Kiwirail in the past couple of weeks hasn’t been having a PR fun-filled time, with ferry strandings, the collapse of a tunnel roof, a Transport Accident Investigation (TAIC) report into a Bay of Plenty derailment caused by adverse weather and the not-very-well timed resignation of the board chairman.
Finance Minister Nicola Willis is right in saying KiwiRail needs a bit of a shake-up but it’s not all its fault, constrained by government interference, policy changes and new governments coming into power thinking they know what needs done.
The ferry debacle was doomed from the start; the ferries themselves were cheap but the infrastructure costs at both Wellington and Picton were the issue, with requirements for earthquake protection and requirements of the Resource Management Act putting costs through the roof.
The trouble with government state-owned enterprises, such as KiwiRail, is the requirements they have to work under and the gold-plated options they take.
Commentators are right that instead of two large rail ferries, three smaller ones would have been a better option, able to use the current facilities at either end of Cook Strait which would have saved a huge amount of money.
The Tawhai tunnel roof collapse will affect one of KiwiRail’s most profitable income streams, with the transport of coal from Ngakawau to Lyttelton potentially out of action for months. The coal will have to be roaded from Ngakawau to Ikamatua which will adversely affect the road network and also put hundreds of additional truck movements on the road.
The TAIC report on the derailment in the Bay of Plenty was a bit of a comedy of errors, with the track inspector surveying the wrong portion of the track before the train derailed due to flooding. It was not a good look.
What amazed me were the comments made by Naveen Kozhuppakalam, the chief investigator of accidents, who referred to the accident as it could have been a potential Tangiwai disaster. The comparison of a freight train derailing on a flat piece of track due to heavy rain (and which doesn’t have any passenger trains operating on it) has no comparison to a Christmas passenger express train plunging off a bridge due to a volcanic lahar.
Rail is the second-safest mode of transport after flying and does have a good record: making comments like this does not show rail in a good light in regards to its record in passenger safety.
Rail is supposed to be a major contributor to national and regional economic growth. It reduces emissions, congestion, road deaths and injuries, delivers wider social benefits, and provides resilience and connection between communities.
A nice thought but as an SOE, and therefore expected to be as profitable and efficient as a comparable businesses not owned by the Crown, KiwiRail can diverge itself from rail lines services or even rail ferries if it’s not making a profit.
This strategic asset of the rail network — and this includes the rail ferries — needs to be secured, and rail needs to be opened up to other operators where a bit of competition can bring down prices.
Allow private enterprise to invest in rail and they will do it cheaper, without the constraints of being an SOE.
Labour in its last term invested heavily in rail, and that was overdue, but they were giving it to just one entity — KiwiRail — without much oversight.
The rail ferries should be classified as a "below-rail asset" and owned by the government, as they are of strategic importance to allow the free flowing of freight across Cook Strait.
But the rail connections to it should be opened up and we may see more investment in passenger rail and a bit of competition bring down freight rates.
National, on the other hand, has not shown in the past much enthusiasm for rail and it’s understandable they have put the brakes on the new ferries, but they can’t just let it die.
They need to look at all options for replacement rail ferries — and they do need to be rail ferries to allow the easy flow of freight between the islands.
Even Don Braid, the chief executive of Mainfreight, New Zealand’s largest logistics company, says the government focus on rail services is long overdue and he is a believer in getting freight off roads and on to rail for most of its journey.
If this happens we need rail ferries and a more competitive rail system for that to work.
• Grant Craig is president of the Federation of Rail Organisations of New Zealand.
