Following decades of neglect, recent years have seen an unprecedented level of Government investment in rail which is gradually reinvigorating New Zealand’s vital national rail network.
The largest rail capital projects since World War II are now underway. In time, these will enable KiwiRail to translate customer demands into improved services and underpin the company’s pathway to profit.
This is a watershed period for KiwiRail, as we swing into development mode alongside business as usual.
Currently, only 12 per cent of total freight and 25 per cent of exports, in New Zealand travel by rail and our aim is to increase those numbers.
Our strategy to return to profitability and deliver a good return to our shareholders is threefold. We aim to run more services, get the equipment we need to be able to grow capacity, and put in place the technology that will enable us to track freight, make it easier for our customers to do business with us, and track profit and loss centres.
Not only does moving freight by rail produce 70 percent fewer emissions than road freight, it lowers roading costs and reduces congestion by taking commuters and freight off the roading network.
Government funding for rail includes more than a billion dollars through the NZ Upgrade Programme to:
This builds on a $196 million investment in the Wellington metro network, which includes double tracking between Trentham and Upper Hutt and raising the standard of the aging Wairarapa Line, including Remutaka Tunnel.
In addition, the Government has invested $3.5 billion through Budgets 2019 – 2021, to replace aging locomotives and wagons and maintain and renew the national network. This investment is seeing KiwiRail:
The Government’s NZ Rail Plan is another crucial development which supports KiwiRail’s commercial sustainability by introducing a new model for ongoing network investment and maintenance. It will see tracks, bridges and other infrastructure funded from the National Land Transport fund, so rail is considered alongside roading investment.
KiwiRail has developed a Rail Network Investment Programme (RNIP) which covers renewals and maintenance over the next three years. It enables infrastructure investment certainty, confidence about jobs and assurance to our customers.
KiwiRail has also seen $470 million for a range of regional projects through the Government’s Provincial Growth Fund. This includes $218m to save and upgrade the Northland Line, and to start purchasing land along the designated spur route to NorthPort. The Northland Line now has five new bridges and 13 tunnels lowered so that hi-cube shipping containers now run through them. In 2022 we will begin work on the line north of Whangarei to Otiria, which is currently mothballed.
Other PGF funded projects include: