Exploring the mystery $300 million

I noted in a post last week the weird mysteries in Auckland Council’s draft annual plan when it comes to what they’re going to be spending the transport money on. To refresh memories, here’s a table showing the council’s proposed capital expenditure on transport for the 2011/2012 financial year: The big mystery is the $307 million proposed to be spent on the “road network” in the 2011/2012 financial year. I can’t quite fathom why Auckland would need over $300 million of council spending on new roads over the next 12 months. I did wonder whether some of this money was going into projects that were technically local road improvements, but had a major public transport benefit – like the Dominion Road project for example. Perhaps some of AMETI could also contribute to the amount – but that’s a multi-year project that seems to be a while away from actual construction, when the real money starts getting spent.

After some discussion on the topic on the Campaign for Better Transport forums, we were helpfully directed to have a closer look at the 2009-2012 NZTA National Land Transport Programme for Auckland, which outlines all the projects in the Auckland region that NZTA will be funding during this three year period (the development of the next NLTP will be an interesting process over the next year or two). Page 9 of that document starts to potentially give us some of our answers to the question of “where’s the $307 million going?” as it outlines the new local roading projects that NZTA is planning on contributing to over the three year period covered by the programme: If we set aside AMETI for now, because it’s a multi-year project that has its final form very much up for debate, the next two most expensive roading projects are quite interesting: Penlink at $203 million and roading upgrades in Flat Bush at $80 million. Penlink is a project that has been proposed in various forms, and to be funded via various means, over the past few years. From memory, it was fully funded by the regional fuel tax until the current government got rid of that tax (and as a result Auckland’s any measure of transport funding independence). Here’s a map of the project: I can certainly see how the project would have benefits – offering a second access point to the Whangaparaoa Peninsula and cutting a big corner off the way in which people get from the peninsula to the city. But it’s very expensive, and I do wonder how much of a priority its completion really is for the Auckland region as a whole. The table below shows some more details on Penlink, including some serious funding allocations in 2009/2010 and 2010/2011 that haven’t happened – maybe they’re being shifted onto 2011/2012? It’s also worth noting that Penlink has only been given a “Regional Priority” of 90 – which I assume means that the region has 89 other projects of greater priority around. One might assume many of them would be a lot cheaper too.

What’s also interesting about both Penlink and the Flat Bush road upgrades is that the NLTP specifies that they’ll both only be funded if a funding plan develops which shows the current options are affordable and value for money. That would tend to suggest that neither project currently makes economic sense – especially not when compared to other projects.

It would be useful to have the $307 million the council is expected to contribute to new roads broken down into a “project by project” list. Particularly if we got an idea about the cost-effectiveness of the projects that make up this large chunk of money. It’s not that I’m saying we shouldn’t be spending $307 million on local roads in the 2011/2012 year – perhaps it makes good sense for us to do so. But perhaps it doesn’t? Perhaps the new political reality of the Auckland Council – with a stronger focus on public transport – might necessitate shifting some of this money towards other projects (like funding the rail station upgrades talked about a few days ago).

Or perhaps it could contribute to the $60 million that Auckland Council needs to save in order to keep rates increases below 5%. We simply don’t know until we see what the money’s going to be spent on and whether it represents good value for money. Hopefully we’ll see more detail on this soon.

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