NZ First's Shane Jones and Winston Peters announce $98.4 million investment from the Provincial Growth Fund in Auckland to Whangarei rail line

NZ First's Shane Jones and Winston Peters announce $98.4 million investment from the Provincial Growth Fund in Auckland to Whangarei rail line

Is Shane Jones’ long term plan to see some or all of the Ports of Auckland’s business operations shifted to Whangarei’s Northport one step closer, or is it a distant dream?

On Friday the Regional Economic Development Minister announced the Government would invest $98.4 million from the Provincial Growth Fund (PGF) in upgrading the North Auckland Line between Swanson and Whangarei. Jones made the announcement alongside State Owned Enterprises Minister and NZ First leader Winston Peters.

It will see 54 kilometres of the 181 kilometre track replaced or upgraded, including the replacement of sleepers and ageing bridges, maintenance work on tunnels and stabilising embankments alongside the rail lines, as well as improvements to the Whangarei Rail Yard. 

Future proofing

Peters says the works are needed to make sure the rail link to Northland isn’t lost.

“Without our investment, this rail line to Whangarei will become unsafe and have to close within five years – leaving Northland cut off from rail services most other regions have,” he says. “That’s unacceptable and unfair to the people of Northland. That’s why the Government is addressing decades of under-investment and neglect in the rail line, to support the future growth of rail in Northland.

“We are investing more than a billion dollars to get New Zealand’s rail system back on track, so rail can play its proper role in reducing road congestion and emissions across our transport system.”

Benefits for Northland

While Jones says the investment will also help improve freight services on the line and have direct benefits for Northland’s economy.

“The maintenance work will make the line more resilient to weather events and freight services more timely and reliable. Not only does it set the right conditions for KiwiRail to grow its freight business, wherever possible KiwiRail will be using Northland based contractors to carry out work.

“It will look to Northland first if they recruit more track staff, as well as sourcing materials in Northland. This initiative will see many millions of dollars being injected into Northland, helping stimulate the region’s economic growth. I’m proud that PGF funding has been able to make this happen.”

The works are central to any plans to see freight and logistics upgraded between Auckland and Whangarei. But the true costs of Jones’ potential longer-term plans will be a lot higher.

Pending report

Last year the Government established the Upper North Island Supply Chain Strategy working group to look at the development and delivery of a freight and logistics in the country’s Upper North Island. It has also been tasked with investigating the feasibility of relocating the Ports of Auckland to Northport in Whangarei. But before that can happen the rail network north of Auckland would need to be upgraded to handle the massive amounts of freight that would be involved.   

The working group released an interim report in April and is now expected to present its final findings to the Government next month. 

Potential costs

A report released in May by consultants AECOM New Zealand and Deloitte looked at the feasibility of upgrading Northland’s rail network and highlighted some of the potential issues involved in moving the Ports of Auckland north. The business case was produced for the Ministry of Transport and paid for by the PGF and said upgrading the Northland rail network and building a new rail spur from the main line to Northport would cost $1.3 billion alone.

And while the report outlined some of the potential benefits to the Northland region, it also raised some flags over who is going to pay for the rail upgrades and what the exact benefits would be.

“There is currently no committed funding identified to deliver the preferred Northland rail project option. There are a number of sources of potential funding, including the Provincial Growth Fund, which initial conversations have highlighted as a potential source for at least some of the required funding. At this stage of the project funding and financing of the project has not been determined.”

Jones is hoping the AECOM and Deloitte paper, coupled with the working group’s findings, will help him convince his cabinet colleagues of the viability of shifting the Ports of Auckland to Whangarei.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

33 Comments

Comment Filter

Highlight new comments in the last hr(s).

Whether the port move happens or not, this seems like a viable investment if it ends up improving the quality of freight rail service while reducing transit time between Auckland and Whangerei.
Currently, more than 99 per cent of Northland's freight is moved by road.

It won't. You're going to need do hundreds of millions of dollars of work on tunnels and tracks to move competitive volumes of freight using the NAL.

This funding really is just deferred maintenance and not a whole bunch more.

What upgrade beyond what is proposed are required to move more freight? and why? Once the track is up to standard then surely its just a matter of more cars per train, and more trains per day? And maybe a bit of area at either end of the line for parking/loading/unloading. How many freight trains a day can we get actually along the NAL lines once we get beyond Swanson/Waitakere?

Seems to me the biggest significant limitation would be making slots between commuter trains to get from the depots out to Waitakere, which would justify a third line from Wiri to the end of the western line commuter service which would also help improve the commuter services too.

"In April 2016 KiwiRail said that it would cost $240 million to bring the Waitakere to Whangarei section up to the standard of the Hamilton to Tauranga section, plus $150 million for signalling upgrading; and with $500 million for electrification the total cost would be $700 million to a billion dollars.[30] In April 2017 KiwiRail reiterated the $240 million upgrade cost; and in June 2017 KiwiRail advised that 9 tunnels on the line (Nos 2,3,4,5,7,8,10,11 & 13) would require alteration at a cost of $50 to $60 million to accept the larger "Hi-Cube" containers.[31]" From Wikipedia.

I suspect the $1.3b report above has updated the costs for spec changes driven by H&S requirements as well as inflation on the tunneling work required, plus the work to actually reach Northport and the facilities that would require to function. In that sense, the $98m doesn't even touch the sides.

okay, scratch moving much freight that way. The $98m is basically life support for a very limited freight line.

I think at some point someone is going to have to take the hit and upgrade/replace the line, the roads and the road toll in Northland are shocking. With the Road to zero road safety thing it could actually end up being cheaper than all the road works and economic drag thats going to generate.

In all honesty it's probably something we need to do; pretty much essential to unlocking any big future value in the Upper Half in terms of tourism too, so it should be considered one big nation-building project and not just the NZ First boondoggle the Port obsession makes it out to be.

I just checked wikipedia, and i notice you omitted this paragraph in your quoting above:
"In October 2017, the new Labour–NZ First coalition government announced that it would spend $500 to $600 million on rehabilitating the line, and building the long proposed extension (branch) to Northport at Marsden Point at a cost of $200 million; the total works to cost $800 million. Shifting the Port of Auckland freight business to Northport would be investigated, but the agreement with New Zealand First does not commit the government to a move to Northport or elsewhere."

Was that spend cancelled, or is the $98m in addition to it?

I couldn't immediately tell that either; I went for the bit I know would still have to be done once the deferred maintenance bit was taken care of. Assuming that is part of the total package, then this only covers the first 10% of what they will need to spend.

Also not sure if those amounts include electrification or just the track and corridor.

You guys are overlooking the single most important factor related to this - NZF election chances in 2020. There seems a disproportionate amount of PGF money being spent in Shane's home region of Northland compared to other regions.

Yeah, more that i'm a bit over caring about the political side of it. More interested in if the spending makes sense or not.

Spend the money on 4 laning Warkworth-Whangerei rather than this line to nowhere and it will instead actually do massive economic good for Northland and save 10's of lives per year.

... that 4 lane highway to Whangarei was scrapped by the Julie Anne Genter ... the only American I know who has a pathological hatred of cars ...

It's only by seeing the Greens in government , that the electorate can see how ideologically driven they are , how unrelated to the real world their ideas ... you know , barking mad !

How to waste money on regressive ideological boondoggles: example #235. Trains were useful in the 19th and first half of 20th Century. Their time has long passed, they can no longer be economic in a small country like NZ, and that is only going to get worse when autonomous trucks start carrying freight in the next 5-10 years

Are you forgetting about road congestion, and how safety would improve if more trucks were removed from the road?

Not to mention the damage to the roads these monsters create.

You may have forgot to include these, amongst other existing costs, NZ inc incur into your calculator!!!

Autonomous trucks can economically do a lot of trips at night, so can actually get traffic off the road in daylight/peak hours.

Autonomous trucks in 5 years, LOL

Until they can figure out how to make them terrorist proof, autonomous trucks won't happen at all. Can you imagine one dirven into a crowded place with explosives aboard???

Probably not much of a problem, they already have suicide bombers.. sourcing the truck and the explosives would appear to be more of a problem

Autonomous freight trucks are coming much sooner than you think. 10year old Waymo's autonomous taxis are now doing about 5000 fare paying riders a month in their pilot program. Many others have pilot programs going too, including a swarm of companies developing autonomous trucks. One is already in service in Sweden. Depot to depot type truck trips, mostly on open road, perhaps mostly at night to avoid congestion, are a simpler problem than passenger vehicles negotiating urban congestion with people and cars that don't always obey the rules.

Foyle have you ever driven at night..say Auckland to Wellington? It's a convoy...trucks after truck ..and the damage to the roads especially plateau is evident. The road crews never have a day off...how much is this costing?

Surely this post is a wind up?

i like you to tell warren buffet that he brought one of the biggest rail companies in the USA a few years ago
"Berkshire Hathaway took a stake in BNSF in 2006, then bought the entire railroad in 2010. Buffett says that remains a great investment decision and praised railroads in general and BNSF in particular."

Govt has no business transporting freight for modern private industry. Pushing freight onto Govt run freight trains will completely fail. The only way it could work is if the rolling stock is privately owned and run and the Govt simply provide and maintain the tracks.

They should stick to simply providing infrastructure for private industry such as highways, cross country transmission lines and gas lines for example.

totally agree, they should run the rails like roads and let whomever wants to run a freight train do it for a fee same as road user for trucks

Sounds good to me.. just make sure that both are charged the actual cost of providing the infrastructure to them.. so RUC for trucks would have to go up substantially, and freight rail fees be set accurately.
Oh, and let the various (freight) users sue each other when they are responsible for problems.. Your train failed/derailed due to poor maintenance/overworked & undertrained operator and blocked the line, the companies whose trains were delayed/stopped due to it get to sue you.

That's exactly the way at least some of Oz operates. Private ownership of rolling stock and loco's plus some sidings (e.g. for grain elevators), and a single track operator with all private consists agreed as to when, where, track length occupied, and for what duration. Straightforward logistics exercise, as the routes are relatively fixed (unlike road).

This government should make it a priority to get better use of the Port of Whangarei. Congestion is only going to get worst in Auckland, if governments (both central & local) continue to focus on road transportation.

Decentralising key infrastructure to the provinces would not only create more employment opportunities to the regions, but also provide an insurance policy should we have another Christchurch again.

The NZ government should stop pampering to the overseas oil interests, and focus on using local energy which this country has plenty of capacity to deliver. This would help our trade balance, instead of exporting profits abroad. Electric train engines; without the wires above, must be possible. Just have a few parked every 50 kms down the line, if the range is the problem.

<3% of cost of CRL.

Either repair and maintain it or scrap it and sell the land.

The entire list are simple basic essential repairs.

Today I had an illuminating conversation with a young moscovian lass I work with. She was complaining about having to take a bus to wellington because there was no train and airflights were exhorbedent at short notice. We don't do infrastructure very well here do we ? It needs to change! Upgrade everything!

Both our Roads and rail are awful. I was driving the Cambridge bypass on Friday. It is so good. As part of basic nation building we need at least one of these projects on a continuous basis. The basic concept of a clean sheet of paper design is so sensible. Currently we seem to spend significant sums just to repeatedly make small incremental improvements to roads that have no possibility of ever being adequate. False economy, short term thinking or just plain foolish - take your pick. Consider an example of Australia's long term planing in the case of the Brisbane to Surfers Paradise motorway.
1) they reserved a really decent road corridor
2) they built a good 2 lane motorway with all the over bridges etc.
3) years later they then built another 2 lane motorway beside the first, unencumbered with all the complications of working around an active motorway
4) Hey presto they had a full spec 4 lane motorway with plenty of room for expansion.

Similar thinking is required with rail. Will the marginal improvements to the Hamilton - Auckland railway support an adequate passenger rail service that will ever be significantly patronized (2 hrs to Papakura???). How much money will they waste trying to create a service that will always be second rate and have a significant chance of failure. Would they be better thinking about the incremental extra cost to do the job properly once and for all and produce a service that is assured of patronage? The government can borrow money so cheaply at the moment; or a BOOT project?? You may spend a bit extra but at least it will not be wasted money.
Do the bloody thing properly the first time.