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Posts Tagged ‘railways’

Haven’t we been down this track before?

25 August 2012 11 comments

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The Situation

In a further sign that National is dusting off more of it’s failed policies from the 1990s, Kiwirail recently made this startling announcement,

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In fact, the planned multi-million dollar cutbacks were so startling that Kiwirail tried to gag Radio NZ and other news media from reporting on this issue.

See: KiwiRail accused of gagging media

Kiwirail’s business plan had suddrenly become so “contentious” that National even prevented the Labour Opposition from tabelling it in Parliament.

See: NZ Parliament:  KiwiRail—Tournaround Plan and Confidence in Board

Evidently, National was unhappy that this document was now in the public arena.

In short, Kiwirail’s business plan calls for $200 million to be cut from their spending,  over the next three years. This involves cutting track maintenance crew.

Kiwirail CEO, Jim Quinn, says,

In terms of our network, we have reduced our network spend over the next two or three years by $200 million. That is not to say we are going back to the bad old days where the business was not invested in.”

See: KiwiRail plan revealed: $200m must be cut

Where have we heard all this before?

History

New Zealand Rail Ltd (NZRL)  was privatised in 1993 by the Bolger-led National government. It was sold for  $400 million to a consortium of Wisconsin Central Railway (40%), Berkshire Partners (20%) and Fay, Richwhite & Company (40%).

The company was renamed Tranz Rail in 1995, with urban passenger trains rebranded Tranz Metro, long-distance passenger Tranz Scenic, and freight Tranz Link.

In 2004, Tranz Rail was purchased by Toll Holdings  and renamed Toll NZ.

In 2008, the Clark-led  Labour Government announced  that the rail and sea operations of Toll NZ Limited, less its trucking and distribution operations, was to be purchased for $665 million. After re-nationalisation, the  company was renamed KiwiRail. 

The Labour government and KiwiRail  planned to spend an estimated $1 billion, over five years,  upgrade the  rail system. Most of this expense was geared toward purchasing new rolling stock.

During rail’s fifteen years in private ownship, this blogger can find no evidence that any investment was made in any new rolling stock. The only capital purchase was the new interisland ferry, ‘Kaitaki‘, in 2005.

By 2008, the rail network was badly run-down, as very little had been invested in anyt form of maintenance with regard to rolling stock, tracks, stations, etc.

Breakdowns became common.

Eventually the LTSA (Land Transport Safety Authority) had to step in,

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During the summer of 2002, when a mini-heatwave hit the country, rail tracks were buckling to such a degree that trains were running at a much reduced speed.

Track de-stressing staff were working hard-out to prevent a situation where de-railment became inevitable,

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The rail network was close to collapse in many areas,

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By 2008, the Labour-led government had decided that the Great Experiment in privatisation had failed, and was delivering the country a spectacular mess.

Enough was enough, and re-nationalisation went ahead.

In the ensuing years, millions were poured into upgrading the rail network; new rolling stock was purchased; stations were renovated (many having been badly vandalised with  no identifying signage for several years); and signalling equipment upgraded.

As Micharel Cullen said in June 2008,

We will now be able to make the investments necessary to develop a world-class 21st century rail system for New Zealanders.”

See: Trains now called KiwiRail

Which now seeminbly brings us, full circle, back to National – the same Party that privatised railways in 1993.

Full Circle

In another act of futile penny-pinching, National has demanded that KiwiRail cut it’s budget by a whopping $200 million.

This will involve cutting rail workers -many of whom are responsible for rail track  maintenance (remember 2002 and 2003, above?),

Kiwirail workers are warning the Government that they or the public may die because of poor maintenance on the main trunk line.

It comes as 181 workers face losing their jobs, but Transport Minister Gerry Brownlee says their claims are “a beat-up”.

Kiwirail workers in Hamilton arrived late today for a stopwork meeting, angry 181 workers are being laid off nationwide. Many do maintenance work on the main trunk line, which they now claim is dangerous as sleepers are loose and rotting.

“We don’t want to see any one get killed, it’s as simple as that,” says Paul Spanswick. “We don’t want to see anyone die.”

The workers say there have been six derailments in six weeks.

“A train could come off and be derailed,” says Mr Spanswick.

At a level crossing at Ruffel Rd, north of Hamilton, that 3 News was taken to today sleepers are loose and the line moves.

“It’s a ticking time bomb,” says Mr Spanswick.

One of the workers who arrived for the stopwork meeting today told 3 News: “These sleepers are bouncing up and down like a trampoline. Something will give, a wheel will jump off the track. I’m concerned for our workers and for the public – someone could die”.

See:  ‘Someone could die’ – rail workers speak out

Transport Minister Gerry Brownlee’s response?

I think the issue about the sleepers is being over beaten-up.”

Unbelievable.

National is so hell-bent on it’s fiscal policies that it is prepared to allow our rail system to run down again, and possibly endanger lives.

National’s low-information supporters often deride Labour governments for spending money.

This is correct: Labour governments do tend to spend money on state services and infra-structure.

That is because irresponsible, short-sighted, foolish  right wing governments inevitably constrict investment and allow services and infra-structure to be run down – often to the point of  endangering lives.

In the 1990s, the running down of railways was left to the ineptitude of private corporations.

Now it is the turn of National.  Their track record, quite simply, has gone off the rails.

Something else for Labour to fix (again!) in 2014.

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Additional

News & Views: Railways

Wikipedia: New Zealand Railways Corporation

Radio NZ: Listen to more on Morning Report (24 Aug)

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Lies, Damned Lies, and National Party Campaign Advertising

25 October 2011 4 comments

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National currently has a set of eight billboards, each featuring Dear Leader’s face, plus a short “statement of intent”, such as “Balance the Books Sooner“, “Building Better Public Services“, etc. They’re catchy and  positive-sounding.

But when compared to National’s real track record over the past three years, the current crop of National Party election hoardings is right up there with Soviet-style propaganda and Orwellian Double-Think. The phrase  “barefaced strangling of Truth”  comes to mind.

Let’s ‘test’ National’s “statements of intent”…

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The first question is “sooner than who“? No one else is currently in government. And when Labour’s term of government ended, they had paid down net debt to about 5.6% of GDP. In dollar terms, Labour paid down NZ’s sovereign debt from approximately $25 billion in 2001 to about $10.2 billion by 2008.

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NZ Net Sovereign Debt 2001 - 2009 (Source NZ Treasury)

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Considering that only half of our sovereign debt  – $18.4 billion – is due to the cost of rebuilding Christchurch,  the remainder is due to two tax cuts (April 2009 and October 2010) which we could ill-afford as a nation. Those tax cuts mainly benefitted high-income earners and the top 10% of this country’s wealthiest.

The top 150 “rich listers” wealth increased by a staggering twenty percent in just this year alone.

So really, we are borrowing money from overseas, to stuff into the pockets of the richest people in this country.

Does that sound remotely sensible?

The second question is who pays to “balance the books”, after borrowing billions to pay for tax cuts?

Answer: who do you think?

So the next time you see one of these billboards, promising  to “Balance the Books Sooner” – don’t forget why those books need “balancing” in the first place, and who will be paying for that “balancing”.

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When I see this billboard around town, all I can see is this: “EXPORT MORE REAL JOBS”.

Like the case of the contract for new  rail wagons that was awarded to Chinese companies, rather than our own workers in Dunedin and the Hutt Valley. Result; around 70 jobs lost.

Little wonder that Dunedin’s mayor, David Cull was angry,

This is frankly a form of economic vandalism. What are we mounting here? An economic development strategy for China?”  Source

Minister of Transport Steven Joyce responded by saying,

The reality is KiwiRail has been treated like Cinderella for too long. This Government will not place requirements on KiwiRail which we don’t on any other government or private-owned company.” Source

It’s obvious how little Steven Joyce cares about his fellow New Zealanders losing their employment.

It seems we’re already very good at exporting… Dairy products… Seafood… Timber… And jobs.

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All I can say to this is that starting the rebuilding seems to be taken an awful long time.

In the meantime, we’re losing timber sawmillers through lack of demand. At a time when the construction industry should be going through massive growth – we are seeing Fletcher shares dropping in value and uncertainty in the industry. How can Fletcher’s profits be falling at a time when an entire city requires re-building???

Other jobs are also being lost in Christchurch. And the dole queues grow.

But yet again, it seems that this government is quite content with “exporting” jobs to overseas workers.

Despite Dear Leader’s cheery (if vacant) smile on the billboard, there seems little to be happy about. Certainly the lack of leadership, action, and jobs is nothing to be happy-clapping about.

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This particular billboard has a weird, dark, ominous feeling to it.

What, precisely, is the “welfare incentive to work”? If National is hinting that it plans to abolish or reduce social welfare – let them come out and announce it to the public.

At the same time, they can announce where the neccessary 154,000 new jobs are, to take on the unemployed.

Let’s not forget that those on unemployment are not there by choice. Let’s not forget that the December 2007 Quarter Household Labourforce Survey unemployment rate stood at 3.8%.

Then the full impact of the banking crisis and global recession hit us.

Unemployment reached7.3% in the  December 2009 Quarter Household Labourforce Survey.

As of August this year, the jobless rate has fallen to 6.5 per cent – just under twice that of 2007.

So, Mr Prime Minister, an “incentive to work” can be something as simple as having jobs available. But having contracts to manufacture rail wagons going to China, or allowing Irish builders to work on Christchurch’s reconstruction will not be very useful to anyone.

Threatening the unemployed with “the stick” is not as effective as offering them a “carrot” – a job.

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Building rail“?!

What new rail are you referring to, Dear Leader???

In fact, as far as I am aware, Mr Key, your government is cutting  back on funding public transport in Auckland,

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Telling fibs again, Dear Leader?

As for the rest,

  • Building roads. Yes, you are. But wouldn’t greater investment in public transport make more sense?
  • Fast broadband. Again, yes. This government is subsidising  telcos to the tune of $1.5 billion to build a fast broadband network throughout the country. (I thought subsidies were a naughty thing in the world of the free market?)

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This one is probably one of the top two most asinine claims for National to be making. The voting public would have to be practically braindead, with the IQ of a wild mushroom, to put any credibility on this statement. Of all the campaign statements that National has ever uttered, nothing screams Arrogance! better than this billboard.

Less debt“? “Less debt” than who – Rarotonga?

The government’s borrowings have exploded almost exponentially, until we currently owe $18.4 billion to various lenders overseas.

If  more borrowing equates to  “less debt” , I’d like to see my bank manager agree to lend me a few million!

As for “lower interest rates” – obviously no one in the National Party campaign committee passed this by the Finance Minister, Bill English,

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Can I send impending increases in my mortgage rates to Bill English or John Key to pay?

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Again, I’ve no idea what this statement is supposed to mean; “staying strong on crime”.

Does it mean locking up offenders for longer periods?

Does it mean more prisons?

Well, not according to Bill English, who recently admitted that prisons were a “moral and fiscal failure”,

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And the Prime Minister has recently suggested that we might not need any new prisons,

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So what, exactly, does “staying strong on crime” mean? Well, nothing really. It is basically a meaningless utterance that panders to the red-neck, lock’em-up-and-throw-away-the-key element in our society. As long as these low-information voters are kept happy, National is assured of a few more votes on Election Day.

This last billboard is probably the one that would most rankle with many people – especially those 2,000+ who have lost their jobs in the last few years, as government cuts back on state workers,

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I’m not quite sure with how a “better” public services can be “built” when this government has effectively been gutting it. Despite clear committments from John Key and Bill English that National would only cap the civil service and not cut numbers,

National’s rebalancing of the tax system is self-funding and requires no cuts to public services or additional borrowing.” – Bill English

If National is elected to lead the next government, I personally guarantee that we will:  ensure government spending is focused on frontline services such as health a education by capping the number of bureacrats…” – John Key

That promise has been well and truly broken.

Sacking over 2000 workers who have worked with dedication and loyalty is hardly a fitting reward.

For such political statements to be made successfully, and without looking like liars and fools, politicians require only that the Voter has not been paying attention. Otherwise politicians would not dare put such rubbish out for  public consumption.

It’s simply amazing what garbage politicians will feed us, if they think they can get away with it.

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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.

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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.

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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,

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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.

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