First planes, now trains

Written By: - Date published: 2:09 pm, March 6th, 2008 - 42 comments
Categories: economy, privatisation - Tags: ,

kiwitrain.jpgIt is looking more likely that the Government will buy back New Zealand’s rolling rail stock from Australian-based Toll.

Toll has been a classic asset-stripper: buy a key piece of infrastructure that should never have been sold, take as much profit as possible with minimal investment, and force the Government to buy the infrastructure back to prevent further economic damage. Lines have been closed and road freight (including Toll’s trucking line) is out-competing rail, increasing roading costs and greenhouse emissions.

The Government had to buy back the rail infrastructure from Toll in 2003 to prevent it falling apart. Toll gave up the infrastructure for a token sum, and promised to match an investment of $100 million from the government in upgrading the rails, and then pay the government for the right to use the rails. Toll has tried to wiggle out of the deal ever since, not fronting with its $100 million and now trying to avoid paying its full fee for using the rails. Now, Toll wants $700 million plus to sell the rolling stock and has rejected a government offer of $500 million. The rolling stock’s value depends on how much the Government demands for use of the rails: if they stick with the original agreed sum of $57 million this year, Toll will be willing to settle for a lower price, if Toll can reduce this cost, it will demand more to sell the rolling stock.

The Government should force this odious company to stick the original agreement and then offer it as little as possible to buy back our rolling stock. Toll has been nothing but bad news for this country; it’s time to buy back New Zealand’s railways.

[Update: The Greens have the same train of thought]

42 comments on “First planes, now trains”

  1. out of bed 1

    Key said it was Labour that was changing its mind on the airport sale at the last minute.

    “They’re trying to portray National as somehow pro-asset sales,” he said.
    http://stuff.co.nz/4426772a6160.html

    Laugh? I nearly wet myself

  2. Brownie 2

    Good thing you were out of bed

  3. out of bed 3

    he he

  4. the sprout 4

    it’s good to see Labour acting like Labour

  5. Steve Pierson 5

    I’m so glad I found that kiwi and train photo. You don’t guys know how many google images pages I looked at, and it’s so cute.

  6. the sprout 6

    steve you old softie

  7. out of bed 7

    I like trains

  8. Tane 8

    Steve, and here I was thinking you’d made it yourself with your kickass MS Paint skillz…

  9. the sprout 9

    me too

  10. Steve Pierson 10

    If I had drawn the pic using paint. I would have had kiwi driving the train, with Key tied to the tracks crying out ‘Kevin Taylor, foreign asset-strippers, anyone: save me!’

  11. monty 11

    Can the government afford to buy back this white elephant? where would it get the money from – they have squandered all the opportunities and now have a deficit. Stupid socialist Cullen – but at least the economy is tanking while he is still in government – if we waited a few more months (till after the election) then Labour would have tried to blame National.

    By the way between buying a white elephant and the deficit – will Cullen be able to afford taxcuts as one off his key criteria is no borrowing? Ha – snookered by his own red ball.

  12. Steve Pierson 12

    If I may be so bold, I take this thread as conclusive evidence that everyone in New Zealand wants the govt to buy back the trains.

  13. the sprout 13

    nice.
    of course nobody would save him, Bill English would stand guard to make sure of it.

  14. the sprout 14

    for sure buy them back. it’s a necessity if they’re to work properly with long-term objectives – you can’t plan squat when you’ve got a private investor’s six month event horizon.

  15. Steve Pierson 15

    dammit, Monty. You spoiled it.

    There’s plenty of money to buy the rolling stock, it’s a currently profitable business, and will be more profitable with proper investment.

    Also, get to know the difference between the operating surplus and the OEGAL surplus. Losses for the Cullen Fund, the ACC Fund, and the EQC Fund due to a bad quarter on the international stockmarkets affect created an operating deficit but has no effect on how much the government can actually spend

  16. out of bed 16

    Can we buy telecom back now?

  17. the sprout 17

    let’s buy the Herald

  18. DS 18

    “Can we buy telecom back now?”

    And the Forestry Corporation. And Contact Energy…

  19. the sprout 19

    and National. no wait, they’ve already been bought

  20. Mike 20

    Odious company and also a Labour Party donor.

  21. Zed 21

    No one wants the trains bought back more than me, but the trouble with this rant is that it is complete bollocks. Toll have actually been working with the government to improve the infrastructure. It was the previous owners who stripped the rail. The government paid a hefty whack to buy back the tracks. The issue now is that the continued cost of upgrading infrastrcuture is more than Toll is prepared to invest. Basically, Toll is saying it doesn;t want to contribute towards the cost of the improvements. That’s not the same as asset stripping.

    The rail should be bought back at a reasonable price to the upgrades can go ahead because there are reasons beyond narrow economic return for why we want to shift more transport to rail. (It’s good for those of us who stay in cars, for example.) But to say Toll have been a disaster is just not true and a good example of the hysterical lies that have undermined arguments against asset sales all along.

    It is also a really bad idea to advocate stealing the company back. The decision to sell was bad, but once it’s made the problems are compounded by nationalising without compensation (or with inadequate compensation.) To give you an idea – what if your pension fund has an investment stake in Toll? Why should your retirement savings be super-taxed because it made a decision to invest in a company that does something socially positive (i.e. operate public transport)?

  22. Remind me again who was in power when it was sold originally. And perhaps a list of cabinet members who are still in cabinet….

  23. Murray 23

    It’s alright for you lefties to support this purchase. I seriously doubt it’s your money they are spending because I seriously doubt that any of you cunts pay tax.

  24. Murray 24

    rOb I am an adult, I use adult words. You should follow my example.

  25. Murry – you’re not an adult. You’re a whining little rightie child. Why don’t you fuck off with your petulant ignorant bigoted cuntishness. Adult enough for you, you fuckin joke?

  26. the sprout 27

    Murray Murray Murray.

    yes i believe National sold the rolling stock to their mates Fay, Richwhite. aren’t they pricks Murray? taking from the poor to give to the rich. very National eh Murray.

  27. Sprout – do you have an email address I can contact you at?

  28. Scratch that – email me at mickyporton[at]hotmail.etc

  29. the sprout 30

    done

  30. Chris 31

    Could the friggin’ Natinal Party please dip into their pockets – they know the trick of sliding hands into other people’s pockets and either ripping them off or giving them heaps of dosh – but could they dip into the Bretheren’s pockets and chip in to buy back the railway?

    they were the ones who sold the country for a song and pretty penny (cheep cheep) …

  31. r0b 32

    Remind me again who was in power when it was sold originally. And perhaps a list of cabinet members who are still in cabinet

    No sooner said than done! Sold in 1993 by the National Bolger government, see:

    http://en.wikipedia.org/wiki/New_Zealand_Railways_Corporation

    None of the ministers then in cabinet are there now of course, as we are fortunate enough to have a Labour government. However, many of them are still MPS: Bill English, Nick Smith, Lockwood Smith, Tau Henare and so on. For the full list see:

    http://en.wikipedia.org/wiki/Fourth_National_Government_of_New_Zealand

    So – why exactly did you want to know BB?

  32. Well no Chris. It was the fourth labour government that sold a lot of our assets. The national party just continued the trend after telling us they would stop it. Interestingly the key people who took part in that asset strip (both labour and national) are now either in the act party or are advisers to the national party.

  33. r0b 34

    Murray – no need to be such a potty mouth.

  34. DS 35

    A laundry list of assets sales:

    Labour (1988-1990) sold: New Zealand Steel, Petrocorp, Health Computing Service, DFC, Post Office Bank, Shipping Corporation, Air New Zealand, Landcorp Financial Instruments, Rural Bank, Government Printing Office, National Film Unit, Communicate NZ, State Insurance Office, Tourist Hotel Corporation, New Zealand Liquid Fuel Investment Ltd, Maui Gas, Synfuel Stocks and Assets, Forestry Cutting Rights, and (the mother of them all) Telecom.

    National (1990-1999) sold: NZ Timberlands, Export Guarantee Office, Government Supply Brokerage Corporation, Housing Corporation Mortgages, Taranaki Petroleum Mining Licences, Bank of New Zealand, New Zealand Rail, Wrightsons Rights, Fletcher Challenge Shares, GCS Ltd, the regional airports of Hamilton, Oamaru, Te Kuiti, Timaru, Masterton, Tauranga, Hokitika, Rotorua, and Palmerston North, the international airports of Auckland and Wellington, Maori Development Corporation, Radio Company Ltd, Forestry Corporation of New Zealand, Works and Development Services Ltd, Capital Properties NZ Ltd, Contact Energy, and VTNZ.

  35. Steve Pierson 36

    DS. Thanks for the list

  36. Rexel 37

    The Nats will strip us of every asset we have. I believe they will even sell our parks as they have no economic need for their under their far right leadership.

    If National wins this election it may be the last one ever as our countryy will be foreign owned by 2011 and we will have lost all control.

    Electing them is that dangerous

    Only a sustained period of repurchasing New Zealand assetts and nationalising key industries will win votes

  37. higherstandard 38

    Rexel

    I think you need to have a lie down – fundamentally little will change with a change of government – both National and Labour are far closer than either like to admit.

    I’ll take is as raed that the rest of your post is just taking the piss.

  38. the sprout 39

    “fundamentally little will change with a change of government – both National and Labour”

    hs – makes me wonder then why anyone would want to trade competent leadership for an inexperienced amateur who isn’t even sure what party he leads.

  39. higherstandard 40

    Sprout

    In terms of the leadership purely because the public are tired of Helen and seem to be more comfortable with John.

    In terms of a change of government I think we both know where this election will be won and lost and it won’t be in areas that will be change markedly before or after the election.

  40. higherstandard 41

    I forgot to ask

    I’m hoping Rexel was taking the piss if not his/her views are somewhat of a concern – hope we are in agreement on that at least

  41. This post is outright nonsense “Toll has been a classic asset-stripper: buy a key piece of infrastructure that should never have been sold, take as much profit as possible with minimal investment, and force the Government to buy the infrastructure back to prevent further economic damage.”

    When in fact Dr Cullen and Toll did a joint deal at the time to buy Tranz Rail and hand over the track to the government for $1.

    The press release is here http://www.beehive.govt.nz/release/govt-toll reach accommodation tranz rail

    The government and Toll worked together to make an offer, Toll has never owned the track.

    What lines have been closed? Go on, list them – and I think you’ll find Castlecliff is it (which hasn’t had freight trains on it regularly for years anyway as it is little more than a large suburban siding).

    Also the claim that more road freight increases costs, without noting that it is covered by road user charges (for the state highways anyway), is being a bit wilfully blind.

    I’m no friend of Toll, but this post is based on complete nonsense.

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    Local body elections are coming up next month. And it looks like all Palmerston North candidates for Horizons (the Manawatu-Whanganui Regional Council) want to take action on climate change:Climate change is set to be a key issue in Palmerston North for the next three years if those wanting to get ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • BORA reform is stalled
    Eighteen months ago, the government promised to strengthen the Bill of Rights Act, by explicitly affirming the power of the courts to issue declarations of inconsistency and requiring Parliament to formally respond to them. So how's that going? I was curious, so I asked for all advice about the proposal. ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • Corbyn and Brexit
    As the Brexit saga staggers on, the focus is naturally enough on the Prime Minister and his attempts to achieve Brexit “do or die”. But the role played by the Leader of the Opposition is of almost equal interest and complexity. The first problem for Jeremy Corbyn is that he ...
    Bryan GouldBy Bryan Gould
    1 week ago
  • A ditch for him to die in
    Last week, English Prime Minister Boris Johnson boldly declared that he would rather die be dead in a ditch than delay Brexit. Unfortunately for him, the UK parliament accepted the challenge, and promptly dug one for him. The "rebellion bill" requires him to ask for and secure yet another temporary ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • Warning! Warning! Danger Jacinda Ardern! Danger Marama Davidson! Warning!
    Lost In Political Space: The most important takeaway from this latest Labour sexual assault scandal, which (if I may paraphrase Nixon’s White House counsel’s, John Dean’s, infamous description of Watergate) is “growing like a cancer” on the premiership, is the Labour Party organisation’s extraordinary professional paralysis in the face of ...
    1 week ago
  • Union solidarity with Ihumatao land occupation
    by Daphna Whitmore Every Sunday for the past two months unionists from First Union, with supporters from other unions, have set out to the Ihumatao land protest, put up gazebos and gas barbeques, and cooked food for a few hundred locals and supporters who have come from across the country. ...
    RedlineBy Daphna
    1 week ago
  • Climate Change: The wrong kind of trees?
    Newsroom today has an excellent, in-depth article on pine trees as carbon sinks. The TL;DR is that pine is really good at soaking up carbon, but people prefer far-less efficient native forests instead. Which is understandable, but there's two problems: firstly, we've pissed about so long on this problem that ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • No freedom of speech in Turkey
    Canan Kaftancioglu is a Turkish politician and member of the opposition Republican People's Party (CHP). Like most modern politicians, she tweets, and uses the platform to criticise the Turkish government. She has criticised them over the death of a 14-year-old boy who was hit by a tear gas grenade during ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • Speaker: Tadhg Stopford: Why I’m standing for the ADHB
    Hi there, just call me Tim.We face tough problems, and I’d like to help, because there are solutions.An Auckand District Health Board member has nominated me for as a candidate for the ADHB, because her MS-related pain and fatigue is reduced with hemp products from Rotorua.  Nothing else helped her. If I ...
    1 week ago
  • Good little vassals
    The Inspector-General of Intelligence and Security has published their report on whether the SIS and GCSB had any complicity in American torture. And its damning. The pull quote is this:The Inquiry found both agencies, but to a much greater degree, the NZSIS, received many intelligence reports obtained from detainees who, ...
    No Right TurnBy Idiot/Savant
    1 week ago
  • Who Shall We Turn To When God, And Uncle Sam, Cease To Defend New Zealand?
    Bewhiskered Cassandra? Professor Hugh White’s chilling suggestion, advanced to select collections of academic, military and diplomatic Kiwi experts over the course of the past week, is that the assumptions upon which Australia and New Zealand have built their foreign affairs and defence policies for practically their entire histories – are ...
    1 week ago
  • The Politics of Opposition
    For most of the time I was a British MP, my party was out of government – these were the Thatcher years, when it was hard for anyone else to get a look-in. As a front-bencher and shadow minister, I became familiar with the strategies required in a parliamentary democracy ...
    Bryan GouldBy Bryan Gould
    1 week ago
  • More expert comments on the Canadian fluoride-IQ paper
    The Green et al (2019) fluoride/IQ is certainly controversial – as would be expected from its subject (see If at first you don’t succeed . . . statistical manipulation might help and Politics of science – making a silk purse out of a sow’s ear). Anti-fluoride campaigners have been actively promoting it ...
    2 weeks ago
  • The return to guerrilla war in Colombia
    by Gearóid Ó Loingsigh On August 29th a video in which veteran FARC (Revolutionary Armed Forces of Colombia) commander Iván Márquez announced that they had taken up arms again was released. There was no delay in the reaction to it, from longtime Liberal Party figure and former president Uribe, for ...
    RedlineBy Admin
    2 weeks ago
  • Air New Zealand identifies this enormous plot of unused land as possible second airport site
    Air New Zealand couldn’t believe its luck that this seemingly ideal piece of real estate had so far gone entirely unnoticed. Air New Zealand’s search for a site to build a second Auckland Airport may have made a breakthrough this afternoon, after employees scanning Google satellite imagery spotted a huge, ...
    The CivilianBy admin
    2 weeks ago
  • Redline on the Labour Party
    No-one on the anti-capitalist left in this country today puts forward a case that Labour is on the side of the working class.  There are certainly people who call themselves ‘socialist’ who do, but they are essentially liberals with vested interests in Labourism – often for career reasons. Nevertheless, there ...
    RedlineBy Admin
    2 weeks ago
  • New Fisk
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Labour’s failure
    When National was in government and fucking over the poor for the benefit of the rich, foodbanks were a growth industry. And now Labour is in charge, nothing has changed: A huge demand for emergency food parcels means the Auckland City Mission is struggling to prepare for the impending arrival ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Ardern attempts to vaccinate Clarke Gayford live on television to prove that it’s safe
    Gayford, pictured here on The Project, before things got wildly out of control. A bold public relations move by the Government to encourage parents to vaccinate their children has gone horribly wrong. Prime Minister Jacinda Ardern appeared on tonight’s episode of Three’s The Project, where the plan was for her ...
    The CivilianBy admin
    2 weeks ago
  • Has Mr. Whippy gone too far by parking on our front lawns?
    Mr. Whippy’s business model has driven it down a dark road of intimidation. Residents in major centres around the country are becoming disgruntled by the increasingly aggressive actions of purported ice cream company Mr. Whippy, who have taken to parking on people’s front lawns and doorsteps in a desperate attempt ...
    The CivilianBy admin
    2 weeks ago
  • Cleaning up the water
    Today the government released its Action Plan for Healthy Waterways, aimed at cleaning up our lakes and rivers. Its actually quite good. There will be protection for wetlands, better standards for swimming spots, a requirement for continuous improvement, and better standards for wastewater and stormwater. But most importantly, there's a ...
    No Right TurnBy Idiot/Savant
    2 weeks ago
  • Fronting up
    Today I appeared before the Environment Committee to give an oral submission on the Zero Carbon Bill. Over 1,500 people have asked to appear in person, so they've divided into subcommittees and are off touring the country, giving people a five minute slot each. The other submitters were a mixed ...
    No Right TurnBy Idiot/Savant
    2 weeks ago

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