The Government has conceded there is little likelihood KiwiRail will meet a financial target to make the business viable.
The KiwiRail Turnaround Plan, announced in 2010, aims to make the business sustainable within a decade when it is hoped it would fund all its costs from customer revenue.
State-Owned Enterprises Minister Tony Ryall says it is unlikely the company will be able to find the $3.85 billion from its own balance sheet, as required by the plan.
He says its business has been significantly affected by the Canterbury earthquakes, the Pike River disaster and the economic downturn.
But Mr Ryall says KiwiRail does believe it can meet the original objective of the plan, which is to be a viable business.