More Funds For Rail Network And Operations
September 9th, 2008
The Govt will inject another $121m into the rail network as it seeks to revive the railways after decades of neglect. The money, to be spread over five years, is on top of the $80m perviously announced for network and equipment upgrades back in July. Predictably NZ Railways Corporation Chairman, Jim Bolger, has put a positive spin on the funding saying the investment funding will strengthen NZ’s transport sector, enabling it to expand its business in key freight and public transport markets. “We now have a structure and the prospect of funding which will enable the industry to work together.”
Long-Term Funding Still Uncertain. Michael Cullen says with more investment, the rail network will not only carry more bulk goods, but can also increase its role in wagon load traffic, through its network of cargo hubs, and private sidings. In addition, there may be opportunities to increase the numbers of both hubs and sidings to capture yet more traffic to rail. Despite the hype, a number of questions remain unanswered. How exactly the money will be spent is yet to be determined and it remains to be seen if the funding package will be continued if there is a change of Govt. Even without a change to a less rail-friendly Govt, there is no certainty over whether or not additional capital will be available once the announced funding is spent which could top $1bn. This means the long-term viability of the network still remains in doubt. Ad-hoc funding remains the order of the day.
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