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Government Right To Hold KiwiRail To Account On Interislander Cost Blowout

Today’s announcement that the Government will not provide $1.47 billion to continue KiwiRail’s plan for two new ferries and terminals is a good call, but substantial service improvements are still required, says road freight peak body Ia Ara Aotearoa Transporting New Zealand.

Interim CEO Dom Kalasih says infrastructure projects are going over budget all the time and it is good that KiwiRail is being held to account.

"Improving the resilience and capacity of the ferry service is important, but we also believe that there is a lot of scope for all the stakeholders affected, including freight operators to work with KiwiRail to find a workable, more affordable alternative".

"Substantial improvements are essential - our current aging ferries cannot operate reliably. There have been too many breakdowns and disruptions to services which are enormously damaging to the freight sector."

"Between $15-20 billion in freight travels across Cook Strait each year, so it’s important to put the cost increase in that context. With freight predicted to grow 1.4 per cent per year, it’s not an issue that can be put off."

Kalasih says the blowout is primarily due to the development of the port facilities in Picton and Wellington, rather than the two ships that are being built in Korea for delivery in 2026.

"It’s really important that KiwiRail and the Government provide clarity about how a safe and resilient Cook Strait service is going to be achieved."

"This was a priority on our Briefing to the Incoming Minister - provide an industry briefing on KiwiRail’s Interislander ferry service and the steps necessary to provide Cook Strait services that are reliable and safe." said Kalasih.

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About Ia Ara Aotearoa Transporting New Zealand

Ia Ara Aotearoa Transporting New Zealand is the peak national membership association representing the road freight transport industry. Our members operate urban, rural and inter- regional commercial freight transport services throughout the country.

Road is the dominant freight mode in New Zealand, transporting 92.8% of the freight task on a tonnage basis, and 75.1% on a tonne-km basis. The road freight transport industry employs over 34,000 people across more than 4,700 businesses, with an annual turnover of $6 billion. For further information , contact Dom Kalasih, interim chief executive, Ia Ara Aotearoa Transporting New Zealand, 027 441 4309.

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