Why Regain Ownership of Rail?

27 Mar 2001

Subjects: Rail, Transport

See also Questions & Answers and the Green Party Strategy to save the NZ Rail Network.

	Rail use reduces climate change emissions and energy use:		Trucks use around five times more energy (and hence produce around five times more CO2 emissions) per tonne kilometre than diesel-powered trains. Trains carry about 13 per cent of freight but only account for around 4 per cent of energy used in moving freight. (EECA, 2000)
	New Zealand relies on roads heavily already:		New Zealand has one of the highest vehicle per capita ratios in the world: one registered motor vehicle per 1.35 people. We transport 61 per cent of freight by road, 13 per cent by rail and 26 per cent by coastal shipping. (EECA, 2000)
	More trucks means more accidents:		Trucks were involved in 97 out of 508 road fatalities in 1999 (almost 20 per cent). ACC employee premium levels per $100 of wages are revealing as an indicator of safety and accident levels: road freight transport $3.06; rail transport $1.62.(ACC, 2000/2001)
	A log-jam is coming:		As New Zealand forestry projects come on stream, major pressure is about to be put onto our freight systems. MAF forecasts potential wood supply to increase from 18.3 million cubic metres in 2000 to 30 million cubic metres by 2006. On the East Coast, logging trucks are estimated to increase in the next few years from 10 - 20 a day to 300 - 400 a day, largely because of a lack of investment in rail. In Northland, up to 700 truck movements a day could be needed for freight from the new Whangarei port, unless a new spur line is built to connect the port to the main railway track. In Rotorua the Waipa mill sits just a few kilometres from the Rotorua rail line - a line earmarked for closure.
	Rail maintenance is run-down:		Aside from some specific big projects like Christchurch's freight centre, Tranz Rail's capital investment in its tracks and signalling nationally has barely kept pace with depreciation. There is no longer a centralised train control system in place for all lines, and the signalling in Auckland needs massive upgrading if passenger light-rail services and freight services are to operate together safely. Long distance passenger rolling stock dates, in some cases, from the 1930s and does not meet modern safety standards. The Napier-Gisborne line is at risk of closure. An overhaul costing $5-10 million would bring it back to full operation.
	No national rail strategy exists:		The Government has said they are working on a rail strategy, but there is no sign of it so far. However the Minister assisting the Prime Minister on Auckland issues, Judith Tizard, told Parliament on 13 December 2000 that the best way to meet the rail access needs of Auckland without disadvantaging neighbouring regions and the rest of the country would be to develop a national rail policy.
	Tranz Rail is an overseas monopoly:		New Zealand Rail was sold in 1992 for $328.3 million to a consortium lead by American rail company Wisconsin Central Transportation and merchant bank Fay Richwhite. The company owns the trains and the tracks, but leases the land the track sits on for a nominal rent of $1 per year. The $328 million was funded by $220 million borrowed by Tranz Rail and $128m from investors. Investors then took $100 million capital out of the company in 1995. (Herald 21.10.00)
	Restructuring means the end of the network:		Tranz Rail has announced that it plans to sell passenger services, close currently unprofitable lines (such as Rotorua and Napier-Gisborne) and contract out maintenance. The contract between Wellington Regional Council and Tranz Rail to provide Wellington with commuter services runs out at the end of June.
	Roads are subsidised compared to rail:		Roads don't have to earn a rate of return. Rail investment comes entirely from the private sector, whereas public roading investment comes from the public sector, including both road users and local ratepayers. Trucks pay for only 45 per cent of the annual costs of the road network. Road users don't face the cost of environmental damage. The global and local environmental costs of roads and their use are huge and well-documented. While neither roads nor rail face their true environmental costs, those costs are much larger for road than for rail. Roads don't face their full safety costs. Rail operates a much more stringent safety regime than road users and is making further improvements. The Rayner report (2000) commenting on rail safety said: "[if the cost of a new rail safety regime] would result in traffic transferring onto road, [it would] exacerbate an already hazardous situation."