Transport Minister Steven Joyce has warned regional councils in Auckland and Wellington they will have to pay more for their commuter rail services.
Mr Joyce told a rail conference in Wellington on Wednesday the long-term viability of publicly-owned KiwiRail depends on its users paying properly for its services.
The minister says the Government has already committed large amounts to upgrade commuter services in Auckland and Wellington, but warned the regional councils they cannot complain if they are not prepared to pay for the ongoing maintenance of the rail system.
"There's lots of talk about further investments and growing the works further in Auckland and Wellington and my view of that is, that's fine.
"But you can't make that a costless choice for politicians in councils in those regions because the ratepayers will have to meet the costs of any additional expansion in terms of operating costs particularly."
Mr Joyce also warned that large users of KiwiRail's freight service will need to pay a more realistic amount. In some cases, commuters could also pay more.
The Government will announce further spending plans for KiwiRail in the Budget on 20 May.
The Wellington Regional Council says it is prepared to pay more to support Wellington rail services.
'Tough decisions needed'
KiwiRail chief executive Jim Quinn says underinvestment in the rail network is blindingly obvious, and the legacy will be felt for some time.
Mr Quinn told the conference KiwiRail has 800 wooden bridges nearing 100 years old and 2.5 million pine sleepers that are at the end of their life.
He says it is possible to spend "infinite amounts" of money on the rail service but there will only ever be a finite amount of money, which needs to be spent on the best infrastructure possible.
