$20m to revitalise 'vital' Hillside Workshop

Dunedin's mostly moribund Hillside workshops are about to be brought back to life with an almost $20 million injection of Government funds.

The Government has also announced $5.8 million of funding for a manufacturing agriculture technology business unit within Dunedin-based company Scott Technology and smaller amounts of funding for seven other projects.

South Dunedin's Hillside workshops. Photo: ODT
South Dunedin's Hillside workshops is getting a significant boost from the Government. Photo: ODT

The Government announced today it is dedicating $19.97 million from its Provincial Growth Fund (PGF) to re-establish the Hillside workshop as a mechanical hub and heavy engineering facility to service KiwiRail's trains.

Regional development minister Shane Jones and trade and export minister David Parker made the announcement in Dunedin this morning ahead of further PGF announcements this afternoon.

Most work at Hillside ended in 2012, after KiwiRail awarded an estimated $29 million manufacturing contract to a Chinese company in what was a terminal blow to the workshops.

Regional development minister Shane Jones makes Provincial Growth Fund announcements at Hillside...
Regional development minister Shane Jones makes Provincial Growth Fund announcements at Hillside Workshops this morning. Photo: Craig Baxter
Since then some work has continued, however, and private companies have also used the workshops.

Bradken has used the foundry and luxury train company Antipodean Explorer has used space there to upgrade its carriages.

Mr Jones said today under the Labour-led Government rail was back on track and the days of managed decline were over.

"Hillside is the only heavy lifting rail facility in the South Island so it is vital to KiwiRail's business,'' Mr Jones said.

"The Coalition Government is investing more than a billion dollars in rail, including $300 million from the PGF in Budget 2019.

"It makes sense to ensure there are quality facilities available to support KiwiRail to maintain their trains and undertake a range of heavy maintenance and upgrade work.''

Scott Technology in Kaikorai Valley Rd. Photo by Peter McIntosh
Dunedin-based Scott Technology is getting a $5.8 million boost. Photo: ODT files
The PGF was also investing almost $8 million in the smaller engineering and manufacturing sectors, which Mr Jones said were vital for the region both in terms of economic growth and employment opportunities.

"We are providing $5.8 million towards the establishment of a dedicated manufacturing agriculture technology business unit within Dunedin-based company Scott Technology.

"This unit will be dedicated to automation solutions and services for New Zealand food processors, producers and their suppliers.''

The funding package also included nearly $500,000 for the Southland and Otago Regional Engineering Collective (SOREC).

Mr Parker said the funding would support the collective work that SOREC was doing to find ways to reinvigorate the sector.

"Both this and the seven other projects that received funding today will create a step change in productivity and efficiency, and lead to the development of 87 new permanent jobs in the region.''

The nine engineering projects funded:

  • Southland and Otago Regional Engineering Collective ($495,000 over 3 years) towards establishment of the Collective to bring a coordinated approach across the sector to build capability and capacity.
  • Scott Agritech ($5.8 million) for the establishment of a dedicated Agritech Business Unit to become a New Zealand-specific and customer-led supplier of automation solutions and services for mainly food processors.
  • Petridish Ltd ($240,000) towards equipment and salaries for its 'Makerspace' area that allows manufacturing businesses to trial and test new, innovative products.
  • United Machinists ($520,000) towards purchasing a specific piece of engineering equipment to accelerate the manufacturing of parts and products.
  • Site Weld ($350,000) to purchase three pieces of engineering equipment for its fabrication, repair and maintenance services business, which services mining, industrial, heavy transport, marine and forestry sectors and is regularly involved in Health and Safety
  • solutions.
  • Farra Engineering Limited ($325,000) towards the installation of a Horizontal Floor Borer machine which will help complete maintenance work in shorter timeframes for several major South Island power generators.
  • Bison Group Limited ($110,000) towards creating a demonstration space to showcase its products that lift and weigh shipping containers and for additional equipment.
  • Red One Fabrication Limited ($93,000) towards a specific piece of engineering equipment to help this company, which is a leader in the innovation and design of Stainless Steel and Aluminium products for the Aviation industry, increase its output.
  • KiwiRail Dunedin Hillside Workshops ($19.97m) to upgrade the two main workshop buildings, overhaul mechanical plant, to enable KiwiRail to increase the services it undertakes at Hillside.



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A great result for Dunedin. Also good to see NZF making good use of the Provincial Growth fund to boost regional area's in the South.

Great news that we are investing in our infrastructure and the businesses that are needed to build and maintain it. This is money that will boost enterprising New Zealanders.

Good stuff.
Makes better sense to give the money to these than to the dcc's nice to have bridge to nowhere.

But it won't be a bridge to nowhere once the harbour basin development gets underway, courtesy of the $20m from the PGF.

That's the point of the bridge, whether you agree with it or not.

Without the DCC showing some commitment of its own towards the development (in this case in the form of improved access to the area), the government probably wouldn't have considered any material request for funding from the PGF.

How about letting us keep more of our money instead of paying more taxes? I think we know what is good/better for us than the government. An insult to our intelligence by giving us back crumbs for all the taxes we pay in Otago. Scott is Australian owned now days. So are tax payers paying for the ozzie owners' dividends & loans? Kiwi Rail has been a black hole for decades- put the entity out of its misery and give tax payers a break- let it fail.

If you are paying too much tax - then can you explain why your mob borrowed 90 Billion $.
Can you explain why the proposed tax cuts by your mob were going to be paid by borrowing - that your great grandkids would have to pay back.
Can you explain why with hospitals being run down, schools closed. nurses & teachers not given a pay rise & the police numbers reduced - given that and all this borrowing - how come all that is being rectifies AND a 7.5 Billion surplus.
I await your response Otagoideas

Great news, these all seem sensible, building on existing strengths.

Just another corporate bail-out. We have all paid for that facility before. Previously Corporate raiders in league with the Gummint stripped the profits and left the shell. Here we go again. I thought the Lord Market was supposed to provide however it seems socialising the costs is kosher. Just saying

This company can build trains / that would last and not break down as the Chinese locos have///// these people are real trades persons. Great to see

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