On Saturday, Transport Minister Simon Bridges was interviewed on The Nation about transport in Auckland. It was an astonishing interview in which I feel Bridges managed to dig more holes than he filled in. You can watch the interview here and Scoop has a transcript here.

The interview can broken into three key topics

  • Transport funding in Auckland
  • The economics of the East-West Link
  • The Third Main business case

Transport Funding in Auckland

Bridges pushed a similar line to what some of his colleagues have been saying, that it’s Auckland’s fault for not putting enough funding in.

So are you going to pay for the shortfall? Or are you expecting that the council will come up with it?

Well, I think on that front what you’ve got to say is we’re really investing strongly. I mean, it’s about two-thirds of Auckland’s transportation — we invest in about a third — are council. As we continue to do more and more of that, of course, we also want to see the same sort of strong response from the council. I think they’ve just had a budget.

The budget comment is interesting as he goes on later to say he doesn’t know what’s in it. Surely his officials should have briefed him on that by now.

They’ve just passed another budget. I don’t have the details, but I’m very interested to see that. My sense is, though, they are investing more in transport.

Simon, in case you read this, the council have increased their capital spend on transport by $161 million this year.

Perhaps the most interesting part of this section of the interview was a small slip where Bridges basically argues that the Government should be paying more. In talking about how to cover the transport funding shortfall of $4-7 billion over the next decade, he argues that the growing economy is giving the government the ability to fund more projects. The government benefits more from economic growth than councils do as a stronger economy results in more taxes flowing into their coffers and is a lot more responsive to change than council valuations of property. Of course, one of the main purposes of investing in transport is to improve the economy.

East-West Link

The interview moved on to the East-West link and in particular the economic assessment of it.

Let’s look at some of the specific projects you’re funding. The Auckland East-West Link Road, approximately 8 K’s of road that could cost around $2 billion. Now, the original cost-benefit ratio didn’t meet what your government would normally expect of a standard. And you’ve told the council, and Steven Joyce has told the council, to be more efficient with its spending. So why aren’t you taking your own advice?

Because I think some of that is not correct, and, actually—

Some of your advice is not correct?

No, no. The benefit cost of this project is 1.9 now. And I think what we can say is—

No, hang on, hang on. Is it 1.9 now? Because at the time in 2015 it was between 1.4 and 1.9. The cost of the project has gone up since then, so the benefits have gone down, and it’s estimated below 1.

No, I don’t accept that.

The interview continues on back and forth about whether the BCR is 1.9 or not for a little longer. Cam happened to discuss this exact issue earlier this week and highlighted that while the NZTA say they’ve done an economic assessment, four experts hired by different submitters all say they haven’t done it properly. This has included increasing the benefits when the cost has increased to keep the BCR at 1.9. Bridges did eventually agree to provide an up-to-date version but I suspect it won’t be anything new

Okay, so you’ll give us an up-to-date cost-benefit ratio? You’ll make that available to us?

Sure. The latest benefit-cost is 1.9. But I think we got back—

Third Main

The final section was about the business case for the Third Main, and was related to the East-West Link discussion. Amazingly Bridges went on to both claim the business case done by his own agencies was wrong, and also that his office was right to try and prevent it from being made public.

No, no, this is the substance of it. Do you think that your office overreached, and as a minister you overreached in this?

No. And I think what has happened today is a really good example of why, in fact, with respect, we were right, even though it is out there now. And that’s simply this. This was a very early wrong business case in terms of its numbers, in terms of much of what it said. I happen, as I say, to actually be in favour of the project in general. I think it’s one that is part of a range of projects that may well come through. But in that area, I don’t think we did anything wrong.

Surely if the business case was materially wrong the government or one of it’s Ministry’s or Agencies could point out all the flaws in it. As for the data not being released, the case is now being investigated by the Ombudsman, which he has promised  to do promptly.

During the panel section at the end of the show Lisa Owen started of by asking “did you hear him answer a single question that I asked him”. As Simon Wilson says, no he didn’t.

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30 comments

  1. What a classic that interview of Simon Bridges was, if it wasn’t so tragic for Auckland I’d say it was the best entertainment on TV for yonks, almost akin to the roasting of a govt minister.

  2. So the net result was National look stupid on transport issues.

    And yet is it a surprise he cannot justify his government/Party’s unjustifiable and frankly backward and economically retarded decisions or is it surprising he hadn’t learnt from the master Sir John to waffle, mislead and deflect his way through the interview and blame the previous government?

    Anyway if there is concern over his inability to do the job he was upstaged on the moron front by his cabinet colleague Nicky Wagner.

  3. I think Lisa was on to something but let him off easy on the point of investment in the 3rd main vs EWL – she started on the fact that it’s extremely cheap and will be taking trucks off the road – implying that the net results (lower congestion) were in the same vein and could be achieved for a tiny fraction of the cost.

    Ultimately this means that the third main probably even further weakens the EWL business case, so it’s going to be ‘extremely uncomfortable’ for those who are pushing through their preferred roading spend. It’s hard to not feel that there are powers effecting the government decision beyond good policy or even ideology.

    1. Unfortunately the third main doesn’t take trucks of the road and the EWL removes through traffic from Neilson St where around 98% of all Aucklands road to rail transfers happen. The third main makes it easier to move freight in from the POT that then needs to be distributed by more trucks through out Auckland, made easier by the EWL.

      The third main actually strengthens the business case for the EWL.

  4. Hoping that the blowtorch is turned up even further and applied closer and closer. More OIA questions perhaps?

    So rich for centeal govt to say the council needs to do more when its central govt policy ie immigration thats putting AKL under so much pressure

  5. Regrettably, the “Nation’ Interview was 1) An amazing display of incompetence by the Transport Minister.
    2) An incredible exposure of the lack of sensible strategic thinking in relation to transport policy for both Auckland and the rest of NZ.
    3) Evidence of a deficit in the direction of NZTA in relation to its operation possibly because of the present government’s unfortunate pork barrel politics.

    It would be really beneficial for us all if transport policy and long term strategies were more transparent so that we get best value for the taxpayer dollar.

    1. Well, to be fair to Simon, he is only young, and still wet behind the ears. He’s only been in the job for – what – about a year? And up until recently, just had to do whatever Stephen and Jerry said. He’s young and good looking, and that counts for more than experience these days (although it doesn’t explain the inexplicable staying power of Gerry, who is none of the previous three…). But: he is showing some signs of being a lot more pro-PT than his predecessors / puppet masters.

      1. Sure Guy, I was a bit tough on young Simon, but this was really because of the ‘huge,huge’ taxpayer dollars that have been biffed around in the wrong direction, in the last nine years. And so inefficiently too.
        I hope he moves from a slow learner to a fast learner quickly, or at least has the guts to tell Steven Joyce how wrong his strategy is for the shape of our city, and what we need to do to fix it. In other words, time for Simon to flex his young muscles.

  6. Lisa may have to wait a while to get that 1.9 BCR case for East-West. She answered her own question. He didn’t.

    I got an email saying –

    On behalf of Hon Simon Bridges, Minister of Transport, thank you for your further email dated 25 May 2017. Your comments have been placed before the Minister for his consideration and you may expect a reply in due course.

    Due course hasn’t yet arrived. I too was asking about E-W, comparing it to the cost of electrifying the Auckland-Tauranga/Wellington railways.

  7. East-West Link: I’ve finally found time to read the traffic modelling report for the East-West Link. The short-term easing of congestion in the local roads has been assumed to remain in the 2026 and 2036 forecasts, despite extensive research showing that the benefits will have disappeared within about 10 years. Therefore the increase in regional daily traffic trips as a result of the East-West Link – calculated as only 0.064% in 2026, and 0.027% in 2036 – will be substantially lower than reality.

    Therefore, the traffic flow figures used to write the business case underestimate the congestion and overestimate the travel time savings considerably. So even before the incorrect adjustment from 2015 figures, the figures used for to calculate the economic benefits are incorrect.

    1. Heidi – On the basis of that, it is time to resurrect one of the discarded cheaper options and transfer the savings straight into the third main rail line and/or the proposed light rail being promoted by the Mayor and Auckland Transport.

      1. +1, I’d have thought that getting SW rail would have been a huge help to this area by getting a lot of through traffic out!

  8. Continuing with the status quo, means road building costs in Auckland will get increasingly more expensive, for ever smaller improvements. The low hanging fruit has been done. $2billion for the 8 km East-West link is ridiculous. The hidden subsidy to automobiles in Auckland has to stop.

    Auckland needs a congestion charge yesterday and it needs to start removing car parking minimums. This will make alternatives transport options more competitive. The various infrastructure governance structures need to work with this system change -not against it.

    NZTA and National obstructing the 3rd main is just head the sand stuff……

    Usually transport is peripheral policy concern for the general election. But this election will focus in part on the housing affordability issue and NZ’s housing problems cannot be solved without finding answers to Auckland’s infrastructure deficit.

    P.S I say that as a Cantabrian who would also want some a multi-modal transport system for Greater Christchurch too.

    1. Auckland needs better public transport, not a congestion charge. A congestion charge is nothing more than a tax on people who haven’t had public transport provided for them, to the benefit of those that have.

      1. Yes, but a CC is a way of getting people out of their cars and into PT, and raises money to help pay for the CC. Of course, the catch is that you HAVE to build the PT first for that to work. Auckland has, as we all know, gone about this whole thing arse about face. Building roads first, then charging a congestion tax, then building Public Transport, is the wrong order.

        Build the PT network first, then charge people to use their cars, and they can switch onto PT effortlessly. Do it well enough, and you don’t actually have to build any more roads!

      2. I would argue that congestion charging would be a good idea even if there was no alternatives at all. You charge people a higher price for driving at times/places when they create congestion, and you don’t charge those that drive at times/places that don’t.

        In other words, apply a market price to a scarce resource, aka supply and demand.

        We have a market price on food, housing, electricity and water, even though those have little or no alternatives. Why not a market price on road use?

        1. I generally agree. However, we have a situation where people have made decisions on where to live, jobs etc based on there being no congestion charging. This would need to get buy in from a significant portion of the population and better (but not necessarily perfect) PT would be a key part of this.

          1. We know that Aucklanders move both houses and jobs frequently, so we can bring it in now, in the areas where the congestion pricing aligns with better PT, and later – with warning – where PT isn’t currently good (and hopefully will be better).

            To me, the more interesting aspect of all this is not whether the public will buy in to congestion pricing, but whether they’ll buy in to the knowledge that the engineers have to change how they model the traffic flows. The engineers are still not including the effect of induced traffic, and the effect on the cbr is profound. I think this is the only way we’ll get real change – whether it’s by convincing one of the major parties to take this knowledge on board and promote it, or by shifting the knowledge base amongst all political parties and councillors. It doesn’t have to be a right wing – left wing thing. A transport network like ours benefits no one but the roading construction companies.

            As you say, “we have a situation where people have made decisions on where to live, jobs etc” … but I would put here, “based on the temporary lower congestion on new roads”. A traffic model that calculates the induced traffic from each and every roading project properly would have predicted the high congestion that these new roads have created over time, and the roads would never have been built. The same money spent on PT would have provided a good, accessible, cheap PT system.

            How do we get Aucklanders to understand that we’ve been cheated? And that it can change?

          2. I think the constant moving is an artefact of bad policy: eg. renting being treated like a glorified form of couch surfing.

            Anyway, I don’t think a lot of people can afford to move anywhere with even basic PT access. Congestion charge will add an extra cost to driving, so it will increase those differences. The cost of congestion charging will be trivial compared to the additional cost of housing within reach of PT.

        2. NickR, “congestion charging would be a good idea even if there was no alternatives at all” – no, that’s just simply not fair. If apples are too expensive you can usually have a choice of oranges – but if all that is sold is apples, then that theory falls apart. With electricity, a second source of supply can be found – with roads, not so. You need the viable alternative option in there from the start.

        3. If CC charges are high for a particular route then that incentives the public transport sector to provide an alternative service. I think this would happen a lot and Auckland’s other transport modes would get an economies of scale boost in their use.

          The whole transport equation would change for the better.

          I would support faster movement towards creating the Congestion Free Network to happen before or in conjunction with a CC. This support is probably necessary given the years of structural support/hidden subsidies given to the automobile. It might be hard to stop the path dependency and get a better balance if Auckland didn’t do that.

  9. And in other news, the pollsters expect National will be re-elected anyway, the only question seems to be whether it will be an absolute majority or not.

    1. It may have escaped you that in the last few major world elections, pollsters have got it all wrong. Not that sure why you would trust them here.

      1. That’s debatable. In the US the polls quite correctly predicted a win to Clinton in the popular vote, the failure was in the mainstream media to correctly interpret the results in key swing states, which were often well within margin for error.

        Outfits that attempted to calculate odds based on state polling, showed each candidate had a reasonably decent chance of winning.

        In Britain under a first past the post system it’s pretty much impossible to predict the number of seats in the house, however again the polls in the last few days were reasonably accurate with the popular vote. What they failed to predict a couple of months out was how poorly May would campaign, but that’s not really the job of a poll.

        In NZ with MMP polls don’t usually sway too much from reality as our house is actually (mostly) elected based on the popular vote.

        1. +1, if anything it looks like Labour will get worse coming into the election as their campaign is truly awful.

        2. Indeed, note also the much smaller margin in for example the US polls: usually under 10%. In comparison the margin between Labour and National over here is hovering around 25%.

          Plus, the parties often underestimated by polls are the populists, so probably NZ First will get a bit more votes than predicted.

          1. Agree. One thing that is in the margin of error here though, and has been for the last couple of elections, is the difference between National having an absolute majority (with lapdogs) or parties being dependent on NZ First to govern.

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