New Zealand government transport plans for the next 10 years include a $36 billion investment in road, a $4.6 billion investment in rail, and an intention to seek improved returns from previous investments and existing services.

Christchurch $2bn draft rebuild plan features an array of civic enhancements including light rail

The movement of containers on rail from the east to west of the North Island is being improved by a one kilometre long deviation around the narrow Kai Iwi tunnel near Wanganui.

Government-owned railtrack operator Ontrack said the bypass would allow trains to carry larger 2.9m containers on the Marton to New Plymouth line.

"These containers are increasingly being used to transport freight from ports and from Fonterra's Whareroa dairy plant in south Taranaki," acting general manager of engineering Walter Rushbrook said in Ontrack's newsletter.

In fairytales midnight is when carriages become pumpkins but for New Zealand's railways it marked the changeover from private to public to ownership.

Haggling over the details of the government buyback of Toll Holdings' rail business went right to the wire last night before a function this morning to reveal the new look business at Wellington's railway station.

In May the Government and Toll announced a heads of agreement for the Government to buy Toll's rail and ferry assets for $665m. There are another $25m of associated costs.

The Government has bought back Toll's rail and ferry business for $665 million.

The Crown has been in negotiations with Toll over a buyback for several months.

It comes against a backdrop of wrangling over Toll's access agreement to the rail tracks, which are already owned by the Crown, with the Government saying it has been failing to pay its fair share.

Prime Minister Helen Clark today said the deal would pave the way for the modernisation of the rail network, which formed a key part of the Government's sustainability agenda.