KiwiRail to fund up to $37.5 million of extra Picton ferry works

The New Zealand Government said on 16 October 2026 that KiwiRail will directly fund up to $37.5 million for Picton rail yard upgrades and for auto-mooring technology on the new wharf, as part of the New Ferries project. Rail Minister Winston Peters said selecting KiwiRail as the long-term operator of the Interislander had given the company confidence to invest its own funds in commercial assets, "meaning the taxpayer is not paying a cent more than our $1.7 billion allocation but still achieves the benefit as the ultimate owner of KiwiRail."

Peters said the government had said in July 2026 that if KiwiRail or either port wanted to use its own money for commercial assets while construction was underway, that would be supported so long as they paid for it and the works did not delay completion. He said the government has the final say on any scope added to the programme.

KiwiRail's proposal is to upgrade the connection from its wagon stabling yards into the wharf linkspan, skew the arrival and departure rail lines to give a little more length, add length to the southern backshunt under the new Dublin Street overbridge, and buy auto-mooring units planned for Wellington for the Picton wharf. Peters said the analysis showed the works could be done alongside the planned construction without delaying the programme, and that they are commercially worthwhile as rail yard operations become simpler to manage through the year. He said auto-mooring makes berthing faster and safer, and uses less fuel.