5 Jun 2009

KiwiRail now valued at $388 million

10:50 am on 5 June 2009

The Transport Minister says there is no realistic hope taxpayers will ever get back the hundreds of millions of dollars already invested in KiwiRail. Treasury has valued the network at $388 million.

The minister, Steven Joyce, has released the Treasury valuation of KiwiRail, of $388 million, while the previous government paid $690 million for the rail network.

Mr Joyce says previous owner Toll Holdings is the only party to have got a good deal.

He says this year, KiwiRail will be subsidised by $90 million and has warned any future subsidies will need to be approved by Cabinet and be bankable.

Mr Joyce says there is a serious question regarding the network's future profitability, and a lot of work going on to see what capital investment and support is needed.

Steven Joyce says the Government considers the network to be a sunk asset but is committed to funding KiwiRail and has no intention of a fire sale.