The government’s ferry announcement this week has caused a frenzy amongst supporters and critics – with some welcoming the news and others saying it has created nothing but uncertainty.

Almost one year after the new government scrapped Labour’s Cook Strait ferry replacement project, Finance Minister Nicola Willis announced the establishment of a new Crown-owned company to purchase two new ferries to replace KiwiRail’s ageing ships.

Deputy Prime Minister Winston Peters has also been appointed Minister for Rail.

“This decision will ensure New Zealand has a safe, reliable and resilient service to move people and freight between the North and South Islands.

“The ferries are expected to begin operation in 2029 as the existing ferries reach the end of their operating lives.

However, Willis did not confirm many details – including the types of vessels and their cost.

“The expected cost of the project is commercially confidential until procurement and negotiations for the associated landside infrastructure have been completed,” she said.

Willis cancelled the Labour government’s earlier replacement plan, known as iRex, due to cost blow outs. The new rail-enabled ferries were due to be delivered in 2026.

In her announcement Wednesday, Willis said the revised plan would significantly reduce overall costs compared to iRex.

The potential exclusion of rail capability on the new vessels has caused an uproar amongst many.

“Whatever the preferred solution, rail freight will continue to be able to be transported between the North and South Islands,” Willis said.

Labour finance spokesperson Barbara Edmonds claimed the ferries would end up being more expensive as well as taking longer to arrive.

“[Willis] has taken a whole year to come up with smaller ferries that are going to cost the country more money in the long run. The portside infrastructure will still have to be built, she’s just burdening future New Zealanders with the cost.”

Lukewarm reaction from transport sector

National road freight associations are welcoming the Government’s announcement, however Transporting New Zealand said freight operators will be disappointed by the lack of certainty on offer.

Chief executive Dom Kalasih said the Government “must move with urgency” to establish the Crown-owned company and progress the project.

“Frankly, a year on from the cancellation of the iReX project, we would have expected more progress to have been made towards the procurement of new vessels and portside infrastructure,” he said.

“We appreciate that the Government has had advice from a Ministerial Advisory Group, Ministry of Transport and transport stakeholders to consider, but today’s announcement leaves a lot of uncertainty for the transport sector, including around cost and rail capability.”

Kalasih says there were positive features in the announcement that the road freight sector would welcome.

“The establishment of a new Crown-owned company to manage the procurement should allow KiwiRail to focus on the maintenance and safe operation of the existing fleet, which needs to be an ongoing priority.

“We’re also pleased to see the Government inviting the private sector to put forward alternative proposals for a ferry service during the first stage of the process, up until March. We should be open to different ways of delivering a competitive Cook Strait service for the country.”

Kalasih said Transporting New Zealand looked forward to working with Minister for Rail Winston Peters and other key stakeholders to ensure the ferries and portside infrastructure delivered a resilient and cost-effective Cook Strait connection.

National Road Carriers Association said the announcement provided certainty that long-term options for moving freight between the North and South Islands is a priority.

“Rail will always be a critical part of New Zealand’s supply chain network and KiwiRail, also an NRC member, needs certainty so it can configure its entire operation to what configuration post 2029 Cook Strait is,” said NRC policy and advocacy general manager James Smith.

“We need to await confirmation from the Government as to what exact solution will be chosen moving forward, and we will be looking for dialogue on establishing what the best solution is for the entire supply chain.

“NRC is looking for robust plans for terminal infrastructure that caters for efficient transfer of freight.

“Ideally the terminal infrastructure should be able to cater for multiple vessel operators ensuring maximum value is obtained for every dollar spent.”

Announcement a dead end – critics

The announcement has also copped a sizable amount of criticism.

Maritime Union of New Zealand National said the Government has “kicked the can down the road” on the Cook Strait ferries.

Union national secretary Carl Findlay said no costs were provided by the Finance Minister and the Government was using commercial confidentiality as a “fig leaf to conceal how its decisions had led New Zealand into a very expensive dead end”.

“The only real announcement today was Nicola Willis announcing she will soon be sacked from the finance portfolio,” he said.

Findlay says the Finance Minister’s claims that the ferry deal would be cheaper than the iRex project had no credibility.

“How can she make such bold assurances when she hasn’t got a deal or even a confirmed plan?

“What New Zealand wanted today was certainty and a path forward, and what we got was an admission of failure from the Minister of Finance.”

Save Our Trains Otepoti-Dunedin said the decision was a “slap in the face” for the South Island.

Spokesperson Dave Macpherson said not replacing the aging and unreliable ferry fleet with rail-enabled ferries “adds enormous costs for a poor long-term outcome”.

Opposition slams Willis

Green Party transport spokesperson Julie Anne Genter said New Zealand could have had ferries by 2026, not 2029, if it was for “this reckless government”.

“Aotearoa could and should have a rail network that connects our communities across the country. What we have [now] is more uncertainty.

 “The Government must commit to rail-enabled ferries. Anything less will sever the South Island rail network from the North Island.

“The Government has messed around for a year and still we have no clarity on what the actual ferry solution will be.”

Speaking to RNZ, Genter called for Willis to resign.

“I think it’s an omnishambles. Nicola Willis should resign over her catastrophic decision to cancel the ferries.

“Basically they’re trying to pretend that they’re making progress to cover up the fact they made a terrible decision last year.”

Labour finance spokesperson Barbara Edmonds said the decision will fail future generations.

 “[Nicola Willis] has taken a whole year to come up with smaller ferries that are going to cost the country more money in the long run. The portside infrastructure will still have to be built, she’s just burdening future New Zealanders with the cost.

 “This Government is making decisions that will fail future generations. It talks about good infrastructure planning with one hand while running down our infrastructure just to make a political point with the other.

Te Pāti Māori co-leader Debbie Ngarewa-Packer said the plan for new ferries had shown the government couldn’t provide certainty for anyone.

 “A government that says it wants less bureaucracy is creating more,” Ngarewa-Packer said.

Prime Minister Christopher Luxon has defended his Government’s handling of the Interislander ferries, saying they’ve found a “great solution” to replace the ageing ships.

“We want good value for money and a resilient, robust service,” he said.