investors to decide if it's a good use. If no one will put their money in, maybe they're trying to tell us something," Seymour said.

"However, that's not the government's position - its position is that we continue to own SOEs and if the Crown is going to give taxpayer money to an SOE then we have cost-benefit analysis and really good policy."

Two rail-enabled ferries were set to be delivered in 2026 under the old plan, with an indicative business case agreed to by the Labour-New Zealand First coalition government in 2018.

Construction had not yet started in December when the deal was canned, and a ministerial advisory group was tasked in February with coming up with an alternative plan.

The cost at the point the contract was terminated had hit more than $3 billion and KiwiRail had requested an additional $1.47b, all of which Willis declined.

New Zealand First has been public about its preference for rail-enabled ferries, campaigning for them in multiple elections.

One of its senior MPs Shane Jones said whether the ferry replacement option needed rail enablement was an issue being discussed by the party's MPs.

"New Zealand First is particularly committed to rail, but it's a matter that's being teased through with our coaltion partners, and it's an item of discussion with our caucus."

Jones evaded questions about whether the options being considered by ministers would keep the ferries in public ownership, or shift to a private model.

Labour's deputy leader Carmel Sepuloni took a swing at New Zealand First, saying it was at the Cabinet table when the government signed up to rail-enabled ferries, which are needed.

"It absolutely would come with a cost, but it's more of a cost if we're not connected up in the way we need to be through rail. More trucks on the road, which is going to cause more damage to our roads and it's not what we want."

Sepuloni told reporters Willis should resign if the alternative ferry replacement plan ended up costing more than $3b.

"She should also be questioning herself and her inability to land this, the way in which she came out too quick at the beginning to cancel the deal with no plan in place," she said.

"Now we have no ferries, we're short on how many millions of dollars, and they still can't make a decision."

Willis said her ferry proposal would not cost more than $3b.