The government today made their road pricing announcement, that they’d agreed a terms of reference to look into it. Those terms of reference also contain one glaring contradiction.
The project is going to be investigated like ATAP was with the government and council working together on it. Here’s their press release.
Smarter Transport Pricing project gets underway in Auckland
The Government and Auckland Council have agreed on Terms of Reference to establish a project to investigate smarter transport pricing in Auckland.
“Alongside our current multi-billion dollar transport investment in Auckland, we need to look at new ways of managing demand on our roads to help ease congestion. Smarter transport pricing has the potential to be part of the solution,” Finance Minister Steven Joyce says.
“Work undertaken last year by the Government and Auckland Council found that smarter transport pricing could help make a big difference in the performance of Auckland’s transport system,” Transport Minister Simon Bridges says.
“Smarter transport pricing could involve varying what road users pay at different times and/or locations to better reflect where the cost of using the roads is higher (i.e. where there is congestion). This could encourage some users to change the time, route or way in which they travel.
“It is essential that we carefully consider the impacts of pricing on households and businesses. A key factor will be the access people have to public transport and other alternatives.
“The Government has also made a clear undertaking that any form of variable pricing will be primarily used to replace the existing road taxes that motorists pay. This is about easing congestion, not raising more revenue,” Mr Bridges says.
The Smarter Transport Pricing Project will undertake a thorough investigation to support a decision on whether or not to proceed with introducing pricing for demand management in Auckland. Officials from the Ministry of Transport, Auckland Council, Auckland Transport, the New Zealand Transport Agency, Treasury and the State Services Commission will work together and engage the public to develop and test different options.
The first stage of the project, which will lay the groundwork for assessing pricing options, is expected to be complete by the end of 2017.
“Any decision on the use of a demand management tool like road pricing is still some years off,” Mr Joyce says. “We look forward to receiving advice from officials as this work progresses. The Government and Auckland Council will then consider the project’s findings.”
Auckland Smarter Transport Pricing Project Terms of Reference are available at www.transport.govt.nz/smarterpricing
It’s positive that we’ve seeing some movement on this but as mentioned, there is a huge contradiction in details of the terms of reference. This is below
The project must consider the implications of any potential pricing initiative on the current land transport funding system of fuel excise duty (FED) and road user charges (RUC). For the avoidance of doubt, this means the potential for any demand management pricing initiative in Auckland to replace or offset FED and RUC in Auckland.
So the government have ruled out any form of regional fuel tax with arguments including that we wouldn’t want people travelling out of the region for cheaper fuel. Yet, here they are stating that fuel and road taxes in Auckland would different to the rest of the country. If the intention is to keep things revenue neutral then it would be better to do that with the rates portion that goes to transport.
Of course none of this does anything to address the now $7 billion funding shortfall.
I’m also concerned that the ToR doesn’t make any mention of a requirement to investigate exactly what other projects are needed before this can be introduced. In our view, we need to have projects like the CRL completed and other aspects of the rapid transit network completed or at least well into construction. We’ll also likely need additional funding to provide more services across our PT network to cope with an increase in demand.
This project is obviously going to be something we’ll be keeping a close eye on