Funding queries cloud rail project

A flagship project in Auckland's rail network redevelopment may be delayed amid uncertainty over a new Government funding formula.

The Government announced on the election hustings in August that a simplified funding policy would accelerate track duplication along the congested 26km western railway line by a year - enabling the $200 million project to be complete by 2008.

"What we have got is a division of labour that gives us more speed," then-Transport Minister Pete Hodgson said.

He outlined a new funding split by which the Government would build all new rail tracks and signal controls in Auckland, leaving the region to pay fully for trains and station upgrades.

This compares with an existing split for most rail capital spending in which the Government pays 60 per cent and the region 40 per cent, and was welcomed then by Auckland Regional Council chairman Mike Lee as a sensible formula.

But doubt crept in yesterday at a council transport committee meeting, when a staff report about unresolved track governance issues left Mr Lee saying he would be concerned if the Government gave with one hand, only to take with the other.

And Government agency Ontrack, which wants to take over supervision of the western line project from council subsidiary the Auckland Regional Transport Authority, told the Herald last night that it was considering a mid-2009 deadline to complete the job.

Its back-tracking revelation followed concerns of potential "slippage" of the project that the authority raised with the council committee.

The authority supervised a $23 million first stage, completed a year ago between Mt Eden and Morningside, and began work over Christmas on a $70 million second stage between New Lynn and Henderson.

But uncertainty is understood to have arisen over the letting of new contracts pending Ontrack's proposed takeover of the project on April 1.

Authority deputy chairman Rabin Rabindran told the committee there had been little progress towards a resolution of governance and other issues since Finance Minister Michael Cullen and new Transport Minister David Parker spelled out development priorities in December.

They said then that they wanted to see a core upgrade of Auckland rail substantially completed "as quickly as reasonably possible and in any case within the next three years".

Their definition of core work was the western-line duplication, an upgrade of Newmarket Station and junction expected to cost up to $75 million, and a $40 million to $50 million double-track 2km spur line connecting central Manukau to the rail network via Wiri.

Although not ruling out regional hopes of electrifying the network and building a loop under Albert St to Mt Eden, the ministers said they were not priorities for Government funding.

Also up in the air is a proposal being championed by Waitakere City Council to build an underground station for up to $140 million at New Lynn, possibly with a contribution from local developers, to remove the problematic road-rail crossing there.

Mr Rabindran expressed concern that Ontrack might have too much on its plate to ensure Auckland's upgrade was completed in a "passenger-friendly manner".

Senior regional council analyst Mark Fleming noted that the regional council's expected share of a $2.6 billion rail capital spending forecast over 10 years remained about $1.1 billion, but the Government's indicated contribution was down from $1.5 billion to $780 million.

This left a 30 per cent funding uncertainty gap.

The transport committee resolved to write to the ministers relaying issues raised in Mr Fleming's report, and to ask the transport authority to report on the Government's basis for giving the Manukau branch line such a high priority over other projects.

Ontrack spokesman Kevin Ramshaw said the only commitment it had made to date was to complete double-tracking around Henderson station by October.