Friday, March 07, 2008



First the track, now the trains

Back in the 90's, the National government sold the railways to a consortium of its rich mates, who proceeded to systematically asset strip it and run it into the ground. As a result, in 2004, the government was forced to buy back the track to ensure that the infrastructure was maintained and that we could continue to have a rail service. Now, four years on, it's looking like they'll be forced to buy back the trains as well.

The core problem is that the new owners, Toll Holdings, don't really want to run a railway, and would rather focus on trucks. They'd also rather not pay the amount they agreed to for track access and maintenance, and might very well just stop running trains rather than do so. So the government is left with the decision of either subsidising the profits of a private company, or running the railways itself as a public service. And I agree with them that the latter is the better option. The rail network is vital infrastructure, and it will only increase in importance in the coming years as oil prices rise and climate change policy force changes in transport modes.

Meanwhile, National's "answer" is that if railways are not commercially profitable, we just shouldn't have them - and according to Colin Espiner, they've even promised to sell them again if the deal goes ahead. And they claim to have moved on from the 90's?