East Coast rail supporters say a regional economic study with a focus on transport infrastructure will need to have its scope set by the communities affected to avoid being a contrived tool for Government to justify closure of the line.

District Councillor Manu Caddie said he will table a paper at the Gisborne Regional Transport Committee next week recommending a Terms of Reference be drafted by the local authorities, have proper opportunity for public feedback and be signed off only with the support all the councils affected.

“The announcement yesterday was intended to deflect criticism from the sorry situation the Government have found themselves in” said Mr Caddie.

In a Select Committee meeting yesterday KiwiRail admitted a lack of maintenance led to the washout that closed the Gisborne line and blamed the lack of funding for basic maintenance on government policy under the ‘Turn Around Plan’.

Minister for Economic Development Steven Joyce and Transport Minister Gerry Brownlee announced the joint local and central investigation to be funded by the Ministry of Business Innovation and Employment after a meeting with regional mayors in Wellington.

Dr Ganesh Nana, the senior economist for BERL who provided a review of KiwiRail estimates for the line has offered to assist with setting the Terms of Reference for the much deeper study the BERL report recommended and opposition parties have called for.

“BERL’s expertise will be invaluable to ensure the whole story is told so we don’t arrive at a predetermined outcome or ignore essential considerations” said Mr Caddie.

Mr Caddie said it was vital that the regions involved had control of the process to avoid a central government whitewash of the investigation.

“Basing their decision on the KiwiRail business case – which BERL has shown is a lot better than KiwiRail or the Government claimed – is a bit like asking a local freight company if they want some remote roads in the district to remain open.” said Richard Burke, General Manager at Leaderbrand.

“Local business owners have shown there has been a negative impact on business and local jobs as a result of this decision that the Government is responsible for” said Mr Burke. Leaderbrand is a major horticultural exporter from the region. Clyde Lumber in Wairoa has stopped processing timber since the line was mothballed in December with 15 to 20 staff now out of work. “Products from this region will be less competitive without the rail and that will mean more job losses that our communities cannot afford” said Mr Burke.

“The evidence is clear, from the Government’s own projections we are going to see another 80-90 logging trucks every day on the highway.”

Maintenance costs on State Highway 2 between Gisborne and Napier have increased significantly in the last 10 years – from an average of $7.6 million per year between 2002 and 2005, to nearly $15 million per year between 2008 and 2012. Based on MAF forestry data, BERL conservatively expects over 80 more trucks each day on the highway if rail is unavailable.

“We currently have rail freight income for 75% of the break-even cost of the line, and that doesn’t include any of these externalities like improved road safety, significantly reduced road maintenance costs and a number of important environmental benefits. With some small investment, it won’t take much to get to 100% in a few years and within ten years the line will be quite profitable. But that is still a false economy, we need to include the other benefits and this study has the opportunity to show the real costs and benefits of a secure rail link complimenting other transport infrastructure” said Mr Caddie.