Railways Bill

, on behalf of the Minister of Transport: I move, That the Railways Bill be now read a second time. Last year the Government rescued the rail network from its disastrous privatisation, and pledged to invest $200 million in it. Crown ownership of the national rail network will help to ensure that the rail system is maintained and developed as a vital part of New Zealand’s transport infrastructure. In addition, the Government’s funding assistance for passenger rail services in Auckland and Wellington—rolling stock, stations, and track—will have extra investment. The aim is to encourage patronage, so that access is improved and road congestion and environmental impacts are reduced. A national rail strategy is currently being developed. It is intended to provide a framework for the development of rail in New Zealand. Its focus will primarily be on improving rail freight and urban passenger transport, in order to support economic growth and to contribute to the well-being of individuals and their communities.

This bill is aimed at promoting the safe operation of the rail industry. It recognises the changes in rail ownership and operational activities, and reflects the strong commitment made by the Government to recognise the recommendations made in the Ministerial Inquiry into Tranz Rail Occupational Safety and Heath 2000, also known as the Wilson report. The bill introduces a more integrated and robust regime that is based squarely on safety risk management principles. Under the current legislation, rail operators are accountable for safety through their approved safety management systems. There are now a growing number of participants in the rail sector whose activities are fundamental to the safe delivery of a rail service, but who will not be covered by a safety management system. The bill extends the licensing regime to cover a greater proportion of those that are termed “rail participants” under this legislation. It requires a clear and visible chain of responsibility between licence holders and subsidiary organisations.

The bill takes a co-regulatory approach to safety. Responsibility for safety is placed squarely on the separate licence holders and their associated rail participants, to provide assurance to the Government that the safety policies and operational systems they have in place mean that they are operating safely and that they will continue to do so. The bill consolidates existing legislation relating to rail safety and expands on that legislation to address a number of deficiencies in the current rail safety legislative framework.

The bill introduces a wider-ranging process of safety assessment to improve safety assurance. It also broadens the range of enforcement powers available to enforce safety. Currently, rail operators submit a safety management system to be approved by Land Transport New Zealand. The Wilson and Halliburton reports criticised Tranz Rail’s safety management system as being “voluminous and unwieldy”. The bill addresses this issue by splitting the safety management system into a high-level safety case and a separate, but linked, safety system. The safety case contains overarching safety risk management documentation that is designed to ensure that the rail participant can properly assess, control, and manage its safety risk and provide safety assurance to the director of Land Transport New Zealand. The safety system is a documented record of the detailed management and operational policies and practices that relate to the safe conduct of all business activities.

The Transport and Industrial Relations Committee has examined the bill thoroughly and has recommended that it be passed with amendments. I support the amendments—as does the Minister—that are proposed by the committee, as they strengthen the bill. The committee has done a commendable job. Supplementary Order Paper 353 recognises the new authority, Land Transport New Zealand, and ensures the objectives of the New Zealand Transport Strategy are reflected in the rule-making provisions. The Supplementary Order Paper also addresses level crossing safety, following recommendations from the coroner concerning a fatality at the Silverstream pedestrian level crossing. These provisions ensure that all parties involved in the operation or management of the crossing will agree in writing on the warning devices to be installed and operated.

The relationship between the bill and the Health and Safety in Employment Act is now a great deal clearer. The role of safety manager, with its high level of personal responsibility, has been removed. This is consistent with the principle that safety is everyone’s responsibility. The committee has refined the hierarchy of interventions the director may take where action is deemed necessary to ensure safe rail operations. Each intervention is more appropriately targeted to the safety risk involved. To clarify safety roles in the new rail environment, a mandatory obligation has been introduced for rail operators and their personnel to obey all instructions from the network controller. The safety case—the key risk management documentation—is now more comprehensive. New aspects require policies to ensure that rail personnel are fit for duty and, in particular, that they are not impaired by drugs or alcohol. There also needs to be a policy for consultation with unions and other representatives of rail personnel in the development of safety systems that affect rail personnel.

The revised Railways Bill will assist in fulfilling the Government’s commitment to rail by improving rail safety performance. It reinforces the rail safety framework and supports other rail initiatives, such as the repurchase of the rail network, the investment in rail infrastructure, and the development of a national rail strategy. I commend the Railways Bill to the House.

I am very happy to take a call in the second reading of the Railways Bill, and I want to make a few points about it. First of all, the National Party is prepared to support this legislation as it came back from the Transport and Industrial Relations Committee, because I think a process was finally followed that this House would be pleased with, but I do not think that members can be pleased with how it started out. The House and the select committee were presented with an initial bill that I think had had an appalling level of consultation with the various industry players.

As everyone in this House knows, the very semantics of the wording we use can often make a big difference. I know that Dr Michael Cullen knows that changing just one word can alter the meaning of an entire agreement or bill. Dr Cullen knows that; he is an expert at the changing of one word.

We ended up in this case with a bill that operators such as Toll Holdings were really quite outraged about. Its representatives said to the select committee: “If only we had been able to be consulted with and been able to have our side of things heard, and with just a small amount of change to some of the semantics and some of the wording—where you have ‘all reasonable steps’ and ‘all practicable steps taken’—we could have lived with a lot of this. But in the way it is currently worded, it will just be an absolute bunfight.” I have to say that all sorts of things about safety in the workplace had to be adhered to, which in some cases, as far as I could tell, were contradictory to the actual Health and Safety in Employment Act.

It seemed to the select committee that there was a way around that, and that the officials should have gone away and talked, because we had a very good basis for the bill. That was the Wilson report. I am very happy to say that I think the Wilson report was of substance. It had some value, and we were hoping that we could turn the Wilson report into a legislative vehicle. That is what I think we have ended up with. As the Minister, who just spoke in the second reading, said, there is a high-level safety case in relation to all the operators who work on a railway line.

We need to understand what the big difference is with railways now. Instead of there being just the former one operator that both ran the carriages and trains and owned the line, and so on—likeNew Zealand Rail, as it used to be for years, or like Tranz Rail, as it then called itself—we have split up the railway line. I guess the best analogy for that is the situation with the roads, where a particular body owns the roads. In the case of the State highways it is Transit, on behalf of the Government, and all the players that want to operate on those roads, like trucking companies and private motorists, pay for specific access to use those roads. With rail, we will see a range of different operators, from the big Toll Holdings, which is the biggest operator, to Connex, which is running trains in Auckland, to smaller companies, and to the hobbyist railways, where trains run for only a few kilometres on a little spur somewhere. So the legislation is required.

I make the case again that the National Party was very happy about the legislation but, as the Minister has said, there is a Supplementary Order Paper to come. I have just been able to look at it. We were not aware of this Supplementary Order Paper, even though this legislation was introduced back in 2003 and the select committee, I repeat, reported back to the House on 9 August 2004. There has been plenty of time, if the Government had wanted to have some cooperation on the Supplementary Order Paper, to let members of the Opposition see it before today, before we suddenly bring this bill in and bang it through under urgency.

I have looked at this Supplementary Order Paper and, as with some Supplementary Order Papers, I see that it is reasonably trivial. There is some stuff in it that now calls the authority Land Transport New Zealand, because when the bill was introduced the authority was the Land Transport Safety Authority. Of course, no one will object to that, but how about something like the proposed new clause 48(a) that gives the Minister the power to make rules concerning “… rail vehicles, railway premises, or railway infrastructure:”? The bill as introduced, under clause 51(a), provided that ordinary rules could be made, amongst other things, to “regulate the use of railway lines, and empower access providers to control, restrict, and prohibit the use of a railway line, and to close railway lines in specified circumstances or on specified occasions.” But quite serious concern was expressed about that.

The select committee members, I think, worked very cooperatively—Lynne Pillay is in the House today, and I think that she will agree that the select committee worked very cooperatively—to get the bill to where it is, but what do I see in this Supplementary Order Paper? The select committee had deleted that power because on evidence, on balance, and across the board of all operators who made that submission, it was something that should not have been in the bill. But what do I see now? I see that Supplementary Order Paper 353 proposes to reinstate it.

The Minister is saying that he does not care what was said in the submissions from all the various interested players at the committee hearing. He does not care about what the officials finally advised the committee, or, indeed, what members of the committee across Labour, the Greens, National, and ACT—four parties or maybe even five parties; I do not think that United Future was represented on the committee—all agreed to, and agreed to in a very cooperative style. No—remembering that the bill was reported back on 9 August 2004, we now have a situation where the Minister has come back with a Supplementary Order Paper and has shoved that provision back in.

Now, I have to say that that really tests our resolve to try to work cooperatively. I think that sending the officials away to work with the various players—mainly Toll, because it is the main game in town, but also a number of others—got us a bill that was tidy and a report back we could all sign up to. It got us into a space where we were comfortable—but now this has happened. It is actually a sort of Michael Cullen on steroids trick. This is not just changing one word; this is coming back and changing the entire intent of the bill by whamming in a Supplementary Order Paper in at the last minute.

I will be talking a little more to some of my colleagues about how we will deal with this bill at the Committee of the whole House stage. But, at this point, I say that the bill as reported back from the select committee does great credit to all members of that committee, to the officials, and to the people outside who have to run the rail system. If this bill were passed as it came back from the committee, we would have a safer rail system in which people would know their responsibilities more clearly. The chain of command would be established as to who was responsible for the railway lines, for the land on the side of the railway lines, for the operation of the rolling stock, for the health and safety of workers on the railways and members of the public who come near a railway line by way of using a railway crossing or walking beside it, and for the rights of individuals to enter on to railways land or to walk off it.

This bill would cover all of that in what I think is a very tidy fashion—but not when the Government, in the form of the Minister, just says it does not care what everybody has agreed to or how long the process took place: “I know best; I am in charge. ‘We won. You lost. Eat that!’ Here is a Supplementary Order Paper at the last minute.”

I am very pleased to rise and take a call on this bill, because I agree with Maurice Williamson that it is a very important bill. I also agree with him that the Transport and Industrial Relations Committee worked really hard on it. I think that the outcome is very, very good. I also have to commend the industry for its submissions, and the union and the employers, who worked together and put very much time and energy into making sure that all the t’s were crossed and all the i’s were dotted, and that we ended up with the best bill we could get. After all, this Government believes that a well-developed, safe, and sustainable transport system is absolutely essential to growth and innovation.

Let us not forget what this bill was a result of. Last year we rescued the rail network from its disastrous privatisation, and we pledged to invest $200 million in it. Crown ownership of the national rail network will help to ensure that the rail system is maintained and developed as a vital part of our transport infrastructure. The bill seeks to build on that. It aims to, and certainly will, improve rail safety. That is very, very important. The bill will transfer rail safety legislation into a comprehensive piece of legislation—namely, this bill—so that what we see is what we get.

The bill will also ensure public safety and the protection of those who are not covered by the Health and Safety in Employment Act. It will ensure health and safety on the job, which this Government is really committed to, as are the workers and their representatives out there. The bill will also gain assurance from the rail industry that it is managing its safety risks.

There has been much work and much commitment, as I said before, from both the union and the employers within this industry to ensure that all bases are covered. I have no hesitation in standing here as a member of the select committee and commending this bill to the House.

I agree with almost every word the honourable member who has just resumed her seat said. When this bill went through the Transport and Industrial Relations Committee there was a great deal of cooperation between members. The officials took a huge amount of time, going back three or four times, I think, to various participants in the railway system. I also agree that this bill is essential to make our railways safe. I most certainly agree that the Government has bought back the railway line in a dilapidated state and that it needs some capital injected into it. I do not think $200 million will be enough—I think it will fall short by a long way—but I agree that the railway system was in a dilapidated state and needed some money put into it.

But now we have this Supplementary Order Paper, about which I note the honourable member Lynne Pillay did not say a word. I have only just received a copy of it and I have only had a limited amount of time to read it. I have to say that it raises a question mark in my head. I listened to the Hon Maurice Williamson, and I think he made a very good point—despite the fact that he is obviously suffering from Alzheimer’s, because he could not remember that Peter Brown and New Zealand First were on the select committee.

💬 Hon Maurice Williamson: I said that.

No, the member did not. He got it wrong.

💬 Hon Maurice Williamson: My total apology. I withdraw and apologise.

I thank the member. He has raised some concerns that do not sit comfortably with us at all. We will take a closer look at this Supplementary Order Paper, because I hope the Minister has not undermined—

💬 Hon Maurice Williamson: Michael Cullen.

Does the member think it is a Michael Cullen trick?

💬 Hon Maurice Williamson: Yes, he changed one word—

He has actually changed about a thousand words, by the look of this Supplementary Order Paper, so we will take a very careful look at it. I hope that the Minister has not pulled some sort of swifty on the select committee, because the select committee took a lot of time and trouble in endeavouring to get this bill right. New Zealand First is of the mind that the bill should be supported in its entirety, and if the Minister has reversed some of the assertions in the bill, then we will be concerned.

Our only other concern—we would like to put this to the Government, maybe one of the next speakers for the Government will tell us the reason—is why it has taken so long to get this bill before the House. The bill was reported back mid last year, and now, in April 2005, we are discussing it in urgency and trying to progress it through the House.

I do not think there is a great deal more I can say. I remember at the time being impressed by the way the select committee applied its talents, its determination, and its dedication to getting this bill correct and fair in all manner of areas. New Zealand First was very impressed with the attitude of the committee and the outcome—the way the bill was finalised. But I am just a bit concerned by this Supplementary Order Paper, and we will be taking a closer look at it when the bill gets to the Committee stage. In the meantime, New Zealand First still supports the bill.

The ACT party does not support the Railways Bill. It is always hard to argue against safety, because one’s opponents can then very easily put out a sound bite saying that one’s party is arguing against safety. When we debated the first reading of this bill, the Hon Jim Anderton, as members might recall, stood up and used a very emotional ploy. He talked about the terrible accident that happened to the child Morgan Jones on the railway. A considerable amount has already been done since that accident. In fact, since 2000 when the Wilson report came out, Tranz Rail, in particular, has done a significant amount of work in improving its safety standards.

There are a number of reasons why ACT cannot support this bill. It started off with good intentions. It went to the Transport and Industrial Relations Committee, as the Hon Maurice Williamson pointed out, and we on the select committee worked towards reporting back with something on which we could reach at least some sort of quasi-agreement that it was better than what came to the select committee in the first place. But, as is typical, especially when we are in urgency—it comes back to urgency—we have to pass all remaining stages of the bill, and lo and behold, there is a Supplementary Order Paper that damn near takes the bill back to what it was before it went to the select committee in the first place and before we heard all the submissions.

And there were significant submissions on this piece of legislation—from Federated Farmers, from Toll Holdings, from Tranz Rail, from the unions, and from the small railways operators. Those are the operators of heritage railway tracks and the small not-for-profit organisations—charitable trusts that run railways just because they are rail nuts. And good on them. They do a good job in terms of preserving some of our historical railways heritage. But this bill is a push by the unions. It is a union-backed bill. It is interesting that—

💬 Jill Pettis: Rubbish!

Well, Lynne Pillay just stood up and said it was pushed by the unions. She said it in her own words. She said that the unions backed this bill—

💬 Lynne Pillay: I didn’t.

She cannot even remember what she said 5 minutes ago, but she said it was a union bill, and she said that it was good to see that the employers cooperated with the unions. Well, what choice do the employers have—the wealth creators, the working people in New Zealand—when these pieces of legislation come before them? They had the Health and Safety in Employment Act, they had the amendment to that, and then on top of that they have the Railways Bill. If that member had even bothered to read the Wilson report she would have seen that it specifically stated that rail should not be disadvantaged when it came to safety measures, that any legislation that followed the report should not be anti-competitive, and that rail should be on the same footing as other forms of transport.

This is not what we have seen. This Railways Bill is demonstrably stricter and more prescriptive than analogous legislation that deals with air transport and road transport. It is significantly more prescriptive in a number of ways, and one is that there is a regulator. The participants, as they are defined under this bill—the licensees, and the people who control access to rail—said in their submissions that they accepted that they have to be responsible for safety and for the setting standards, they have to be accountable for those standards, and they have to be accountable when things go wrong. There is no problem there, they do not disagree with that at all. But what will happen is that having a regulator responsible for all that will take the responsibility for the safety standards, and setting the compliance and vigilance for those standards, away from the rail companies—the rail participants—and put them in the hands of a regulator. All the participants will be reduced to box ticking and ensuring that the companies comply.

As I said at the beginning, it is hard to argue against safety, and we do not argue against safety. But one always has to remember that safety comes at a cost. Under this bill, safety is coming at a significant cost. Those parties, such as the Greens, who say they want to save rail, should look very carefully at the costs in this legislation that will be inflicted on rail operators. The licensing costs will go up for the participants, and the fees have not been set yet. Plus Land Transport New Zealand has stated that its costs will go up. Its hourly rate will go up to $160 an hour. There will be no time limit on that, so those costs will run into the many thousands, and those costs will always be passed on to the people who use rail, whether it be freight operators, or whether it be passengers.

The companies themselves will not carry those costs. When those companies find that they are in financial difficulty and that they cannot carry the costs and have to pass them on to their customers, what will this Government do? I know what they will do. We will see more of this nationalisation of State assets in reverse. We will see a repeat of what happened with Air New Zealand. It will happen with the railways, and we will go “back to the future” where, in 1 year, $90 million of taxpayers’ money was lost by New Zealand Rail, and where we had shocking safety standards.

The member Lynne Pillay has huge faith in Crown ownership ensuring that safety follows. She has an incredible faith in politicians. I do not have that faith in politicians. I would not have that faith in any politician to ensure that no accident happens on the rail, and this is what this legislation will do, because it puts the onus on the Minister of Transport. The perception out there will be that the Minister of Transport will keep rail safe. What will happen the first time that there is an accident? Who is going to be responsible? Will the Minister of Transport put up his hand and say “mea culpa”? I doubt it very much. This is bad legislation made worse by a Supplementary Order Paper introduced at the last minute to overturn the agreements that were reached at the Transport and Industrial Relations Committee, and we will not be supporting this bill.

I am happy to take a very brief call on the Railways Bill. As the chair of the Transport and Industrial Relations Committee I want to thank fellow committee members for all their hard work—those who turned up and understood the bill. I think there was an ACT leadership thing going on—

💬 Hon Maurice Williamson: Primary!

Yes, primary—that was it—paid for by the taxpayer. It was not done by rail, though; I think it was done by aeroplane. Quite frankly, I think that speech was an ungracious one, because Deborah Coddington does actually contribute very positively to the committee when she is there. On this bill, all the members worked through a very good process.

As the Minister of Defence said in his speech, this measure is about an approach whereby the Government does not set the rules then expect the people out there just to follow them; the people out there are actually engaged in setting the rules themselves, monitoring them, and making sure, from both the management and the workforce perspectives, that they have the safest possible rail system in New Zealand. There are many terrible international examples of rail safety gone wrong. The select committee tried to learn from those examples and not repeat the mistakes. I think in this bill we have the best of both worlds. We have proper Government intervention through a proper Government agency, but, more important, we have management and workers together making sure we have a safe railway system. I look forward to the debate in the Committee, where we can test that as we go through the bill.

The Greens are supporting the bill. The process in the Transport and Industrial Relations Committee was good. It took some time to get our heads round the measure, because what we have now is an industry with a great many players, and there is scope for overlap and therefore scope for gaps between responsibility. This legislation provides measures to ensure responsibilities are met and things do not fall into gaps.

Rail does not have a bad safety record. The problem is that when things go wrong they can go horrendously wrong, and the accidents can be of a horrific nature. Trains are very large and very unstoppable, and it is important that we do have really good processes in place, as Mark Gosche has said. It is up to the operators to write out their safety procedures. But they are not left on their own. They then have to have those safety procedures approved by the Director of Land Transport New Zealand, as it is now.

The mechanisms in place are, first of all, the safety case and the safety mechanisms. The safety case provides the overarching framework of processes and mechanisms, and the safety systems are the more detailed procedures for the day-to-day operations. The removal of the position of safety manager is interesting, the reason for it being that it is believed that all operators have to take a measure of responsibility. The words in the bill provide that the buck actually stops at the highest level. There are a whole range of operators, from access providers to infrastructure owners, rail vehicle owners, premise owners, rail traffic controllers, and maintenance providers. It is important that in each of those areas there is sufficient funding in place to make sure that the operators have the funds and the expertise in place to meet their safety obligations.

Deborah Coddington made a good point about the amount of costs met by rail operators. Of course those costs are higher for rail operators than they are for other transport operators. In the case of road transport we have warrant processes that are administered by somebody else. In the case of rail transport the expertise lies with the rail operators. They have to supervise their own safety processes, to make sure they are done day by day, because they are the ones who know about the matter.

The Greens are pleased to support this legislation.

Firstly, I thank the Transport and Industrial Relations Committee for the work it has done. United Future does not have a member on that particular committee, but I can see from the report back that the committee worked very cooperatively and made some very useful changes to the legislation. I also thank the officials who helped us with a briefing to enable us to come up to speed with the changes that have been made. As I said, we think that these changes are improvements to the legislation.

The bill proposes a more proactive approach to identifying and managing critical safety issues, by ensuring that the key rail participants are licensed, that key safety data is collected, that operators demonstrate that they are managing safety risks, and that the Land Transport Safety Authority has more powers to audit, inspect, and sanction operators. This bill seeks to reduce compliance costs without reducing safety standards. A feature of the bill is its proportional response to the various issues that arise. It does not seek to overlegislate, but it does not let pressing issues fall through the gaps. It provides distinctions as to who is accountable, and that is very useful. Another feature of this bill is the implicit incentive to maintain a required level of safety standards.

The changes made by the select committee reflect the ongoing vigilance of the industry and Parliament to maintain safety standards and to correct any problems, inconsistencies, or discrepancies—no matter how incidental—that might compromise rail safety or the efficient management of the rail corridor. The inclusion of new definitions of terms and positions in the first series of clauses provides needed clarity as to the roles and responsibilities of positions that are central to operational safety and performance. It also provides for a clear pathway to accountability in order to isolate and fix problems that may arise. We are interested not just in sheeting home the blame to someone but also in then being able to fix the problems that may arise.

The legislation recognises that addressing issues of safety often calls for direct action to be taken, bypassing the line of authority when circumstances warrant it. That is represented in the bill by the requirement to obey the network controller unless circumstances dictate independent action—such as where the network controller has no knowledge of the situation at hand. That flexibility allows for quick action to be taken, and is yet another example of the practical measures that are a hallmark of this bill.

It is encouraging to note that the legislation reflects the thinking of experts in the field who have first-hand experience in other jurisdictions. The fact that an expert from the United Kingdom was consulted on risk management in the rail industry is testimony to the fact that no stone was left unturned to get the best result. This approach—ascertaining as much what to do as what not to do—is a healthy approach to designing safety standards. Safety monitoring at a personal level is also addressed in the bill, which requires that safety assessors have the requisite training, knowledge, and experience to undertake assessments. United Future commends that inclusion of expertise as a necessary requirement of safety assessors.

We are also pleased that unresolved issues surrounding level crossing safety have been addressed in this bill. There have been too many tragedies involving personal safety at level crossings, largely because of a lack of adequate warning devices and signs. We are pleased that there will be improved coordination between parties, both at the local level and at the higher governmental and operator levels, to improve warning signs and related safety measures. It is important that a balance be reached between allowing heritage rail operators—who offer important tourist attractions—not to be overburdened with compliance costs, and still maintaining required safety levels. United Future is pleased that this bill recognises that balance. The bill also provides a good balance between upholding requirements and allowing flexibility to act to achieve railway safety.

United Future congratulates officials and the committee for applying practical solutions to pressing risk management and rail safety problems. This is an approach that United Future always advocates, so we gladly lend our support to the second reading of this bill.

Bill read a second time.

Instruction to Committee