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State of Tranz Rail Proof Privatisation Fails

Sorry state of Tranz Rail proof of privatisation failure

The sorry state of Tranz Rail is proof that privatisation of strategic state assets does not work in the public interest, the Alliance says.

The sale of Tranz Rail was a bonanza for successive private owners who have asset-stripped the rail network and left it in ruins, says Alliance spokesperson Jill Ovens.

The Alliance welcomes the Government's moves to take the tracks back into public ownership, but would go further in taking control of the rail system by making it fully publicly owned and controlled.

"The state of the tracks and rolling stock is proof that private companies do not provide the investment needed to maintain our infrastructure in the public interest," Ms Ovens says.

"Their primary concern is to return a profit to their shareholders."

The Alliance acknowledges that the deal with Australian company Toll Holdings should increase the amount of freight being carried by rail and take some of the pressure off the roading system, because Toll has to be more efficient than Tranz Rail has been.

But the Government's deal provides no security for passenger rail services long term.

In yesterday's press conference, Toll managing director Paul Little said that while there would be no reduction in passenger services in the short-term, his company had little interest in running passenger services, saying they had little expertise in that area.

The Alliance says it was outrageous that Tranz Rail scrapped passenger services between Invercargill and Christchurch, and Auckland and Rotorua.

"It may be true that people can access cheap air fares between the main centres, but these are not available for travel to the provinces," Ms Ovens says.

"These routes also have huge potential for the tourism industry, if only we had decent trains and well run stations."

It is ironic that the deal giving a private company potential control over rail operations in New Zealand was announced on the day Aucklanders celebrated the opening of the publicly owned Britomart centre with the prospect of a revival of suburban rail in that gridlocked city.


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