Government won't bankroll Overlander

The Government has promised to maintain the main trunk line for possible future tourist operations. Picture / Greg Bowker

The Government yesterday brushed off pleas to save the Overlander, but promised to maintain the main trunk railway line to standards high enough for a future tourism operation.

Rail operator Toll will also wait until today to make a final decision whether to axe the service. The last two trains are to run between Auckland and Wellington on Saturday.

Although observers doubt the company will keep the service going without a Government subsidy, Toll spokeswoman Sue Foley said last night that it wanted to make a last-minute assessment of its options, bearing in mind an offer by regional councils along the route to help to market the service.

Acting Finance Minister Trevor Mallard said after Cabinet's weekly Monday meeting that he and his colleagues saw "no prospect of the current Overlander service becoming commercially viable".

Neither was it a fuel-efficient operation at an average patronage of 50 passengers a day each way.

"The fares already overlap with airlines and the reality is that the service is just not well used - it cannot compete with low-priced air travel and coaches," Mr Mallard said.

"Cabinet considered the regional implications of ceasing the Overlander service and accepted that the current bus services run by the InterCity Group met the needs of those communities."

Green Party MP Sue Kedgley condemned the decision as "utterly short-sighted and incredibly stupid".

"At a time when the rest of the world is investing in upgrading their rail network, we are dismantling ours - hasn't the Government heard of climate change?" she said.

"The Government had no difficulty finding $1.5 billion for new roads but can't find $1.75 million a year to allow the service to continue for six months to two years while we search for an alternative way of making it viable."

Rail and Maritime Transport Union general secretary Wayne Butson said the Government's "big fat no" would help to drive rail in this country into the ground at a time when Toll was also warning it may end freight services along the Napier to Gisborne line.

But businessman Thomas Manning, who is leading a consortium hoping to begin an upmarket tourist rail service between Auckland and Wellington in 2009, expressed relief that the Government had promised to maintain the track to passenger standards in the meantime.

Toll could be expected to seek a reduction in its rail access fee if it only needed the tracks to be maintained for freight trains running at a maximum of 80km/h instead of a passenger standard of up to 100km/h.

Mr Manning said Toll could retain exclusive use of the track only for one year after it stopped running passenger trains at least three times a week.

Although it would be a challenge to his consortium to build a passenger base once it was lost, he was confident that it could be done, and Toll's exit would at least remove one level of complexity for his venture.

His consortium proposes buying three diesel-electric trains carrying up to 140 passengers compared with the Overlander's 200 seats each way, but with much higher fuel efficiency.