NZPA report parts of Len Brown’s inauguration speech at the Auckland town hall this evening:
In his first address at the first Auckland Council meeting, Mr Brown said it was time to stop imagining how to improve Auckland’s transport system and other infrastructure and time to start acting.
Mr Brown’s three key rail visions – an inner city loop, a line to Auckland International Airport and rail to the North Shore – will all come with high price tags, which the Government has said indicated it may not be able to be fund for some years.
But Mr Brown said such lines were vital if the Government wanted to meet its commitment to having New Zealand incomes catch up to Australia in 25 years.
“For New Zealand to catch and pass Australia economically, Auckland’s infrastructure needs to match and surpass the likes of Brisbane, Melbourne, and Sydney,” Mr Brown said.
“It will not be easy. These are expensive projects. But we have had reports, discussions, and debates for long enough.
“There will be a cost. But we will do it.”
He said the projects were vital if people from the North Shore wanted to work in south Auckland, and vice versa, without requiring three hours a day getting to and from work.
“It’s about ensuring businesses can move their freight around and through our city quickly and efficiently, rather than having to factor time spent stuck on motorways and congested local roads into their costings.
“And it’s also about ensuring that investors – local and foreign – see Auckland as a great place to establish a business, creating jobs and prosperity not just for Auckland, but for all of New Zealand.”
Mr Brown noted that Auckland in the 1970s nearly had a light rail project, conceived by former Auckland City Mayor Sir Dove-Meyer Robinson, only for it to be derailed.
“Imagine the economic and social potential that that rapid rail project would have unlocked over the past 30 years. Imagine the prosperity that Auckland would have created for all of New Zealand.”
Mr Brown also said technological and other infrastructure, along with an improved environment for entrepreneurship, was vital.
“Auckland could be like San Francisco – a hub of innovation and entrepreneurial activity,” he said.
“The connections and collaborations between our universities and businesses are already producing first-class results and promise more to come.
“We must nurture them and give them, literally, room to move, so they can develop new products and services we can export to the world.”
I think it’s good that the link between clever transport investment and economic development is being grasped by Len Brown. While the railway lines themselves won’t magically solve all of Auckland’s problems, if they’re coupled with policies that promote a concentration of economic activity in areas like the CBD then I think the benefits are potentially significant.
Looking at this link between transport and economic development, there was an interesting article in the NZ Herald a week or so ago that I was reminded of. The article tries to answer the question of “why, if New Zealand has such business friendly policies, do we struggle so much in terms of our economic development?” The answers to this question are quite interesting:
Last year economist Phillip McCann wrote a paper about our productivity paradox: the mystery of “why a country that seems so close to best practice in most of the policies that are regarded as the key drivers of growth is nevertheless just an average performer”.
How can it be that we’re the second best country in the world for doing business but in terms of GDP per capita we are falling behind countries like Slovenia, Korea and Taiwan?
McCann said existing New Zealand debates tend to focus too much on internal explanations like regulation, taxation and institutions – more lint picking – but his theory is that “economic geography” is to blame. Yes, New Zealand has always been in the wopwops of the world, but the world has changed.
Now we are being squeezed out by growth in super-regions we aren’t part of, global cities we don’t have and the influence of multinationals who can’t even be arsed having an office here. Face it, we’re not part of the “in” clique. Incidentally, could someone please invite the New York Times’ rockstar economics writer Tom Friedman down here to explain why if “The World is Flat” as he claims, we are falling off the bottom?
I wonder whether the same theory applies, at a lesser scale of course, to analysing the constraints on Auckland’s economic development. Poor public transport investment over the past 60 years has reduced the comparative attractiveness of locating your business in the CBD and therefore encouraged a highly dispersed pattern of employment. But with businesses all relatively isolated from each other around Auckland, the connections and interaction between them has been reduced, compared to say what might be going on in Midtown Manhattan (obviously an extreme example).
It’s entirely likely, in my opinion, that this has had a negative effect on Auckland’s economic potential over a very long time. Perhaps the biggest actual long term benefits of projects like the CBD Rail Tunnel will be increasing the attractiveness of the CBD for businesses to locate – and the longer-term agglomeration benefits that will result from that. Certainly, analysis of large rail projects in places like London indicates that the biggest benefits are these “agglomeration benefits”.