Rail Asset Loses Value

$0The $690 million of taxpayers' money spent on rail assets last year, when the Labour Government renationalised rail by buying the operating company from Toll, are now valued at just $349 million. $0$0 The loss of nearly half the value was disclosed by the Treasury in the Government's financial statements for the ten months to April 30. $0$0 The then Government made the acquisition of Toll New Zealand's rail and Cook Strait ferry operations, paying in cash on July 1, 2008. At the time, Toll NZ's Australian parent, Toll Holdings, said its book value for the assets sold to the Government was $430 million.$0$0 Treasury now says an unaudited assessment of the fair value of the assets acquired and liabilities assumed through the deal is $349 million.$0$0 In the ten months to April, KiwiRail earned $562 million of revenue and recorded an operating surplus of $4 million. $0$0 While the figures will be bound to throw the spotlight on the merits of doing the deal in the first place, Minister of Transport Steven Joyce has accepted that the deed is done and KiwiRail is something that the Government must support rather than sell off.$0$0 He has said that investment funds will be made available to grow the business but has said this will only be done if a business case can be argued, proving that there will be return on investment.$0$0$0$0