Rail buy-back good news for contractors

By Richard Michael
CEO
New Zealand Contractors' Federation

The Government has finally succeeded in buying back the rail operations activities from Toll Holdings. After a long negotiation, the deal has finally been done and, no matter what your views might be about the politics of the decision, it should be good for the civil construction sector.

Toll only owned the company for a few short years. In that time they were never able to come to an agreement with the government about track access charges. As a result of this much needed infrastructure work on the network was not started and there was relatively little work done on the network as a whole.

Now that a deal has been struck it is likely that there will be much more work to be done. Many of the bridges in the network, while safe, are in urgent need of repair.

The main trunk line between Auckland and Wellington needs to be upgraded so it can compete with the overnight road freight services. This will require considerable civil works to lower some of the tunnel floors so that bigger containers can be used as well as track realignment work to enable speeds to be increased.

The Midland coal route across the South Island is the key strategic route to get West Coast coal to market. It has a large number of old bridges that will need to be replaced in the near future. This route would also be more profitable and effective if axel weights could be raised so that individual trains could carry more coal. This could be a major infrastructure project for the future.

With the government at the helm they will presumably want to ensure that rail plays it full part in an integrated, intermodially based transport system. To do this will also require some significant civil works to connect parts of the network that are currently isolated. This will be particularly important to link up the rail with some of our ports to support the desired increase in coastal shipping.  Again all good work for the sector.

Sustainability is a key issue in the lead up to the election, and seems to be an issue whose time has come. Every election has a headline theme and sustainability is looking like its going to be it for 2008. Because rail is efficient as a long haul freight transporter, more use of this, along with coastal shipping, is seen as a major plank in the Government’s sustainability policies.

Obviously not much work has been done on the rail corridor and the surrounding assets for a long time. If contractors want to get into this work then it is likely they are going to have to learn some new skills. This will require assessed training so that Ontrack can be comfortable that all staff are appropriately trained for the work they do.

Ontrack is very much driven by a safety culture and will demand the highest levels of performance in this area. It has also said that it is keen to work with a wide range of companies as long as it is satisfied that the smaller firms have the skills, training and infrastructure to do the work.

I think this could be a major area of work going forward and I encourage Contractors to make contact with their local Ontrack staff to see if they can get a slice of the action.

The opening up of another major infrastructure sector has got to be good for the industry. It should allow us to reduce the reliance on the road transport sector and develop new skill sets and experience.

Obviously the new rail agency is also learning the ropes of a new level of investment in their network. This has already started with the two projects in Auckland and Wellington which are already in the process of spending over $1billion. However, it will take some time for them to build up their skills and experience in this area and we as an industry must be prepared to work constructively to get the job done.