Yesterday the Ministry of Transport released for consultation the Draft Government Policy Statement (GPS) for 2018-2025. The GPS is refreshed every three years and as the name implies, it sets out the government’s policies and spending for transport over a 10-year horizon.
The single most important aspect of the GPS are the funding ranges for each of the 10 activity areas. The funding ranges set an upper and lower limit of how much money will be spent on each activity every year. These ranges are then used by the NZTA in conjunction with regional councils in setting the more detailed National Land Transport Programme (NLTP) and Regional Land Transport Plans (RLTPs) which will list specific funding levels. This is how the various transport documents are tied together and as you can see, other regional and national plans have to be consistent with or give effect to the GPS, meaning there aren’t a lot of options to stray from what the government wants.
In total, over $11 billion is expected to be spent over the six years from 2018 to 2024 but depending on circumstances that could be as high as over $12 billion.
And importantly, here are the individual funding ranges as a graph. This looks at the total range over three years and I’ve included the 2012-15 and 2015-18 figures as a comparison to show how they’re changing. Some notable things you can see:
- There is another significant increase for state highway improvements. Many of the big Roads of National Significance projects will be winding up over that 3-year period but other expensive projects, such as the East West Link and Northern Corridor are expected to getting underway.
- They’re lowering the bracket for local road projects saying it was consistently under spent but that the opposite is true of local road maintenance.
- On top of the State Highways fund, there is a separate activity for regional projects which they admit are mostly state highway projects too.
- Public Transport gets some improvements in range but it’s worth noting that this covers both services and infrastructure. Also with NZ’s weird funding rules, it isn’t allowed to be spent on rail infrastructure.
- Walking and cycling does get a little boost but not a significant one.
To give an idea of where investment has been in the past, this shows the funding ranges for the 2015-18 NLTP and where within those ranges funding was allocated.
Much of the text within the document feels like it has just been copied and pasted from previous versions of the GPS but I went through (most) of it anyway and a couple of things stood out.
The document states that the GPS takes into consideration a range of government policies relevant to transport, this includes the Kaikoura earthquake and tsunami recovery. But oddly it makes multiple references to the fact it doesn’t fully take into account the ATAP work agreed between the government and the council as it’s waiting on funding decisions. This makes me nervous that the government are planning on picking and choosing from ATAP.
30. The Auckland Transport Alignment Project is a collaborative exercise between Auckland local government and central government officials. It has provided analysis to inform the development of the GPS. The Auckland Transport Alignment Project identified four key strategic challenges and a strategic approach to investment for Auckland. The strategic approach looks to make better use of existing networks, target investment to the most significant challenges, and maximise new opportunities to influence travel demand.
31. The draft GPS 2018 recognises the Auckland Transport Alignment Project and Kaikoura earthquake but does not fully take the funding implications of Auckland Transport Alignment Project into account. There is expected to be changes to the final GPS 2018 once funding decisions have been made.
Previous GPS’ have talked a lot about getting value for money from transport investment while at the same time promoting programmes like the RoNS and other government initiatives that assessment has shown to perform poor economically. Now they’re starting to drop the charade government projects will be good value and saying they’ll be done anyway, simply because the government like them. This is a massive double standard from the government who have for years berated Auckland for projects they claim have a low economic value.
36. It is expected that maximising value for money will automatically advance economic growth and productivity and road safety. However, there will be investments with a low benefit cost return that are necessary to advance Government policies. In these cases there will need to be a strong policy alignment (as expressed in the GPS) with Government policies and transparency about the reason for the decision.
61. For many investments it will be possible to obtain good benefit cost returns while providing the right infrastructure and services at the best cost. However to sufficiently advance some government policies, investments may require a lower than normal benefit cost return (i.e. less than the average Benefit Cost Ratio (BCR) for the National Land Transport Programme (NLTP). Even in these cases, in general it is expected that the benefit cost ratio will at least exceed one.
One thing to remember about the GPS is that it only covers some areas of transport which seems short-sighted, even if they claim there will be integration with other modes.
39. Investment in movement of freight by road is covered by the GPS, but investment in movement of freight by rail, sea and air is not. However, coordination between the GPS and those responsible for different modes of transport can help to maximise the benefits of transport to the economy.
There are a few positive things to say about public transport and the role it has to play, such as:
115. Significant increases in public transport capacity have seen more people using and relying on public transport in the main metropolitan areas. These increases have occurred alongside increasing fare box recovery, indicating that the investment is resulting in more efficient outcomes.
116. The GPS will support this result by:
- continuing to invest in public transport, including modal integration where appropriate
- continuing the momentum set by GPS 2015 to increase the efficiency of public transport investment
Yet at the same time, they make some odd statements such as that forecasts are overly optimistic.
Passenger numbers have increased recently and are forecast to increase in Auckland and Wellington over the short term (and in Christchurch in the medium term). Although forecasts of increased passenger numbers have typically been overly optimistic. Auckland and Wellington public transport plans are based on an increased public transport task.
Fare box recovery rates have improved in Auckland and Wellington. Currently expenditure is in the middle of the funding range.
The proposal is for a gradual increase in the funding range to cover forecast passenger growth and for some public transport infrastructure work (such as park and ride facilities).
There is a need to keep focus on value for money, and ensure fare box recovery rates are at the expected levels.
Over optimistic forecasts, that’s a bit rich coming from the MoT, for example remember this graph showing actual vs forecast vehicle travel.
Of the big investments in PT in the last decade, the rail network and the busway, in both cases they are performing ahead of expectations. In the case of the rail network, we are ahead of those expectations despite the trains taking about 2 years longer to fully enter service like the earlier assessments had identified. We’re also performing ahead of the MoT’s expectations when it comes to ridership for the CRL. At one point, they claimed we wouldn’t meet the 20 million trips by 2020 yet at current rates, we’ll hit it this calendar year.
Consultation on the GPS is open till the end of March.