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Big picture perspective needed on Gisborne transport access

Big picture perspective needed on Gisborne transport access

Media Statement
15 January 2013

“The release today of a Berl review of Kiwirail’s decision to mothball the Napier to Gisborne rail line raises some valid concerns about how strategic transport infrastructure decisions are made in New Zealand, but with such low transport demand in the region, both now and into the future, it is difficult to see how three separate yet competing transport connections for Gisborne can be sustained,” says Stephen Selwood CEO of the New Zealand Council for Infrastructure Development.

Last year Kiwirail determined that, following a washout of the only rail connection linking the city to the main line, there was no justification to repair the track and continue running a commercial loss. According to Kiwirail analysis, the line lost $2.4 million in the year before services were stopped. On this basis, the company has determined there to be no business case for spending an additional $4 million to reopen the line and $6 million annually over the long term to maintain it.

“Berl argue that in this instance a wider economic analysis which incorporates environmental and social impacts on the Gisborne community is required before a decision is made as to the future of the line. While such analysis is required from a national perspective in relation to transport connectivity to the region, it is not required by Kiwirail which operates under a more commercial model.

“There are some convincing reasons to take a wider view of the Kiwirail decision. Rail freight will be moved on to the state highway network with at least some impact on safety and traffic volume; environmental impacts have not been extensively considered, most notably carbon emissions; local interests are not measured; and more intangible strategic benefits to the region and nation are difficult to quantify.

“However, while wider factors should certainly be considered by the Government, it is extremely difficult to see under what scenario reinstating the Gisborne line could become a sound policy decision. Even if freight volumes doubled, the demand for which has not yet been identified, there is more than adequate capacity in the existing road connection. State Highway 2 is currently, and will continue to be, maintained for general traffic.

“It would be great to see a plan for the region that justified investment in both road and rail. With as few as 2000 vehicles per day using the route, even BERL's more ambitious projections of potential growth would still have little discernible impact on the road connection except to strengthen justification for safety improvements on the highway that are already needed.

“Furthermore, while this debate has been framed unhelpfully in the context of road versus rail, potentially the biggest impact of continuing to operate uneconomic rail services is on coastal shipping. Coastal shipping produces fewer emissions than rail and, like rail, is most competitive in the transport over long distances of non-perishable items. Road freight, in contrast, maintains a strong advantage in the transport of perishable goods and deliveries over shorter distances.

“So while the Berl report raises some important issues around the need for a bigger picture perspective, it does not create a strong case for revisiting Kiwirail’s decision on the Gisborne line. When public money is involved, an holistic view of transport access and connectivity is required, not a mode specific decision. But in this case, road and shipping capacity appears sufficient to maintain equivalent access to Gisborne and public subsidy of rail is unlikely to be justifiable.

“For the rail line to be reopened, a long term, fundable and economically viable transport and land use plan would need to be developed by Gisborne authorities demonstrating which activities will drive rail demand into the future and how these fit into a wider social, economic and environmental vision for the region. In the absence of this plan, mothballing and not closing the line appears on current evidence to be the right decision,” Selwood says.

ENDS


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