Just a quick post for now – more detail later.
The final version of the 2012 Government Policy Statement has been released today – and yes, it’s unsurprisingly bad. Really bad. By my calculations, between 2012 and 2018 the policy will have the following spread of funding:
When public transport use is booming, state highway traffic volumes have stagnated for a number of years and oil prices are high and likely to go higher (imagine the price of petrol if the NZ dollar was at its usual 60 US cents) having such a huge focus of spending on state highways (and $8b of the state highways total goes to new ones) is just downright stupid.
Read more in the Ministry of Transport’s Q&A section here. I just don’t quite know how they can pretend that this funding mix will boost economic growth (spending billions on motorways with low cost-benefit ratios) or represents good value for money. It also seems like every submission was ignored.
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I couldn’t even find the summary of submissions. Do you know where that is? Defeated, as always, by the difficulty of navigating MoT’s website.
I looked for that too, to no luck. I guess they’re to embarrassed to put it online?
whats really annoying is the press release highlights the public transport spending. However this spending includes $600 million for Project Dart (finsihed), $400 million loan, $400 million for Wellington (mostly finished), $600 million for electrification works (largely complete by July 2012 when GPS comes into force).
In other words its a load of porkies. Frustratingly the release has been reported verbatim, by stuff.co.nz., and not much better in the herald.
Bye you useless government that never gets questioned about anything. Most people are unware that National are doing this, spending more money on roads this is being done behind our backs. Who knows whats going on, they seem to get away with it all the time without being questioned by the media. How many more Sacred Cows can you get?
I spoke to a university friend of mine who is round my age early 20’s and he told me he was unware that the government was spending this much on roads and said that this was out of order. He has also lived in Australia for 2 years and said that NZ nowhere near competes with Australia when it comes to infastruture. Australia have a world class public transport system as well as a good highway network. He believes the government should forcus on Transport not roads. Its obvious the National are repeating the same mistakes made 50 years ago over and over again. It’s not that people in NZ hate public transport it just that its so unrealiable nobody wants to use it. The government wants us to think that we don’t like it so it can carry on wasting huge sums of money on motorways. This should be an election issue!!!! Not another Sacred Cow!!!
The roads of national significance certainly gets the lions share of the funding
What will be interesting will be comparing it to the draft GPS you talked about in your post entitled “analysing the draft government policy statement” found at http://greaterakl.wpengine.com/2011/04/28/analysing-the-2012-government-policy-statement-%e2%80%98engagement-document%e2%80%99/
Also interesting is if any of the proposed 4 new roads of national significance have been officially added, and if so wether any money has been allocated for them
Steven Joyce to be interviewed on RadioLive today soon. Can’t wait to hear what PR BS spin he has to spout this time.
You might have noted this:
It is also important to note that the majority of central government funding for public transport infrastructure is provided outside of the National Land Transport Fund and so not included in the GPS. Most of this funding is for metro rail. To date more than $2 billion in Crown appropriations has been agreed, of which $1.6 billion is for Auckland and $485 million for Wellington
Yes it includes committed funds, but then so do the state highways. Given the tiny proportion of nationwide trips attributable to metro rail, this is enormous. The real issue should be local roads, which need governance restructuring to get a bigger share of funds given how critical they are. If you take your Auckland-centric hat off and recognise that metro rail provides and always will provide trips for a tiny proportion of New Zealanders doing a fraction of their trips, then it looks like public transport does incredibly well – in being funded by road users. Bear in mind that most of the population doesn’t live anywhere near metro rail.
Add the money that users put into public transport, and ratepayers (and the pot of gold Auckland councils refuse to raid that has been called Infrastructure Auckland, ARH Ltd etc), and it doesn’t look half bad either.
You see state highway users put virtually all they pay into this fund, local road users as well, whereas this only represents the central government share of subsidies taken from road users, not all of the public transport subsidies or indeed funding.
Hi, what do you have in mind in terms of fixing the governance of local roads?
The last time this was looked at was during the late 1990s, in the context of some big debates on roads corporatisation which never went anywhere. Local government started off interested, then got very opposed when they realised that without road networks to manage, they would have very little to do – and that this would be a one-way ticket to TLA amalgamation, one thing they truly loathe the thought of.
I suspect roads governance is tied up in the wider picture of local government re-organisation. There is still a lot of scope to trim down the number of local councils with some well-chosen amalgamations (=why does the Wairarapa need three councils for forty-fifty thousand people?)
Ross, yes you hit it in one. I would require all councils to put roads into commercial CCOs (LATEs pre LGA 2002) and get output funded. They would be empowered to charge access levies on properties and tolls, but if they were not viable would effectively have to merge with neighbouring road CCOs. Indeed, the Wairarapa has four councils if you count Tararua.
My concern is for roads to operate as utilities, for rates funding to be replaced by a property access levy and for general funding to be based on a per km level of revenue from vehicles which is for maintenance and any surplus for capital improvements. I would expect the current 60 odd entities to be down to 20 rather rapidly and probably even out at around a dozen that could be viable.
You’ll recall from a past working life, I’m sure, the policy regime by which local roads are supported by a sliding subsidy rate (based on the relationship between total road programme and a council’s rateable value); which means that urban councils get, or got, 43 percent of their roads costs, and the mendicant rural ones can get up to 70 percent. Even if rural roads authorities were operating as utility companies, the need for central government money won’t be going away anytime soon.
This is also an illustration of a well-known principle in network economics that costs are a declining function of demand (in plain English, the average cost per user of a busy network is a lot less than the average cost per user of a low-demand one). One of the problems of the more rural local governments is that providing any sort of network in their areas is going to be expensive, and roads are no exception.
Aside from the $88m for Wellington all the other rail money was set aside in the 2006 and 2007 budgets, or will be paid by Auckland & through PT services.
It’s based on a firm foundation of official Peak Oil skepticism since 2008 — see here: http://oilshockhorrorprobe.blogspot.com/2011/07/new-zealand-governments-response-to.html .
Just thought you’d like to know that the government is, indeed, committing NZ to ever increasing oil dependence on the grounds that there’s nothing to worry about, and all these peak oil types are just crying wolf.
(Of course the moral of the story is that sooner or later the wolf comes and nobody believes it…)
thanks for the link.
GAret Hughes on TVNZ at 8 pm tonight if you’d like to hear an opposing view 🙂
Wow, $2 billion to police the roads. Maybe the next time someone bleets about the revenue gathering actions of the police should be reminded that an approx $85m return on a $2b cost is not exactly daylight robbery.
It’s really disappointing (but not surprising) to see the media fail to pick up on how tiny the expenditure on public transport is, yet such expenditure seems to be highlighted in the release and subsequent ‘reporting’. And please “Continued funding for State highways and the Roads of National Significance will help encourage business, tourism and jobs and will improve road-user safety” (SJ quoted from the herald today). If he cared for road safety we would be seeing immediate action on the deadly road north of Puhoi, not some 10 year project. And those tiny businesses in Northland just waiting for an extra lane to Auckland to build their markets and hence turn into massive world beaters? Must be hundreds of them.
Maybe the herald is changing its outlook a little. The headline for the article outlining these changes is ‘Fuel tax hike to pay for road costs’. Not their usual unfetted support for such projects.
arnie, Thats $2bn over 10 years to generate $85m each year in revenue. Actually, that’s $2bn from the Land Transport Fund and $850m into the Consolidated Fund. So yep, thats one hell of a good investment for the few tax payers that don’t contribute to the land transport fund by also being car/bus/truck users 🙁
I also suspect that the increase in public transport expenditure is something to do with PT hitting the radar in some parts of the country. I think that this blog’s desire for it to become an election issue is starting to happen. Wait for local MPs to start falling over themselves with promises of their support for PT.
The increase in in PT is only for operating expenses – there is no increase in overal PT expenditure, rather a decrease. As admin points out, that increase in operating costs is gobbled up by the increased track access fees, in effect there’s probably a decrease in that area as well. Joyce either doesn’t care what the public wants and/or has had some sort of awful pre-pubescent experience involving buses and/or trains, and as a result has dedicated his adult life to ridding Auckland of them…