Non-rail Ferries Risk Costing NZ $3.3b A Year

With the Coalition Government partners negotiating their plan for a replacement for the iReX ferries this week, the Rail and Maritime Transport Union (RMTU) is warning of the huge risk to New Zealand of choosing ferries with no rail capability.

The call follows the release of a new report from EY that shows that rail creates $3.3b worth of value to New Zealand, with much of that benefit accruing to road users.

RMTU General Secretary Todd Valster says taking rail off the Strait would be economic sabotage.

“With no rail capability on the Interislander, the Christchurch to Auckland rail freight route will be unsustainable, and that puts the viability of the entire rail network at risk.

“That’s $3.3b dollars of value to our economy at risk, not to mention the loss of competition and cost to freight customers that removing rail from the freight market would create.

“Incredibly, the Minister of Transport has admitted in Parliamentary written questions that he has received no advice on these costs, even as the Government prepares to make a decision on whether or not to have rail-enabled ferries.

“Rail is the car driver’s best friend – it takes heavy trucks and other commuters off the road and reduces congestion. Expanding rail should be a priority for any government that wants the roads and the rest of our transport network to run smoothly. It is great value for money, generating $8 in benefits for every dollar the government invests.

“If this Government was actually serious about driving growth, getting people moving on our roads and improving safety, it would be investing to move more freight and passengers on to rail. Instead, its new transport plan has slashed hundreds of millions from rail funding over the next three years.

“It’s ironic that the Government is spending hundreds of millions filling potholes created by trucks, at the same time as it is trying to force more heavy trucks onto the roads by cutting rail funding. If the Government really wanted fewer potholes, it would be working to get freight off trucks and on to rail.

“We are calling on the government to stand by our rail system and the New Zealand industries that rely on it by making sure any new ferries they put on the strait are rail-enabled. Our economy and our environment depend on it.”

According to EY the value of rail is $3.3b and is comprised of:

• $1.5b in time and congestion savings for road users because rail carries freight and passengers that would otherwise clog roads
• $291m in avoided health problems that would come from more diesel trucks on the road
• $226m in reduced fuel costs to the country compared to moving freight and people by road
• $161m in safety savings. An absence of rail would lead to 8 more deaths and 202 additional injuries through road crashes
• $42m in reduced maintenance costs by removing heavy trucks from the roads
• $36m in greenhouse gas emission savings because rail is more fuel efficient than trucking

Note: written parliamentary questions in which the Transport Minister has confirmed that he has no advice on, or modelling of, the economic impact of removing rail from Cook Strait:

43832 (2024). Tangi Utikere to the Minister of Transport (16 Jul 2024): What advice or modelling, if any, has the Minister received on the impact that having no rail-enabled ferry for the Cook Strait would have on freight contract costs?

Hon Simeon Brown (Minister of Transport) replied: I have not received any such advice.

43834 (2024). Tangi Utikere to the Minister of Transport (16 Jul 2024): What advice or modelling, if any, has the Minister received on how many freight trucks would be needed on New Zealand’s roads if there were no rail-enabled ferry for the Cook Strait?

Hon Simeon Brown (Minister of Transport) replied: I have not received any such advice. I note that rail freight is regularly carried by KiwiRail on the two ships that are not rail-enabled, particularly when the Aratere is out of service.

43842 (2024). Tangi Utikere to the Minister of Transport (16 Jul 2024): What advice, if any, has the Minister received on the number of freight truck trips that would be taken on New Zealand roads if there was no rail-enabled ferry for the Cook Strait?

Hon Simeon Brown (Minister of Transport) replied: I have not received any such advice. I note that rail freight is regularly carried by KiwiRail on the two ships that are not rail-enabled, particularly when the Aratere is out of service.

43844 (2024). Tangi Utikere to the Minister of Transport (16 Jul 2024): What advice or modelling, if any, has the Minister received regarding transport emissions if there was to be no rail-enabled ferry for the Cook Strait?

Hon Simeon Brown (Minister of Transport) replied: I have not received any such advice.

43846 (2024). Tangi Utikere to the Minister of Transport (16 Jul 2024): What advice or modelling, if any, has the Minister received regarding the costs of road network maintenance if there was to be no rail-enabled ferry for the Cook Strait?

Hon Simeon Brown (Minister of Transport) replied: I have not received any such advice. It's worth noting that trucks pay road user charges to contribute towards road maintenance, which this government has increased for state highways by 91% over the last NLTP period.

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