An interesting question and answer session in parliament today on the merits of the CBD Rail Tunnel and the Puhoi-Wellsford “holiday highway”.
A transcript can be read here (and by the way it’s interesting to see in the video how keen Bill English & Gerry Brownlee were to say that they’re even less keen on the CBD Rail Tunnel project than Steven Joyce is).
In terms of Joyce’s answer to the initial question, as I’ve said previously, it’s actually quite difficult to compare “apples with apples” when it comes to the projects, because there are a variety of “wider economic benefits” that are taken into consideration. My understanding is that there are effectively three types of WEBs: agglomeration benefits, employment benefits and national economic benefits (called CGE in the SAHA assessment that looked at all these different types of WEBs.)
If we look first at pure transportation benefits, we can compare the two projects fairly easily. This is shown in the parts of the two tables below that have been highlighted in red:
All the Puhoi-Wellsford totals are calculated at 8% discount ratios – so if we’re comparing apples with apples we must use that for the CBD Rail Tunnel. So, looking first at just Transport Benefits we see a total of $1.319 billion in benefits from the CBD Rail Tunnel project and $530 million from the Puhoi-Wellsford road. Now I know the rail tunnel is a more expensive project ($2 billion to $1.6 billion roughly I think), but it’s certainly not 2.48 times the price: which means that on pure transport benefits, the CBD Tunnel is significantly better value for money.
So let’s now turn to the “Wider Economic Benefits” referred to in both the tables above: $185 million for the CBD Rail Link and $159 million for Puhoi-Wellsford. However, it’s worth asking the question about whether these two numbers are measuring the same thing – as Steven Joyce seems to think they are. I’ve previously uploaded a full version of the Puhoi-Wellsford business case, so it’s useful having a look through there to see what its wider-economic benefits actually measure. Page 30-31 of that report outline the “potential wider economic benefits”:
It’s interesting how the authors of the business case were somewhat wary and doubtful about the veracity of these benefits – saying things like “quantifying the benefits can be challenging” and “forecasting the exact value of these changes can be subject to very considerable uncertainty.” Hardly a rock solid case for the wider economic benefits used to (supposedly) haul the holiday highway’s BCR up to 1.1 – but for some reason we don’t see Steven Joyce complaining about these WEBs.
Turning back to the CBD Rail Link project now, are these the same kind of benefits that make up the $185 million in “Wider Economic Benefits (EEM)” shown in the table earlier in this post? Well, reading through pages 99 and 100 of the CBD tunnel’s business case suggests not. In fact, the CBD Rail Tunnel’s WEBs (the conventional ones) seem to be something different entirely:
It would seem that these “agglomeration benefits” are the ‘standard’ way to measure WEBs in the NZ context. But oddly enough, such an assessment hasn’t seemed to have occurred at all for the Puhoi-Wellsford Road. I’m actually not particularly surprised, because agglomeration benefits arise from what happens when you bring activities together – while for the Puhoi-Wellsford road, it’s actually likely to result in pushing things apart, so may actually have (if anything) negative agglomeration benefits.
This all raises a couple of key questions in my mind.
- Were the wider economic benefits used in the Puhoi-Wellsford business case calculated using the standard agglomeration-based methodology for wider economic benefits, as per NZTA’s Economic Evaluation Manual (EEM)?
- If not (as it would seem), what was used to calculate the $159 million of wider economic benefits included in the business case for the Puhoi-Wellsford Road – other than a wild stab in the dark about potential effects on tourism and forestry?
We perhaps get a few answers to these questions from the graph in the SAHA Assessment, undertaken at the request of NZTA to examine the wider economic benefits of all the Roads of National Significance – using a variety of different methodologies.
This graph suggests that Puhoi-Wellsford creates basically no agglomeration benefits, but rather that all its wider economic benefits come in the form of what’s broadly categorised as “employment benefits”. If we go back to the business case of the CBD Rail Tunnel and look at what the “transformational benefits” of that particular project are expected to provide – it sounds eerily like employment benefits to me:
As I said earlier, the SAHA international report starts to go into a further set of wider economic benefits – being something called “CGE” which really starts to confuse me. But even with extremely generous assumptions, the CGE benefits delivered by the Puhoi-Wellsford road pale into insignificance compared to the employment benefits of the CBD Rail Tunnel.
It would seem to me that the best match for the type of benefits the CBD Rail tunnel is anticipated to provide are these “employment benefits” – shown in the blue bars of the graph earlier in this post. That is why, when I put together a graph that effectively inserts the CBD Rail Tunnel, the blue bar ends up so huge (once again, this is not surprising, if a project was ever to have employment benefits they would come from something that encourages a concentration of high productivity and high paying jobs, which is obviously what the CBD tunnel project does). So, in my very considered opinion, the graph below is as fair a representation of an “apples versus apples” comparison that we’re going to get:
All of this leaves me with one massive unanswered question – and that is how on earth Puhoi-Wellsford’s business case has managed to be as high as 1.1 (including WEBs), when its benefits – even its conventional transport only benefits – are so low. Page 7 of the Project Summary Statement says that Puhoi-Wellsford has a projected cost of $1.38 billion in 2009 dollars (its turnout cost is a higher $1.69 billion due to inflation). Page 49 of the business case for the CBD Rail Link says that it has a capital cost (including additional rolling stock, which of which I think is not necessary) of $2.31 billion.
So let’s do a bit of a comparison:
In short, while the CBD tunnel is definitely the more expensive project, its benefits – no matter which way you measure them, are enormously greater than the benefits of the Puhoi-Wellsford road. Under none of the scenarios for including wider economic benefits does the holiday highway make economic sense, just as under all the scenarios we see the CBD Rail Tunnel making economic sense.
There are other matters that make me think Puhoi-Wellsford’s cost benefit ratio is enormously inflated (like the unrealistic time savings and the fact that the effects of tolling haven’t been considered), but even with the most generous interpretation of that project’s economic benefits, it simply can’t compare to the CBD Rail Tunnel on all measures.
So why are we building it first again?
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Because the government appears to be a bunch of road-obsessed idealogue. The reason NZ is experiencing brain is in part because of these sorts of road-only views that make young people move to Europe and the US to allow them to live in exciting urban settings – NB Joyce NZers aren’t moving in their droves to Atlanta, they’re moving to cities like NY, SF and London which have great PT systems and dynamic ‘CBDs’.
The thing that annoys me is when talking about the CBDRL business case he says “it does not say how many extra people would use the project compared with the number who would use the electric network without the tunnel, it does not tell us how many cars it would take off the road and whether it would reduce congestion”
Yes it does, page 43 & 44 have this info
*the new station at Aotea is forecast to become the busiest station on the network, with almost 12,000 passengers every peak compared to 9,000 at Britomart by 2041;
*the three new stations in total are forecast to have over 20,000 passengers every peak in 2041;
*annual rail patronage with the CBDRL is forecast to reach 50 million by 2041, more than twice what it would be if the Link wasn’t built; and
*the CBDRL will remove around 15 million car-kilometres from the network in the year 2041.
So that is 25 million extra trips a year within 20 years of it opening (the report assumes an opening date of 2021)
Darren Huighes needs to lift his game at the moment Joyce can pretty much lie and nobody challenges him.
@ Cam. It’s easy to say that but have you ever been in a debate with SJ?
If Darren actually had a skim through the business case he could have easily countered his arguments as I have posted above. The fact he lets him get away with it just shows how weak and ineffective he is and with performances like this from many in the party it is no wonder Labour aren’t getting any traction.
Matt, write that list of lies above into a nice polite letter to the Herald, 200 words… I’d do it but they’ve run me twice already recently on this issue. Go on, it’s a goody… pants on fire. We’ve got to out this prick
@Lucy no i havn’t. Based on the evidence though i’d think i was a chance considering he seems to get a lot of his facts wrong, he’s actually quite lazy. Point is there are plenty of points that Hughes could have pulled him up on had he been prepared. Have a look at the list that Matt has outlined above and also SJs previous comments about more people using Puford than the Auckland rail system, anyone with a decent knowledge of the facts could have challenged these assertations quite easily.
Take your (i’m assuming)Labour party hat off and look at this objectivly, Hughes was poor, at the moment Labour are poor they have no hope in next year’s election. This is one issue they should really be trying to land some blows on.
@Matt,Yep I was just about to reply to Lucy but you have said exactly what i was going to post.
What’s really galling is that the government is telling Len Brown to wait for the spatial plan before asking for money for large work, while it plows ahead with its pet projects. If Len waits for the plan half his term will be wasted. Maybe if Len agrees to wait for the plan then he can get an extra 18 months added on to his term seeing as he he will be forced to spend the first half twiddling his thumbs. I bet Banks wouldn’t have been told to sit tight and wait for the plan.
Also transport spending is the biggest driver of urban form, they don’t mean wait to decide what’s best, they mean ‘this is what you’re having’
Having watched Steven Joyce do this in question time over and over again I’ve come to conclude that he’ll simply make the numbers work for him, no matter what (Hamilton’s rail project has fallen victim to his MO too). The business case for the CBD rail loop is absolutely clear- but the Government’s performance yesterday proved that senior Ministers just don’t believe in it (and rail generally it seems) especially not English. Only a couple of months ago he was saying the following:
Hon BILL ENGLISH: The investment in roads is freeing up congestion and lifting our export productivity. If oil prices rise, then I am sure that people will make their choices about whether to travel more or less, or whether to change their mode of transport. It is our guess that even if oil prices rise, most people still will want to travel by private car…..my guess is that we would need to have a very high oil price to make the cost-benefit ratio on rail look better. If the oil price was high, we would have to presume most people would shift to rail, but even if the volumes on rail doubled or trebled, the economics of it are still very marginal.
Waiting till people are priced out of their cars and into an inadequate PT network is hardly a vision for an internationally competitive and sustainable city. We may have the business case, but while English holds the cheque book and views like this, I can’t see us moving forward very quickly.
Great to have you commenting here Jacinda. Bill English is clueless when it comes to transport issues, your quote of what he said in relation to rising oil prices is quite incredible.
Nikki Kaye supposedly supports this project, but where is she? This will be THE BIG ISSUE in Auckland Central electorate next year.
“Nikki Kaye supposedly supports this project, but where is she?”
I’ve been similarly wondering where Len Brown is. Neither Nikki Kaye or Steven Joyce have promised a rail tunnel. Len Brown has. He promised it but, unless I’ve missed the announcement, he hasn’t offered up any financing but is instead waiting for other people to deliver what he promised. I believe that he is sitting on enough assets to build 15 rail tunnels. Or a rail tunnel, rail to Albany under the harbour, rail to the airport, and still have several billion dollars left over. But he has higher priorities, like shares in Mackay and Cairns airports.
Why should the tunnel be top priority for Kaye and Joyce when it isn’t for Brown?
Man, he just can’t win with you. He’s been the Mayor for just over a month. The business case for the tunnel has been public for a week. We’ve consistently heard from the Government that they won’t help fund the tunnel, but it’s unrealistic for Auckland alone to fund a $2b capital project that will ultimately benefit the entire national economy, especially since to do so would beggar the region for the next 30 years. This is not a local suburban road. So maybe, just bloody maybe, give Brown a chance to get the multitude of jobs done that are part of being Mayor rather than expecting him to focus entirely on a single project.
Also, given that this project is of enormous significance to her tenuously-held electorate, Kaye should be very public in her support for it or face being turfed in favour of Jacinda next year. The ’08 result was that close.
The Government have said that they have questions about the business case and it needs more study. They’re obviously not going to pay for the whole thing. I’m sure that they’ll come on board because it is a good project, but it is up to Auckland to drive an Auckland project. That’s what the Super City is about.
Looking back at the comments here after the business case was released… On the same day and the day after release, people were criticising the Government for not offering complete support and funding. Yet Brown gets away with saying nothing for over two weeks? He’s the one that promised the tunnel, so he’s had plenty of time to think about how he is going to keep his promise. I’d like to know what he intends to do, and won’t be impressed if his only plan is to wait around for someone else to make some decisions.
The tunnel doesn’t have to “beggar” the city at all. Like I’ve said… Brown could announce a few asset sales, complete funding, and a project start date without having to wait for Government to do anything. No rates increase. No special petrol tax. Easy!
I’m unsure just how attractive rail is electorally. I suspect that most people are in favour as long as they don’t have to pay for it. Brown essentially promised Auckland about $7billion worth of rail projects with the implication that other people would pay for them. Everyone likes free stuff. If he’d run on a platform of, say, doubling rates or a 50c/litre Auckland fuel levy then I think he’d have come in a distant second in the mayoral election. I suspect this is why he is keeping quiet now. He doesn’t want to be seen to be responsible for any additional costs to Auckland residents and he doesn’t want to have a revolt on the North Shore where people might see a steep rise in rates or petrol prices to pay for a rail tunnel when they don’t have rail to the North Shore.
“Sell a few assets” and then what? The idea of flogging off income-generating assets in order to purchase non-generating assets seems incredibly short-sighted to me. Take away the dividend income from the shares and you have to find another revenue stream to make up the difference. Guess where that comes from. Hint: rates.
Brown never expected it to be free. He does expect central government to come to the party, because if Auckland performs well economically it’s good for the whole country. Josh has published the figures on how much value-add there is to employment in the Auckland CBD. Given that most of that is captured in income tax, which goes to the state, it’s not unreasonable to want the state to chip in on funding for something that’ll bring more employment to the area.
Nobody I’ve seen is criticising the government for not offering complete funding. We’re criticising for not offering any funding, for fudging, distorting and lying about the tunnel’s economic justification, and then in the next breath offering unconditional billions to be spent on roads that have very weak economic rationales.
You don’t like Brown. Fine. You’re not convinced about the tunnel. Fine. But please don’t distort the reasons why those of us in the other camp are so annoyed at National’s attitude.
But I AM convinced by the tunnel. I think it makes a lot of sense as transport infrastructure, even tho I think the wider economic benefits contained in the business case don’t stand up to close inspection. This is why I’m wondering why Brown isn’t telling us how he intends to build the tunnel. Which, incidentally, he promised BEFORE the business case was released, so the figures in the business case aren’t relevant to anything at all since it was going to be built anyway.
As for the income from asset sales… You’re assuming that the rate of return in public ownership is as high as possible, but economic analysis and history shows that most assets under-perform in public ownership. So the price you’re likely to get selling them will be more than the value of their current income warrants. That said, it’s a matter of priorities again… If you value a dividend income for general council purposes higher than a CBD tunnel, then that’s your choice. But you’re unlikely to convince Bill English to treat the tunnel as a high priority in that case.
Obi, one interesting matter to throw into the mix is a consideration of what the next step is in advancing this project. That next step is to have the route designated – for which the documentation is just about complete as far as I know.
The complicating factor is that the only agency able to designate the rail corridor, as far as I know, is KiwiRail. And who is KiwiRail’s minister – none other than Steven Joyce. So unless the government gives KiwiRail the green light to proceed with lodging the notice of requirement, my understanding is that the project can’t go any further.
It seems relatively likely to me that Auckland Council will stump up with the first lot of money (to do the detailed design and basically get the project “ready to go”). But there will come a point when a deal needs to be done between Len Brown, Steven Joyce, Bill English and John Key about how the bulk of the project gets funded. That’s a decision that we don’t necessarily need to make for another year or two, as long as we continue with the designation in the meanwhile – but it’s obviously something that will need consideration eventually.
But getting back to my main point, as KiwiRail needs the go ahead to lodge the notice of requirement to protect the route, it will be Steven Joyce who is holding up the project if he does not allow them to take this next step.
“The complicating factor is that the only agency able to designate the rail corridor, as far as I know, is KiwiRail.”
That’s odd if true. Correct me if I’m wrong, but designation is a matter only of reserving land for future use. I would have thought that was a core responsibility of councils.
Ignoring the designation… Does Kiwirail have a legislated monopoly on constructing railways? What is to stop the Supercity Council from building the tunnel itself and then allowing Kiwirail to run trains through it? You’d need Kiwirail’s agreements for the connections at each end, but I can’t imagine they’d withhold that.
I think that providing Auckland pays for the designation process and land acquisition he won’t actually object as none of that actually guarantees the project will go ahead but just that it can. In fact I think that is what will happen, Auckland will keep the thing ticking over then in a few years when we are ready to call in the diggers we can put a funding case to the government at which time we can only hope they are more receptive.
Well let’s get designating the whole of Admin’s Future Rail Map, STAT.
Obi, it is not a fact, economic or historic, that assets are better managed outside of the public sector. Some can, some can’t. It depends. Brown clearly isn’t a sell assets type and probably mentioned that somewhere in his campaign. He did support the local fuel levy, but you know who ditched that. If the govt won’t allow the local council to expand its tax base, then it should stump up for the some of the things Auckland needs.
Jacinda – We know they are lies and so does he but he knows he can get away with it because both the opposition and media are useless. As I pointed out Darren or any other opposition MP could easily have thrown it back in his face but didn’t which makes them just as incompetent as Joyce.
All the attacks in parliment so far have been half hearted and without real conviction. You guys need to read up and understand your facts if you ever want a chance of toppling him
@admin Really pleased to see a forum with such solid discussion and debate (been watching for a bit but felt moved to jump into the fray!)
To be honest the only discussion/positioning I’ve heard on the CBD rail loop from Government members has been from Joyce and English, but I may well have missed any contribution by others.
@Jacinda
Sticking up for Darren Hughes a little here…..although comprehensively covered on this excellent site, AKT Trains and over at the CBT Forum and website…..it seems to me that you guys need the key information to be distilled down to 10 key points that you can take this guy down on. It is a balancing act as in simplifying, one can end up inherently giving away loop holes that SJ can use to wriggle off the hook.
I am not without contacts both side of the political fence….. it is perhaps sobering to consider that John Key has been compared to Keith Holyoake, and that National regimes ruled NZ for virtually an entire generation between 1949 and 1972 (apart from a minor “burp” between 1957 and 1960). Given NACT ownership of the media, it will be interesting to see how the debate on MMP versus FPP is framed…..So Labour, I can’t imagine the frustration you guys must be feeling, but this really is crunch time for you.
And the whole thinking about CBT Loop and high value export focussed jobs in the revamped CBD and Waterfront versus same old same old motorway urban sprawl should be pivotal to your campaign in Auckland. Without adequate transport, Auckland will continue to economically under perform….the facts and figures are crystal-clear in the respective business cases for the Holiday Highway versus the CBD Loop.
National’s alternative has/is/will always be to provide jobs for National Party voting support and donation base – including farmer sellers on the outskirts of cities, residential property development companies, shopping mall developers and trucking companies. Totally economically unsustainable development (…another property bubble and Global Financial Crises anyone?) as well as shockingly environmentally destructive.
These hypothetical arguments over made up figures don’t win any votes as nobody understands them and the technocrats simply obscure the debate in terminology. What we simply need to do is ask-
1. Where do they plan putting the 50,000 extra vehicles in Auckland by 2031- whose properties do they intend demolishing if they think they can simply keep building wider motorways?
2. Is getting to warkworth 5 minutes earlier be really worth $2 billion and the environmental destruction of a new motorway North of Auckland.
3. How will we ever be able to hold any major sporting events in the future if nobody can get to the venues.
If you want the effects of this lunacy to hit home- you need to frame the debate in a more tangible form.
Agree Topcat:
4. Is it true that the toll between Puhoi and Warkworth will be $10 each way?
If the answer is ” the toll has yet to be determined, but your figure is ridiculously high ” then the follow up is ” does the Minister concede that without this information then the benefit cost analysis for the Holiday Highway must be incomplete, and will he therefore withdraw his support for the project until the cost of the toll and its impact is known ?”
(No, I have no basis whatsoever for the $10 figure, but thought it would be a useful starting point…)
Genius. I hope Jacinda’s taking notes.
@ Cameron
I see you’re employing the Steven Joyce technique of argument, that is plucking any figure out of the air as in ‘my understanding is that the cost of subsidising a passenger on a train from Hamilton to Auckland is something like $15,000 or $16,000 per trip’ and running with it. It’s about time someone started confronting him with his fictions and I suspect there’s no better weapon than creating a competing fiction!
It is quaint, Obi, that you take the government’s objections to the CBDRL business case at face value, despite the inaccuracies in their position, as reasonable [See Matt L’s analysis and rebuttal of every point SJ made in parliament above]. Especially as you offer no argument for this. You simply say: ‘I think the wider economic benefits contained in the business case don’t stand up to close inspection’. Like that’s an argument. What you have to accept is that the govt. are flailing round for objections simply because they don’t want it, it doesn’t fit their provincial world view, nor the needs their special interest partners, they aren’t interested in arguments, analysis, or reason. It’s prejudice.
Fine OK, what to do, if like you say: ‘But I AM convinced by the tunnel’. Well I think this is maybe where I agree with you. I think we, Auckland, should just plough ahead and commit to it. For I believe that the world, and a future government will catch up and see the desperate need in this project. Borrow and it will all work out. These trains will be full the moment the CBDRL opens, as we urgently need to offer an alternative to oil driven transit as soon as we can. And I agree we will then be able to extend the network through the rest of the city, including the NS….
“Especially as you offer no argument for this”
It took me a while to read the Appendix K after Admin gave me a pointer to it. It seems to rely on a number of assumptions that I find to be unconvincing.
Currently CBD jobs pay more than non-CBD jobs. No one disagrees with that… low value economic activity will not be located in an area of high real estate values, and high value activity pays high salaries. BUT… the business case assumption seems to be that locating activity in a CBD will naturally lead to higher salaries. Now it might happen to be the case that if we build a bigger CBD, then “they will come”. For instance, a company doing light manufacturing in Manukau will decide to relocate to the CBD and upskill to be a software company. Or an international bank will relocate from Tokyo to Auckland. Or a firm of Birkenhead (or Taupo) lawyers doing divorces and house sales will relocate to the CBD, become commercial lawyers, and double their salaries. But I doubt it. I suspect that a bigger CBD will only yield higher salaries if there is a demand for that high value CBD-centric economic activity AND a lack of transport capacity to the CBD is currently limiting the size of the CBD so that it is unable to support that activity currently.
Ultimately, the wider economic benefits only result if employment in the CBD increases significantly. The business case relies on an assumption that this is true because the council says it will be true. Plenty of rail projects gave failed in economic terms because that induced demand fails to eventuate to the extent predicted. Channel Tunnel and the CTRL to London being two spectacular examples. So the government is acting perfectly correctly, IMHO, in testing the growth assumptions rigorously before stumping up the money. On the other hand, its a Len Brown electoral promise so the business case doesn’t matter… he just needs to explain how he intends to deliver on his promise.
It might be worth doing a benefits realisation study on an existing Auckland rail project to test previous estimates of demand. We’ve got a great example nearing completion soon. We know the Manukau link has more than doubled in price. Why not complete it and see if the demand estimates are accurate or not? If they are, then work out why the budget was blown and take it in to account in the tunnel business case. If the demand estimates turn out to be wrong as well (either high or low), then similarly work out why and adjust the tunnel business case.
“it doesn’t fit their provincial world view”
You made a crack the other day about Joyce being some sort of provincial hillbilly. New Plymouth might not be Auckland, but its significantly bigger than the hometown of the previous Minister (Murchison), the Greens Spokesman (Gisbourne), or the Labour Spokesman (Foxton). Maybe the last Labour government would have approved the tunnel if Annette King hadn’t still been a Murchison girl at heart? 😉
Ah Obi, you may find the forecasts unconvincing, like the Minister, as it is easy to demand proof of a forecast, confident that it is impossible to achieve. You ignore the 3 American examples? Too foreign for you? Whatever, you could also, like the Minister claim that nothing ever changes, except somethings that he likes, while refusing to accept that what we do has an effect on how things turns out. If we want AK’s economy and culture to transform in a good way [And I for one do] then we surely should tailor our actions to that end. Transport drives land use, Joyce is the biggest spender in the country, he is shaping our world while pretending he isn’t.
Also he clearly does have a small town set of values that I believe are wrong for the big town that AK has become, and he also comes from one too [these two things are not necessarily causative]. The fact that some other people also come form small towns is clearly likely, but completely irrelevant. Smiley face.
Admin- The interesting thing about the designation is that it highlights a fundamental misunderstanding or misalignment of the project. Yes it is a rail project, and SJ and Bliinglish hate money to go to rail, but properly understood it is an Auckland Transport project. It isn’t about getting goods to port, and KR is really a freight company, it is an intra-city people movement issue. And ideally Auckland Transport properly organised, and funded, should operate like Transport For London, and be focussed on facilitating the efficient, timely, cost-effective, and pleasant moment of citizens and visitors around and through the city by whatever mode works best. In a way it is a distraction having a national rail operator in the mix.
This is especially obvious as we now have such an anti-democratic, and anti-devolution nanny-ing government in power.
You’re right. I’m actually firmly of the belief that the rail corridors shouldn’t be owned by KiwiRail, but rather by NZTA. In effect, what was Ontrack should have gone into NZTA rather than into KiwiRail. It would treat the rail network like what it really is – another form of state highways. Anyone would be able to use the rail network, but obviously they would need to pay their way (although you could take into account the wider benefits for road users of getting freight off roads and onto rail).
The big advantage of this approach is that NZTA could choose how to spend its money on road or rail, rail would have access to the National Land Transport Fund. Another big advantage is that you could bring a truly integrated viewpoint to transport matters – and you wouldn’t have a critical piece of New Zealand’s infrastructure in the hands of a glorified freight company that really doesn’t seem to have a clue when it comes to long-term management and planning of its assets.
KR’s predecessors certainly haven’t showered themselves with glory on the long-term planning front. But KR’s actions now are largely driven by the fact that the shareholding minister hates rail and would rather that KR curled up and died. In the face of impossible demands for near- and mid-term results, KR’s only rational choice is prescribed by the circumstances: shut under-performing lines unless a high-value anchor customer can be found in the very near future. Blame Joyce for what KR is doing with branch lines.
Guys, you have a brilliant example just in the herald the other day to use,
The new sthighway20 was supposed to improve traffic flow…it’s actually slower.
Also, get some figures about induced demand on the new highway?
Use these to fight Waterview and NW widening..I still think it’s not too late to stop those projects…particularly when you start asking how the waterview traffic flow are like when waterview meets the western motorway.
This will prove to aucklanders once and for all building new roads is pointless.
Waterview is somewhat necessary, if only to give a realistic alternative to the CMJ for south/west traffic or in the event of a full closure of the Harbour Bridge. It actually is justified, unlike Puford and the rest of the RoSN.
I think Waterview is justifed eventually, just not now. However the Vic Park tunnel will deal with the worst congestion around the harbour bridge for a few years. I dont think Waterview should be an urgent project, more something to be done once the CBD loop tunnel is built, not before. However probably too late to stop it by the end of next year.
As an aside can anyone recall what the Waterview BCR is?
I think the BCR for the whole Western Ring Route is around 1.2. I’m not sure whether that include or excludes wider economic benefits.
There’s quite a lot of interesting information on the project here: http://www.waterviewapplication.nzta.govt.nz/Evidence.aspx
The SAHA report you posted the other day indicates it is around 2.5 before WEBs
Ah yes good point. SAHA measure it at 2.5, NZTA measure it at 2.1. Something tells me that’s including wider economic benefits.
obi is actually correct to raise this particular argument as these soughts of WEBs were widely used to justify motorway building in Britian in the 1960s and 1970s. Detailed studies of the actual effects in the decades since those projects were built have found that the economic growth that did occur along the new motorways wasn’t addititional to what would have occurred without the motorway but was merely a reallocation from from areas where motorways weren’t built to areas where motorways were built. This conclusion should have come as no real surprise to transport planners as the same economic reallocation effect had been noted during the Victorian railway building boom.
It is fair to question the assumptions underpinning agglomeration benefits because essentially Agglomeration Theory is Business Location Theory with the cause and effect reversed. Both theories acknowledge that transport costs affect locational choice and that falling transport costs (in terms of time, money and convenience) will increase demand and therefore rents in the most accessible locations. The resulting concentration of high wage jobs in the CBD is deemed to be an attraction phenomonen by one theory and an exclusion theory by the other. As with induced traffic, there has to be unfulfilled demand that could not be accommodated anywhere else for there to be any real economic benefit from improving the transport situation in a partticular location. In the absence of that condition all you are doing is robbing Peter to pay Paul.
Kevyn I think we have to be careful with our comparisons. Like Obi trying to suggest that somehow the Channel Tunnel is an analogous precedent for the CBDRL, I’m pretty sure you’re not dealing with apples and apples here. You are right to point out that not every transport project will help create an agglomerative effect. Exactly, quite the reverse is true, especially with ones that promote de-intensification. Transport projects that open up access to new real estate, like motorways, like the spread of Victorian Railways [which made suburbia possible], are likely to have an anti-agglomeration impact. Agglomeration is the idea of the development of new activity through intensity, so it is entirely consistent with agglomeration theory that new English motorways in the 60s not only didn’t generate new business but also made it difficult for certain types of business to exist at all. Especially specialist service, entertainment, and cultural businesses. The fact that agglomeration theory was employed to sell anti-agglomerative projects doesn’t surprise me during the crazy peak of global motorway mania, but to still have a Transport Minister suffering from this disease in the second decade of the 21st century [nearly] is completely insane. We know exactly what happened to both urban centres and the economy in the UK in the 70s and onwards, so it is a damn good idea to try to not repeat that.
So for a light engineering business to choose between business park A, B, or C, out on the new ring road for their location, it only helps generate road based trips for staff, suppliers, and customers, as new and displaced activities. And a couple of extra pies bought from the service station. This type of situation offers no agglomerative outcome. It’s fine, but as you say the firm could be at any of these places, doesn’t matter, and the success or otherwise of the venture will hinge on other factors more than location.
When Vodafone, Telecom, Fonterra, the ASB, et al all locate their in the same city centre, and not dispersed between four+ business parks you not only get the efficiencies in any activities between these businesses [ie no need to drive from, say Smales Farm to, say Manukau City for that meeting-you can walk], but it also suddenly makes a whole class of activities possible that would not otherwise be the case, stuff that cannot survive in a dispersed market. And these tend to be high quality and high value. And importantly they are the activities that make a city particular, give it a quality, make it a place worth being in and going to. You cannot get truly successful theatre companies, globe trotting chefs, or other specialised services without intensity, and AK isn’t big enough to have more than one really intense centre. And you don’t get a place with a quality, a soul, a particularity, that people will want to visit without that intensity, a centre with some vitality, even if you are lucky to have a beautiful harbour and a bunch of weird and lovely scoria lumps.
The CBDRL will, as the report clearly and convincingly shows, vastly help the desperately needed intensification of Auckland, with the creation of an Auckland that could really succeed. So therefore the completely opposite of 1960s English urban decline. And the complete opposite of the road our Minister is taking us down. One that will work, unlike his programme of dissipation and dilution.