KiwiRail announces Hillside workshop sale

KiwiRail has announced the proposed sale of its Hillside rail engineering workshops in Dunedin.

The business will be sold as a going concern from early May, with a final decision due by the end of August.

44 workers were made redundant from the Hillside workshop in July last year.

Chief executive Jim Quinn says Hillside is losing money.

"We've got a couple of major jobs that we're doing now which come to an end at the end of the year and we simply don't have a similar forecast to follow that."

Mr Quinn says they're looking for a sale outcome that secures Hillside's future as New Zealand's largest heavy engineering site.

Rail and Maritime Union general secretary Wayne Butson says the sale would never have been needed if the Government had a focus on keeping New Zealanders in jobs.

He says the Hillside workshops make an important a contribution to the Dunedin economy, so they shouldn't close.

Mr Butson says the union will work proactively with prospective buyers to ensure a smooth transition, including the retention of its highly skilled staff.

The Government's in favour of Dunedin's Hillside rail workshops being kept as a going concern.

The facility's future is now in doubt with KiwiRail announcing its intention to sell the site.

Finance Minister Bill English is endorsing KiwiRail's position that the sale should see jobs at the workshops retained.

"We certainly agree with that because it's the skilled people there, if there's an ongoing business it'd be great for Dunedin if that can continue."

However it appears the Government's not been in the loop over KiwiRail's decision to sell its Hillside workshops.

Prime Minister John Key hadn't heard about it when questioned by media earlier today.

He also said he was a little surprised by the decision.

And Mr English also seems not to have been told about the SOE's plans.

Mr English says the new trains and wagons purchased by KiwiRail don't need as much repair and maintenance as the older rolling stock required.

Meanwhile Labour leader David Shearer is predicting jobs will be lost at what is a hugely important business for Dunedin.

"Selling is the game here, selling off Hillside, selling off legislation to pokies. I think that tomorrow we'll probably hear the Crafar farms have been sold to Shanghai Pengxin - that's the economic plan for the future."