Budget 2026 commits more than $1 billion to KiwiRail's network in what the Government is touting as the first fully funded three-year rail investment programme.
Rail Minister Winston Peters announced earlier today that up to $1.1 billion had been allocated for KiwiRail's planned network investments between 2027 and 2030.
A further $107 million was set aside to continue critical renewals on the Auckland and Wellington metropolitan rail networks.
It comes in a watershed year for trains as the City Rail Link, the country's biggest infrastructure project, prepares to open two new stations in Auckland later this year.
Peters said the funding model put rail on the same footing as the state highway network.
"Rail infrastructure is funded like the state highway network thanks to our law reforms when last responsible for rail, and this is the first time a Government has fully funded a three-year programme up front to put rail on the same sure footing as many other infrastructure categories," he said.
KiwiRail will use the allocation, combined with approximately $60 million its freight customers contribute through track user charges, to prepare the 2027-2030 Rail Network Investment Programme for government approval.
That programme is a three-year plan setting out how rail infrastructure is maintained, renewed and improved, prepared by KiwiRail and approved by the Transport Minister.
Peters said he expected accountability in return for the investment.
"The Government expects value for money and cost efficiency from KiwiRail, having enabled the procurement of modern plant and equipment to underpin faster and simpler rail network operations," he said in a media release.
"Rail infrastructure investment already sees 66 cents in every dollar going to maintenance and renewals, well above the 60-cent benchmark the Infrastructure Commission recommends, and we expect this will increase over time, ensuring a great network condition for families and freighters."
The $107 million for metropolitan rail was earmarked for Auckland and Wellington, where Transport Minister Chris Bishop said there had been historic under-investment.
“Thousands of people rely on trains every day to get to work, school, appointments and events. They deserve services that are reliable, resilient, and able to keep pace with growth in our biggest cities,” he said.
“Reliable metro rail matters. When trains run well, more people have a real choice about how they travel, pressure comes off busy urban roads, and transport networks work more efficiently."
The metro funding would go toward replacing and upgrading core assets such as track, sleepers and ballast, as well as slope remediation and formation works.
Bishop said: "These basic, essential projects are not glamorous but they are exactly what is needed to improve the performance of the network and give passengers a better service."
The Budget 2026 figures show total rail funding for the 2026/27 financial year of just over $1.4 billion, representing about 13% of Vote Transport.
Roading receives the lion's share at $9.3 billion, or about 85%.
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