Railways Bill — First Reading 
Railways Bill — First Reading 
[Volume:610;Page:7409] 
Railways Bill 
First Reading 
Hon PAUL SWAIN (Minister of Transport) 
: 
 I move  
That the Railways Bill be now read a first time. 
 At the appropriate time I intend that the bill be referred to the Transport and Industrial Relations Committee—the House will be relieved to know—with no conditions. 
The rail industry in New Zealand is moving away from being vertically integrated with one major operator to being fragmented with a number of different key players. This devolution creates safety gaps at the margins which need to be effectively covered by legislative change. I flagged the introduction of this legislation late last year but a few issues relating to how the bill would affect small heritage operators meant that introduction was delayed. However the bill is now ready and its introduction should not be delayed any further. 
This bill will have a positive effect on rail safety as it brings a more robust system and it will help those who are interested in investing in New Zealand railways to understand the proposed regulatory regime. The safety legislation will apply to all rail participants regardless of who they are. New legislation needs to recognise changes in rail ownership and operational activities. This Government has made a commitment to recognise the recommendations made by the Ministerial Inquiry into Tranz Rail Occupational Safety and Health 
2000 also known as the Wilson Report. A subsequent review of the state of the infrastructure conducted by Halliburton KBR has reinforced the need to introduce changes. 
This bill consolidates legislation relating to rail safety from the Transport Services Licensing Act and the Land Transport Act into a single Act. It also incorporates relevant parts of the Railway Safety and Corridor Management Act and contains remedies for a number of deficiencies in the current rail safety legislative framework. At present rail operators are accountable for rail safety through their approved safety management systems. In future however there will be participants in the rail sector whose activities are fundamental in the safe delivery of a rail service but who will not be covered by a safety management system. 
This bill extends the licensing regime to cover a greater portion of rail participants. It requires a clear and visible chain of responsibility between licence holders and subsidiary organisations. It improves the audit process by introducing a wider-ranging process of safety assessment and it enhances the range of powers available to the regulator—the Land Transport Safety Authority—to enforce safety. Operators who perform well in their safety assessments will be rewarded with reducing compliance costs over time. Operators who do not perform well can expect more regulation including more regular assessments and the requirement to produce safety improvement plans. At the moment it would be very difficult to prosecute a member of the public or perhaps an employee who might do something that has a serious safety consequence. The bill changes that. Although the safety manager is responsible for the overall safety of the operation an individual could be held accountable for his or her actions if necessary and the court will be allowed to decide a penalty suitable to the level of the offence. 
The bill also contains new provisions in which the Minister can make rules which are a form of legislation to do with a wide range of issues including driving hours and drug and alcohol standards. Current law requires only rail operators to have a licence and before a licence can be granted operators must have a safety system approved. Because Tranz Rail and heritage organisations were vertically integrated the safety of the whole rail operation was managed through the rail operators’ safety system. However with the sale of the Auckland rail network we have moved away from that model. Similarly further possible changes in track ownership outsourcing maintenance or contracting train control will mean that those activities are no longer covered under a single rail operator’s licence or its safety system. Extending the licensing regime to include those who provide access to the track means that access providers will also require a safety system. All rail participants will be captured under the safety system of either the rail operator or the access provider through interoperability agreements. Those agreements will be approved by the regulator and must demonstrate a chain of responsibility from the licence holder right through to the individual contractors who are part of the wider operation. This is important in order to maintain accountability. 
Both the Wilson and Halliburton reports criticise Tranz Rail’s safety management systems for being voluminous and unwieldy. Their sheer size makes it very difficult for the regulator to navigate and in practice reduces their efficacy. Rail licence holders will still have a safety system. The bill requires a safety case—a high level public document that contains among other things an overview of the rail operation’s key activities and a description of the safety policy and objectives. This safety case must include a strategy for managing identified risks and an outline of the safety monitoring and reporting regime. 
In addition key documents relating to the operation will be listed in the safety case. The safety case will be approved by the regulator and should that licence holder wish to make changes to it those changes also need to be approved by the regulator. Secondary documents and manuals relating to the operational practice will sit underneath the safety case as part of the wider safety system. Those documents will not require approvals for variations but in the case of a safety assessment they will be subject to audit to ensure that an operation is complying with its own standards. As well the regulator can require the safety risks to be remedied. That means that licence holders will be required to change aspects of their safety systems or add to them if deficiencies are found. 
The current audit process is a paper-based test that ensures an operator’s records match the standards set out in the safety management system. That means that it does not matter what the standard is just that it is consistent. There is no provision for the auditor to make sure that the standards required of the regulator are actually being carried out. If we are to achieve full safety assurance for rail operations a combination of audit inspection investigation discussions with staff and the use of accident-reporting data must form the basis of safety assessment. The bill provides for that level of safety assurance. 
Under this bill the regulator will negotiate with the licence holder the frequency with which the operation should reasonably be assessed. For those who demonstrate a consistently good safety record the time between assessments may be extended thereby reducing their compliance costs. The regulator may require an operator with an unacceptable safety record to develop a safety improvement plan. This plan recognises continuous improvement and allows the licence holder to work proactively with the regulator to achieve agreed safety outcomes. It should also help the licence holder achieve a good safety record and reduce compliance costs in future. While the current audit system merely checks compliance with a system that may be outdated or ineffective this bill will allow the regulator to review the safety case. That would occur in situations where the regulator can reasonably demonstrate that the nature of the business has changed considerably and that the operation is significantly different from that for which the safety case was originally proved. 
I am committed to ensuring that non-commercial operators and particularly small heritage operators are not unduly penalised by the costs associated with this new safety regime. Those charges are still being finalised but they will be kept to a minimum where possible. Over the next few months officials will consult the industry over the structure for fees and charges under the bill and will also encourage heritage operators to address the issue in submissions to the select committee. I should add that I have had discussions with the heritage operators and they have indicated to me what their concerns are. We have indicated that we will meet them some of the way. There are still a lot of details to be worked through but they have my assurance that we are trying to ensure that compliance costs are kept as low as possible given the charitable nature of many of those organisations. I am also conscious of the need to minimise paperwork for small operators. The Director of the Land Transport Safety Authority may if appropriate allow an operator to use the documentation required for its current licence as its safety case. 
The bill will make the sanctions regime more effective by allowing the regulator a series of ramped-up powers that can be used accordingly and in relation to the seriousness of a safety breach. The current sanctions regime relies on imposing conditions on the operator’s licence or suspending the licence. Both options are restrictive and impractical. There is no scope to effectively enforce lesser breaches without disrupting the whole operation. Graded powers will allow the regulator to acknowledge small breaches without having to impose hefty penalties. It will also encourage licence holders to be proactive andidentify their own risk without incurring a penalty if the risk is managed quickly and effectively. 
The bill proposes a number of positive changes to the way the rail industry is regulated and how safety is assured. Given the direction the industry is taking moving from vertical integration to fragmentation New Zealand would be sensible to learn from the mistakes made in other countries—particularly in the United Kingdom where poorly managed safety gaps have resulted in disastrous rail accidents that have taken many lives. This Government has a vision for transport in which rail plays a significant part. If we want to fulfil that vision we must improve our rail safety performance up to international best practice. We must ensure the continued success of our efforts to reduce serious injury and deaths in the rail area. The bill does that and I commend it to the House. 
Hon ROGER SOWRY (Deputy Leader—NZ National) 
: 
 The National Party will be speaking in favour of this bill and voting in favour of its introduction but we do so with severe reservations because we are very concerned about some aspects of it. Although we will vote for this bill to go to a select committee we will be reserving our position depending on the bill that emerges from the committee. 
I want to start by saying that I notice that the Government and United Future have decided that this bill will have full submissions. I acknowledge that a bill like this needs full submissions from a range of people interested in the process. I regret that we will not be allowed to do that for the Civil Aviation Amendment Bill and I regret that United Future has stopped that given that it has no one on the committee and shows very little interest in transport issues. That aside United Future has rolled over as is its wont. 
I take issue with the Minister who said that rail was moving away from being vertically operated—and he is right there—to being fragmented with a number of players. I am bemused that he can say that with a straight face given that just a few weeks ago in this House he was trumpeting a deal that the Government had signed with Tranz Rail for its management to have sole management rights to the track. It was denying access for anyone other than the odd heritage operator and the obvious passenger transport that is already broken down. That deal is still on the backburner because after having signed the deal with Tranz Rail executives the Minister raced around behind the bike sheds and did a deal with Toll Holdings which undermined the Tranz Rail executives. So the Government went from having total faith in Tranz Rail and buying the track back and giving Tranz Rail’s chief executive and management the total rights to run it to racing around and doing a deal with Toll Holdings saying: “No you can have total rights. You can get the same money. The Government will own the track and Toll Holdings can operate it.” 
We now know that that deal is effectively dead in the water. Toll Holdings will not be able to get the 90 percent shareholding that the Government had insisted upon in that arrangement. So now we have other operators lining up to purchase the operation and they do not know whether they will get the same deal from the Government. It may well be that Tranz Rail is moving away from being vertically operated because it is in such a shambles after the Government’s meddling in the sale process that people do not have a clue as to who will operate or own what. 
The Minister stood in the House a few weeks ago and said that the reason he had had to front up with $200 million for Tranz Rail was that the company would be broke by Friday and if he did not come up with the money the trains would stop. Well the trains are still going. I tell the Minister that Tranz Rail could go broke because of the reports it has to commission every few weeks to evaluate another deal that the Government is trying to stitch up with another potential buyer—that is what might send Tranz Rail broke; it has nothing to do with the original reasons. 
Hon Jim Anderton 
: Do you really believe that? 
Hon ROGER SOWRY 
: Mr Anderton sits there chuckling away but he is the man who has been promising rail all over the country visiting everywhere but Nelson. He has promised rail all over the country but he has not delivered on it at all. Richard Prebble has a better track record in delivering services than Jim Anderton. Jim Anderton has been going to Gisborne just about every month for 4 years and saying the same thing: “Don’t worry the trains will start.” There is not one extra log on the rail now than when he started going—and he knows that. 
Mr Anderton can sit there and chuckle all he likes as the only Cabinet Minister to be on New Zealand superannuation and proud of it. That says a lot about the high stand he takes when it comes to using taxpayers’ money—$180000 plus the car and Vogel House are not enough for him; he has to take New Zealand superannuation as well just to make sure that ends meet and that he can pay for his regular Thursday or Friday night at the movies. I tell Mr Anderton that that sort of behaviour goes down with the populace at large about as well as his continual promises to save rail in Gisborne. People have stopped laughing about Mr Anderton in Gisborne; they are polite to him because they are never quite sure whether the chequebook is coming out but they suffer him only begrudgingly. That is what they tell us on a regular basis. 
What is of concern in this bill is the huge amount of fines. It is the good old Jim Anderton approach to Government: if something is going wrong in the rail business sock some fines in there. We have fines that will apply to staff—to the workers whom Mr Anderton represents. If a staff member fails to act in a safe way he or she is liable for a fine not exceeding $100000. 
Hon Jim Anderton 
: If he or she does something causing death. 
Hon ROGER SOWRY 
: No that is not what the bill says. I suggest that Mr Anderton reads clauses 60 to 65 because he will then see what it means. Next time Mr Anderton is on the plane to Gisborne he should read them and stand up in Gisborne and tell the people there—when they have stopped laughing—that this Government is happy with $100000 fines. The union movement is not happy with that. It is on record as saying that it opposes these clauses. We will oppose them as well and we will not support the bill with those sorts of draconian fines particularly when the company can also be fined under the occupational safety and health legislation. So not only does one have to be content with fines under the occupational safety and health legislation under this bill one is also able to be fined up to $100000 under clause 60 and up to $50000 with imprisonment terms not exceeding 1 year or 6 months depending on the section of the legislation. 
We think that is draconian. We think it is likely to mean that the person operating in a shunting yard—[ 
Interruption 
] Government members can chip away but do they think that the person down in the shunting yard who makes an error of judgment will be happy with the fact that because he is standing alongside the track doing his job and an accident occurs for which he is found to be liable he can be fined up to $50000 or $100000 depending on the error of judgment? 
What other industry has those fines? None—not one. Why would we fine the workers at that level? Does Mr Anderton believe that they can pay for it? Are those workers on a salary plus New Zealand superannuation like him? Are they double-dipping? No they are just getting a salary. He is out there saying: “No that is not good enough. We will get the company under the occupational safety and health legislation and we will get the staff members the managers the shunter operator the person”— 
Hon Jim Anderton 
: The shunters usually get run over—that’s the problem. 
Hon ROGER SOWRY 
: Oh he says the shunter gets run over so he is not worried about him. Well I want to say— 
Darren Hughes 
: Be sensible. 
Hon ROGER SOWRY 
: Mr Hughes says this bill will stop them being run over. Mr Hughes also said that the alcohol tax on port would stop youth drinking and they are still laughing about that in Levin on Saturday night. I say to the Government that we will not support this bill in the shabby condition that it is in. 
PAUL ADAMS (United Future) 
: 
 I rise to speak in support of the Railways Bill. United Future is supporting this bill because we believe it is a much-needed common-sense piece of legislation that will enhance the safety of all users of Tranz Rail’s network from railway workers to freight users to suburban commuters. The days when the rail network was fully owned and operated by a single organisation are long gone yet our rail safety regulations do not yet reflect the new reality. New Zealand’s rail system has become increasingly fragmented with Tranz Rail contracting out maintenance and selling off assets including passenger services. Adding to the fragmentation has been the emergence of small independent players such as heritage operators. The fragmentation of New Zealand’s rail network is set to continue apace and may well gain momentum once the ownership of Tranz Rail and the rail tracks has been settled. 
The Railways Bill will establish clear lines of accountability for rail network safety issues. It will also impose robust new safety requirements on rail operators requiring them to be licensed to appoint safety managers and to develop safety plans. The new safety requirements will be backed up by greatly increased penalties for non-compliance and wider monitoring and enforcement powers for the Land Transport Safety Authority. Failure to enact this legislation and thereby to enable the implementation of the new safety regime could well expose New Zealand to the sorts of problems now besetting British Rail. That is the last thing the beleaguered rail industry and indeed the transport sector with its large and growing infrastructure deficit needs right now. 
 No one in the United Kingdom has yet introduced a safety regime along the lines of that being proposed in the House tonight. As a consequence the British rail system is an incomprehensible mishmash of Government interests network owners rail service owners maintenance contractors rail service contractors and a whole host of others. That means that when UK regulatory authorities want to enforce preventive safety requirements by checking rail traffic tracking systems the maintenance of railway lines and equipment or general safety regimes they are often unable to determine who exactly is responsible for any given area. 
The same problem applies to determining issues of responsibility and liability after a serious rail accident has occurred as has been the case several times in recent years. At best this leads to extensive delays similar to those faced by Wellington commuters last summer when Tranz Rail had to slow trains down due to the heat-buckling of some parts of the track. At worst it can lead to serious accidents involving heavy loss of life such as the Paddington rail disaster which was seemingly caused by a preventable signal failure and in which 31 people were killed and 400 others injured. In fact the distressing state of the British rail system led to an interesting debate in the UK Parliament between those who thought Britain had the worst railways in Europe and those who thought they were merely awful. During the same debate Tony Blair was accused of having neglected the rail issue since being elected in 1997. 
Thankfully New Zealand’s rail problems have so far been largely confined to the category of inconvenience rather than outright disaster on the scale of that seen at Paddington. It must be remembered that the impetus for the Railways Bill was a ministerial health and safety inquiry into Tranz Rail convened by the Minister of Labour Margaret Wilson after the death of five Tranz Rail employees in 7 months. Rail safety in New Zealand is a serious issue and we should not simply trust to luck to prevent more of the same or worse from occurring in the future. 
That is not to say that United Future does not have some concerns about this bill and we will continue to monitor those carefully. In particular we are concerned about the compliance cost levels facing small players such as heritage operators. The cost of applying for a licence paying annual licensing fees developing a safety case and paying for approval from the Land Transport Safety Authority could easily become prohibitive. However those concerns have been partially mitigated by various economies that can be made and partially by an effective subsidy that will cover a certain proportion of the cost of the regular safety assessment that heritage operators will be required to undergo. United Future raised this concern with the Government very early on in the process and we are satisfied that reasonable efforts have been made to find practical solutions to the challenges faced by smaller operators without compromising the safety regime that this bill is to put in place. 
Another issue and one which has proved to be the most controversial is the proposal that individual rail safety managers may be liable for death or injury caused as a result of deliberate negligence on their part. However we are comfortable with that provision given that the threshold has been set quite high and that it is necessary if proper lines of accountability for safety are to be established. Quite frankly we do not see anything wrong with holding people personally responsible for their own deliberate actions when any misjudgement or neglect could result in serious property damage or loss of life. I ask the House how robust safety standards—or in fact any standards—are to be enforced without any notion of personal responsibility. 
 This legislation will play a vital role in the future of rail in New Zealand. We believe that rail can play and will continue to play an increasingly important role as part of New Zealand’s transport infrastructure. We would certainly prefer to see as much of that as possible achieved by the market without Government intervention but given the fiasco caused by Tranz Rail’s ownership of the network we realise that some intervention is required to bring the rail network back up to a high standard and assure its future viability. 
Nevertheless rail freight and passenger service operators will continue to operate commercially no matter who owns the tracks and hopefully on an increasingly competitive basis that will see the volume of rail transport increase and the price of freight by volume decrease. But to achieve that we need to get the fundamentals—and particularly the safety and accountability issues—right from the start. This bill is a very good start and we commend it to the House. 
PETER BROWN (Deputy Leader—NZ First) 
: 
 I listened with interest to the contribution made by Paul Adams. I have to ask whether we heard about another background backyard deal between United Future and the Labour Government. United Future does not even have a member on the select committee yet the member said that he was very happy with everything. The United Future members sit in closed rooms and discuss what a bill will be what it will do and the intention of it. That is not democracy. It is an abuse of the system to come to the House and say that the bill is all hunky-dory when nobody has had any input in it whatsoever and United Future has not even made an attempt to have a member on the select committee. The member is very misguided in saying that. 
I accept that Paul Adams’ concern about the British rail system was genuine. However the British have really addressed the issue over there. They have really gone into their system and played hardball. They have a company called Network Rail that the British Government has taken over without any doh ray me or waffling along like this Labour Government did here when it talked one day about doing a deal with Tranz Rail and the next week about doing it with Toll Holdings. 
Paul Adams 
: Will the member support this bill? 
PETER BROWN 
: We will support this bill but for genuine reasons. The United Future members are so misguided that they need our expertise to straighten the thing out. We will support this bill. We will sit on the select committee unlike that member. United Future will not have anybody on the select committee. It has already done a deal with the Government and the member thinks that it is all OK. He is quite happy with the fines and the penalties that have been imposed in this bill although we have some major concerns with regard to them. I can now see where the Government’s woolly thinking came from. With due respect to Mr Adams I can now see why the Government is so woolly on transport issues. The Government does not have a clear idea in its head about what needs to happen. 
Fundamentally if we want to develop rail then we have to have the track in Government ownership. Dr Cullen refused to do that at one time but now he is talking of doing it. First of all he talked about a deal with Tranz Rail whereby it was to have monopoly rights of operation and then 2 weeks later he wanted to do the same deal with Toll Holdings. In essence what needs to be achieved is to have a rail track company with competitive operators providing the services. Mr Adams alluded to that but he could not have said anything to the Government about it because there is nothing in the bill that outlines that sort of theory. Mr Adams alluded to the fact that competitive services on our rail track system would make an improvement yet there is nothing in this bill that will encourage anybody to move one single log from the roads on to rail—nothing. I have searched the bill looking for some sort of incentive to do that and have found there is absolutely nothing here that will do that. However the bill does go to one of the core issues by trying to address the safety concerns that we have with Tranz Rail. 
About 10 years ago a political party was formed in this country. 
Hon Paul Swain 
: What was the name? 
PETER BROWN 
: That political party was called New Zealand First. One of the reasons for forming that party was our concern about the State asset sales; that was a fundamental reason for forming the party. There is no greater example than Tranz Rail of why we were concerned about State asset sales. I have heard people criticise the Hon Richard Prebble over the issue of the railways. However in fair dos to the man he sorted out New Zealand Rail and made it efficient for 1 year and he made it available to— 
Hon Jim Anderton 
: Oh! 
PETER BROWN 
: The member indicates that he would not have sold New Zealand Rail. I can recall that member sitting very comfortably in his seat when Labour was in power between 1984 and 1990 selling all sorts of assets. 
Hon Jim Anderton 
: Was the member in England then? 
PETER BROWN 
: I was here. I know that the member made a little bit of a ruckus on the side but basically when push came to shove he was part of that Government between 1984 and 1990 when $11 billion worth of State-owned assets were sold to private people. 
We are concerned about the level of fines and penalties provided for in this bill. We are not comfortable with the level that is to be imposed here. 
Hon Paul Swain 
: Too high or too low? 
PETER BROWN 
: The penalties may well be too high. 
Paul Adams 
: Well said Paul! 
PETER BROWN 
: Does the member disagree with me? When one imposes penalties they have to be realistic and fair. In this bill they seem to be fairly on the high side to put it mildly. We do not agree with people offending or agree with the failures that are addressed in this bill but we believe that the penalty should reflect the crime. To go back to the example of Britain which Paul Adams referred to I tell members that that country is actually holding the directors of Network Rail to account for manslaughter in relation to one of the big rail crashes that occurred there. In my personal opinion we should look at a lower fine level for modest offences but if we get into the serious stuff then the penalties should be very severe. I am not sure whether this bill reflects that sort of philosophy; in fact I am certain that it does not. It seems to whack a heavy fine on to somebody for what could be a very modest offence. 
We would be interested to know when the Tranz Rail track will become the responsibility of Track Co. The Hon Roger Sowry said that Tranz Rail went cap in hand to the ministry some time ago—and I think the Minister concurred—saying that it would go belly up within a few days or weeks. But Tranz Rail is still continuing. 
Hon Paul Swain 
: It’s got $40 million; that kind of helps. 
PETER BROWN 
: That keeps Tranz Rail ticking over but when can we have a resolution to this problem? 
Hon Paul Swain 
: When the shareholders vote. 
Hon Jim Anderton 
: It’s still a democracy. 
PETER BROWN 
: I am glad to know that. It will be a step in the right direction to get the railway structured correctly and to apply this legislation in order to get the track company running properly taking appropriate safety measures and bringing the whole system up to standard. 
I believe the money that the Government proposes to invest in the track company will not be sufficient in the longer term. I think it is $20 million a year for the next 5 years. That is not enough and the Minister knows it. The amount should be at least double that for the first few years and probably for as long as 10 years. The reports that I have had about the condition of the track cause some concern. 
We will support this bill being referred to the select committee. We will listen to the submissions and we will endeavour to give the Government our best advice on how to get the rail track company up and formed so that rail freight can take cargo from the roads through competition thereby removing congestion and making the roads a safer place to operate on. New Zealand First supports this bill going to the select committee. 
Hon JIM ANDERTON (Minister for Industry and Regional Development) 
: 
 I rise to speak in support of this important measure. The aim of the proposed legislation as members have noted is to promote the safety of rail operations by adopting recommendations made by the Ministerial Inquiry into Tranz Rail Occupational Safety and Health led by my colleague Margaret Wilson. This bill will transfer rail safety legislation into a single piece of law and consolidate the laws relating to the management of the railway corridor. 
As the explanatory to the bill outlines a number of gaps in existing laws have been identified and they will be exacerbated if action is not taken by a number of users that may ultimately be using the lines. Those gaps will if not addressed compromise safety for rail employees and for the general public. I do no know whether Mr Sowry has noticed this fact but most of the people who are killed on the rail network are killed while working for Tranz Rail. In particular the ministerial inquiry highlighted deficiencies in Tranz Rail’s safety system and in the audit and inspection processes. 
The duties of all rail participants in New Zealand whether they be rail vehicle owners railway premise owners infrastructure owners or long-term leaseholders of the railway lines whose operations contribute to the safe operation of rail activities are set out in this new bill. The bill places a duty on rail participants to take all reasonable steps to ensure that none of the rail activities for which they are responsible causes or is likely to cause the death of or serious injury to individuals or significant property damage. 
I heard Mr Sowry say that we are introducing draconian measures and that these measures are unreasonable and are not spelt out. Well I say they are spelt out firstly in clause 6 for the benefit of rail participants—the owners of the various sections of the rail system. Rail participants must take all reasonable steps to ensure that none of the rail activities for which they are responsible causes or is likely to cause the death of or serious injury to individuals or significant damage to property. Why should they not take those steps? It would be extraordinary if we changed the legislation and said they should not worry because it was all right just to keep on killing people. Then in so far as rail personnel are concerned a rail participant may not do or omit to do anything in respect of a rail vehicle railway structure or railway premise if he or she knows that act or omission will cause or will be likely to cause the death of or a serious injury to individuals. If somebody knows that something will kill someone and does nothing about it why should that person not be held responsible? That is the problem with the present Act: those people cannot be held responsible. 
I urge all members to support this bill. It makes sense and it represents an important improvement in the health and safety of rail employees as well as the travelling public. It also introduces significant financial penalties and even jail terms for serious neglect of safety measures. 
I first became aware of the failures of the present legislation surrounding the rail system when a tragic accident occurred to one of my young constituents. That is why I am here tonight—to celebrate the progress of this bill. I am sorry that Mr Sowry is not here to hear this because if he had asked Morgan Jones’ family what they thought about the existing legislation they would have told him plump and plain and he would not die wondering what they thought. On 2 July 1994 a 6-year-old boy Morgan Jones fell off a gangway leading to a viewing platform on a New Zealand Rail train. He suffered multiple head injuries. He lost a leg part of the use of one arm and the sight in both eyes. Is that serious enough for Mr Sowry? It was certainly serious enough for Morgan Jones. What could he claim from New Zealand Rail? He could claim nothing. What could he claim from the Accident Compensation Corporation? He could claim only $43.90 a week. Could he sue New Zealand Rail? No he could not.Did the agencies of the State take on New Zealand Rail? No they did not. 
I said this to the House at the time: “Despite the requirements in the Transport Services Licensing Act that the railway operators have a comprehensive safety system virtually every aspect of safety management was shown to be lacking in the circumstances surrounding Morgan Jones’ injury. The basic design of the guardrails was insufficient. There was no consistency in the actual guardrails and parts used no secondary safety devices no reliable system of safety checks and no designated responsibilities among management staff.” That is what the inquiry found and according to its report the guardrails used on the train would not have met the requirements even for a stationary ramp in a factory under the Factories and Commercial Premises Act of 1981. So even if Morgan Jones had been walking up a ramp into a factory instead of being on a train the guard rail on the train would not have complied. But because New Zealand Rail was exempt from those safety regulations no action was taken against it. 
Three Government agencies—the Department of Labour the Land Transport Safety Authority and the Police—had jurisdiction to investigate the circumstances of that accident and take appropriate action against New Zealand Rail. The Land Transport Safety Authority recommended some safety improvements; that is what it did. No prosecution of New Zealand Rail was mounted despite the prima facie evidence of negligence and the very serious injuries sustained by Morgan Jones. The Department of Labour and the Ministry of Transport passed the buck between one another. According to the Ministry of Transport there was scope for New Zealand Rail to be prosecuted under the Health and Safety in Employment Act. The Department of Labour however declined to initiate a prosecution and declared that the accident came under the jurisdiction of the transport legislation. Does that sound familiar? 
That is what this law change is about. It is about holding people accountable and making sure that the rail system in New Zealand is safe. The accident to Morgan Jones and other accidents like it were simply damning indictments of the safety standards of New Zealand Rail. The bracket that Morgan Jones held when he went across that platform did not secure the handrail against upward movement. The bracket was not in accordance with the original design of New Zealand Rail; it had actually been fixed so that it did not work. New Zealand Rail did not have adequate inspection systems in place even to detect that fault. This legislation is meant to make sure that New Zealanders feel safe when they travel on public transport in this country—and rail we hope will be an important element in that public transport system. 
Most if not all New Zealanders will support the measures that Parliament has before it today for the safety of rail operations. Many New Zealanders will know that this country’s record has been shamefully inadequate in the rail system network in recent years. They know that we have to do better than we have done. This legislation is aimed at doing just that. I recommend to the House that we support this bill get it through as rapidly as we can and take the steps that are long overdue to make sure that Morgan Jones’ experience is never again repeated in this country on a rail passenger system that should have known better than it did and should have been an awful lot better than it was. 
SUE BRADFORD (Green) 
: 
 The Green Party welcomes the bill that we have before us tonight. After the shocking record of Tranz Rail including a series of five worker deaths on the job within 7 months in 2000 we certainly support all moves to make the rail industry safer and its structures more accountable. This bill has been developed within the cooperative working relationship on transport that exists between the Green Party and the Government and it is on that basis that we wholeheartedly back its introduction. 
This bill marks a comprehensive attempt to introduce a sensible and an up to date system for rail safety in the wake of changes over the last two decades that mean the Government no longer owns operates and regulates the railways as it did in the past. Much as some of us would like to turn back the clock on Richard Prebble and his friends and their selling rather than saving of rail all of us have had alas to learn to live with the consequences of that. 
The overarching intent of this bill is to fix the problems raised by the ministerial inquiry into Tranz Rail which reported back in late 2000 and the 2002 Halliburton KBR infrastructure review. While the language of legislation like this can be quite technical and dry I would like us all to remember the number of rail workers and passengers who have been injured the workers who have died and all the human tragedies that lie behind the commissioning of the Wilson inquiry and the Halliburton KBR report which have led to this legislation. The bill draws together provisions of the Transport Services Licensing Act the Land Transport Act and the Railway Safety and Corridor Management Act. It imposes clear duties and gives the Land Transport Safety Authority clear powers to address safety issues. Those steps are long overdue. 
We are about to see a renaissance of rail in this country and it is appropriate at this time to put forward new safety legislation to replace the disjointed and outdated systems that exist at present. For too many years rail was left to moulder as it was seen as a dying industry or as just a commercial venture that was not really worth very much attention. We are delighted to be part of restoring the role of rail as a key part of a sustainable transport network for New Zealand. If rail is to carry much more freight and I hope a whole lot more passengers as well we need to have excellent safety systems. More trains and more staff mean less of a margin for error not more. There can be no compromising on safety as rail is rebuilt. 
During the select committee process we will be listening carefully to the submissions. We do have a few areas of particular concern with regard to the bill and the first of those—shared I know by the Rail and Maritime Transport Union and others—is over the way that the penalties provided for in the bill apply equally to rail workers and to employers. I will be looking at that very closely during the hearings on and consideration of this bill as I do not think front-line workers should ever be put in a position of carrying the can financially personally or in any other way for management or governance failures for which their employer bears real responsibility. 
On a second matter the Green Party is particularly mindful to ensure that heritage railway operators who by and large have a good safety record are not subject to undue costs. The Government has taken a positive approach to that issue and we are confident that there will be no problems. I believe that the solutions in this area are likely to be administrative as much as legislative and that the fears of some small operators will not actually eventuate. 
We have also been anxious to ensure that there is a seamless interaction between occupational safety and health systems and the rail safety system. It is important to both that there are no gaps between the two regimes. It is also critical that there is no needless duplication especially as that would impact heavily on the smaller operators. In addition many of the heritage operators use a mixture of paid staff and volunteers and it is important that all parties understand their obligations and are not subject to unnecessary bureaucracy. I understand that the Land Transport Safety Authority and the Department of Labour have already been discussing how the new systems will interface. Again many solutions will be administrative. 
On a final note I particularly want to draw the attention of civil libertarians and others to clause 73(2) which may otherwise be missed. The bill includes a relatively extensive regime of prohibitions and fines compared with the present regime. Almost all are necessary for safety. However we will be interested in the views of submitters on whether clause 73(2) goes too far when it comes to people’s mere presence on a station platform or to their crossing a rural railway line. We are sceptical as to whether such a broad range of penalties in addition to the existing powers of the Trespass Act is good lawmaking. 
This bill is really needed. I hope Parliament will work cooperatively to make it the best bill it can be. Those who suffered under the old system deserve nothing less. 
HELEN DUNCAN (NZ Labour) 
: 
 I am pleased to support this bill which seeks to improve safety so that rail passengers rail workers and indeed even rail freight will not come to harm and can travel safely on our New Zealand railway system. The bill is focused on safety issues and I commend it to the House. 
BRENT CATCHPOLE (NZ First) 
: 
 I rise on behalf of New Zealand First to support this bill to the select committee. We believe that the uniform safety regime the bill promotes is a good step in the right direction. Without such safety measures we have seen the occurrence of a number of rail accidents. Jim Anderton talked of one in particular where a young boy fell through railings and suffered horrific injuries. 
 The bill as it stands does not talk about a minimum standard of service that rail participants must provide. It talks a lot about safety but it does not talk about the service they should provide. This is a weakness and I hope the select committee will look at it when it considers the bill. The Minister of Transport will be able to make rules to provide for safety in relation to rail participants and this bill is a good way of ensuring that. But the Minister must ensure that the system he or she is trying to implement does not wipe out the likes of heritage operators. There are a number of heritage operators around the country and they should be subject to safety measures but not to the extent that they are driven out of the system altogether. 
David Benson-Pope 
: You’re the “Heritage Supporting Party”. 
BRENT CATCHPOLE 
: Well let us hope the Government supports the heritage operators with this bill as it goes through the House; if not we will see quite a number closing down— 
David Benson-Pope 
: We would be the last people to disadvantage hard-working heritage operators in this country. 
BRENT CATCHPOLE 
: I think I have the call here. Does the member mind if I carry on? 
David Benson-Pope 
: You can carry on. 
BRENT CATCHPOLE 
: Thank you very much. This bill identifies problems with the current audit and inspection process by introducing a broader system of safety assessment that is able to be tailored to reflect the participating safety history and the prospect of each rail licence holder. That is very good but there is no incentive to do this. Some huge costs are listed. They are very prohibitive and the fines are not realistic. They are way out of proportion to what would be expected and they are considered to be unfair. We certainly consider them to be unfair. 
Another big gap in this bill is the incentive to encourage more logs off the roads and on to rail. The bill does not provide for that. If we look at the real reason that Toll Holdings is trying to purchase Tranz Rail we see it is not for the rail; it is for the road transport that Tranz Rail operates. It is interesting to note that Tranz Rail is the largest trucking operator in this country. That tells us something: there is no incentive to get goods off the roads and on to rail which would help to make our roads safe. 
Jim Anderton said earlier that the majority of people killed on the rails are workers but he conveniently forgot that a large number of people are killed at level crossings—admittedly on the roads. This bill does not address the dangers of level crossings and the number of people who are killed in that way. I would like to see the select committee take more notice of that aspect because it is an area where safety can be improved immensely. 
 New Zealand First firmly believes that the Government should own the track and provide incentives for competitive operators to run the passenger and freight services. A competitive structure would create more incentives to get the passengers and the freight on to the track making it a worthwhile prospect. We would hate to see the smaller branch lines continuing to be closed. I would like to make sure that this bill is not so prohibitive that it makes it impossible for those smaller branch lines to operate. 
With that I would like to summarise by saying that New Zealand First will support this bill going to the select committee provided that the select committee looks at the concerns I have raised and at the concerns Peter Brown raised with regard to rail and the safety of rail. 
DAVID BENSON-POPE (NZ Labour—Dunedin South) 
: 
 I am pleased to rise briefly in support of this legislation and to respond to the specific comments made by the previous speaker about heritage rail operations. As the member for Dunedin South I am pleased to live in a city and to represent an area that has not one but two of the most important heritage rail operations in the country. Arguably the Taieri Gorge operation is the most important heritage tourist operation in New Zealand. Equally important is the Ocean Beach Railway heritage operation which is a smaller but none the less very enthusiastic and dedicated heritage restoration group like so many others throughout the country. 
I have had discussions about the concerns that were raised prior to the introduction of this bill—exactly the issues that were raised by the previous speaker. I am confident from discussions with the Minister—and I have communicated the information to those operations being aware also that the national heritage umbrella organisation has been involved in the formation of this legislation—that those operators who are so welcome and who contribute so much to this country’s heritage and tourism attraction will not be unduly penalised by this measure which is consistent with the proper protection of their own workers and volunteers and members of the public. In fact I am aware also of the ministerial discretion included in the bill that would allow for particular circumstances to be acknowledged and accommodated. 
So I believe that those concerns have been adequately met. I will certainly work to ensure that that is the case and in supporting the legislation I am pleased to recommend it for further consideration. 
JOHN KEY (NZ National—Helensville) 
: 
 We are certainly in for interesting times in the rail industry just as this bill is in for interesting times when it goes to the select committee. National will be supporting the Railways Bill going to the select committee but not without a great deal of apprehension. Why are we in for interesting times? Let me point out why that could be the case. 
The Minister said that we are moving away from a vertically integrated operation. He would know all about that because he has his chequebook out to build Track Co. the Government-owned rail network. The only problem is that when the Minister of Finance sat in front of the Finance and Expenditure Committee and was grilled by my good self about how much money it would cost he did not have a clue. He knew it was going to cost a whole lot more than the $100 million he pathetically tried to cough up as a figure when journalists asked him. He knew it would probably be more than $200 million—a figure he begrudgingly told a few more journalists a day or two later. But he does not know whether it will cost $300 million $400 million or $500 million. 
I will tell members the answer. It will be a lot. Do members know why? It is because this Government is not happy with its pork-barrel politics when it comes to just the roads. It is not happy enough dumping Auckland’s roading problems on us and promoting its own roads in its own members’ electorates. Now it wants to do the same thing with rail. 
When this legislation is rammed through by this hopeless Labour Government I can tell members what will happen. Track Co. a Government-owned company is going to be caught by its own legislation the Railways Bill. Does that worry this Government? No it does not. Do members know why? It is because when this Government has problems with its own it retrospectively legislates. It does not worry the Government that Harry Duynhoven happens to have crossed the law because it will hold this Parliament under urgency and it will change the law retrospectively. That is what it will do. So when Track Co. has all sorts of problems with this hopeless legislation that the Government is going to ram through then the Government will retrospectively change the law anyway. That is why it is not worried. 
We are in for interesting times all right. I look at Labour members over there in the Chamber. They are like deer caught in the railcar’s headlights. They do not know what is going on. They do not know who to believe. They are frightened and I can understand that concern and fear. I look into those members’ eyes and see that they are absolutely terrified. They do not know what is coming next. 
I can tell them what is coming next. Lower growth more unemployment and fewer Labour members in the 2005 Parliament are coming next. But let us not worry about that. Of course Labour will buy a few roads from Napier to Gisborne. It holds the Napier and Gisborne electorates. It does not matter that it will cost the average taxpayer of New Zealand hundreds of dollars extra every week. The Government will be propping up some pork-barrel rail politics but let us not worry about that. That will keep the member for Gisborne and the member for Napier in their seats and that is all the Government cares about. That is what is in front of us for the rail network. 
I would like to talk for a moment about the problems taking place concerning the maintenance of the rail network. Government members may not know of a term “CWR”. Let us test them. They are living experts on everything that goes on in New Zealand. I ask Mr Cosgrove what “CWR” stands for. There is a blank look on those members’ faces. It is like the blank cheques they want to write out to run the rail network. They are all awake now but they do not know what “CWR” stands for. It stands for continuous weld rail. 
Members on this side of the House do their research. We do not just ram through hopeless legislation. We do not just hit and hope that it will work. We worry about the poor taxpayers. We know who the buck goes to. We know that our people are out there working day and night up to 80 hours a week day in and day out to pay for the hollow promises being made by that Government. 
CWR—continuous weld rail—means that at every 12 metres there used to be a join in our rail network up and down the country over thousands of kilometres. Labour came up with the bright idea of welding the track all together. That happened under the 1984 Labour Government which said to weld it all together and not to worry about it. Did I hear someone ask whether the track had been stress-tested or whether Labour had thought about what would happen when the heat was up? 
Well the track buckled—just as Labour will when it comes under pressure and it is under a lot of pressure when it comes to the foreshore and seabed. But we should not worry about that. Labour is under so much pressure that it is seeing its majority swept away just as the sands of time are swept away on our beaches across the country. That is what is happening. Anyway the rail network buckled. It buckles at temperatures of 32 to 33 degrees. If someone had asked me about that 12 years ago it would have saved the country hundreds of millions of dollars but no one asked so I did not tell them. The rail network buckled and now hundreds of millions of dollars will have to be spent. That is the kind of work that will take place when Track Co. owns the rail network. That is what will happen to bridges and the track network up and down the country. 
I return for a moment to the Wilson report which is the foundation of this legislation. The Wilson report will redefine who the rail participants are and who therefore under this legislation needs to come up with a safety plan. It is quite an extensive and long list as one would expect from such prescriptive legislation. I am hoping that that wonderful Transport and Industrial Relations Committee chaired by Helen Duncan and attended by my good self the Hon Roger Sowry and Deborah Coddington of the ACT party will be able to whip a bit of sense into this legislation. [ 
Interruption 
] No Clayton Cosgrove is not on that select committee; he is on one of the other ones. 
Under the legislation what is a rail participant? It is an infrastructure owner. No. 1 on the list is Track Co. It is the infrastructure owner. That is right. It is the Government-propped-up-by-votes rail network. That is the long-term name. 
I do not want to digress but I do want to make a comment for a moment about the way in which the Government has put that particular thing in place with Toll Holdings. 
Debate interrupted.