Well, what an interesting day. The review of the CBD rail tunnel project – a process that has been ongoing since December last year – finally spat out its results. And I stress the plurality of those results, because effectively we have ended up with two reviews: one from Ministry of Transport and Treasury officials, and one from Auckland Council, Auckland Transport and their various consultants. It’s somewhat strange and interesting to compare the two reviews.

This post will look at the MoT review. I will look at Auckland Council’s review in a separate post – probably within the next day or two.

I had the advantage of attending a “technical briefing” from the key Ministry of Transport officials late this afternoon, which involved some useful discussion about how the MoT review differs from the original business case, and then how the Council’s review differs from the MoT review. The differences are very complex, and have reinforced my long-held belief that transport modelling is an incredibly dangerous and confusing process, where slight changes to ‘input assumptions’ can make a huge difference to the final results. In essence it seems as though the MoT have changed some of the assumptions from what the business case used – resulting in a much lower cost-benefit ratio. Then the Council changed some assumptions to come up with a different cost-benefit ratio again.

This is the comparison that the MoT’s review made between their review and the original business case: As you can see, there’s an absolutely massive difference between the two. From my understanding, there are two main reasons behind the reduction in transport benefits:

Firstly, the business case made the decision that rail capacity would be hit in 2024, whereas the MoT review has looked at this question in a bit more detail, and says that capacity will be reached in different years on different lines. Some of MoT’s statistics on this matter are a bit hard to believe – such as their assumption that the Eastern Line will not reach capacity, even by 2041. For the Western and Southern Lines, there’s some demand that won’t be fulfilled due to overcrowding by 2041, but MoT’s numbers yet again seem illogically low:

The other big change to the assumptions is the parking charge in the CBD that has been “inputted” to the modelling. The business case used an inflation adjusted figure of $30 a day whereas the MoT review used an inflation adjusted figure of $16 (both in 2041). Once again it seems fairly illogical to assume that parking charges will stay pretty much as they are now (only adjusting for inflation) as Auckland’s CBD grows over the next 30 years and becomes increasingly dense. Of course Auckland Council could get the ball rolling by charging market rates in their parking buildings for once!

Both these changed inputs, along with some technical changes, have had a surprisingly massive effect on the economics of the project – as you can see in the first table. Indeed, MoT’s general assumption is that the rail tunnel won’t make a particularly massive difference to travel patterns into the CBD – as can be seen from the table below:

One thing that I found particularly interesting at this afternoon’s briefing with MoT, is that when I questioned whether they had assessed whether the city centre could actually handle all those bus and car passengers in 2041 – the MoT officials admitted that they hadn’t looked at this issue. Considering that currently we have around 23,000 bus passengers entering the city at peak times, it’s an interesting question to ponder whether the street network has the capacity to handle an increase to what MoT think will happen in 2041 with or without the CBD Tunnel. I can’t quite see, even with significantly enhanced bus priority measures, how we would be able to double the number of peak time bus trips to the city centre, particularly while people in cars would also (supposedly) be able to increase from 35,000 this year to around 40,000 in 2041. I just don’t see the road capacity, particularly if Auckland Council pushes ahead with its vision for making the city centre a nicer place for people.

So I must say that overall I see some major flaws in MoT’s review as it relates to traditional transportation benefits. Now this is not necessarily because MoT has done its job wrongly, but rather that their assumptions are a bit out of date – and don’t really reflect what is likely to occur in the future as Auckland’s city centre changes. They assume that the CBD can handle a doubling of buses at peak times, while still providing enough road space to handle more cars than we have at the moment. They assume that parking charges will barely change over the next 30 years and they assume – quite counter-intuitively I think – that the rail network has sufficient capacity to serve the CBD, right up until 2041 with only relatively minor problems on the Southern and Western Lines, and without any problems on the Eastern Line. Quite critically, the MoT review also doesn’t really consider the impact of changing around the bus network so that it is based around more services feeding into the rail corridor, instead assuming that the current mess of bus operations will continue.

Fortunately, the Auckland Council review considers these issues in much more detail – as well as undertaking an extremely interesting assessment of wider economic benefits. But that will be for my next post.

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  1. 1. How much did it cost the MOT to produce this review (including time spent by MOT and Treasury officials and outside consultants)?

    2. Why hold a “technicla briefing” on a major report like this only a few hours after it has been released? Are they trying to avoid answering difficult questions?

    3. Do they make any attempt to justify their bizzarre assumptions? If they cannot defend the assumptions adequately, the entire process is pointless. Do they present evidence to back up their assumptions?

    1. A lot of the assumptions were based on the 2010 Regional Land Transport Strategy. The MoT officials seemed to justify the non-logical outputs by simply saying that they were using the region’s assumptions and the region’s modelling.

      Of course, one would think that if you got nonsensical outcomes you would ask why, and start taking a critical look at your assumptions to see if they’re actually accurate.

      1. so what you are saying is that they have made no attempt to justify or defend the assumptions used for this review? is “Yes Minister” their only operational manual? why undertake a costly review if you don’t closely examine the robustness of the underlying assumptions? incompetence? stupidity? political bias? this is a farce. the MOT have no credibility, nor do Treasury.

  2. love to know how they generated those capacity statistics, they are absolute madness. Once the Panmure busway/interchange has been built many people will transfer to train from the eastern buses as the train only takes 16mins (less with EMU’s) yet the bus is more than twice that. Only thing that will stop this is capacity issues.

    Also western line is crowded now with 15mins, so with superior EMU service and bus reorientated to be feeders 10min freq will soon be overwhelmed. Also with CBDRL network resilience will be much improved which equals less delays, happier customers and higher patronage.

  3. “Some of MoT’s statistics on this matter are a bit hard to believe – such as their assumption that the Eastern Line will not reach capacity, even by 2041.”

    Are you assuming that most people have seats? If you pack in passengers at London Underground densities then there is plenty of scope for growth in passengers without increasing the number of trains.

    1. Obi, the capacity is measured in a variety of ways. One is the number of standees compared to seated passengers and the other is the time that people are expected to stand for. The MoT modelling suggested that without the tunnel by the mid 2020s people would be standing on all trains from around Glen Eden/Sunnyvale on the Western Line and from around Manukau on the Southern/Eastern lines.

      Interestingly, they seemed to figure that was completely acceptable.

      1. It is one way of handling peaks without having excess capacity in the off peaks.

        I usually had to stand from boarding on my Zone 4 Tube journey in the morning rush hour. There were already plenty of people standing at that stage. While I would have preferred a seat, I wouldn’t have been willing to pay an awful lot more for a weekly ticket to cover the extra trains and tunnels that would have been required.

  4. I thought we didn’t even have capacity now to fit 1 or 2 extra trains per day from Hamilton — did they explain how we will keep increasing capacity? Can we fit longer trains into Britomart or could the platforms be lengthened? Will the new EMUs turn around a lot quicker?

    It would be interesting to see the calculations used and what sort of service patterns would be required.

    1. They accept there’s little train capacity left. However, post electrification all the peak time trains will be at least 6 cars long, which does add quite a lot of passenger capacity.

      However, MoT still assume that patronage could double from current levels without any capacity problems. I’m not quite so sure.

  5. I attended along with Josh. MoT said they would put their supporting data up on their website shortly. They were caught short by the announcement today apparently.

    The entire presentation is based on “the model”, which I really struggled to see matching with reality. In the chart above, for instance, it is assumed that there are no capacity constraints for bus, car and ferry, when in reality there are.

    My usual hobby horse about no risk assessments for expensive oil held true for this. A lot of focus on the cost of parking, none on the cost of petrol. Expect petrol at $3.75 a litre by 2041 according to the model. According to some sources on the Oil Drum, this will be about the time that conventional crude oil has been exhausted completely, and well after the 2025 date that Saudi Arabia loses it’s ability to export oil.

  6. I asked how the 10 – 15 minute time saving for Western Line passengers had been modelled, and was told that this calculation will become available. I would expect a huge patronage boost on the Western line as the result of the CBD tunnel, will be interesting to see if the MoT study agrees.

  7. The more I hear the worse it gets.

    How the hell were these fools paid for that half arsed job?

    I’d suggest that a group of high schoolers would be able to make a more accurate assessment than these clowns.

    1. if they point blank refuse to defend the assumptions of their model, they don’t deserve to have a job. they are amateurs.

  8. Wow, so the MoT has simply assumed a limitless supply of road capacity in their modelling…. well time to use that report for toilet paper and move on to something based in reality.
    They are really looking at this the wrong way, i.e. what will a rail tunnel do for traffic levels in unconstrained conditions. What they should be looking at is what is the cheapest and most efficient way to meet the projected growth in CBD trips. This idea that peak hour bus trips can double at the same time as a 15% increase in general traffic without any constraints is a massive flaw to their evaluation. They would need bus lanes on every arterial and motorway leading into the CBD to support that, and with that in place you certainly couldn’t increase traffic, you’d have to slash it. At what point does the necessary pair of bus tunnels and associated busways fit into their cost-benefit analysis, because that is the sort of infrastructure they would need if they want to double bus trips and increase car trips concurrently.
    Back to the drawing board MoT, lets see a report called “evaluation of transport infrastructure option to avoid constraining growth in the Auckland CBD”.

    1. The sad thing Nick is that they could be right about unlimited road capacity. After all they have a minister who when presented with a capacity constaint will simply draw a line on a map and say put a motorway there.

  9. Josh, Thanks for this speedy update. A few questions come to mind:

    1) I agree that the mode share into CBD at morning peak in 2041 looks like it does not take account of the transport strategy. The question that it raises is this: what is the passenger carrying capacity/hour assumed by MOT for the lines that are feeding into the CBD in 2041? (Eg Perth’s lines run at around 20,000/hour/line in the peak, but Auckland’s – at present – run at around 3,000/hour. Upgrades, capacity improvements, and tunnel all aimed at bringing that capacity up.)

    2) There is talk of “the model”. Is MoT using outputs from the transport model that was developed by ARC, and which is said to be able to model the RLTS? Maybe that is what is meant by saying that its work is based on ARC’s model, which is (said to be) based on RLTS? Is ask this question because I am aware of how insensitive this model was to fuel price changes – ie it fails to predict the kinds of mode shift that we observe even today, and if is the basis for predicting mode share, then that is one reason for the MOT review being so skewed.

    Be grateful for your answers to these Qs Josh.

    Regards, Joel

    1. Hi Joel. The MoT review was very much based on a complete acceptance of the modelling while ignoring its flaws.

      The biggest problem is what Nick points out above: there’s no consideration of how the CBD can handle all those buses and cars that the modelling says it needs to. And in my meeting yesterday MoT did not dispute that they hadn’t looked at that issue.

    2. 6 x 6-carriage trains would be 5400 pax per hour (150 pax per carriage), 4 x 4-carriage is 2400. 4-carriage trains on the western line are already at crush capacity by Mt Albert (when they replace a 6-carriage). 6-carriage services have standees, but aren’t packed. Which means we can probably double the number of pax currently carried, before the network chokes. At the current 20% growth rate, that should be 2016 or 2017.

  10. Great to hear Mike Hosking going on about this on ZB this morning… way to spread disinformation. Saying that Len Brown is dreaming and has been lying about the figures!

    1. We all know that Newstalk ZB is a highly right wing biassed radio station, that happens to be half owned by APN who also own the Herald.

  11. Josh,

    Just a further note. I have read the review – which I have to say is a very brief document – barely 10 sides. And the devil will be in the detail of the appendicees. But I include here the comments it makes, about what the reviewers believe needs to happen for the CBD Rail Loop project to be justified in a BC sense….

    The review also states that it supports Council going ahead with the NOR process to protect the route. I am aware from my investigation of the work needed for that NOR that many of the issues that are set out in this quote will need to be addressed.

    Regards, Joel

  12. Sorry, sstuffed up the quote from the review. Here it is:

    ” There are a range of actions that could be undertaken or facilitated by Auckland Council and Auckland Transport which would improve confidence in the outcomes expected from the City Centre Rail Link:

    * Auckland Council finalising and implementing its spatial plan and City Centre Masterplan to help clarify the project’s role in the CBD and wider Auckland.

    * Demonstrating commitment to resolving current and emerging CBD access issues, for example by improving bus operations and addressing capacity issues.

    * Development of a robust and achievable multi-modal programme for transport in the CBD, which considers a thorough analysis of alternatives and identifies the optimal mix of modes to meet demand.

    * Beginning implementation of large scale residential developments along the rail corridor.

    * Implementation of additional park and ride sites, and changes to bus feeder services where appropriate.

    The implementation of these measures, combined with rail patronage above forecasts and a robust economic case, would provide a strong signal that the conditions are in place to drive the necessary benefits from the project and therefore to reconsider the business case for the project….”

    This is an important set of points which should not be lost sight of. They are points related to integrating land use development with PT improvements running out to 2041. Related planning and implementation priorities and methods should be coming forward in the Spatial Plan and to an extent also the CBD MasterPlan.


    1. Joel. Yes all very sensible, but there is certainly an aspect of chicken and egg to this: What better way to stimulate development along rail corridors than to have the network more complete, frequent and efficient? In other words does not the building of the CRL not enable the things above come into being? Apparently a third road to Northland will transform Northland’s economy simply by speeding up traffic by 10 minutes on a 4 hour trip, is worth doing in the hope this will happen. So infrastructure can lead change? Why not here? How hard is it to do all these things concurrently? Do we have to wait until Auckland has failed to grow to build the necessary infrastructure?

      Joyce has a self belief like Rumsfield, he clearly believes he can alter reality. And unfortunately there are ways he can, the image of people being stuffed onto trains that then try to run in and out of Britomart at total capacity is one designed to make train use unattractive, unreliable and fail to grow to its potential. There is nothing in the MoT report that suggests an analysis of how to help AK grow well, or even at all. The thing is a hatchet job.

      Also this is his second attempt at gazumping the release of an AC report. Like the Harbour crossing release Joyce was sitting on this until AC announced theirs. Like then he is nothing more than a ‘merchant of doubt’ to serve his own ideological ends. This government is ‘relaxed’ about the prospect of AK sliding into mediocrity…..

  13. Kia ora Josh, great analysis. This process certainly is frustrating, all the more so because the media seem to be buying the Government’s shonky review over the Council’s analysis. My colleague and friend Stuart Donovan has been looking at the agglomeration benefits of the project as part of his Master’s thesis over in Amsterdam (he’s doing a course on transport and spatial economics). He found the agglomeration benefits would be even slightly higher than the original business case, I believe, though in the same order. We just need to keep pressing on with the sound analysis and try to get get a simplified explanation to the media. But the good news is (I think) that the Council seems committed to the project and I think they will be able to find a way to fund it, I just hope it’s not a PPP that leaves it too unaffordable for anyone to use.

  14. Hi Josh,

    We have discussed your scepticizim over transport modelling in the past and agreed to disagree on some points, however if this were true tranpsort modelling the traffic constraints into the CBD should not have been exceeded so easily. to begin with, there is no such thing as a crystaL ball, so to create forecasts in any industry assumptions are required. In standard practice, all underlying assumptions such as parking price etc should have been agreed by all parties well before undertaking this lengthy analysis. It would appear that both sides have obviously not agreed and hence the polar results.

    In my opinion if Stu Donovan (who is a credible transport modeller/economist) has conducted an independant review which agrees with Auckland Council and Transport then I would give that far more weight then one conducted internally at MOT due to the pressure on them in our current political climate.

    I fear that this rift between the two parties will reult in a sub standard solution, as so many resources are being invested into the question of “Yes or No” as opposed “What and How”.

    1. Or the elephant in the room question: if we don’t build the tunnel how the heck are we going to get all those people into town?

      Weird that the review didn’t even look at that issue.

      1. “how the heck are we going to get all those people into town”

        If you don’t believe the agglomeration benefits then there isn’t much need to grow the CBD and there isn’t any need to transport lots more people in to the CBD. growth can happen in Manukau and Albany and other sub-centers.

        It seems that MOT, Treasury, and the Government don’t think much of the Council’s projected agglomeration benefits. To me they don’t seem to pass the common sense test, and if they did then they’d be making a case for relocating Auckland’s high value businesses to Sydney. But… If they do exist then the easiest way to finance the tunnel is a levy on the agglomeration benefits. If these manifest themselves as higher incomes then the easiest way to levy the benefits is by setting unsubsidised CBD rail fares that are sufficient to pay for the tunnel. If I was working in the suburbs and a move to the CBD promised to raise my salary by, say, 20 percent then I’d be more than happy to pay $20 extra a day in fares.

        However, the Government’s review of the business case just means the Government isn’t going to pay for the tunnel. That is largely irrelevant since Len Brown has promised to build it, set down a date by which it will be complete, and has several means available with which to pay for it (fares based on agglomeration benefits, asset sales, and rates). The Government’s decision has actually made things simpler… Rather than having to deal with a reluctant central government and go through multiple reviews and negotiations, the Council can just get on with building the thing. This should be a higher priority than the current car park building program.

        1. “If these manifest themselves as higher incomes then the easiest way to levy the benefits is by setting unsubsidised CBD rail fares that are sufficient to pay for the tunnel”

          Isn’t that tantamount to heresy? Seems stunningly logical. It’s just that “if” word that you start the sentence with. I was agglomerated once. It made me much less productive what with all the commuting. I hatched an escape plan and left the city (London) and the country (UK) and will never go back there. World class city? You can keep it!

      2. Or “How” are we ever going to become a world class city without a world class (public) transport system?

        1. Is Auckland a world class city now? You could argue that it is. If so, it has done that without a world class public transport system. If not, then is Auckland likely to grow sufficient to be compared with unambiguously world-class cities like Sydney? Probably not. And a world class public transport system isn’t a pre-requisite anyway, as cities like Los Angeles, Atlanta, Vancouver, and Miami demonstrate… all these have public transport systems that are similar to Auckland’s existing system or smaller systems.

        2. Auckland is a provincial backwater in a potentially great setting. Dreary, traffic clogged and lacking vibrance and vitality. If I was in my 20s I’d be gone, oh that’s right I was and I was. World class in auto-dependency.

          It can be fixed pretty easily, well improved anyway…. It’s not a hopeless case it’s just been run by provincial minded inadequates for so long that it can be hard to persuade people just how close it is….

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