China Northern trumped Hillside in filling KiwiRail orders

China Northern Locomotive and Rolling Stock Industry Corp easily outbid KiwiRail's Hillside workshops in tenders to supply new rolling stock, the auditor-general says in ruling out an investigation of the contracts.

Christopher Finlayson reviewed documents dating back to 2005 after Labour Party and Dunedin South MP Clare Curran last August asked the body to investigate four purchases of rolling stock from China Northern because of concerns about value for money and the impact on KiwiRail's Hillside facility.

Dunedin-based Hillside has been split up after KiwiRail failed to find a buyer. The foundry operation is being sold to ASX-listed manufacturer Bradken for an undisclosed sum and other operations progressively closed with the loss of jobs.

In the tender for the June 2009 purchase of 20 DL locomotives Hillside's bid ranked sixth and was deemed "uneconomic due to its longer delivery time and higher cost structure". China Northern completed the order in June 2011.

In the December 2010 tender for 300 container flat top wagons, Hillside's proposal was ranked third and documents noted that Hillside "could not meet the delivery schedule and would require KiwiRail to carry out all performance, warranty and cost risk itself".

"We did not identify any material departure from good practice process or any unfairness in the way the Hillside tender was treated," the auditor-general says in a statement.

In early March 2011, KiwiRail varied the December 2010 contract to increase the order to 500 wagons and contracted to buy 20 more locomotives.

While KiwiRail considered Hillside's ability to supply the additional rolling stock, China Northern was "significantly faster and cheaper" and the Dunedin facility was already behind on a separate wagon order.

Hillside had not built locomotives "for some years".

Defects found in rolling stock had been remedied at China Northern's expense, the report says.


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lowest cost option wins over work for NZers = the free market delivers jobs to China

So if this contiunes what will there be for NZers to do here?

how long before every one is on the unemployment benefit?

the Chinese going to pay your benefits - yeah right!!
Wake up NZ

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Another Labour Party “manufactured beat-up” as they cry crocodile tears, using the workers plight at Hillside as a political football in a brazen attempt to appear to be “doing something” for the manufacturing sector. Shame on Curran, the unions and the Labour Party for having such disrespect for the people at these workshops.

At the time this was happening, Labour were electioneering… and still to this day claim, that increasing minimum wages automatically without corresponding increases in productivity is possible and has no effect on “bottom line” hence why all evil business owners should pay at least $15/hr as a minimum – even to school leavers without any corresponding increase in productivity. Typical union thinking that is. Well, the AG has rubbed Curran’s nose in the steaming turd of her own making with irrefutable proof against that fanciful notion – using this Hillside workshop situation as an example.

The unions claim they “increase productivity” yet, once again the AG figuratively grabs Little by the scruff of the neck and rubs his nose in the same pile of populist propaganda, with the proof that the workshops were behind on a separate order and "could not meet the delivery schedule and would require KiwiRail to carry out all performance, warranty and cost risk itself". So at that time, the workshops couldn’t even fulfill the full tender bid requirements… let alone the full tender.
Another inconvenient truth for Labour is that they themselves consigned the workshops to eventual oblivion with signing NZ Inc up to a FTA with China. Cause… and effect.
As a country we are unable to pick and choose what aspects of a FTA we want or agree with and in a free market that we enjoy here in NZ, the mantra is “be competitive, because if you can’t – then someone else will be” … and that someone is the China that Labour wedded to NZ Inc with the FTA.
Curran, Little, the EPMU and the Labour Party should be totally ashamed of themselves belittling the plight of the hillside workers, so they can use their situation – that they themselves created – as a cheap political football they can try and score a few points with. Shame on them indeed!

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So very True; but unpalitable to the Unions, if they understand it.

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