To be honest, I was surprised to read National’s Napier MP, Chris Tremain, come out in support of his government’s decision to close the Napier to Gisborne rail link. This is an issue that transcends the usual political boundaries and is fundamental to the direction of the East Coast in terms of future economic development.
The region’s mayors, business leaders, the Chamber as well as a multitude of ordinary citizens from across the political divide have come together on this issue for a number of reasons.
First and foremost, all understand that good regional infrastructure is
fundamental to economic development. Economic development brings jobs and jobs are the basis for regional wealth, growth and prosperity.
Basically, without a first world rail and roading network, the East Coast will not even be considered for the type of economic development needed to realize the potential of many industries. The forest sector is one example that is often cited. The example is a good one as it highlights regional competencies. For example, the Port of Gisborne is only set up to handle break bulk and not containerized product. What this means is that, for example, it is an efficient exporter of logs,
but cannot export manufactured product that must be shipped out in containers. The Port of Napier is set up to export containers.
Exported logs have not had one cent of value added in this country, whereas if we are to grow as a region, and remember only Northland has a higher rate of unemployment, the number one priority of our region’s leaders must be to create economic growth and employment for local people. There has been talk of a Taiwanese wood products manufacturer locating a plant in Gisborne, however, with this decision to close the line, such development will not occur. It’s as simple as that.
Now that the Business and Economic Research Ltd (BERL) has actually provided an independent view that criticizes the government’s decision to close the line, Mr Tremain has ammunition to go to cabinet and ask for a review of the decision. And in a statement that drips with irony, Mr Tremain points out the fact that this government has spent $750m on new funding for Kiwirail over the past three years. Well, all we are asking for is 0.5% of this budget in order to get our line up and running again.
Many who have followed this issue will remember a meeting a couple of years ago at the old Cossie Club in Napier where Kiwirail management admitted that they could not promise a reliable service to the businesses of the East Coast, but then complained that there weren’t enough companies using the line (this is before the storm very conveniently washed out part of the track). At the time the sales rep responsible for managing the business in this part of the country was based in Palmerston North. So, no reliable service and not a local agent on the ground: no wonder businesses weren’t using the track.
As someone who has worked in the forest industry, I know how important it is to ensure product is delivered to the port, the mill or wherever on time. If Kiwirail had really put effort into developing the business up and down the East Coast, this line would be profitable now.
I was talking with a local truck driver about 6 months ago and noted that trucking companies must be pleased the line is closed because it means more business for them, to which the truck driver replied that it is a dreadful road to drive and is particularly hard on the vehicles. As someone who has driven the road numerous times, I can understand this sentiment.
The problem is once the line is closed, it will be very expensive to reopen as time passes by. As BERL pointed out, the amount of extra money needed to maintain the Gisborne to Napier road, due to the increased number of trucks that will result from this line closure, will far exceed the cost of repairing and maintaining the rail line.
Being a political leader is not easy, however, there are times when you must stand up for what you believe in and, more importantly, for what is right. Closing the rail line between Gisborne and Napier is the wrong decision for the East Coast. Time will prove this so. The political leaders who are ultimately responsible for making the decision to close the rail line are not based in the Bay or even on the East Coast. Mr Tremain is. It is time he started standing up for our region and living up to his slogan of Backing the Bay, because at the moment, the Bay is going backwards at a great rate of knots.
Since writing this post, my Labour colleagues Phil Twyford and Moana Mackey have confirmed that a Labour government in 2014 will reopen the line:
Labour pledges to re-open rail line
Phil Twyford | Tuesday, January 22, 2013 – 16:51
Labour in government will re-open the Gisborne-Napier rail line due to be closed under National, the party’s Transport spokesperson Phil Twyford says.
An independent report by economic consultants BERL casts doubt on the analysis used by KiwiRail to justify the mothballing of the line.
“KiwiRail’s business case for the closure is utterly inadequate and falls way short of a comprehensive cost-benefit analysis, something a Labour government would carry out and which I am confident would justify the line’s re-opening,” Phil Twyford said.
“National doesn’t give a damn about the affected communities, and is content to sit on its hands while Gisborne loses a vital economic lifeline.
“It is wasting billions of dollars on its ‘motorways of madness’ but cannot find $4 million to fix slip damage to this rail line.
“Shutting the line is typical of the short-termism National demonstrated with the closure and sale of the Hillside rail workshops. The BERL report shows that National is blind to the wider economic costs and benefits, just as it was at Hillside.
“The line should be reinstated now for $4 million. It will never be cheaper. The longer you leave it, the more expensive it will be to re-open it.
“This whole issue demonstrates National’s double standard when it comes to road and rail: KiwiRail’s inadequate business case justifying the line closure falls well short of the benefit cost analysis required of roading projects. On the other hand, if the Government applied the same narrow financial analysis to half the country’s roads they would be mothballed too.”
Mr Twyford said the BERL report noted annual freight volumes only needed to reach 180-200,000 tonnes per year for the line to be profitable. Current volumes of 44,000 tonnes showed that growth from local horticulture and forestry would bring the target within reach and this would justify future re-opening.
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