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Prime Minister Christopher Luxon has again defended his Government’s handling of the Interislander ferries, saying they’ve found a “great solution” to replace KiwiRail’s ageing ships.

It’s been a year since Finance Minister Nicola Willis cancelled the previous Labour Government’s plan for two new mega ferries.

The announcement yesterday that the Government will set up a new company to procure two new ferries to begin operating in 2029 has been criticised for lacking detail. The Government has defended itself by saying it needed to wait for advice from its ministerial advisory group and also get indicative costs from shipbuilders.

Speaking to reporters during a visit to Levin today, Luxon again defended the plan.

He said the new ferries will arrive by 2029 and there is a window between now and the end of March to find a better solution.

“We want good value for money and a resilient, robust service”, Luxon said.

The most likely option is for two medium-size, 200m, non-rail enabled but “rail-capable” or “RoPax” ferries, which was the option that emerged from the advisory group in June. This option allows rail freight to be shifted on and off the ferry on trucks.

Winston Peters has been made Minister of Rail. Peters, who supports rail enablement, has invited the private sector to put forward alternative proposals for a ferry service during the first stage of the procurement process.

In March 2025, any such proposals will be assessed alongside the Government-proposed option and a final proposal will be chosen.

The Government says it can’t yet say the size of the funding envelope established due to commercial sensitivities, but the costs are expected to be much less than the project being developed under Labour, which had ballooned to more than $3 billion.

Act leader David Seymour said indicative costings for the two ferries and the landside development are “approximately half” of the $3 billion iRex project, of which the Crown was funding about $2.2b. Pressed on whether he should have shared that information, he said his use of “approximately” created a big range of costs.

Seymour has also said the “option of private investment or a mixed ownership model remains on the table”.

But Peters said he was “wrong”.

“He’s wrong on the figures that he’s used, he’s wrong on the question of privatisation and he’s wrong on the question of what it’s going to cost,” Peters told RNZ.

When those costings were put to Luxon today he said “David Seymour is not the Minister for Rail”.

He said the solution will be less than $3.2 billion.