Tranz Rail's new Australian owner Toll Holdings, which last year said it did not want to run passenger trains in New Zealand, has changed its mind according to the Greater Wellington Regional Council.
"We have now met with Toll and clarified that they are committed to ownership and operation of Tranz
Metro," council chief executive Barry Harris said yesterday.
Last year, as Toll worked through its takeover of Tranz Rail, chief executive Paul Little said the company was mostly interested in Tranz Rail's freight services and did not wish to operate passenger services.
The council currently subsidises the service to the tune of $17.5 million a year and has for some time been unhappy with its quality.
The council has made two bids to buy Tranz Metro, the latest initiated in December last year. However, at a meeting on Friday Toll told the council it intended to retain the service.
The council's first bid for Tranz Metro collapsed in December 2002 when Tranz Rail's former management refused to open Tranz Metro's books to the council and joint venture partner Stagecoach.
Harris said the council was now working on proposals to form the basis of a new contract with Tranz Metro for subsidised passenger services.
"The proposals will include expectations for transparency of information, quality of service and the urgent need for capital investment on ageing rolling stock."
- NZPA
