The newspapers and TV have carried a report (certainly ordered by the transport minister Steven Joyce in advance of his budget announcements next month) by some fresh faced university graduate named Luke Malpass, described as "a policy analyst with the New Zealand policy unit for Center of Independent studies" based in Sydney (where else?) on the future for Kiwirail.
The gist of his claims can be summarised in a soundbite in his own words :-
"In order for rail to come close to commercial equilibrium (to break even), the network has to shrink from 4000 kilometres to 2300km. The government was repeatedly advised of this by the Treasury before the purchase.
"The rail system required a subsidy under private ownership to operate a network of the present size. This policy will continue under public ownership - except the subsidy will get larger."
Golly gee. Was this worth a massive fee, Mr Joyce? In fact, that 4,000 km is long history, it includes lines such as Napier-Gisborne, Rotorua and Stratford-Okahukura which are almost defunct from underinvestment, lines that are actually very much needed, as is the rest of the network. And "advised of this by Treasury" - oh dear... refer to our postings from last year on that topic. In fact those postings cover all of Messrs Joyce/Malpass's claims and arguments.
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