Key Points:

The country's rail operator and tracks will be overseen by one state-owned enterprise, Finance Minister Michael Cullen announced today.

Dr Cullen said from October 1, KiwiRail and Ontrack would report to the board of the New Zealand Railways Corporation, which would be chaired by former prime minister Jim Bolger.

Mr Bolger currently chairs the establishment board of KiwiRail, the Government's name for the rail operation business it bought back from private company Toll in July.

At the time Dr Cullen said it was likely that Ontrack - the state-owned railway track company - and KiwiRail would become separate operating units of a single SOE.

Today he confirmed that arrangement.

He said the current members of the board of the NZ Railways Corporation, essentially a holding company for remaining rail assets from the sell off in the 1990s, had resigned with effect from the end of the month.

Dr Cullen said he would announce the next tranche of capital funding for rail upgrades and expansion next week.

The Government initially injected $80 million into KiwiRail after its purchase to keep operations at their current level in the immediate future.

But Dr Cullen has previously signalled an additional upgrade package of around $300 million would be likely.