Shane Jones, New Zealand's self confessed champion of the regions, was in Palmerston North this week to launch several projects that received money from the Provincial Growth Fund.

Among these was the Palmerston North Freight Hub planned by KiwiRail.

He talked at length with local civic leaders and the local development agency discussing plans and proposals for infrastructure around the region. He said the biggest project he has working on is the rehabilitation of KiwiRail.

"For quite some time the leadership of Manawatū and Palmerston North have been promoting themelves as a leading hub manufacturing logistics centre.

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"To do that and for us to work with you we've got to be prepared to take a risk and spend considerable amounts of money.

"After having done that, in partnership with the private sector and the civic leaders, then we will have endowed this of NZ with long term infrastructure," he said.

Palmerston North Rail/Road Hub is expecetd to attract investments from major operators.
Palmerston North Rail/Road Hub is expecetd to attract investments from major operators.

He pointed out that finding money in a "time of tight capital constraint wasn't easy". But $500 million has come from PGF because "we have to be able to back the people who are executing the projects".

The design of a new railroad freight hub near Palmerston North is a bold vision for New Zealand's logistics sector, KiwiRail Group chief executive Greg Miller said.

"The master plan for the three kilometre long intermodal freight hub, unveiled by Regional Economic Development Minister Shane Jones, combines a container terminal, warehousing for road transport operators, and bulk goods and forestry loading operations with KiwiRail's train operations and maintenance facilities.

"This is a major step forward in New Zealand's approach to freight logistics," Mr Miller says.

"It brings road and rail freight together in a much more integrated and seamless way, improving efficiency and saving in costs. The design allows for consumer imports and bulk exports to be managed at one place, and there is plenty of room to co-locate freight partners and meet their warehousing needs."

KiwiRail launched an ambitious plan for a Palmerston North Rail/Road Hub.
KiwiRail launched an ambitious plan for a Palmerston North Rail/Road Hub.

Miller said Palmerston North is already a critical freight distribution point, with goods coming through from the upper North Island, Taranaki, Hawke's Bay, Wellington and the South Island.

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"With freight volumes expected to increase in the decades ahead, this intermodal hub will be a crucial freight centre for the lower North Island.

"The efficiency improvements will make rail more attractive and help manage the numbers of trucks on our national and regional roads. But we are also planning for the decades ahead, ensuring the hub is designed to accommodate longer, more economical 1500 metre trains - which is a 60 per cent increase in length and capacity.

"A purposely designed facility to link rail and road together like this hasn't been seen in New Zealand.

"We are creating something world-class, which will support the growth of Manawatu's logistics industry well into the future."

Palmerston North Rail/Road Hub.
Palmerston North Rail/Road Hub.

The Government's Provincial Growth Fund has invested $40m as a catalyst to developing the hub. This funding allows KiwiRail to design the hub, purchase land for it and have the land designated for rail use.

With the master plan complete, KiwiRail is now working with local councils, iwi and other stakeholders to identify sites around Palmerston North where the hub could be built.

KiwiRail expects to identify a preferred technical site, and will be consulting with the public early next year, before seeking to have the land designated for rail use.