INDEPENDENT NEWS

Government investment for rail turnaround

Published: Tue 18 May 2010 12:14 PM
Hon Steven Joyce
Minister of Transport
18 May 2010 Media Statement
Government investment for rail turnaround
The Government's commitment to invest $250 million to support the KiwiRail Turnaround Plan will help increase New Zealand's economic productivity and put us on the path to faster growth, Transport Minister Steven Joyce says
The Budget 2010 appropriation is the first round of Government support for the objectives of the $4.6 billion Turnaround Plan.
The Government has committed in principle to a total package of $750 million over the next three years, with final decisions on funding subject to individual business cases.
“The KiwiRail Turnaround Plan is designed to see the rail freight business become sustainable within a decade by getting it to a point where it funds its costs solely from customer revenue,” says Mr Joyce.
“In fact, the lion’s share of the $4.6 billion will come from the business itself.
“The government investment reflects the fact the amount of freight being moved on New Zealand’s transport network will double by 2040 and all transport modes need to become more efficient to meet this demand.
“The government is committed to retaining and improving the rail freight network and is providing KiwiRail the capital investment to demonstrate it can become commercially viable and make a valuable contribution to the New Zealand economy.
“To do this, it will need to focus on the areas where it can increase revenue, become more efficient and carry more – primarily bulk and long distance freight.”
Mr Joyce says stringent conditions for government funding will be set to make KiwiRail accountable to taxpayers.
“Funding, while committed in principle, will depend on meeting the government’s performance measures.
“Achieving this turnaround will be a challenging process and requires the support of every KiwiRail customer and employee,” says Mr Joyce.
Questions and answers are available on the Ministry of Transport website: www.transport.govt.nz
ENDS

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