THE New Zealand government has allocated $NZ 1.3bn ($US 933.4m) to rail in its 2021 budget released on May 20, including funding to renew the South Island locomotive fleet and open new facilities to increase the localisation of wagon assembly in the country.

The latest allocation builds on the $NZ 1.2bn and $NZ 1bn allocated in the 2020 and 2019 budgets, respectively.

The government has allocated $NZ 722.7m over six years to allow national railway KiwiRail to complete the purchase of new mainline locomotives, shunting locomotives and freight wagons, to replace vehicles at the end of their useable life. KiwiRail will also upgrade its maintenance facilities, including building a new rolling stock maintenance hub at the Waltham Mechanical Hub in Christchurch, and install safety enhancements on freight trains in urban areas.

“KiwiRail has already replaced its ageing North Island locomotive fleet, and this latest tranche of funding will fully cover the cost of replacing our South Island locomotives, many of which are more than 40 years old, and purchasing new electric shunting locomotives,” says KiwiRail group chief executive, Mr Greg Miller.

Another $NZ 449.9m will be fed into the National Land Transport Fund over two years to fund the first three years of a 10-year plan to raise New Zealand’s rail network to a resilient and reliable standard.

$NZ 87.3m has been allocated to provide working capital for core asset management over three years to ensure core freight, tourism, and property assets can be maintained until new rolling stock, inter-island ferries and facilities are operational.

$NZ 85m has been allocated over five years to build wagon assembly facilities at the Hillside Workshops in Dunedin, in addition to the previous $NZ 20m investment made through the Provincial Growth Fund to upgrade the existing maintenance facility. The two initiatives together will revitalise Hillside as the main workshop for KiwiRail in the South Island.

“The Hillside Workshops have been an important part of Dunedin's history and economy for over 100 years and we’re building off the nearly $NZ 20m investment we made in 2019 to re-establish them as a mechanical hub,” says state owned enterprises minister, Dr David Clark. “Instead of buying ready-made wagons from overseas, this new facility will allow us to initially assemble around 1500 wagons locally.”

“When we have new locomotives and wagons, and a rail network that is up to standard, we will be able to provide more reliable and timely services to our freight customers to better meet their needs,” Miller says. “We know there is more demand for rail freight than we can currently provide with our ageing assets.”