Posts Tagged ‘Kiwi Rail’

Did this catch Dear Leader Key by surprise as well?

15 November 2012 8 comments


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The sale of Hillside Workshops will affect it’s workers badly,

KiwiRail is making 80 to 90 workers at the Hillside railway workshop in Dunedin redundant after making only a partial sale of the site.”

See: Dozens of railway workshop jobs to go

I wonder – was John Key as surprised with this announcement today as he was a week ago,  when the HLFS   figures were recently  released, revealing that  unemployment was now at 7.3%?

I’m very surprised with the numbers I’ve seen this morning, goodness knows what the next one will look like.” – John Key, 8 November 2012

Perhaps he was. Perhaps, as Bryan Gould pointed out in the NZ Herald today,

In the wake of the grim news about factory closures and lay-offs over recent months, the figures were only to be expected. Indeed, the warnings about a crisis in manufacturing have been coming thick and fast, and from all quarters.

There was, though, one person, it seems, who was blindsided by the bad news. The Prime Minister, we were told by the television news, was “taken by surprise”. The only explanation for this is that John Key has paid little attention to the unemployment issue over the past four years, despite its destructive impact both on individuals and their families, and on society as a whole.”

See: Bryan Gould: Plight of jobless makes us all poorer

After four years of  Key’s “leadership”, what do we have?

  • High unemployment
  • A shortage of housing, and rising house prices
  • Exporters suffering under a high dollar
  • National policy designed to drive down wages (see: John Key’s track record on raising wages)
  • A stagnating economy

Adding to the above,  this report out today,

Continuing bad economic news is prompting forecasters to speculate the economy may have gone backwards for the first time in two years.

Retail figures for the September quarter showing a big fall in spending follow weak inflation and job numbers for the same period have been released in recent weeks.

Westpac economist Michael Gordon says there is a reasonable likelihood the economy contracted in the most recent quarter.

Deutsche Bank senior economist Darren Gibbs believes that at best, the economy failed to grow at all and possibly went backwards during the period.

He said a manufacturing survey for October due in the next fortnight will give the first indication of whether or not the economy’s loss of momentum is continuing in the current quarter.

Finance Minister Bill English told Morning Report that the numbers bounce from quarter to quarter and the latest figures are not of concern.

He said the economy is as uncertain as it has been for years, and the Government will continue to focus on straight forward objectives, like getting back to surplus and rebuilding Christchurch.”

See: Economy may be going backwards

No wonder New Zealanders are escaping to Australia faster than East Germans climbing The Wall, during the Soviet era,

A net loss of 39,500 people to Australia contributed to New Zealand’s net loss of migrants in
the September 2012 year. This is down from the record net loss of 40,000 in the August 2012
year. The September figure resulted from 53,700 departures to Australia, offset by 14,200
arrivals from Australia. In both directions, most migrants were New Zealand citizens.”

See: International Travel and Migration: September 2012

It’s not just the low pay (which is being driven lower by National policies); nor the cost of housing rising higher and higher as a minority speculate on  property for tax-free gains; nor rising unemployment; nor the growing wealth-divide.

What is driving New Zealanders to escape – and I use that word with precise deliberation – is that our society has a strong impulse for self-flagellation that manifests as constantly making wrong economic decisions. Instead of looking at the long term – sufficient numbers of New Zealand voters opt for short term benefits. The result is that few of our economic problems are actually  addressed in a meaningful way.

The joke is that so many New Zealanders still hold a quasi-religious faith in the National Party as “prudent managers” of the economy.

Which is sad, really.

National is the last political body to earn the reputation of “prudent manager”.

Any Prime Minister who reveals surprise at a worsening economic situation – despite data  screaming “Red Alert! Red Alert!” on every indicator, is one who is asleep at the wheel and hasn’t a clue what is going on around him.

How can a Prime Minister with an entire government department at his disposal, which spends $17,547,000 a year,  be oblivious to 13,000 people losing their jobs in the last three months?

See: Household Labour Force Survey: September 2012 quarter

Does he not read a newspaper?

Or, as with the GCSB briefing in February, was Key simply not paying attention?

Or perhaps, as with the John Banks police file, did he wilfully choose not to look at the information?

Precisely why are we paying this man $411,510 each year?!

One other reason why so many New Zealand voters are so deluded into voting for National; the old ‘aspirational middle class‘ thing.

We all want to be affluent, succesful, and secure. The National Party is filled to the brim with millionaires, rich lawyers, businessmen and women, etc. Even Paula Bennett knew how to rort the welfare system when she was on the DPB, and bought a nice house with WINZ assistance.

Mowst of us want that. So by electing National,  some of that success will rub of onto us, right?


So f*****g wrong.

Who benefitted from National’s 2009 and 2010 tax cuts? Check out the data,


2009 taxcuts



2010 taxcuts



As the numbers above show, the higher your earnings, the greater your tax cut. Conversely,  the lower your earnings, the less you got.

If you earned $40,000 p.a. your tax-cuts in 2009 and 2010 was – $9.94.

At the same time, GST went up. That meant you were now paying 15% on food, electricity, fuel (more actually), rates, etc.

High income earners have done very nicely out of the tax cuts.

By contrast, the Australian governments treated their low-middle income earners somewhat differently,

As part of the Government’s policy to spread the benefits of the mining boom, one million people will be freed from paying tax when the tax-free threshold is trebled from A$6000 to A$18,200.

More than seven million earning less than A$80,000 ($102,000) will receive tax cuts and parents with children at school will be paid A$410 a year for each primary school pupil and A$820 for each secondary student.”

See: Fed-up Kiwis head to Oz en masse

That is called re-distribution of wealth to those who need it.

As compared to National’s re-distribution of wealth to those who do not need it.

It takes a while for the Aspirationists to wake up and realise that they’ve been conned. In the meantime, Key smiles and waves and bats away serious economic problems; Paula Bennett targets and blames the unemployed for daring to be unemployed; Hekia Parata is busy undermining our education system; John Banks is throwing taxpayers money at private Charter schools; and the rest of the National Party are further dismantling our once egalitarian society, and doing dubious back-room deals with casinos, big business, foreign governments, and god-knows-who-else.

The only thing that would really, really, really piss me off is that National voters became disenchanted with their own “government” – a mess of their own making –  and headed off to Australia. To hell with that!

It’s a shame that Aussie Customs can’t made a small addition to their Immigration Declaration Form,

Have you ever,

[] been convicted of a drugs offence?

[] been a part of a terrorist group?

[] voted National?

Ticking the last box should be grounds for immediate repatriation to New Zealand.

The Aussies may already have started: I understand that Paul Henry is being sent back to New Zealand?



= fs =

Jobs, jobs, everywhere – but not a one for me? (Part Toru)


“The driving goal of my Government is to build a more competitive and internationally-focused economy with less debt, more jobs and higher incomes.” – 21 December 2011


So John, how’s that “More Real Jobs” campaign pledge working out for you?

Tell us more about these “Real Jobs” and how we’re going to get “More” of them?


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Plus on top of that,

Latest redundancies;

And tell us, John, how will drug testing unemployed and State control over solo-mother’s (but never solo-dads)  birth control, give us “More Real Jobs“?

Surely, John, your plans for drug testing and birth control for welfare recipients  is not a cunning diversionary tactic from your Party strategists (paid out of our taxes) to deflect public attention from your total inability to generate “More Real Jobs“?!

You wouldn’t stoop to such a cheap trick, would you, John?

Surely not?





Unemployment rate lifts to 6.7pc



= fs =

Kiwirail – back on track, on the sea

22 September 2011 3 comments

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It’s nice to see more investment in the up-grading of our rail and inter-island ferry service.  Kiwirail is fast being brought back up to standard, after 15 years of neglect under private ownership.

Railways was privatised in 1993, by the then-Bolger-led National Government.  (Source)  The new owner, Tranz Rail Ltd,  paid $400 million to the government and was made up of  a consortium consisting of  Fay, Richwhite & Company (40% ),  the American railroad Wisconsin Central (40%), and Berkshire Partners (20%).

From then, until 2008 – when railways was re-nationalised by the then-Clark-led Labour government – the asset was owned by a variety of private owners. In 2003, one of the major institutional shareholders was AMI – now facing insolvency after several major earthquakes in Christchurch.

Continuing losses, such as $346 million lost in the half-year ended December 2003, did not help the companies viability, despite carrying considerable amounts of freight such as 2.1 million tonnes of coal on the Midland line in the South Island.

The rail network was badly run-down by 2008, with many urban lines and stations dilapidated, vandalised, and in need of urgent maintenance.

In the Hutt Valley, for example, very few stations had any identifying signage which indicated which stop it was. They had all been mostly vandalised beyond recognition or destroyed totally. It was not until post-2008, and with State investment, that suburban rail began a programme of considerable improvements and upgrades. New passenger carriages; freight wagons; and locomotives were purchased, and Kiwirail began a slow progression back to a modern service, that is fit-for-purpose and a valuable asset for the 21st century.



The privatisation of railways has been a stark and expensive reminder that privatisation is not a guarantee for better service. In the case of railways, the taxpayer is now footing the bill for fifteen years of neglect – even when the directors and managers of Tranz Rail walked away with $6 million in severance payments. Not exactly a good look,  one might think.

In fact, the only pirece of major capital investment in 15 years of private ownership was the sub-charter of the new inter-island ferry,  ‘Kaitaki, in 2005. No other capital investment, rolling stock, or improvements were made to the rail system during the period of private ownership.

As the price of fossil-based fuels continues to rise, transport based on alternative systems such as railways will become more and more critical to a modern, functioning economy.  Railways is simply too vital to be rested in private ownership which – as recent history has demonstrated – is not capable of managing such a strategic asset.

In the coming decades, this author predicts that railways will assume a greater role in our economy and society.  As petrol and diesel escates in price, rising on an almost weekly or monthly basis, rail will once again become profitable. It may also reverse the primacy of the internal-combustion automobile, making rail a preferred option for long-distance travel.

In the decades to come, it may become apparent that the decision of the  Labour Government in 2008 to re-nationalise railways was perhaps the single most prescient act on their part.


In retrospect

Lack of ongoing maintainance reached critical levels in the summer of 2002/03, when high temperatures resulted in tracks buckling and the LTSA ordering Tranz Rail to reduce train speeds and to re-hire track de-stessing crews,









Broken-down trains… unmaintained tracks… disgruntled passengers. Sound familiar?

It is fairly evident that the current maintenance and purchase of new rolling-stock are things that should have been carried out over the last couple of decades. The neglect of our rail system allowed private owners to attempt to make short-term gains, over long-term necessary expenditure.

The tax-payer is picking up the ‘tab’ for this misguided experiement in privatisation.



Common Sense prevails!

Merje DDM, which grew out of the collapse of buggy maker Tritec, focuses mainly on providing seating for theatres and auditoriums in New Zealand and Australia, but has now completed a new range of train seats developed from the ground up. 

The firm has its origins in Brugger, a big Hutt Valley supplier of seating components in the 1960s, when many of the world’s car makers had factories in the area. 

Brugger was later sold and renamed Kenson Industries. As protections on the vehicle sector were removed, Kenson began moving into other areas, including other types of seats, plus buggies for infants. 

When that company collapsed in 1998, some of the remnants were gathered together to become Tritec. Based in Gracefield, Tritec built up a large business focused on buggies, but it also fell into receivership in 2008. 

It was later bought out of receivership by another Wellington company, Phil & Ted’s, which was mainly interested in the Mountain Buggy brand, closing the production side. 

Miles Fowler, who used Tritec to make theatre seats which he then sold in New Zealand and Australia, faced losing a key customer, so negotiated to keep some of the manufacturing capability, taking over the seat-making business. 

Merje – a name made from the initials of Fowler and another director Jesse Paenga, along with their partners – was formed and the firm does most of its business providing seats used in theatres and lecture halls, with one of its largest customers Victoria University. 

“They tend to be quite large projects, but there is often gaps between them,” Fowler said. 

This gave the company scope to submit a proposal for the AK carriages from KiwiRail, a contract which was first mooted to Tritec. One of about 30 initial proposals, Merje was one of three firms short-listed for the train project, providing samples used elsewhere in the KiwiRail network. 

It designed a product that is largely locally made and which is now being delivered. 

Fowler says a key advantage of the company’s seats was the fire- proof graphite foam from Acma Industries, another long-established manufacturer, based in Upper Hutt. 

Palmerston North’s Fibreglass Developments provided the fibreglass backing of the seats, while other firms in the region provided components used in the seats. 

“A couple of things came from Auckland, but essentially they’re 100 per cent manufactured here. We try to stick as close as we can to the Wellington, Lower Hutt area.” 

Fowler said Merje, which has about a dozen staff, was expected to have turnover of about $3 million this year.

Which underscores the fact that local industries can build stock for our railways. We do not have to “outsource” major rail manufacturing contracts overseas to places like China or South Korea.

The $29 million cost of giving Chinese firms a contract for 300 new flat-top wagons was not just monetary – but it has cost fellow 70 New Zealanders their jobs in Dunedin and Wellington. Plus probably more, in terms of flow-on jobs generated from losing such a lucrative contract.

We will not grow our economy, nor generate jobs, if we continually opt for “the cheaper option”. There has to be a will and conscious decision to make job-creation our #1 economic priority. Any government that does not understand this is bereft of understanding, and derelict in their duty.

The people of Dunedin made their feelings known on this matter at a public rally on July 9

Labour MP David Parker addresses the rally.

A section of the crowd listens to the speakers.

Hillside boilermaker Stuart Johnstone and twins Skye and Kane get their message across in the Octagon on Saturday.

As Dunedin Mayor Dave Cull said on the day, the decision to award a contract to overseas firms and cut back on local employment was “short-sighted, simplistic and destructive”. He further added,

“This issue here is about the sum total of all those things, and much much more. Communities need to work, in both senses of the word.” (Text of full speech.)

“This is frankly a form of economic vandalism. What are we mounting here? An economic development strategy for China?”, the Mayor has demanded.

Otago Chamber of Commerce president Peter McIntyre said,

 “… the threat was not just to Hillside jobs, but about 120 other job losses that would follow.  We cannot afford this to happen.

Indeed, we cannot.

Exporting jobs is not the answer.