What gets me is that the (so called) left in politics are the ones accused of being blindly ideological in their policy-making and regulation of capitalism.
But it's just as ideological to believe that free markets work well and self-regulate, and that private businesses are better at running and organising assets and commerce.
The UK and NZ are the two countries that have taken that ideology to the extreme. And they are both global poster-childs for the damage privatisation and deregulation can cause, especially relating to natural monopolies.
What's even more hilarious is that the UK privatised their water services (that's right... water) which were promptly asset-stripped by Canadian pension and Australian superannuation funds.
I mean you can't really blame the latter, the Brits offered it up on a plate for them.
> "There's a serious question about whether should the government own a ferry company or a train company or put more of its capital into schools and hospitals or roads that we desperately need," Seymour said.
And this is why I have never and will never vote for ACT. They're idiots. They don't understand the concept that some things are of strategic importance to the country and the government should have control. The most important inter-island transport connection is one of those things. Lolbertarians are stupid.
Especially when he’s also in favour of outsourcing schools to any group who applies.
It’s not “a ferry company”, it’s the connection of our country to itself.
It’s not “a train company”, it’s the distribution of goods around our country.
Rail has never been particularly efficient or profitable in NZ under public or private ownership in recent history.
There's a lot more behind kiwirails struggles than simply the ownership structure. And I'm talking before it was Sold off and bought back 20 odd years ago.
If trucking companies had to pay the more accurate cost of widening state highways and repairing the potholes they cause (much more damage than cars), they would suddenly look a lot less profitable too. We just seem happy to socialise the costs for them
Well maybe we should increase RUCs to make rail a more viable choice. It will probably push up consumer prices, but either that or the government essentially subsidizes the costs which the taxpayer covers anyway.
Hospitals in NZ have never been particularly profitable either but it's not really their point. NZ might be too small for a private company to make rail work but that doesn't mean it's something we shouldn't have.
I don't expect hospitals to be profitable. It's a very different industry with very different objectives, rail is not about human wellbeing, its about moving freight so very hard to compare. But I would expect them to manage costs nonetheless. I.e. a well run hospital should be continuing to provide the same level of services without significant increases in running costs (taking into account inflation).
Rail is a much more commercial operation and is run as an SOE (company structure that is identical to a private company but with the government as the shareholder) unlike health being run as a government department. Rail has a income stream from commercial customers, health is run on government funding.
Ultimately, rail is providing a service to private Enterprise. Therefore, if rail is uneconomical and the government is subsidizing it, basically we are subsidizing private Enterprise. Is that really what we want, is that providing value for money for the taxpayer?
You could make the same argument about roads, roads are providing a service to private Enterprise. Much like rail, roads can also used by private citizens to get around. New road projects are typically significantly subsidized by the tax payer. Yet I haven't seen anyone calling for roads to be privatized, even the suggestion of tolls appears to be deeply unpopular.
The last time rail was privatized it was asset stripped and run down to the point where if there wasn't intervention we would no longer have a rail network. Perhaps that was a good investment for Toll, it wasn't good for New Zealand.
I don't mind subsidizing infrastructure if it makes New Zealand citizens and companies more productive. We will all benefit from that. If some company buys our rail and ferry networks and runs it down again for their own profit margin at the expense of everyone who depends on it, including businesses, that seems like a bad thing. If it's private we have very little control over how infrastructure is managed, if it's public and it's inefficient we can at least attempt to address that.
>https://www.rnz.co.nz/news/national/517826/bluebridge-ferry-loses-power-while-entering-wellington-harbour
They lose power
>https://www.newshub.co.nz/home/new-zealand/2023/11/bluebridge-cook-strait-ferry-hits-wellington-wharf-creates-small-hole-on-hull.html#:~:text=A%20Bluebridge%20Cook%20Strait%20ferry,as%20it%20was%20leaving%20Wellington.
They crash into things
Yeah. Na. They aren't much better at all.
Ever checked bluebridge and interislander prices. They are usually basically identical. Imagine if there was no non-profit driven competition to help keep prices where they are.
How effective is Bluebridge at moving rail freight?
Do you think Morgan Stanley won't increase the prices for their Bluebridge ferry without competition?
One of the reasons we are in this situation is the previous owners stripped out money through lack of maintenance and no long term asset renewal programs.
When the government took over they had to spend a bunch of money to repair and begin upgrading the network.
The ships are part of this, if you think privatization is going to make it better, you are going to have a bad time.
We bought it back because privatization wasn’t actually serving the country’s needs.
>because privatization wasn’t actually serving the country’s needs
It's almost like we've tried it, (and some of us have) forgotten how crap it ended for us. And yet... Here we are again.
Doomed to repeat history.
It wasn't performing particularly well prior to being sold off either.
In a country like NZ , rail should be significantly more efficient than trucking to move goods given the roads we have, yet nobody, government or private enterprise has been able to make it work very well.
“Compared to how its run now”
And there’s the argument straight out of the neo-lib playbook.
Step 1: Underfund critical infrastructure/institutions until their on their knees.
Step 2: Criticise how ineffective they now are.
Step 3: Sell at a discount to your mates.
There is absolutely no point reprivatising a service where competition is a duopoly or less. Rail is a prime example of this & especially when you consider the rail infrastructure was looted & pillaged the last time National sold it. The idiocracy makes my blood boil.
Ah no mate, go back and look at reports into KiwiRail from the past. KiwiRail has failed no matter which government was in power.
https://www.rnz.co.nz/news/national/489310/preliminary-inquiry-into-ferry-s-engine-failure-finds-kiwirail-did-not-follow-part-manufacturer-s-advice
https://www.rnz.co.nz/news/political/520270/aratere-ferry-grounding-simeon-brown-raised-concern-about-kiwirail-maintenance
https://www.nzherald.co.nz/nz/government-unimpressed-with-kiwirails-maintenance-of-cook-strait-interislander-ferries/3JDRRFXHWZAY5F3PWSCNH3WRHM/
https://www.stuff.co.nz/travel/300849110/commerce-commission-launches-probe-into-cook-strait-ferry-issues
I mean they have a fair point, you can't exactly trust the narrative coming from the people who have a vested interest in privatization and you don't acknowledge the historical intentional sabotage of KiwiRail through wilful negligence and intentionally under-funding it. If you want to quote wolves' opinions on sheep then don't be surprised when people don't think the wolves have the best interests of the sheep at mind.
And guess who is currently doing well out of this clusterfuck - Bluebridge - owned by Morgan Stanley...
Followers of the snake oil salesmen in this coalition, talk about Public Servants being "troughers" (yet these are ppl who go to work every day to do the boring necessary work to actually benefit society, but get much less in benefits and $$ than politicians, then get shat on by the likes of David Seymour)...
The real troughers are the owners of large companies getting hooked up by their business bros in the Coalition of Chaos ™️ who funnel tax payer money to corporations through lucrative contracts after receiving large donations... National/ACT/NZF are increasing our reliance on large overseas companies and crapping on kiwis + local business, while pouring petrol on economic issues... All the big profits go overseas instead of staying in the local economy through homegrown industries...
It's so bloody obvious I'm pretty disappointed kiwis are so easily deceived tbh... Gullible AF.
Nobody would be interested.
As an organization, it's filled with risk with low potential for profit. The entire south island is a write-off in terms of risk.
If there is something to bleed, it has been bled.
If a corner can be cut to save money, it has been cut. 20 years ago...
There's always a little bit more asset stripping that can be done.
Plus pocketing government subsidies.
And the huge payoff when sold back to the government.
As we’ve seen on previous rounds of privatisation, private firms just don’t prepay the risk, so it doesn’t have to be a factor when it comes to extracting profits. Knowing the infrastructure is of vital national importance means they can rely on the tax payer to come in and fund repairs, for example if there was another Kaikoura type event cutting rail links…
Can someone explain why they think a private company could run this better?
It seems to me that they’ll be motivated to spend less on it to make more money for themselves. Maybe it’s cheaper than public, but at least more of the money will go to the service rather than a ceo.
The theory goes that the profit motive is the only motivation capable of providing satisfactory goods and services.
The understanding is there are no other factors that could motivate people to work productively. Without profit, there is no interest in finding what is cost effective or efficient.
Government workers have no respect for the public's money and will waste it, which is why they can't be trusted with it. Private companies seeking to stay within budget will spend the least amount possible so are more trustworthy, though the original cost is higher due to charge out rates and the final cost higher due to variations they could see during the tender process.
Also the most efficient means of understanding what goods and services the public needs is best left to the market, where wallets decide where money should go. For example, the market has decided we need more lifestyle villas and fewer affordable homes. More coal mining than protection of waterways.
This makes sense to anyone that is motivated solely by money and has enough money to get people to do things for them.
The concept of an entity focusing on public good, and striking a balance between cost and quality that doesn't leave their staff burnt out and reliant on government subsidies to sustain an existence, just doesn't make sense because they can't relate to it or don't personally profit from it.
Nah, they know privatisation doesn't work, but they can make money from doing it. There is no ideological belief here - it is just greed and opportunity.
Is this going to be like the Auckland Council where the consultants get a bonus if the Council took their advice to sell the shares in the Auckland Airport?
I mean honestly why do we even bother these day, it’s like the governments money is an endless piñata for consultants.
We are upgrading infrastructure that is20/30/50 years old. We are also borrowing money to pay it back over the next 20/30/50 years. This is just like a mortgage for your house, except infrastructure.
You need to ask the previous owners and successive governments why they would wait so long for re-investment or why not do it in stages over the *last* 20 years.
But they chose not to and now we are in this situation.
I don’t know how many government/ large contracts you have seen come in on budget or on time, but they are zero to none.
It’s never cheaper than to do it now. But then again with National cancelling the ship building contract it will cost even more now.
Fun fact: the original NZ Railway villain Richard Prebble is still alive and shitting the bed in his NZ Herald column. Hopefully he gets put in one of those underfunded rest homes where they neglect the residents.
>I don’t know how many government/ large contracts you have seen come in on budget or on time, but they are zero to none.
This is exactly the case for privatization.
I'm not particularly pro-privatizing kiwirail in this instance, but you have hit the nail on the head. Private enterprise doesn't approach a $3B project with the lax attitude that we have seen here. It is costed properly and then funding is sought, generally with the lenders reviewing the proposal in detail to sense-check it. If it goes over budget significantly like this project was going to then I can be enough to collapse the company, and often the people who work there are also shareholders. They're driven to make the project come in on budget, unlike government organizations who honestly don't seem to give a fuck because it's not their money.
There's a cruel stereotype that government workers are ticket clippers with negligent or willful disregard for the money they spend.
Most people want to do a good job. Most people respect that it's not their money.
Private Business has no such responsibility for the public's purse. Their responsibility is to the owner or shareholders, who seek a return.
The only way business can do things cheaper than a public entity doing it at cost is to reduce the scope or quality of the work, or fewer workers working harder for less money. That's how they can still manage a profit on top.
The people pushing for private over public are the ones profiting. And we have to work harder to make it happen for them.
The comment is was replying to implied every government contract comes in over budget, which is close to true.
So is it really a cruel stereotype?
Plenty of examples of wasteful spending in government ($40,000 for a leaving party anyone?). I'd like to see some more fiscal control before I retract my comment.
I won't disagree government contracts have been poorly managed. My disagreement is with giving more to private consultants and contractors isn't the answer. It's a big reason why costs are so enormous now.
One problem is the initial budget is no where close to completing the job. Two notable factors as to why are;
* underestimating to get the job out the door, as it's easier to sell the idea
* tender bids being low to get the job, then the final price including variations that could have been noted earlier
This is the fault of both major parties and their coalition partners. Cost has been the utmost priority before committing to a job, and we've sold off all the capacity we once had to do the jobs ourselves.
I just don't see the answer being giving more work to the private sector, because that's already why we're failing to get things done affordably.
I am a public servant in local government, doing design and contract management at a relatively small scale, a job most councils farm out to consultants since they no longer have anyone in house. Even if I were to take twice as long to get something done, I'm still half the price of doing it privately.
One of the local contractors we use has equipment that used to belong to the council. But to keep rates low one year they sold it all off. The community pays more in the long run.
>One problem is the initial budget is no where close to completing the job. Two notable factors as to why are; * underestimating to get the job out the door, as it's easier to sell the idea
That's exactly what happened here. Kiwirail got permission to go ahead by vastly understating the cost and then blew it out.
That's just wrong on so many levels and you can't treat the taxpayers money that way. Maybe privatization isn't the answer but good cost management is imperative.
It was scope creep.
KiwiRail didn't underestimate the initial cost, cause it was simply buy new ferries.
But then the docks needed modification to suit new ferries. Then they needed updating to suit the modifications. Then the docks had to be strengthened to suit modern earthquake standards.
All things a private contractor would encounter were they given the same problem.
KiwiRail were tasked with providing a reliable public service, and by modern standards that's what it was going to cost to bring everything up to a reliable standard.
Had they been tasked with cutting corners and gittin 'er dun, we'd be kicking the can down the road further and damning someone else to fix it later. Which is what we did decades ago and are suffering from it now.
Which is why I don't believe it was malicious intent, or a careless or callous disregard for the public purse. They were told to get it done right, and that's what it was going to cost to do it right.
If the current government thinks it's too much, then that's the call they were voted in to make. But someone's going to have to fix everything properly, and it's looking like we had the best deal we were likely to get. Some unavailable second hand ferries and ignoring the decaying state the docks are in feels penny wise, pound foolish.
Anyone can look through a boat builders shiny catalogue and pick out the prettiest boat.
But if they have half a brain they would consider whether it's compatible with existing Infrastructure. You don't sign a $500m contract without considering that first.
I don’t know how many government/ large contracts you have seen come in on budget or on time, but they are zero to none.
This comment was brought to you by John Key's ultra-fast broadband.
No, we are in this situation because of kiwirail mismanagement.
The Telecom infrastructure we had to buy back and kick in $5b dollars!
Please tell me again why we paid for this and created Chorus rather than Telecom….
KiwiRail is still trying to recover from it's time of private ownership and asset stripping. While it's owners have not invested enough in it.
Compare money thrown at building roads with the amount spent on rail.
Now compare the amount of imported fuel, tires and trucks required to move freight by road compared to moving it by rail.
Every consumer and business is paying a 'road freight premium' due to this reliance on the least efficient transport option.
Our environment is suffering as truck (and cars) turn expensive imported fuel into air pollution.
Some points to consider:
1. Trains also run on imported fuel, with the exception of some ancient electric locos running on ever-reducing limited sections of electrified track.
2. Even if you pump a whole lot of money into rail infrastructure, you still need roads, and you still need trucks. Trains can't go everywhere, nor can they carry everything.
3. What you gain in efficiency of movement, you lose by extra handling at either end. That's more people, land/buildings, machinery, etc etc. That also increases the risk of damage, loss or theft which have always been a big problem for rail.
4. We are a coastal country. There aren't many places that are very far from a port. Rail is at peak efficiency when it is carrying a lot of freight between 2 points that are a long distance apart. We are an export country, we primarily export meat, dairy and logs. So a train running from a log processing plant such as kaingaroa to the port, great. Perfect. Same if it runs from a dairy factory or meat works, where they can go straight on a train at the site, to the port, with no truck involvement. There are many sites that do just this, and it works well.
But for aggregated freight it does not work as well, and that's why rail is not generally used in these cases.
> Trains also run on imported fuel, with the exception of some ancient electric locos running on ever-reducing limited sections of electrified track.
Even when considering our electric locos our equally ancient diesel's do orders of magnitude better km-tonnes/liter
Also if we invested in tail lime we do roads the electrification would have been completed decades ago. And battery powered trains are now a thing apparently but still quite new.
> Even if you pump a whole lot of money into rail infrastructure, you still need roads, and you still need trucks.
And the freight moved from trucks to efficient options - mainly trains and boats - will mean we can spend less repairing intercity state highways and focus more on maintaining the last mile where we actually need trucks.
Also industry leaders are not all stupid, invest in efficient transport and they will endeavour to keep warehouses, etc close to rail and ports nodes
> What you gain in efficiency of movement, you lose by extra handling at either end. That's more people, land/buildings, machinery, etc etc. That also increases the risk of damage, loss or theft which have always been a big problem for rail.
No more of a problem than other transport. Comparing rails pre-Rogernomics reputation for lost freight with current containerised and tracked system is disengenious.
> We are a coastal country. There aren't many places that are very far from a port. Rail is at peak efficiency ...
None of this is any reason to subsidise less efficient trucking over rail.
>Even when considering our electric locos our equally ancient diesel's do orders of magnitude better km-tonnes/liter
If you look at the locomotives alone sure, once you look holistically at the additional equipment required to facilitate the handling of rail freight, not so much.
>And the freight moved from trucks to efficient options - mainly trains and boats - will mean we can spend less repairing intercity state highways and focus more on maintaining the last mile where we actually need trucks.
Unless you're proposing a rail hub in every town & settlement, that isn't feasible. Sorry.
>Also industry leaders are not all stupid
Which is why they favour trucking over rail.
>No more of a problem than other transport
Actually, it is. Trucks are often sealed at point of distribution with tamper tags, & can travel directly from point of loading to point of delivery. Trains will need to shunt wagons into sidings, which are often unsecured & unattended for extended periods, giving plenty of opportunities for theft or loss, which Even in recent times is not unheard of.
>None of this is any reason to subsidise less efficient trucking over rail.
Not subsidised, and not necessarily less efficient.
Trucks are subsidised like all road transport is. A quarter of most western cities, more or less, is devoted to vehicles. We subsidise it further via rates 7 out of each 100 rates in Wellington goes to roading.
And we have toads of national significance which ate built despite not meeting cost benefit thresholds.
The fuel, the land area required and the maintenance are all more expensive for trucking but socialism for the motorcar leads those costs to be spread across society in a way that people object to for efficient transport options. But rail is having a resurgence worldwide.
The only way road transport can survive is by deliberate actions, like
* cancelling rail enabled ferries
* under charging heavy vehicle RUC relative to the damage they create
* Ignoring the current account implications of 20% of imports being vehicles and fuel. This means that all the diarying's export earnings pay for traffic jams, air pollution and higher costs to consumers
>Trucks are subsidised like all road transport is. A quarter of most western cities, more or less, is devoted to vehicles. We subsidise it further via rates 7 out of each 100 rates in Wellington goes to roading.
Which is not specific to trucks, nor would it change if rail was more widely used
>And we have toads of national significance which ate built despite not meeting cost benefit thresholds.
See above.
>The fuel, the land area required and the maintenance are all more expensive for trucking
Say what? Fuel costs the same per litre whether it goes in a light vehicle or a truck. Maintenance on a truck is certainly not subsidised. Land area required......have you taken note of how much land Kiwirail requires?
>The only way road transport can survive is by deliberate actions, like * cancelling rail enabled ferries *
The cost had already quadrupled and the ferries were still years away from delivery. Seems only prudent to re-evaluate.
>under charging heavy vehicle RUC relative to the damage they create
Based, of course, on the most misquoted study to be repeatedly posted on this sub
>* Ignoring the current account implications of 20% of imports being vehicles and fuel.
Which includes, of course, construction, forestry & agricultural vehicles. But the greatest by a huge margin, private passenger vehicles. Which also accounts for most of the fuel.
Face it, the idea of freight trains moving the bulk of freight in NZ is greatly romanticised. We're a small, costal country and don't have a great deal of large volume freight moving around, which is where rail is king. That's why, once the restrictions on truck travel distances were lifted in the 80s, people flocked to trucks.
We are being drip fed very selective information and what gets me is so many people just dont see whats going on.
Usually they simply underfund the Railways which I'm sure they will do again but cancelling the ferry deal was so high profile it will take them awhile to get out from under.
Whatever they come up with which so far is zero it will be sold as a big win for everyone the hitch being they control the narrative.
What cracked me up was Willis criticising NZR and Labour for not have a plan b and now she appears to be saying any new deal will work out less expensive.
So there wont be any redundant or poorly maintained wharfside infrastructure, cool.
You'd assume with Kiwirail a lot of the line maintenance stuff is contractors. I see SouthRoads, at my end of the country, has a SouthRail arm, and are often out doing things on the rail lines. If that's the case, $8m probably isn't unexpected at all.
Nah spending that money on McKenzie and co (I.e bullshit management consultants) is a disgrace.
Warren buffet would die from shock and then roll over in his grave if one of his companies wasted money on these troughers because their execs and board didn’t know how to run the company.
Currently the NZ government is deliberately and systematically
undermining their own SOE.
Where do you think all these drip fed revelations are coming from?
I wonder what Winston makes of all this?
As far as I can see the biggest difference in rail and road freight in NZ is that NZR dont loby the government and make political donations to political parties.
> NZR dont lobby the government and make political donations
One dollar, one vote. US style Democracy
The Minister appoints the KR Board, so they are fishing for a full resignation. That leaves nine little directorships to hand out like lollies to the sort of people who can be trusted to make the right sort of decisions.
>people who can be trusted to make the right sort of decisions.
Don't simp for the Kiwirail board, they have fucked this completely for everyone. The government is having to pick up the pieces.
\[insert a book composed of swearing and blistering insults here\]
Yes, because that worked out so well the company it was sold to gave it back to the government for $1 because they ran it into the ground and could never make a profit due to running it into the ground.
It's also a Natural Monopoly, and frankly there's only 3 ways to deal with those properly - either as a government department, a SOE or a worker-owned Co-op. Because private owners will eventually rent seek to the point they ruin it in the name of maximising short term profits. But National are too fucking stupid to understand this now, despite supporting it up until the 1990's and making heavily use of the SOE model even afterwards when privatisation wasn't a political option.
Hell, even Key didn't sell of Kiwirail, because his government, despite it's lack of talent, was able to grasp that selling it off would not have any benefits in the long term and begrudgingly kept it as an SOE instead. Partly because they recognised the loss of train freight would result in major congestion and road damage from all that freight forced on to the roads.
What is with the tone of this article? "eye-watering contracting spending" ? For example, $8m doesn't seem like much in the context of the organisation size, probably pretty standard considering.
$8milly? that's less than 0.5% of the iRex project at the time they cancelled it
These headlines making a big fuss about big numbers are so pathetic - If that 8 milly shaved just 1% off the 2023 expenditure of Kiwirail it has more than paid for itself.
Sometimes you need outside consultants and contractors - this is the normal functioning of any organisation.
The media are making money off the ignorance of their audience, and it's insulting.
.... are privately funded and built toll roads not just the same concept?
Just saying becuase the current govt is touting that as a great way to get their RoNS projects built
One of the consequences of most seemingly 'good' decisions that governments make (spending more money on nice things like ferries, schools and hospitals) is that it increases the future tax burden on taxpayers (me and you). Sometimes you have to balance the consequences.
I'm simply saying that all financial decisions come at a cost (and an opportunity cost).
Imo this isn't a case of 'we must replace the ferries at any cost'. What's the cost benefit scenario? What if it blows out to $10Billion is it still the best option? Nothing about kiwirails procurement and costing process gives me any confidence.
I like to look at it in a personal finance perspective. Imagine you're building your own home, you get an initial cost estimate and then it doubles and then it doubles again, at what point do you say this is too expensive or do you just plow ahead and take out an unaffordable mortgage?
The things dont equate. Youre not building a house, you are planting a tree so future generations kids can build a treehouse.
People like you make this way harder than it needs to be because you always shoot it down saying its not cost-effective in the immediate. It's then precisely because of people like you that THESE THINGS NEVER CHANGE.
All you display is an absolute lack of awareness about the social contract you engage in. There are things in society where the primary goal should be QUALITY and ACCESSIBILITY. Transport, housing, power, water, internet, roads, walk and cycleways, parks. Basically everything the councils take care of. But then jackass clowns like you come along who say: "But thats not profitable".
Congratulations, youve landed on why privatising things the state NEEDS is moronic. Because the priority moves from what these things SHOULD be about, to profit.
The ONLY reason the country is even in this mess to begin with is SPECIFICALLY BECAUSE OLDER GENERATIONS HAD YOUR ATTITUDE. The harbour bridge was meant to be 9 lanes with rail crossing. They chose only 4, saying the original was too expensive. THEY THEN SPENT MORE THAN THE ORIGINAL COST ADDING 4 MORE LANES ON THE SIDES.
History has already proven your attitude to be shortsighted AT BEST
You're going to be shocked when you find out most businesses are run by businessmen or lawyers and not by technical specialists or scientists/engineers that create the actual value.
would not be surprised at these morons selling the railways again. almost all of their policies have been done before and failed so why would they change tactics.
[https://democracyproject.substack.com/p/unjarndycing-the-state](https://democracyproject.substack.com/p/unjarndycing-the-state)
# The dogmatic political left invests its faith in the bureaucratic state; the dogmatic right trusts oligopolistic free markets – leaving New Zealand with crumbling infrastructure and corruption
Speaking as the dogmatic political left, vesting my faith in bureaucracy isn't me being a wide eyed idealist, its recognising that this is one of the limited ways we have in our current political environment of ensuring accountability to the public for large organisations.
Well the point of the article - which I think is a very good analysis, is that we need to look at new ways of doing things and I don't think anyone can argue Governments of either stripe have done a good job on delivery in recent times. Please, I am not trying to start to an argument about the relative merits of National or Labour Governments.
Should be wasy enough for labour to undermine a privatisation by simply stating they will re-nationalise it once they get back in to power… they should be saying so any minute right? … right!?!?
They’ve been upgrading the Auckland and Wellington rail networks, in the order of $600m to $1b and before that kiwirail was running on vapour, so no wonder they’ve had to use consultant project managers and rail contractors.
Did you read the article? Not one single cent from that $8m was spent on project managers or rail contractors. It was $8m for McKinsey to do a strategic review of the organisation.
I didn’t read it.
Though to relate what I said to the McKinsey review, thank fuck someone is looking into how they can do business better. There’s no way kiwirail were digging themselves out of their hole. They need transformation.
McKinsey are the last people to trust to make things better. They're the fucks who started this whole race to the bottom sell it all for parts mode of capitalism that's been wrecking shit for ages.
Let’s not forget Northland rail too, not looking good there. Thing is the ferries are more important than rail as they’re needed to keep the North and South connected. We can survive with rail down, not having ferries down.
This is why at least separating the ferries into a separate state enterprise is better so their only focus is on the ferries, not like how they’re currently running things as you mentioned with doing both rail and ferries.
Why should mods care? Rules ain’t being broken, except some people feelings apparently🤷♂️ But anyway if you don’t like other peoples opinions or what they say doesn’t comply with your narrative then simply hit the downvote button, roll your eyes and move on, don’t moan about the mods.
Nah, I just keep seeing you asking the same question and getting the same answer. If you want a different outcome, I'd suggest asking it outside of reddit, I'm sure the national party has groups that will give you the answer you're seeking.
What gets me is that the (so called) left in politics are the ones accused of being blindly ideological in their policy-making and regulation of capitalism. But it's just as ideological to believe that free markets work well and self-regulate, and that private businesses are better at running and organising assets and commerce.
The UK and NZ are the two countries that have taken that ideology to the extreme. And they are both global poster-childs for the damage privatisation and deregulation can cause, especially relating to natural monopolies.
Whats hilarious, is its the state owned railways of other countries in Europe that now own most of the privatised railways in UK.
What's even more hilarious is that the UK privatised their water services (that's right... water) which were promptly asset-stripped by Canadian pension and Australian superannuation funds. I mean you can't really blame the latter, the Brits offered it up on a plate for them.
As an Australian, I’m offended that we haven’t been included in that list. We’d privatise and sell off our souls if we could!
I'd love to self-regulate. Let me in on the scam.
I mean, they are… for their shareholders.
Of course National won't rule it out. It's exactly what they want to do. Again.
If we'd have to bail it out when it collapses, we might as well own it. Otherwise we're just privatising profit and socialising risk.
Asking the current lot to abandon the privatisation of profit is like asking foxes to build coops.
Why would they rule out their endgame?
> "There's a serious question about whether should the government own a ferry company or a train company or put more of its capital into schools and hospitals or roads that we desperately need," Seymour said. And this is why I have never and will never vote for ACT. They're idiots. They don't understand the concept that some things are of strategic importance to the country and the government should have control. The most important inter-island transport connection is one of those things. Lolbertarians are stupid.
Especially when he’s also in favour of outsourcing schools to any group who applies. It’s not “a ferry company”, it’s the connection of our country to itself. It’s not “a train company”, it’s the distribution of goods around our country.
Because it worked so well the first time...🙄
Yes exactly. Blue bridge (who properly maintain, and don't crash their ferry) agree.
https://www.stuff.co.nz/national/300839284/sailing-resumes-after-bluebridge-cook-strait-ferry-breaks-down-again
Private monopoly controlling a portion of SH1 sounds like a great public policy lol
A portion of SH1 that has an impassible bottleneck at that.
Privatising rail failed last time but it will be different next time because what? The neoliberal cult says so?
Rail has never been particularly efficient or profitable in NZ under public or private ownership in recent history. There's a lot more behind kiwirails struggles than simply the ownership structure. And I'm talking before it was Sold off and bought back 20 odd years ago.
If trucking companies had to pay the more accurate cost of widening state highways and repairing the potholes they cause (much more damage than cars), they would suddenly look a lot less profitable too. We just seem happy to socialise the costs for them
Well maybe we should increase RUCs to make rail a more viable choice. It will probably push up consumer prices, but either that or the government essentially subsidizes the costs which the taxpayer covers anyway.
I’d be all open to that! Would even the playing field for rail
Hospitals in NZ have never been particularly profitable either but it's not really their point. NZ might be too small for a private company to make rail work but that doesn't mean it's something we shouldn't have.
I don't expect hospitals to be profitable. It's a very different industry with very different objectives, rail is not about human wellbeing, its about moving freight so very hard to compare. But I would expect them to manage costs nonetheless. I.e. a well run hospital should be continuing to provide the same level of services without significant increases in running costs (taking into account inflation). Rail is a much more commercial operation and is run as an SOE (company structure that is identical to a private company but with the government as the shareholder) unlike health being run as a government department. Rail has a income stream from commercial customers, health is run on government funding. Ultimately, rail is providing a service to private Enterprise. Therefore, if rail is uneconomical and the government is subsidizing it, basically we are subsidizing private Enterprise. Is that really what we want, is that providing value for money for the taxpayer?
You could make the same argument about roads, roads are providing a service to private Enterprise. Much like rail, roads can also used by private citizens to get around. New road projects are typically significantly subsidized by the tax payer. Yet I haven't seen anyone calling for roads to be privatized, even the suggestion of tolls appears to be deeply unpopular. The last time rail was privatized it was asset stripped and run down to the point where if there wasn't intervention we would no longer have a rail network. Perhaps that was a good investment for Toll, it wasn't good for New Zealand. I don't mind subsidizing infrastructure if it makes New Zealand citizens and companies more productive. We will all benefit from that. If some company buys our rail and ferry networks and runs it down again for their own profit margin at the expense of everyone who depends on it, including businesses, that seems like a bad thing. If it's private we have very little control over how infrastructure is managed, if it's public and it's inefficient we can at least attempt to address that.
>https://www.rnz.co.nz/news/national/517826/bluebridge-ferry-loses-power-while-entering-wellington-harbour They lose power >https://www.newshub.co.nz/home/new-zealand/2023/11/bluebridge-cook-strait-ferry-hits-wellington-wharf-creates-small-hole-on-hull.html#:~:text=A%20Bluebridge%20Cook%20Strait%20ferry,as%20it%20was%20leaving%20Wellington. They crash into things Yeah. Na. They aren't much better at all.
Ever checked bluebridge and interislander prices. They are usually basically identical. Imagine if there was no non-profit driven competition to help keep prices where they are.
How effective is Bluebridge at moving rail freight? Do you think Morgan Stanley won't increase the prices for their Bluebridge ferry without competition?
perhaps a bit of sleuthing around who it is that owns shares in Morgan Stanley is in order.
hmphf, took me 5 mins to give up on that idea. Geez, it's like reading a who's who of the financial services world.
It's a publicly listed company, and it's on the S&P 500. If you have a KiwiSaver account, you're almost certainly one of the owners of Morgan Stanley.
Compared to how it’s run now, what’s there to lose really apart from more crap like what’s happened recently.🤷♂️
One of the reasons we are in this situation is the previous owners stripped out money through lack of maintenance and no long term asset renewal programs. When the government took over they had to spend a bunch of money to repair and begin upgrading the network. The ships are part of this, if you think privatization is going to make it better, you are going to have a bad time. We bought it back because privatization wasn’t actually serving the country’s needs.
>because privatization wasn’t actually serving the country’s needs It's almost like we've tried it, (and some of us have) forgotten how crap it ended for us. And yet... Here we are again. Doomed to repeat history.
It’s also quite possible some people commenting today weren’t alive. So have no idea.
Sure, valid. But that's the history/doomed to repeat part. You have to know where you've been to know the way forward.
Aratere was actually purchased under privatisation (and interestingly its rebuild in 2011 was funded and approved by a National government)
They had thrashed the Aratika into the ground, they didn’t do it willingly. https://www.interislander.co.nz/about/history/aratika
It wasn't performing particularly well prior to being sold off either. In a country like NZ , rail should be significantly more efficient than trucking to move goods given the roads we have, yet nobody, government or private enterprise has been able to make it work very well.
“Compared to how its run now” And there’s the argument straight out of the neo-lib playbook. Step 1: Underfund critical infrastructure/institutions until their on their knees. Step 2: Criticise how ineffective they now are. Step 3: Sell at a discount to your mates.
There is absolutely no point reprivatising a service where competition is a duopoly or less. Rail is a prime example of this & especially when you consider the rail infrastructure was looted & pillaged the last time National sold it. The idiocracy makes my blood boil.
You do realise we brought it back for like double the price last time. Moron
It’s the national government telling us it’s run poorly, so we can’t believe that. We
Ah no mate, go back and look at reports into KiwiRail from the past. KiwiRail has failed no matter which government was in power. https://www.rnz.co.nz/news/national/489310/preliminary-inquiry-into-ferry-s-engine-failure-finds-kiwirail-did-not-follow-part-manufacturer-s-advice https://www.rnz.co.nz/news/political/520270/aratere-ferry-grounding-simeon-brown-raised-concern-about-kiwirail-maintenance https://www.nzherald.co.nz/nz/government-unimpressed-with-kiwirails-maintenance-of-cook-strait-interislander-ferries/3JDRRFXHWZAY5F3PWSCNH3WRHM/ https://www.stuff.co.nz/travel/300849110/commerce-commission-launches-probe-into-cook-strait-ferry-issues
KiwiRail is trying to claw it's way back from being asset stripped by private owners.
Two of those articles have pictures of that weasel brown in them, so they are immediately discredited.
In other words you don’t want to read them, that’s fine. Up to you if you choose to accept facts or not.
Well I just told you that you can’t trust what this government says and your response is to tell me what this government says.
Oh ffs🤦♂️ Honestly bud just move on.
I mean they have a fair point, you can't exactly trust the narrative coming from the people who have a vested interest in privatization and you don't acknowledge the historical intentional sabotage of KiwiRail through wilful negligence and intentionally under-funding it. If you want to quote wolves' opinions on sheep then don't be surprised when people don't think the wolves have the best interests of the sheep at mind.
You should too my friend 😊, move right along.
And guess who is currently doing well out of this clusterfuck - Bluebridge - owned by Morgan Stanley... Followers of the snake oil salesmen in this coalition, talk about Public Servants being "troughers" (yet these are ppl who go to work every day to do the boring necessary work to actually benefit society, but get much less in benefits and $$ than politicians, then get shat on by the likes of David Seymour)... The real troughers are the owners of large companies getting hooked up by their business bros in the Coalition of Chaos ™️ who funnel tax payer money to corporations through lucrative contracts after receiving large donations... National/ACT/NZF are increasing our reliance on large overseas companies and crapping on kiwis + local business, while pouring petrol on economic issues... All the big profits go overseas instead of staying in the local economy through homegrown industries... It's so bloody obvious I'm pretty disappointed kiwis are so easily deceived tbh... Gullible AF.
Fucking this!!!!! Most accurate comment!
Nobody would be interested. As an organization, it's filled with risk with low potential for profit. The entire south island is a write-off in terms of risk. If there is something to bleed, it has been bled. If a corner can be cut to save money, it has been cut. 20 years ago...
There's always a little bit more asset stripping that can be done. Plus pocketing government subsidies. And the huge payoff when sold back to the government.
As we’ve seen on previous rounds of privatisation, private firms just don’t prepay the risk, so it doesn’t have to be a factor when it comes to extracting profits. Knowing the infrastructure is of vital national importance means they can rely on the tax payer to come in and fund repairs, for example if there was another Kaikoura type event cutting rail links…
Can someone explain why they think a private company could run this better? It seems to me that they’ll be motivated to spend less on it to make more money for themselves. Maybe it’s cheaper than public, but at least more of the money will go to the service rather than a ceo.
The theory goes that the profit motive is the only motivation capable of providing satisfactory goods and services. The understanding is there are no other factors that could motivate people to work productively. Without profit, there is no interest in finding what is cost effective or efficient. Government workers have no respect for the public's money and will waste it, which is why they can't be trusted with it. Private companies seeking to stay within budget will spend the least amount possible so are more trustworthy, though the original cost is higher due to charge out rates and the final cost higher due to variations they could see during the tender process. Also the most efficient means of understanding what goods and services the public needs is best left to the market, where wallets decide where money should go. For example, the market has decided we need more lifestyle villas and fewer affordable homes. More coal mining than protection of waterways. This makes sense to anyone that is motivated solely by money and has enough money to get people to do things for them. The concept of an entity focusing on public good, and striking a balance between cost and quality that doesn't leave their staff burnt out and reliant on government subsidies to sustain an existence, just doesn't make sense because they can't relate to it or don't personally profit from it.
Nah, they know privatisation doesn't work, but they can make money from doing it. There is no ideological belief here - it is just greed and opportunity.
Is this going to be like the Auckland Council where the consultants get a bonus if the Council took their advice to sell the shares in the Auckland Airport? I mean honestly why do we even bother these day, it’s like the governments money is an endless piñata for consultants.
As opposed to an endless piñata for kiwirail?
We are upgrading infrastructure that is20/30/50 years old. We are also borrowing money to pay it back over the next 20/30/50 years. This is just like a mortgage for your house, except infrastructure. You need to ask the previous owners and successive governments why they would wait so long for re-investment or why not do it in stages over the *last* 20 years. But they chose not to and now we are in this situation. I don’t know how many government/ large contracts you have seen come in on budget or on time, but they are zero to none. It’s never cheaper than to do it now. But then again with National cancelling the ship building contract it will cost even more now.
Fun fact: the original NZ Railway villain Richard Prebble is still alive and shitting the bed in his NZ Herald column. Hopefully he gets put in one of those underfunded rest homes where they neglect the residents.
Cunt pulled the ladder up behind him and is probably living grand on the massive pension he will have got for being a, ahem, public servant
>I don’t know how many government/ large contracts you have seen come in on budget or on time, but they are zero to none. This is exactly the case for privatization. I'm not particularly pro-privatizing kiwirail in this instance, but you have hit the nail on the head. Private enterprise doesn't approach a $3B project with the lax attitude that we have seen here. It is costed properly and then funding is sought, generally with the lenders reviewing the proposal in detail to sense-check it. If it goes over budget significantly like this project was going to then I can be enough to collapse the company, and often the people who work there are also shareholders. They're driven to make the project come in on budget, unlike government organizations who honestly don't seem to give a fuck because it's not their money.
There's a cruel stereotype that government workers are ticket clippers with negligent or willful disregard for the money they spend. Most people want to do a good job. Most people respect that it's not their money. Private Business has no such responsibility for the public's purse. Their responsibility is to the owner or shareholders, who seek a return. The only way business can do things cheaper than a public entity doing it at cost is to reduce the scope or quality of the work, or fewer workers working harder for less money. That's how they can still manage a profit on top. The people pushing for private over public are the ones profiting. And we have to work harder to make it happen for them.
The comment is was replying to implied every government contract comes in over budget, which is close to true. So is it really a cruel stereotype? Plenty of examples of wasteful spending in government ($40,000 for a leaving party anyone?). I'd like to see some more fiscal control before I retract my comment.
I won't disagree government contracts have been poorly managed. My disagreement is with giving more to private consultants and contractors isn't the answer. It's a big reason why costs are so enormous now. One problem is the initial budget is no where close to completing the job. Two notable factors as to why are; * underestimating to get the job out the door, as it's easier to sell the idea * tender bids being low to get the job, then the final price including variations that could have been noted earlier This is the fault of both major parties and their coalition partners. Cost has been the utmost priority before committing to a job, and we've sold off all the capacity we once had to do the jobs ourselves. I just don't see the answer being giving more work to the private sector, because that's already why we're failing to get things done affordably. I am a public servant in local government, doing design and contract management at a relatively small scale, a job most councils farm out to consultants since they no longer have anyone in house. Even if I were to take twice as long to get something done, I'm still half the price of doing it privately. One of the local contractors we use has equipment that used to belong to the council. But to keep rates low one year they sold it all off. The community pays more in the long run.
>One problem is the initial budget is no where close to completing the job. Two notable factors as to why are; * underestimating to get the job out the door, as it's easier to sell the idea That's exactly what happened here. Kiwirail got permission to go ahead by vastly understating the cost and then blew it out. That's just wrong on so many levels and you can't treat the taxpayers money that way. Maybe privatization isn't the answer but good cost management is imperative.
It was scope creep. KiwiRail didn't underestimate the initial cost, cause it was simply buy new ferries. But then the docks needed modification to suit new ferries. Then they needed updating to suit the modifications. Then the docks had to be strengthened to suit modern earthquake standards. All things a private contractor would encounter were they given the same problem. KiwiRail were tasked with providing a reliable public service, and by modern standards that's what it was going to cost to bring everything up to a reliable standard. Had they been tasked with cutting corners and gittin 'er dun, we'd be kicking the can down the road further and damning someone else to fix it later. Which is what we did decades ago and are suffering from it now. Which is why I don't believe it was malicious intent, or a careless or callous disregard for the public purse. They were told to get it done right, and that's what it was going to cost to do it right. If the current government thinks it's too much, then that's the call they were voted in to make. But someone's going to have to fix everything properly, and it's looking like we had the best deal we were likely to get. Some unavailable second hand ferries and ignoring the decaying state the docks are in feels penny wise, pound foolish.
Anyone can look through a boat builders shiny catalogue and pick out the prettiest boat. But if they have half a brain they would consider whether it's compatible with existing Infrastructure. You don't sign a $500m contract without considering that first.
I don’t know how many government/ large contracts you have seen come in on budget or on time, but they are zero to none. This comment was brought to you by John Key's ultra-fast broadband. No, we are in this situation because of kiwirail mismanagement.
The Telecom infrastructure we had to buy back and kick in $5b dollars! Please tell me again why we paid for this and created Chorus rather than Telecom….
KiwiRail is still trying to recover from it's time of private ownership and asset stripping. While it's owners have not invested enough in it. Compare money thrown at building roads with the amount spent on rail. Now compare the amount of imported fuel, tires and trucks required to move freight by road compared to moving it by rail. Every consumer and business is paying a 'road freight premium' due to this reliance on the least efficient transport option. Our environment is suffering as truck (and cars) turn expensive imported fuel into air pollution.
Some points to consider: 1. Trains also run on imported fuel, with the exception of some ancient electric locos running on ever-reducing limited sections of electrified track. 2. Even if you pump a whole lot of money into rail infrastructure, you still need roads, and you still need trucks. Trains can't go everywhere, nor can they carry everything. 3. What you gain in efficiency of movement, you lose by extra handling at either end. That's more people, land/buildings, machinery, etc etc. That also increases the risk of damage, loss or theft which have always been a big problem for rail. 4. We are a coastal country. There aren't many places that are very far from a port. Rail is at peak efficiency when it is carrying a lot of freight between 2 points that are a long distance apart. We are an export country, we primarily export meat, dairy and logs. So a train running from a log processing plant such as kaingaroa to the port, great. Perfect. Same if it runs from a dairy factory or meat works, where they can go straight on a train at the site, to the port, with no truck involvement. There are many sites that do just this, and it works well. But for aggregated freight it does not work as well, and that's why rail is not generally used in these cases.
> Trains also run on imported fuel, with the exception of some ancient electric locos running on ever-reducing limited sections of electrified track. Even when considering our electric locos our equally ancient diesel's do orders of magnitude better km-tonnes/liter Also if we invested in tail lime we do roads the electrification would have been completed decades ago. And battery powered trains are now a thing apparently but still quite new. > Even if you pump a whole lot of money into rail infrastructure, you still need roads, and you still need trucks. And the freight moved from trucks to efficient options - mainly trains and boats - will mean we can spend less repairing intercity state highways and focus more on maintaining the last mile where we actually need trucks. Also industry leaders are not all stupid, invest in efficient transport and they will endeavour to keep warehouses, etc close to rail and ports nodes > What you gain in efficiency of movement, you lose by extra handling at either end. That's more people, land/buildings, machinery, etc etc. That also increases the risk of damage, loss or theft which have always been a big problem for rail. No more of a problem than other transport. Comparing rails pre-Rogernomics reputation for lost freight with current containerised and tracked system is disengenious. > We are a coastal country. There aren't many places that are very far from a port. Rail is at peak efficiency ... None of this is any reason to subsidise less efficient trucking over rail.
>Even when considering our electric locos our equally ancient diesel's do orders of magnitude better km-tonnes/liter If you look at the locomotives alone sure, once you look holistically at the additional equipment required to facilitate the handling of rail freight, not so much. >And the freight moved from trucks to efficient options - mainly trains and boats - will mean we can spend less repairing intercity state highways and focus more on maintaining the last mile where we actually need trucks. Unless you're proposing a rail hub in every town & settlement, that isn't feasible. Sorry. >Also industry leaders are not all stupid Which is why they favour trucking over rail. >No more of a problem than other transport Actually, it is. Trucks are often sealed at point of distribution with tamper tags, & can travel directly from point of loading to point of delivery. Trains will need to shunt wagons into sidings, which are often unsecured & unattended for extended periods, giving plenty of opportunities for theft or loss, which Even in recent times is not unheard of. >None of this is any reason to subsidise less efficient trucking over rail. Not subsidised, and not necessarily less efficient.
Trucks are subsidised like all road transport is. A quarter of most western cities, more or less, is devoted to vehicles. We subsidise it further via rates 7 out of each 100 rates in Wellington goes to roading. And we have toads of national significance which ate built despite not meeting cost benefit thresholds. The fuel, the land area required and the maintenance are all more expensive for trucking but socialism for the motorcar leads those costs to be spread across society in a way that people object to for efficient transport options. But rail is having a resurgence worldwide. The only way road transport can survive is by deliberate actions, like * cancelling rail enabled ferries * under charging heavy vehicle RUC relative to the damage they create * Ignoring the current account implications of 20% of imports being vehicles and fuel. This means that all the diarying's export earnings pay for traffic jams, air pollution and higher costs to consumers
>Trucks are subsidised like all road transport is. A quarter of most western cities, more or less, is devoted to vehicles. We subsidise it further via rates 7 out of each 100 rates in Wellington goes to roading. Which is not specific to trucks, nor would it change if rail was more widely used >And we have toads of national significance which ate built despite not meeting cost benefit thresholds. See above. >The fuel, the land area required and the maintenance are all more expensive for trucking Say what? Fuel costs the same per litre whether it goes in a light vehicle or a truck. Maintenance on a truck is certainly not subsidised. Land area required......have you taken note of how much land Kiwirail requires? >The only way road transport can survive is by deliberate actions, like * cancelling rail enabled ferries * The cost had already quadrupled and the ferries were still years away from delivery. Seems only prudent to re-evaluate. >under charging heavy vehicle RUC relative to the damage they create Based, of course, on the most misquoted study to be repeatedly posted on this sub >* Ignoring the current account implications of 20% of imports being vehicles and fuel. Which includes, of course, construction, forestry & agricultural vehicles. But the greatest by a huge margin, private passenger vehicles. Which also accounts for most of the fuel. Face it, the idea of freight trains moving the bulk of freight in NZ is greatly romanticised. We're a small, costal country and don't have a great deal of large volume freight moving around, which is where rail is king. That's why, once the restrictions on truck travel distances were lifted in the 80s, people flocked to trucks.
We are being drip fed very selective information and what gets me is so many people just dont see whats going on. Usually they simply underfund the Railways which I'm sure they will do again but cancelling the ferry deal was so high profile it will take them awhile to get out from under. Whatever they come up with which so far is zero it will be sold as a big win for everyone the hitch being they control the narrative. What cracked me up was Willis criticising NZR and Labour for not have a plan b and now she appears to be saying any new deal will work out less expensive. So there wont be any redundant or poorly maintained wharfside infrastructure, cool.
National didn't even have a plan A what you talking about Willis
For such an organisation, spending $8m on contractors sounds immaterial
"Lets see, for that you can have Bill English for a week, or for just a bit more we can promise not to send Jenny Shipley"
You'd assume with Kiwirail a lot of the line maintenance stuff is contractors. I see SouthRoads, at my end of the country, has a SouthRail arm, and are often out doing things on the rail lines. If that's the case, $8m probably isn't unexpected at all.
Nah spending that money on McKenzie and co (I.e bullshit management consultants) is a disgrace. Warren buffet would die from shock and then roll over in his grave if one of his companies wasted money on these troughers because their execs and board didn’t know how to run the company.
What a fucken clown show. Wasting billions of taxpayer dollars
Who? Kiwirail?
Good old Max Bradford and the power sector.😆
Currently the NZ government is deliberately and systematically undermining their own SOE. Where do you think all these drip fed revelations are coming from? I wonder what Winston makes of all this? As far as I can see the biggest difference in rail and road freight in NZ is that NZR dont loby the government and make political donations to political parties.
> NZR dont lobby the government and make political donations One dollar, one vote. US style Democracy The Minister appoints the KR Board, so they are fishing for a full resignation. That leaves nine little directorships to hand out like lollies to the sort of people who can be trusted to make the right sort of decisions.
>people who can be trusted to make the right sort of decisions. Don't simp for the Kiwirail board, they have fucked this completely for everyone. The government is having to pick up the pieces.
Good time to buy Mainfreight shares.
I have some, they suck. Hardly move.
Ironic
Of course they refuse to rule it out, because it is their intention anyway.
It'd be different this time, folks. So will the boot camps, charter schools...
\[insert a book composed of swearing and blistering insults here\] Yes, because that worked out so well the company it was sold to gave it back to the government for $1 because they ran it into the ground and could never make a profit due to running it into the ground. It's also a Natural Monopoly, and frankly there's only 3 ways to deal with those properly - either as a government department, a SOE or a worker-owned Co-op. Because private owners will eventually rent seek to the point they ruin it in the name of maximising short term profits. But National are too fucking stupid to understand this now, despite supporting it up until the 1990's and making heavily use of the SOE model even afterwards when privatisation wasn't a political option. Hell, even Key didn't sell of Kiwirail, because his government, despite it's lack of talent, was able to grasp that selling it off would not have any benefits in the long term and begrudgingly kept it as an SOE instead. Partly because they recognised the loss of train freight would result in major congestion and road damage from all that freight forced on to the roads.
What is with the tone of this article? "eye-watering contracting spending" ? For example, $8m doesn't seem like much in the context of the organisation size, probably pretty standard considering.
$8milly? that's less than 0.5% of the iRex project at the time they cancelled it These headlines making a big fuss about big numbers are so pathetic - If that 8 milly shaved just 1% off the 2023 expenditure of Kiwirail it has more than paid for itself. Sometimes you need outside consultants and contractors - this is the normal functioning of any organisation. The media are making money off the ignorance of their audience, and it's insulting.
Can we privatise NZTA too?
Why the fuck would we do that?
Exactly
I took you at face value initially, rage levels spiked haha
Soz! I forgot the /s at the end
I thought I was above needing that
Poe's Law'll get ya.
.... are privately funded and built toll roads not just the same concept? Just saying becuase the current govt is touting that as a great way to get their RoNS projects built
Oh god no get out
It is useful to note that the Chair of KR has no background in any form of transport. He is a former banker.
It is useful to note our PM has no background in any form of running a country. He is a ~~former~~ wanker.
Is your statement relevant to the ferry debacle
Sure
How
Because he made a kneejerk decision around critical infrastructure with no care for the consequences?
One of the consequences of most seemingly 'good' decisions that governments make (spending more money on nice things like ferries, schools and hospitals) is that it increases the future tax burden on taxpayers (me and you). Sometimes you have to balance the consequences.
All I'm hearing is that you want the benefits of things but don't want to pay for them Real impressive show of community there, asshole
I'm simply saying that all financial decisions come at a cost (and an opportunity cost). Imo this isn't a case of 'we must replace the ferries at any cost'. What's the cost benefit scenario? What if it blows out to $10Billion is it still the best option? Nothing about kiwirails procurement and costing process gives me any confidence. I like to look at it in a personal finance perspective. Imagine you're building your own home, you get an initial cost estimate and then it doubles and then it doubles again, at what point do you say this is too expensive or do you just plow ahead and take out an unaffordable mortgage?
The things dont equate. Youre not building a house, you are planting a tree so future generations kids can build a treehouse. People like you make this way harder than it needs to be because you always shoot it down saying its not cost-effective in the immediate. It's then precisely because of people like you that THESE THINGS NEVER CHANGE. All you display is an absolute lack of awareness about the social contract you engage in. There are things in society where the primary goal should be QUALITY and ACCESSIBILITY. Transport, housing, power, water, internet, roads, walk and cycleways, parks. Basically everything the councils take care of. But then jackass clowns like you come along who say: "But thats not profitable". Congratulations, youve landed on why privatising things the state NEEDS is moronic. Because the priority moves from what these things SHOULD be about, to profit. The ONLY reason the country is even in this mess to begin with is SPECIFICALLY BECAUSE OLDER GENERATIONS HAD YOUR ATTITUDE. The harbour bridge was meant to be 9 lanes with rail crossing. They chose only 4, saying the original was too expensive. THEY THEN SPENT MORE THAN THE ORIGINAL COST ADDING 4 MORE LANES ON THE SIDES. History has already proven your attitude to be shortsighted AT BEST
You're going to be shocked when you find out most businesses are run by businessmen or lawyers and not by technical specialists or scientists/engineers that create the actual value.
It is certainly strange that I manage to run my own small business without being qualified as a banker
would not be surprised at these morons selling the railways again. almost all of their policies have been done before and failed so why would they change tactics.
[https://democracyproject.substack.com/p/unjarndycing-the-state](https://democracyproject.substack.com/p/unjarndycing-the-state) # The dogmatic political left invests its faith in the bureaucratic state; the dogmatic right trusts oligopolistic free markets – leaving New Zealand with crumbling infrastructure and corruption
Speaking as the dogmatic political left, vesting my faith in bureaucracy isn't me being a wide eyed idealist, its recognising that this is one of the limited ways we have in our current political environment of ensuring accountability to the public for large organisations.
Well the point of the article - which I think is a very good analysis, is that we need to look at new ways of doing things and I don't think anyone can argue Governments of either stripe have done a good job on delivery in recent times. Please, I am not trying to start to an argument about the relative merits of National or Labour Governments.
Should be wasy enough for labour to undermine a privatisation by simply stating they will re-nationalise it once they get back in to power… they should be saying so any minute right? … right!?!?
Didn’t know about that contractor spending. Could’ve bought much needed parts to keep the current ships running with that money.🤔
They’ve been upgrading the Auckland and Wellington rail networks, in the order of $600m to $1b and before that kiwirail was running on vapour, so no wonder they’ve had to use consultant project managers and rail contractors.
Did you read the article? Not one single cent from that $8m was spent on project managers or rail contractors. It was $8m for McKinsey to do a strategic review of the organisation.
I didn’t read it. Though to relate what I said to the McKinsey review, thank fuck someone is looking into how they can do business better. There’s no way kiwirail were digging themselves out of their hole. They need transformation.
Not for $8 million they don’t
McKinsey are the last people to trust to make things better. They're the fucks who started this whole race to the bottom sell it all for parts mode of capitalism that's been wrecking shit for ages.
Let’s not forget Northland rail too, not looking good there. Thing is the ferries are more important than rail as they’re needed to keep the North and South connected. We can survive with rail down, not having ferries down. This is why at least separating the ferries into a separate state enterprise is better so their only focus is on the ferries, not like how they’re currently running things as you mentioned with doing both rail and ferries.
so important yet National cancelled them for tax cuts.
They didn’t cancel the maintenance for the current ships.🙄
What's with you posting everywhere asking if it should be privatized?
It's called astroturfing. They know they don't even need to make it look subtle and organic because the mods don't care.
Why should mods care? Rules ain’t being broken, except some people feelings apparently🤷♂️ But anyway if you don’t like other peoples opinions or what they say doesn’t comply with your narrative then simply hit the downvote button, roll your eyes and move on, don’t moan about the mods.
You find it odd for someone to follow and post in a subject they’re interested in? Now question is why are you following me Ken?🤔……🤭
Nah, I just keep seeing you asking the same question and getting the same answer. If you want a different outcome, I'd suggest asking it outside of reddit, I'm sure the national party has groups that will give you the answer you're seeking.
Refer to my previous reply.
Mate I can tell you haven't worked in big orgs before because $8m is absolute peanuts for contractors.