NZ needs transparent pricing structure for Toll’s freight operations, says road industry

<p>The New Zealand Government said it cannot produce a transparent pricing policy for Toll NZ’s freight operations yet, due to the financial mess left behind by Toll’s predecessors, Tranz Rail.</p> <p>Road Land Transport Forum chief executive Tony Friedlander is very concerned about possible cross-subsidisation between road and rail under Toll.</p> <p>The government purchased the track from Tranz Rail for $1 in December last year and Toll Holdings took majority ownership of the rail carriages.</p> <p>Toll also owns 14% of Owens logistics operations and the Cook Strait ferry service.</p> <p>Transport minister Pete Hodgson agrees with the road industry that the government needs to be clear about how it is going to charge Toll for tonnage on road and rail.</p> <p>But he said: "It isn’t going to happen any time soon as Tranz Rail left the tracks and carriages in a bundled mess."</p> <p>It would take months to sort out the pricing structure, he said.</p> <p>Mr Hodgson told <em>Lloyd’s List DCN</em> he expects the government board, On Track, to discover "further unpleasantries", as the demands of the job became greater.</p> <p>The privatisation of the rail in 1993, when the government sold the railway system to Tranz Rail, was the most "ham-fisted privatisation in our history," he said.</p> <p>’"There was no capital expenditure requirements of the new track owner on the track. The company failed to invest in the infrastructure, which was reflected in the purchase price of the track."</p> <p>Toll Holdings managing director Paul Little said he expects Toll NZ to be sustainable within five years.</p> <br />