Budget 2024 rail investment supports reliability and value for money

The Government’s $466 million Budget 2024 investment in rail highlights a commitment to reliable public transport in Auckland and Wellington and supporting export growth nationally, KiwiRail Chief Executive Peter Reidy says.

The metropolitan rail networks

Budget 2024 includes $159 million to complete Auckland’s Rail Network Rebuild and $107 million for overdue track renewals in Auckland and Wellington and assistance covering council contributions.

Mr Reidy says the significant investment will help to raise network condition and support passenger and freight growth. 

“We fully appreciate the Government’s need to manage spending and are thankful for this healthy investment in rail - which will be going where it is most needed.

“There is a lot of maintenance required each year on both the Auckland and Wellington metro networks, which are mostly used by commuter trains. The networks include complex track structures, overhead power, signals and complicated telecommunications systems. Historically metro maintenance has been underfunded, creating a backlog of renewals work that has resulted in faults and issues that cause disruption for commuters.

“The Rail Network Rebuild in Auckland is addressing the highest priority issues and is crucial for allowing more frequent trains across the city once the City Rail Link opens in 2026. We have already completed rebuild work on the core network, and the funding in Budget 2024 will allow us to finish the job, replacing aging track foundations and improving drainage on the outer parts of the metro network.

“In addition, the Government has committed funding to cover other needed historic track renewals in both Auckland and Wellington and is topping up Auckland Transport (AT) and Greater Wellington Regional Council’s (GWRC) annual contribution to network maintenance for the coming financial year (FY25).

“Like local roads, metro rail infrastructure is co-funded by the Government and councils. As the main users of the metro networks, AT and GWRC fund most annual maintenance and renewals costs and NZTA pays for 51% of their costs. I appreciate the financial pressure on councils and that they have struggled to meet the full rail costs in recent years – but it does put limits on the maintenance work KiwiRail can do.

“We all agree that the current funding model is no longer working and earlier this year we welcomed Transport Minister Simeon Brown launching a review of the model. The Government’s addition to the council contribution in Budget 2024, while the review is ongoing, will help ensure we can do the required work this coming financial year. It means we will be able to raise the condition of both networks and help ensure reliable trains for commuters.”

The national rail network

Mr Reidy also welcomed additional funding for the national rail network, through the next Rail Network Investment Programme (RNIP).

“Over the last three years we have been focussed on raising the standard of our national rail network, and the Government commitment in Budget 2024 will help us continue that work. Rail carries 25 per cent of exports, and upgrading our rail lines will contribute to the Government’s goal of growing New Zealand’s export economy.

“The $200 million top up for the RNIP lifts the next two years of committed funding for the national network to around $900 million, meaning similar levels of funding to now will continue.

“We have new locomotives and wagons arriving in the next few years to replace much of our aging fleet. This continued Government commitment to the network is an important part of delivering reliability for our customers and growing rail freight in New Zealand.”

The next RNIP will be finalised and approved by the Transport Minister later this year. In advance of this, KiwiRail will demonstrate our plan to prioritise reliability and productivity, strengthen the connection New Zealand businesses have to export markets, and address safety critical asset risks. Value for money will underpin the RNIP programme.