The bill for fixing up struggling KiwiRail has topped the $1 billion mark, with more than half of that coming from the partial sale of state-owned power companies.
The Government has now initiated "a major review" of the rail operator's business after it sought even more funding, Budget documents reveal.
Yesterday's Budget included the commitment of a further $198 million for KiwiRail's "Turnaround Plan" to return the company to commercial viability. The plan was originally forecast to cost the Government $750 million but yesterday's commitment takes it $1.04 billion.
In 2012, the Government said the $250 million it committed to the plan that year would come from asset sales. It committed a further $94 million from asset sales proceeds last year. This year's $198 million takes total "Future Investment Fund" or asset sales cash committed to the turnaround to $524 million.
Including the $1.04 billion committed to the turnaround plan, Governments have now poured a total of $2.4 billion into KiwiRail since it was bought back from Australia's Toll Holdings by Labour in 2008.
