On Tuesday the long-awaited review of Auckland’s Council Controlled Organisations (CCOs) was released. While the headlines focused on the proposed merger between ATEED and Regional Facilities Auckland, there are also some important changes to how transport decisions are made, especially in the way that Regional Land Transport Plans are developed.
The final report from the CCO review runs to over 100 pages so for now I’ll just focus on what seems like it could be important for how transport decision-making happens. A quick read through the later sections on accountability and culture could also have some significant implications, but these are a bit less immediately clear.
Perhaps the most interesting section relates to discussion of how transport strategy happens. The CCO review in general is pretty scathing of Council’s lack of capability in strategy development, but in the transport space it points the finger at legislative changes made in 2013 to the Land Transport Management Act:
Auckland Transport assumed responsibility from the council for setting the city’s transport priorities in the regional land transport plan when the Land Transport Management Act 2003 was amended in 2013. The changes amalgamated two planning documents, the council’s regional transport strategy and Auckland Transport’s investment programme, into a single document, the regional land transport plan, which Auckland Transport was given responsibility for approving. The change left the council in a unique position among local authorities of having no statutory role in developing the transport strategy in its jurisdiction.
This amendment, in our view, was wrong in principle and at odds with the intent of Auckland’s local government reforms, which was to give the CCO responsibility for preparing a regional transport plan and the council responsibility for approving it to ensure consistency with its own land use planning as well as central government legislation and policy. We did consider whether to recommend a legislative change to bring about this intent, but we concluded a non-legislative approach could achieve the same outcome more quickly and simply. This would involve Auckland Transport and council staff working collaboratively to develop the regional land transport plan, which the governing body would endorse before going to the CCO’s board for approval. Auckland Transport said this approach would help create a “single source of the truth” about Auckland’s transport future.
The need for a much greater Council role in developing the RLTP seems like it’s a direct response to the absolute mess that Auckland Transport made of the RLTP in early 2018, when they bizarrely put together a draft document that was stuffed with roading projects and slashed investment in public transport, walking and cycling. This RLTP, which fortunately was never approved by the AT Board (although presumably they had workshopped it with staff before releasing it as a draft), contained the following howlers:
- Slashed the cycling budget by 90%
- Ranked light-rail as the 83rd highest priority project
- Cut rail operations
- Ranked a bunch of fairly dubious road projects at the top of the priority list
Ultimately, Minister of Transport Phil Twyford needed to intervene:
I’ve had sincere apology from AT chair Lester Levy for internal “budget” document mistakenly made public. The doc certainly doesn’t reflect my conversations with @phil_goff and @AklTransport board and our shared commitment to building a modern transport system for Auckland.
— Phil Twyford (@PhilTwyford) January 25, 2018
The RLTP was then put on hold, and a detailed update to the Auckland Transport Alignment Project eventually effectively took over the job of the RLTP to define the 10-year investment programme. But I wouldn’t be surprised if the debacle of the draft 2018 RLTP weighed strongly on the minds of those putting together the CCO review.
Given the transport programme makes up such a large proportion of Auckland Council’s budget, it makes sense for the Council’s Governing Body to effectively have ‘joint ownership’ of the RLTP with the Auckland Transport board. Of note, the recent RMA review suggested merging the RLTP with the council’s parallel Long Term Plan process and if implemented would shift the creation of that to the council.
The next interesting area the CCO review discussed was in relation to how Auckland Transport need to get better at small projects. Given many of the most important changes we need to make to the transport system are collections of relatively small projects (e.g. safety improvements, walking and cycling improvements), it’s critical for Auckland Transport to get better at this job. As I mentioned last week, the lack of progress in the last few years on implementing cycling plans is absolutely unforgivable.
Auckland Transport’s processes for approving small projects are, in our view, simply unsuited to the task. A public transport study Auckland Transport commissioned in 2017 concluded the CCO’s approval process contained unnecessary requirements, and that it also took longer than comparable Australian cities to complete small projects.
The CCO said it planned to look for ways to improve the approval and implementation processes for small projects. It said some of those improvements could include:
- reviewing its project development processes for small projects, including the time taken to design the work, consult the community on that design and obtain the necessary consents (One frustration of local communities is that Auckland Transport doesn’t usually seek their input until it has prepared a design concept. Admittedly, the CCO often subsequently amends the design after feedback, but as many local board and ratepayer groups pointed out, it makes obvious sense to seek input beforehand. After all, locals often know what will work and what won’t better than a CCO-employed engineer unfamiliar with an area.)
- review its customer response process – in other words, tell communities or individual ratepayers concerned when it has no budget to carry out work they have requested
- make more use of local boards as “proxies” for community views to avoid protracted public consultation
- extend the use of dedicated small-projects teams (the CCO already has some for minor programmes such as maintenance and public safety) to speed up the execution of projects.
All these options are worthy of consideration. Given local board projects are involved in 100 of the CCOs’ 560 projects a year, improving the way it manages them should be one of its top priorities, and the council should monitor its progress in this respect. Even Auckland Transport acknowledges that improving the way these 100 projects are delivered could go a long way towards improving local board satisfaction. We would add another option to this list: share the design of local communities’ transport programmes with local boards. (These programmes include minor works and educational and road safety awareness activities.) Adopting a genuinely shared approach to local transport would, in our view, address a lot of criticisms levelled at Auckland Transport and also greatly improve the CCO’s working relationships with local boards.
Radically overhauling consultation processes that clearly don’t work at the moment must be a top priority, alongside making it far easier and quicker to actually get on with doing fairly small-scale improvements to the transport system. We’ve been calling for change for a long time though, and even as recently as this week we’ve heard of small projects being required to have dozens of staff in project management roles, so I’ll believe it when I see it.
Something else which doesn’t help overly long and complicated processes has also been picked up by the CCO review – NZTA’s tortuous business case and funding approval system. Again, this isn’t exactly news as it’s been obvious for years how completely dysfunctional this process is. The CCO review doesn’t hold back in its criticism:
Auckland Transport described the way it received funding from the New Zealand Transport Agency as a “very significant issue”. It said obtaining the necessary (50 per cent) funding contribution from the agency could take anywhere from three months to two years, even for the simplest of projects, because the approval process was so lengthy and involved. Plus, it said, any project with an estimated cost of more than $1 million required both a detailed business case and an application for funding before the New Zealand Transport Agency would approve funding. (As we were writing this report, the agency increased the value of projects requiring these protracted processes to $2 million.)
Auckland Transport said the agency’s funding process was inflexible and bureaucratic, adding that “it would be difficult to design a more complicated process”. The CCO told us the biggest component of many small projects was the business case and funding approval processes, which diverted scarce resources from where they were really needed. Even the new $2 million threshold was, it said, “very low”. In addition, submitting a strong business case did not necessarily mean approval would be forthcoming – and projects were unlikely to proceed without such approval and funding. Auckland Transport’s submission to us included a case study for dedicated bus lanes (and bus interchange improvements) that showed the process for getting funding approval would take a year, even if fast-tracked.
This situation has arisen because the royal commission’s recommended shift to what it called “outcome-based funding” never came to pass. Specifically, it said the process for approving individual projects should over time “move to an outcome-based model, where strategic objectives in the overall funding envelope are established by the parent organisations, but the tactical decisions on funding priorities are made by the CCO’”. What it meant, in effect, was that the CCO could receive bulk-funding – an amount agreed upon by central and local government each year, depending on the CCO’s strategic objectives – and Auckland Transport would be left to execute projects big or small with that funding. Auckland Transport has estimated that such an approach would produce an efficiency gain of 5 per cent – that is, it would save $500 million over its 10-year $10 billion regional land transport capital programme. It would also avoid the huge effort that currently went into preparing funding applications and business cases.
As hinted at, NZTA have made some recent changes to their processes, but these seem almost laughably ‘tinkering around the edges’, when a much more fundamental review of the way transport planning and business cases processes is required.
The recommended improvements that have been suggested by the CCO review, in relation to Auckland Transport, all seem to broadly make sense:
- Auckland Transport and the council should jointly prepare the regional land transport plan, the draft of which the council should endorse before it goes to Auckland Transport’s board for approval.
- Auckland Transport and the council should set up a working group to clearly delineate their bylawmaking powers and its work should culminate in a memorandum of understanding setting out the agreed approach. The council should help Auckland Transport with its bylaw-making activities, given Auckland Transport has acknowledged a lack of capability in this area.
- Auckland Transport should urgently review its processes for minor capital works, including how it involves local boards and the potential for local boards to share in the design of its annual work programme during the preparation of local board engagement plans.
- Auckland Transport and the council should explore urgently with the Ministry of Transport and the New Zealand Transport Agency how to streamline funding processes, particularly in relation to business case and funding approval requirements.
It will be interesting to see if the Council follows through with all these recommendations.