Christie defends Hillside report

John Christie
John Christie
Chairman of the group wanting KiwiRail's Hillside and Woburn workshops to build new trains for Auckland, John Christie, has defended the value of a Berl Economics report released by the group on Sunday and dismissed within hours by Transport Minister Steven Joyce.

Mr Christie yesterday said he did not think the speed with which Mr Joyce rejected the $15,200 report - paid for by the Dunedin City Council and the Rail and Maritime Transport Union - had left the group with egg on its face.

"Not at all. Not at all. Definitely not.

"I think the city's signalled that it is keen to co-operate as a city, a whole-of-city approach, to try to get what work it can, sensibly, from the tender and bid process, and we are still in that discussion and in that debate."

Mr Joyce told Parliament on Tuesday, in answer to a question from Labour's Darren Hughes, the report was based on "highly debatable assumptions".

The report suggested the workshops could complete 69% of the work required to build the 38 three-car electric multiple units (EMUs) and 13 electric locomotives, creating up to 1270 jobs and adding up to $250 million to GDP.

Mr Joyce gave an example of comparisons in the report being wrongly drawn and he questioned the availability of skilled train manufacturers in New Zealand and the possibility of New Zealand becoming "somehow" a successful exporter.

"It [the report] has also made no allowance for any commercial risk for the trains to be built in this country despite the fact that it has never been done before, which, frankly, is inexplicable," Mr Joyce said.

Mr Christie said Mr Joyce had stopped short of saying that there were no opportunities for New Zealand industry to participate in "some other form".

And, after meeting KiwiRail chief executive Jim Quinn in Auckland yesterday, Mr Christie said there was the possibility of other New Zealand companies, aside from the KiwiRail workshops, "sticking their hand up" in the tender process.

Asked who they might be, Mr Christie said: "That's a good question".

He considered even if the tender was won by an overseas manufacturer, there could still be opportunities for New Zealand companies.

"It doesn't mean we have to accept we can't participate with somebody else who may hold the head tender, and that's an important point.

"There are many players that could possibly get involved in some assistance with the build."

One of the authors of the Berl report, Kel Sanderson, yesterday defended the information in it relating to the capabilities of the workshops to do the job.

Mr Sanderson said he had been told by "people at a high level within KiwiRail" the workshops were capable of building the trains but over a longer period of time than the 45 months KiwiRail was seeking.

"The information we got was not just or mostly from the union.

"It was mostly from KiwiRail and we were given line-by-line costing of their production and that was confirmed by a person of high ranking within KiwiRail.

"There may be a difference between 'Can you technically produce that good?' as distinct from 'Can you manage a contract of $375 million on time?'."

Mr Quinn told the Otago Daily Times on Monday it would take "a huge amount of input" for the workshops to be able to produce EMUs and he did not believe the workshops could produce them quickly enough or at a competitive price.

Mr Sanderson said he was not out to "have an argument" with Mr Quinn over the workshops' capabilities, because Mr Quinn would have "a whole lot of other things that he will be taking account of".

- mark.price@odt.co.nz

 

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