What’s More Stimulating than a Road?

Stephen Joyce tried to appeal to New Zealanders’ common sense in an opinion piece over the weekend:

It makes sense in a slowing economy to bring forward infrastructure investment to boost economic activity and protect jobs. You get the economic boost from the extra spend, plus something to show for it. If you build the right infrastructure it can in turn boost economic growth in the future.

Governments build things like hospitals, schools, prisons, electricity transmission lines, and new roads and railway tracks. New school buildings have already been going up at a fast rate for a while now.

For Joyce, unsurprisingly, the “big opportunity” is in new roads:

The big opportunity to lift infrastructure investment in New Zealand quickly is in transport; notably new roads.

To the National Party, new roads are a general panacea, being good medicine when the economy is growing, too.

We need more than “something to show for” our large transport investment. Boosting economic activity – whether with projects that are easy to get off the ground quickly, or with bigger projects to serve long-term infrastructure needs – must be in projects that have high value themselves. New roading and big highway projects may seem logical to Joyce, but they make little economic sense. The traffic they induce makes our carbon emissions, congestion and safety problems worse. It’s long been known that investment in public transport provides more jobs than investment in roads. We’ll need to continue improving and maintaining our roads, but new roads should be rarely considered, as driving imposes high costs to both the driver and to society:

Results suggest that each kilometer driven by car incurs an external cost of €0.11, while cycling and walking represent benefits of €0.18 and €0.37 per kilometer. Extrapolated to the total number of passenger kilometers driven, cycled or walked in the European Union, the cost of automobility is about €500 billion per year. Due to positive health effects, cycling is an external benefit worth €24 billion per year and walking €66 billion per year.

1. Easy-to-implement projects with shorter lead-in periods will provide fiscal stimulus if they have a high jobs / $ investment ratio.

Good quick-to-implement schemes are those that provide high levels of employment and that get money into the hands of the people who spend most of it on basic goods and services. Bad schemes are those that have lower employment rates and that get money into the hands of richer people who tend to invest in property, pushing prices up, or who take it overseas.

• In education, employing more teachers and support staff, and funding more maintenance projects. New schools, necessary in areas seeing big growth in rolls, are for long-term planning.
• In health, employing more people to provide primary health care out in the community. New hospitals and regional clinics are necessary, but they’re long-term projects.
• In waste, employing people to collect, repair, upcycle and compost resources at a local level. The big recycling and waste-to-energy plants are probably necessary, but rushing them will only produce poor, ill-conceived plans.
• In housing, employing people to fix, insulate and double-glaze NZ houses, to build the type of high-density housing we need, and providing training programmes to fill the capability gaps.

Returning to transport, fiscal stimulus could be provided by employing people to:

• Repair footpaths,
• Clear debris from cycle lanes,
• Install cycle parking in town centres, at bus stops and transport hubs,
• Do trials of low-traffic neighbourhoods,
• Enforce parking rules,
• Install lighting on footpaths,
• Extend regular maintenance programmes to include minor improvements,
• Implement small-scale safety projects,
• Convert petrol cars into electric cars,
• Control the lollypop signs at school crossings,
• Count people walking, cycling, scooting and using wheelchairs; transport analysis is lacking this crucial data,
• Compile data about regional bus services required to make good investment decisions for increasing multi-modal inclusive access in regional and rural areas,
• Improve driver training,
• Provide education about safety and urban planning,
• And much, much more.

There are plenty of schemes we could implement quickly, with real benefits. There is no need to press the button on any project with low value just to stimulate the economy.

2. A call to push forward with new road projects is a call to continue creating problems

When National were in government, as Joyce points out, they did invest in roads:

A decade ago New Zealand, like everywhere, was struggling with the aftermath of the Global Financial Crisis. The government sped up rather than slowed down its infrastructure spend, despite plummeting tax revenues. Projects like the Coromandel’s Kopu Bridge, the Victoria Park tunnel in Auckland, and the Hawkes Bay Expressway extension were “shovel ready” and the go button was pushed. Then the big projects like Waterview, the Waikato Expressway, the Kapiti expressway, and the Christchurch motorway projects followed on.

The result, in terms of investment return, safety, and carbon emissions, doesn’t bear a repeat performance.

Our current government isn’t making the same mistake. It has a different focus, with goals for improving environmental, economic and social outcomes without sending increasing money overseas as revenues for the oil and car industry, and without saddling our children with huge maintenance bills they’ll be unable to pay in the future.

There was a big shift in the narrative of the latest Government Policy Statement. What we’re seeing in the NZTA disarray is not from a shift in budget, because that was only slight. Nor is it from a fear that transport funds are drying up – there is clearly more money available than ever before.

The problem goes much more deep.

3. National may have been faced with ample “shovel ready” roading projects, but the current government has not been similarly favoured with “shovel ready” multi-modal projects.

From their inception, NZTA should have been a multi-modal transport agency, with a pipeline of ‘shovel ready’ projects of all modes, not just of big, expensive, uneconomic highways.

Public transport, road safety, cycling and smaller scale rural and local road improvement projects were all in the NZTA’s scope, and bringing forward these projects should have been an option when the new government took office. This would have kept the construction sector ticking along while the roading projects were re-scoped to spread the budget to improve the safety on more roads.

Instead of being multi-modal, as Jami-Lee Ross once said:

NZTA is the premier road-building agency in this country.

Rail, too, was ignored. What state of survival mentality did Kiwirail have to endure to mean it didn’t even have a few plans to pull from a drawer, read to roll, such as for electrification to Pukekohe?

Worse, we’re now nearly two years since the election. The National Land Transport Programme has more funding than ever before. We should by now have a transparent pipeline of projects lined up that meet the goals of new government.

It’s also five months since the CEO of AT wrote to NZTA describing the problems for trying to proceed with projects in the Auckland Transport Alignment Programme:

We are discovering a number of systemic issues encountered in the NZTA business case process which are threatening the delivery of the programmes and projects agreed by all parties to the ATAP, adding cost or creating delays.

Why has this still not been resolved? NZTA and the Ministry of Transport have had some damning reviews, but surely aren’t immune to all attempts at rehabilitation? They are supposed to be here to serve NZ, and provide 21st Century solutions to our transport challenges.

My theory is that public officials are well-connected with the engineering consultancies and road construction companies, and they’ve been hearing fears from people who don’t have the skills for designing bus networks or building light rail, and who think providing active mode infrastructure is beneath them. There’s possibly fear amongst the public officials themselves that they will need to reskill. However, transport funding is still huge; their jobs aren’t on the line. Adaptation is a natural and necessary response to our safety and climate crises.

From what I’ve been hearing, the fears that the long-term roading programme would diminish has led to a creativity in establishing ways to retain highway spending, and in using the business case process to delay unpopular projects. In addition to the other cultural and organisation problems at NZTA (which are hopefully slowly being repaired), this creativity has undoubtedly contributed to the general disarray.

At a shallow glance, Joyce’s opinion may resonate with New Zealanders because there is a logic to providing a steady workload. But New Zealanders have suffered the safety, congestion and pollution consequences of National’s bias towards big road projects. The last thing we should do is take steps backwards. We can’t reward change-resistant public officials by prioritising their favoured high cost, low value projects while everything else is in disarray; it would delay their critical paradigm shift. Instead, we need them to solve their business case mess and cultural problems, and start releasing the multi-modal workflow.

The civil construction sector deserves this, as much as anyone, so they can can start growing their capability in projects that bring safety, sustainability and inclusive access to our urban and rural populations. Once our public service truly makes the shift, New Zealand’s transport sector will thrive, while improving our networks in a sustainable way.

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