Peters privately explored new Interislander ferry after saying one 'would not make sense'

Rail Minister Winston Peters privately asked KiwiRail to investigate acquiring an additional Interislander ferry to bolster the strained Cook Strait service, less than two weeks after publicly insisting “it would not make sense” to do so.

A letter released under the Official Information Act shows Peters instructed KiwiRail to look into the costs of an additional ship, after freight customers raised concerns over the network’s resilience.

Labour said it showed the Government was quietly preparing a backup plan, while Peters insisted there was “nothing wrong with being ready for anything”.

Interislander is currently down to one ferry, due to the retirement of the Aratere and scheduled maintenance of the two remaining vessels.

The freight industry called for a contingency plan when a technical fault with the Kaiārahi in March left Interislander down to one vessel, saying it highlighted the vulnerability of the critical service.

At the time, Peters was asked whether any interim measures to increase capacity were being considered before the new ferries arrive in 2029, like in 2021 when KiwiRail leased an additional ferry to secure the key Cook Strait link.

“It would not make sense to access a spare vessel for short-term disruptions,” Peters said in a statement on March 12, noting disruption at the time was only planned to be for a few weeks, unlike the months of disruption years earlier.

The Valentine ferry (left) was leased in 2021 to boost freight capacity after Interislander was reduced to one ferry. Photo / Mark Mitchell

But a letter released to the Labour Party under the Official Information Act revealed Peters wrote to KiwiRail on March 24, requesting the organisation “maintain a constant market assessment of additional tonnage options for the Interislander”.

“Interislander customers expressed their concerns directly to us and through the road transport lobby Transporting New Zealand, following the recent Kaiārahi disruption,” Peters wrote.

He asked that KiwiRail provide an outline of capital and operating costs of a potential additional vessel.

“We are aware of freight-only vessels on the market in Australia and that the sister ship to Kaiārahi is also on the market”.

In response, KiwiRail chairwoman Suzanne Tindal said they had earlier told freight customers they did not intend to lease a ship “because it was uneconomic to do so”.

Tindal provided estimated costs for the purchase or charter of an additional ship, based on fortnightly updates and advice from brokers, but the figures were withheld citing commercial sensitivity.

Labour’s transport and state-owned enterprise spokesman Tangi Utikere said Peters was “now shopping around for an insurance policy” after “insisting a backup ship wasn’t needed”.

“If everything was on track, there’d be no need for one,” Utikere said.

“The Government’s ferry replacement programme is nowhere near as secure as ministers have claimed.

“Nicola Willis really put the ferries down the gurgler, and now Winston Peters is quietly trying to find a Plan B because he knows the lemon he was handed,” he said.

Labour's transport spokesperson Tangi Utikere says Peters is being "sly" in looking for an insurance policy. Photo / RNZ

Asked why he instructed KiwiRail to look into an additional ferry, Peters told the Herald there was “nothing wrong with being ready for anything”.

“In fact, that’s what the public expect of the Interislander. It is right and proper for a ferry business to have its finger on the pulse of the market in case a good deal comes up, hence our letter,” he said in a statement.

“To be clear, getting a backup ferry and crewing an empty vessel would be absolutely foolish behaviour, you would only seriously look at that if you’re staring at a prolonged outage, like when KiwiRail got the Valentine vessel in 2021 after the Kaiārahi suffered a gear failure and was out of service for an entire year.”

Peters said Interislander reliability had climbed to near 100% since he took over the portfolio, thanks to a “robust asset maintenance regime”.

“That contrasts sharply with reliability of 81% in 2021 and 83% in 2022, but we seriously doubt the previous Government wants to acknowledge their performance.”

The Interislander service will be down to one ferry for around 80 days while its ageing Kaiārahi and Kaitaki vessels undergo wet dock maintenance in Wellington and hull inspection and maintenance in Singapore respectively.

Ethan Manera is a Wellington-based journalist covering Wellington issues, local politics and business in the capital. He can be emailed at ethan.manera@nzme.co.nz.