The Government has established a new company to procure replacement ships for KiwiRail’s ageing Interislander ferries today. Video / Mark Mitchell
Analysis by Georgina Campbell
Georgina Campbell is a Wellington-based reporter who has a particular interest in local government, transport, and seismic issues. She joined the Herald in 2019 after working as a broadcast journalist.
The future of Interislander’s ageing ferries started with Winston Peters and, more than four years later and a stint outside of Parliament, will now end with him after he managed to claw back responsibility for rail.
Finance Minister Nicola Willis and newly appointed Minister for Rail Winston Peters. Photo / Mark Mitchell
The new job means he has ministerial oversight of KiwiRail.
The Deputy Prime Minister and NZ First leader has gained control of the future of the Interislander ferries, is the one responsible for delivering them and is going back to the drawing board.
“We’re going to start with a clear sheet of paper ... to consider all possible permutations and then make a decision that makes sense to New Zealanders who are paying for it,” he has said.
Peters has been here before, in 2020, which is when this saga began.
At this time, NZ First was in Government with Labour and Peters was the Minister for State-Owned Enterprises.
A Beehive press release from May that year said Peters welcomed KiwiRail’s announcement that it was seeking a preferred shipyard to build two new rail-enabled ferries for the Cook Strait crossing.
“This Government is committed to restoring rail to its rightful place in New Zealand. Bigger, better ships, with new technology are yet another step on that journey,” Peters said.
Peters pointed out at the time that only the Aratere was rail-enabled.
“An unwillingness from previous governments to invest properly in New Zealand’s rail infrastructure has meant the Aratere has had a number of costly technical and mechanical issues.
“It is vital we act now to ensure our Main Trunk Line between the North and South Islands is resilient and well-provisioned for the future.”
The Aratere is Interislander's only rail-enabled ferry. Photo / Mark Mitchell
This was a ferry plan that Peters was on board with.
These ferries are of course the mega ferries that Willis announced were cancelled last year.
The ferries were going to be rail-enabled meaning that trains could drive directly on and off them seamlessly.
Rail-capable ferries (the ones Willis intends to procure in March if there are no better options) require road bridging where containers are removed from the rail wagons by a vehicle that then loads them onto the ferries.
Peters is big on rail.
A breakdown of the $3 billion Provincial Growth Fund, which was part of Labour’s coalition deal with NZ First, shows rail got the biggest slice of the pie.
Just over $450 million went to rail, which is 16% of the total money spent, for plans like reopening the Napier to Wairoa line.
When Peters had oversight of the ferries in 2020, the Government expected $435m would be enough for the project and the remainder to be privately funded.
Later that year, NZ First was kicked out of Parliament after a landslide victory for Labour in the general election.
It was from this point that the ferry project cost escalations started. It went from $775m to more than $3b.
“I’ve got no regrets about what I did. I’ve certainly got regrets that what started off at $400.1m blew out to [potentially] $4b according to Treasury.”
Peters said “certain interests” took the chance to rip off taxpayers for their own advantage without any concern for the final rail utilities or taxpayers' interests.
Jacinda Ardern spearheaded a landslide victory for Labour in the 2020 general election. Photo / Dean Purcell
Peters did not really feature at the time the Government he is now a part of put a stop to KiwiRail’s seemingly endless requests for more money for the mega ferries.
An expert ministerial advisory group was set up to investigate the best way forward for Cook Strait. Its report was delivered to ministers in June.
In July, Willis told Newstalk ZB’s Heather du Plessis-Allan the public would “find out about the ferries once ministers have made decisions”.
She expected that would be within the quarter but that quarter came and went.
When told the Government appeared to be leaning towards non-rail-enabled ferries, Peters responded: “Who said that’s going to happen? Let’s see what happens in the end.”
Asked whether he would prefer rail-enabled ferries, Peters said: “Well, of course I would. Because for 100 years that’s what we’ve been planning to do.”
Asked if it was a bottom line, Peters said: “We don’t have bottom lines like you do – this isn’t our first rodeo”.
“I think you should go and ask the minister, I’m not in charge of it. Or you could perhaps ask the minister why I’m not in charge of it, somebody with a proven record.”
Two new mega ferries were due to arrive in 2026 to replace Interislander's fleet before they were cancelled. Image / KiwiRail
Willis and Prime Minister Christopher Luxon then said we could expect an announcement on the ferries by the end of the year.
Answering questions on behalf of the Prime Minister in the House, Peters said the Government will decide by December 11.
“It was always on the 11th of December or before so, we haven’t pushed any date out at all.”
This date was exactly one year after Cabinet decided to cancel the mega ferries.
There was great anticipation about finally finding out about the new ferry plan.
Many people were therefore speechless when Willis and Peters announced the new ferries hadn’t been ordered, there was no shipbuilder and no final cost.
Asked whose idea the Minister for Rail position was, Peters said: “Put it this way, we planted the seed and it became his [Christopher Luxon’s] idea.”
Asked why rail-enabled ferries needed to be considered, Peters said: “Well, as Don Braid from Mainfreight said this morning, it’s really a no-brainer.”
Peters said everything should be in the mix before they make “the wisest decision we can possibly make”.
But Peters stressed this needed to be at a cost the Government could afford.
Peters said he wanted to ensure rail was regarded and supported as a critical part of the country’s infrastructure.
“And that’s both islands of this country,” he said.
Sound familiar?
Georgina Campbell is a Wellington-based reporter who has a particular interest in local government, transport, and seismic issues. She joined the Herald in 2019 after working as a broadcast journalist.
