Land Transport (Rail) Legislation Bill

I move, That the Land Transport (Rail) Legislation Bill be now read a third time.

Our Government is committed to securing the role of rail in the New Zealand transport system. The network is a major contributor to the national and regional economic growth of this country. It’s a vital link in our supply chain, and it will play an important role in our economic recovery from the pandemic.

Rail provides so many benefits to New Zealand: reducing emissions and congestion, reducing road deaths and injuries, and providing vital connections between communities. This Government’s vision is for a multimodal transport system that gives Kiwis real transport choices, and within that system we are striving for a national rail network that will provide modern rapid transit in our largest cities, particularly Auckland and Wellington. But, as we speak, as Tauranga, as Hamilton, and as Canterbury plan their future transport systems, they are all looking, in one way or another, at the role that rail can play as the backbone of public transport systems.

Rail is also the backbone of a sustainable 21st century freight network, and we need to consider all of the modes together as parts of an integrated land transport system. We want the most efficient mode to be used for any given task moving freight or people, and rail can no longer be left out in the cold. This bill brings it in for decision makers to consider alongside every other mode. It will support the restoration of rail, helping to achieve our Government’s goal of a rail network that delivers value for all New Zealanders.

The EY Value of Rail report—that was commissioned by KiwiRail, but suppressed by the former National Government, and released by KiwiRail when I became the Minister of Transport—found that rail contributes $1.5 billion of value to New Zealand every year. By taking trucks off the road and reducing wear and tear on our highways, by preventing deaths and serious injuries, and by reducing carbon emissions, it contributes real value. Without it, our transport system simply wouldn’t work.

The Future of Rail review that our Government did found that the network has been in a state of managed decline. Fixing the issues with rail so that it can deliver on our vision requires an ongoing commitment to investing in the network, and that’s why our coalition Government has invested $4.6 billion into the rail network in the last three years. However, the challenge is not just about increasing the level of investment. We also must update our current approach to planning and funding rail, and address the structural factors that have contributed to its managed decline.

The annual planning and funding arrangements for rail through the Budget process have imposed a short-term view of investment that is entirely inappropriate for a long-lived asset like rail. The result has been uncertainty, short-term procurement decisions, and chronic under-investment in the rail network.

The new planning and funding framework that this bill ushers in follows a partial integration approach. It brings rail and other land transport investments closer together and allows investments to be made in a way that gets them to work together. This is an important step not only for rail but for our vision of an efficient and sustainable multimodal transport system. Ministers will retain their decision-making rights over rail investments, KiwiRail continues as a State-owned enterprise, and Waka Kotahi—the New Zealand Transport Agency (NZTA)—will be responsible for providing Ministers with advice on the rail network investment programme, which will be produced on a three-yearly cycle. While the Government guides the rail network through the investments needed to keep it resilient and reliable, it’s crucial that Ministers are accountable for and have oversight of the funding for the rail network as well as its commercial assets.

It’s important to ensure that the statutory rail network investment programme established by this bill is robust and it reflects regional and national priorities. This bill ensures that Waka Kotahi gives independent advice to KiwiRail and Ministers that takes into account any relevant regional land transport plan. Rail is critically important to so many of our regions, and it’s very important that the regions have a voice in the rail network investment plan. This will also ensure that Ministers are informed of any interdependencies between the regional priorities, the regional land transport programmes, and projects. This will allow KiwiRail to work closely with Waka Kotahi and regional councils to make sure the voices of the regions are heard.

This approach will also ensure that rail infrastructure is funded through the National Land Transport Fund. That is the budget and the programme of all land transport modes that is produced on a three-yearly cycle with a 10-year horizon. This bill contributes to our goal of ensuring that rail is no longer siloed and no longer ignored, but its critical decisions about investment and services are made in a joined-up and integrated way so that in any given corridor or any urban area where we’re wanting to move people, or in any freight task around New Zealand, we can make investments based on what is the most sustainable, efficient, resilient transport mode, and not by simply defaulting to what we have always done.

As we’ve previously said, Crown funding for rail will need to increase from past levels to ensure that KiwiRail can continue to operate as a commercial business and that its freight and logistics operation is run on commercial lines as a business, but we also want to secure the public benefits from the wider rail network. The development under this legislation of a track user charge recognises the need for transparency and fairness in rail funding. The track user charge will ensure that the users of the rail network contribute to its maintenance and upkeep. Under the National Land Transport Fund, we can continue, in a small way, to invest in rail when it is the most appropriate investment for the transport system, but I want to make it clear—because I know this is something that is still sensitive, and it’s been the subject of some confused debate—that the bulk of funding for rail on an ongoing basis will continue to be provided by the Crown. With this combination of funding from track users, the Crown, and the National Land Transport Fund, we will be able to fund the catch-up investments the rail network needs to achieve its goals.

Rail is a strategic, long-lived, national asset which delivers safety, anti-congestion, and environmental benefits for all New Zealanders. It is the sustainable backbone of our 21st century transport system. It’s clear that we need to take a long-term and properly planned, integrated approach to rail in this country, and this bill is about changing that approach to transport planning and applying a long-term strategic approach.

The bill will secure rail’s ability to continue to deliver those benefits to New Zealand that I’ve mentioned, and we will ensure that we have a rail network that keeps people, places, and products connected. It won’t surprise members of this House that the commanding heights of our economy, the great export producers, our dairy, forestry, coal, timber—all of those are the major export primary producers, and they want to see investment in rail. They want an efficient and modern, capable rail network. Talk to the two freight-forwarding companies who shift the most freight in this country—Toll Holdings and Mainfreight—and they want to see investment in a modern rail network. They don’t support the narrow, roads-only vision that we so often hear from the Opposition benches.

This bill will be vital for progressing regional economic development, creating jobs, and developing our regions at a time when they need it most. The bill will give the long-term certainty that the rail network needs, and it will be instrumental in delivering a resilient, reliable, and safe rail network that will benefit all New Zealanders.

I want to finish by thanking the public servants in the Ministry of Transport, the people who work for KiwiRail and NZTA, and Treasury, actually, who have all contributed to the future of rail review and this legislation. I commend this bill to the House.

Thank you, Mr Speaker. I rise in opposition to the Land Transport (Rail) Legislation Bill. Look, it’s actually a bit of a smoke and mirrors bill, in the main. It’s got a lot of stuff it talks about which is—some of it good—not actually legislatively necessary, all to disguise what the Minister of Transport admitted: that, actually, at the heart of this, the nub of this, is the little land transport cookie jar that they can raid when they feel a need to fund rail.

Actually, Mr Speaker, you wouldn’t have seen, but Madam Speaker before you might have gathered that I appeared a bit late here when the revised speaking list came out this afternoon, worried that I might not be able to make it in time to take this call. As things transpired, it was so much easier, so much easier. But, you know, that actually of itself is illustrative of the wrong-headed thinking in this and why we shouldn’t be pilfering the Land Transport Fund funded out of roading fuel taxes for rail, as there I was, on the eastern side of the CBD and look, surprise, surprise, there is no way I could have got back here by the rail that this Minister wants to raid from that fund.

It took Wellington Combined Taxis. It took the second taxi; for some reason, the first one took a look at me and decided to go elsewhere. But the second taxi got me here on time using the road, the road funded at least in part because it’s a local road—at least half-funded by road-user taxes paid by motorists that this Minister wants to divert away, divert away from the network used most often by most people for most journeys and to instead put it somewhere which is used far less often, by far less people for far less purposes. That is suboptimal at best. I wouldn’t claim it wasn’t used at all, but compared to the roading network and the demands on that, it is used far, far less.

I do agree with the Minister, though, that the idea of integrating our planning—transport planning, including all modes, particularly rail, alongside road—is a good idea. In fact, it’s a fantastic idea. It doesn’t need legislation to do it. You don’t need legislation for people to talk to each other, arrive at a consensus, and agree on a way forward. You don’t actually need law to permit that. But even if we allowed that, perhaps, legislating a framework around that might assist in some way; you don’t need to take money out of the Land Transport Fund from motorists to achieve that. So all this bill really is about is a funding source for rail that takes money from people that have paid their taxes for the roads they use, giving them less, to give a service that doesn’t appear to be able to wash its own face a bit more money.

I’m just going to finish with a comment he made about people that said they want this—Mainfreight, for instance. If there were road transport companies that really wanted rail to thrive, they would put more of the goods they carry on rail. That would create the profits the retention of which would provide the capital for KiwiRail to have grown. The fact they don’t do that shows that it isn’t the economic powerhouse that the Minister wants to believe it is. There is a place for rail investment from the consolidated fund, Minister. Road users who pay road taxes have an absolute right to expect that those taxes—because, as you have said, they are hypothecated—will go to maintain and further improve their roading network. This is a bad bill conceived of a bad idea.

Thank you, Mr Speaker. It’s disappointing to hear that—and, really, some fundamental misconceptions about how the funding of State assets works. It’s no good expecting Mainfreight to put more freight on rail if the rail system is absolutely derelict through years and years of neglect. I speak for Canterbury here, because we would love to see some rail down in Christchurch—better freight, passenger rail; would love to see it there, but the state of the network at the moment simply doesn’t work.

If we can get some of that freight off the roads, on to the rail, free up congestion, and use those funds for improving the rail network, it’ll be better for everyone. People will move more freely, freight will move more quickly, carbon emissions will go down, and you know what? That’s the work that this Government has been doing for the last three years and will continue doing into the future, and this is part of that plan. I commend it to the House.

Thank you, Mr Speaker. Well, if we were to believe that member’s view of this, it’s all sunshine and lollipops if this bill is enacted. Well, the simple reality is that it is not, and this member is quite clearly unaware of the detail of how we’ve got to this stage with this particular piece of legislation. So, as it’s gone through the different steps, we have been very clear in our view that there is no need—and, in fact, that it would be inappropriate—to enable rail access to National Land Transport Fund money, which is, fundamentally, to have the upgrades of roading and the likes.

💬 Hon Phil Twyford: It already has access to it.

Now, the Minister says they already have access to it. So, if that’s the case, why are we bothering with this piece of legislation at all, Mr Twyford? Clearly—clearly—the Minister is not quite up to speed on it, and I appreciate that it’s late in the day for him, but what the existing legislation enables is that the National Land Transport Fund is to be used for some aspects, like train stations or busways, that are outside the typical roading stuff, but this new bill enables a whole other suite of access to the funding. And so, from that perspective, we totally oppose that, because the fundamental premise on this side of the House is that the National Land Transport Fund is there to fund roading projects, and rail in particular should be funded through its own mechanisms in that manner. Now, we’re not opposed to rail funding, and indeed we support rail in the right places, but it should be a commercially focused Stated-owned enterprise (SOE). And what we’ve seen from this Government—the intent—and that’s born out through this legislation as well, is that KiwiRail moves away from that SOE model to a public-good model. And, simply, that’s not where it should be; that’s a fundamental difference in perspectives between the different sides of the House.

One of the key concerns I have in relation to this legislation, as well, is that, actually, it makes it a little clunky. So what we have brought in here, through this, is to implement what are called “rail network investment plans”. So these are a three-year programme of work that gets put forward to sit in the Government policy statement on transport. But the issue here is that the Minister has to sign off this rail network investment plan, which then the New Zealand Transport Agency must include in their planning programme; yet they have no ability to influence what’s in that plan. There’s no flexibility for them to make trade-offs between what might be proposed on the rail side versus the road side, and so, from that perspective, the two just don’t align, and you can’t merge that together into the seamless, multimodal transport system that the Minister claims he wants to achieve. It just doesn’t make sense; we don’t need this piece of legislation. It’s not the right thing.

One of the other aspects I have concern around now is that, given the COVID situation we’ve seen, there has been a significant shortfall in the revenue gained through the National Land Transport Fund, and so now, if we’re providing more of that funding for rail, the question is how many more roads are going to miss out. We’ve already seen $5 billion stripped out of that road funding budget by this Government. We totally oppose this bill and will continue to do so.

Thank you, Mr Speaker. It’s no surprise, and should be no surprise to anyone, that we are supporting this bill, because New Zealand First is the party for the regions. What do we need in the regions? We need investment and, especially, we need investment in rail. I think that the Minister Phil Twyford quite eloquently set out in detail what this bill will do in regards to ensuring that we are able to invest in rail, concentrate on rail, build rail, especially in our regions. I think that he also outlined why it was so important.

What is hollow to me about the National Party not supporting this bill is the reason, because it’s opposite to what this side of the House is, which is we are the regions and we want to invest in rail, and that side doesn’t. The last speech that we heard from Tim van de Molen was that they want to invest in roads. Well, New Zealand First is supporting the Labour Party and this coalition Government and supporting this bill, and we commend it to the House. Thank you.

I’m not going to take too long, because I endorse the comments made by my colleagues on this side of the House. We don’t support this bill. We don’t think it adds value. I think it was Margaret Thatcher, former Prime Minister of the United Kingdom, who said once that the problem with socialism is that sooner or later, you run out of other people’s money. This is a bill that is designed simply to rob Peter to pay Paul and to divert money away from road users to obsolete railway. So we oppose this bill, and that’s it.

E Te Māngai, tēnā koe. Tēnā koutou e Te Whare. I actually wasn’t intending to do a call on this bill, but I do feel compelled to respond to the Hon Scott Simpson, particularly his invocation of former Prime Minister—I’m aware that I’m also standing between members and their weekend as we end urgency. But I do just really, really, really need to respond to the invocation of former Prime Minister of the United Kingdom, Margaret Thatcher, and particularly that statement: “The problem with socialism is you run out of other people’s money.” I want to ask members of the National Party where on earth they think money for the roading projects that they love so much comes from. It is largely from everybody, because they are not particularly in favour of user-pays policies for roading projects. What that means is that people, like myself who do not own a car end up paying for the roads that the National Party is so keen on.

Just to make it really clear to members of the public who may be actually listening and hoping for some content of this legislation to be discussed, what the Land Transport (Rail) Legislation Bill does is create a framework that brings planning and funding of the rail network under the land transport planning and funding regime set out by the Land Transport Management Act 2003. Currently, that Land Transport Management Act deals with the planning and funding of public transport, State highways, and of local roads. So to add rail into that mix is simply actually to become more agnostic towards the types of projects that we are funding. As an Opposition that so often gets up in the House and talks about ideology, I would really love them to reflect on the ideological obsession that they have with roads at the cost of all other projects.

Particularly on that point, just finally, I want to respond to the point made by the honourable Brett Hudson, which is that most people use roads—he’s not honourable. Well, my learned colleague, my learned friend Brett Hudson—

💬 SPEAKER: No, no, he’s not even learned.

CHLÖE SWARBRICK: Oh OK, Brett Hudson from the Opposition.

💬 SPEAKER: That’s for lawyers only.

CHLÖE SWARBRICK: Yeah. What he was saying is that most people use roads; therefore, we should just continue to fund only roads. That has got to be some of the most broken logic that I have ever heard from a member of Parliament. We’ve always done things this way; therefore, we must always continue to do things this way, even if it particularly doesn’t work and is one of the major drivers for increasing carbon emissions in this country. We have an opportunity to do things differently. And, actually, the core logical point made by Brett Hudson is that if you build it, they will come, and they will use it. Therefore, it’s a great argument for investing in rail.

So the Green Party are really glad to be supporting this piece of legislation today, and I wish all members of the House a great weekend.

The question is that—

💬 Ian McKelvie: Mr Speaker.

Oh—I call Ian McKelvie.

I can’t resist it, Mr Speaker. I cannot resist it and the reason I cannot resist it is that I’ve got 10 minutes to waste, because the Government, by putting this bill through this afternoon, has stuffed my 5 o’clock at the Fat Farmer and I’m very upset about that, so I’m going to waste a bit of their time—because I’ll never get back to the Fat Farmer by 5 o’clock today. I just want to remind the previous speaker that we too like rail—so much so that one of the members of my electorate yesterday brought a petition to the House trying to get the train to stop in Taumarunui.

💬 SPEAKER: Hear, hear!

The rail is so bad they won’t stop in Taumarunui. So that’s another reason for me not to support this bill, aside from the Fat Farmer at 5 o’clock.

But I just want to remind the Minister, because it’s ironic—irony is not meant to be used in this House, I realise that, but it’s somewhat ironic that the last Labour Government hypothecated road funding specifically to be used for roads, and this one’s de-hypothecating road funding to be used for whatever we want, and I thought that was quite interesting as well. I do remember the argument at the time, put up mostly by Local Government New Zealand, at length, to get road funding dedicated to roads. And now we’re un-dedicating road funding for roads. So, Mr Speaker, that’s my short contribution.

The question is that the motion be agreed to.

💬 Dr Parmjeet Parmar: Mr Speaker.

Oh, I’m sorry. Dr Parmjeet Parmar. Sorry, the member’s got to call loud when we’re trying to get out of here!

Mr Speaker, thank you. Ha, ha! I just want to comment on that anti-road attitude from Chlöe Swarbrick and the Labour Government. They need to realise that buses run on roads. Buses are part of public transport systems, so we do need roads not just to support motorists but also to support our buses. Putting money from one pot to the other pot is not a real investment. We want real investment if the Government is really serious about investing in our rail network.

The Minister Phil Twyford was really good at using some words like “sustainable system”, “We need investment.”, “We need a multimodal transport system.” We support all those things, but this bill is not supporting that. So that’s why we oppose this legislation. Thank you.