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No probe into KiwiRail's Chinese buys

Friday 8 Feb 2013 1:01 p.m.

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The Auditor-General has derailed Labour MP Clare Curran's request for a probe into KiwiRail's decision to buy train engines and wagons from China rather than have them made at its Dunedin workshops.

The Auditor-General deemed, after looking into the purchases, that the Dunedin South MP's complaint did not warrant a full inquiry.

It said the decisions by KiwiRail to buy the locomotives and wagons from a Chinese manufacturer were not made for anything other than normal business and commercial reasons.

"The processes followed by KiwiRail appear reasonable, the relevant evaluations have been carried out properly, and we have seen no evidence to suggest improper influence over these decisions," Lyn Provost said in her report.

Over a period of two years KiwiRail agreed to buy 40 locomotives from China Northern Locomotive and Rolling Stock Industry Corporation (CNR) and 500 container flat top wagons from the same company.

Ms Curran had raised concerns about the value for money of the purchases and their effect on the future of KiwiRail's Hillside workshops.

The report says KiwiRail advised the cost of fixing various defects with the locomotives and wagons were met by CNR.

"We have seen nothing to suggest that the defects that have been encountered and fixed by CNR affect the original decision that CNR provided the best value for money," the report said.

Ninety of 115 workers lost their jobs at the 130-year-old Hillside workshops in November when KiwiRail sold the casting shop to Australian company Bradken.

Ms Curran had said she did not believe Government claims that it did not instruct KiwiRail to go for the lowest-cost bidder or run down the Hillside workshops.

NZN

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