So it has been confirmed: the Transmission Gully Motorway will not even come close to providing benefits that match its cost. An interesting article from the Dominion Post on it:
The cost of upgrading the coastal highway north of Wellington could have ballooned to nearly $2 billion, almost twice the cost of building Transmission Gully.
However, documents obtained by The Dominion Post through the Official Information Act show that neither project is economically viable and would never be built under old funding criteria.
Transport Minister Steven Joyce announced last month that the $1.025 billion Transmission Gully highway would be built as part of a $2.3b roading project from Levin to Wellington Airport.
The Gully was chosen over upgrading the coastal highway, which was deemed to be more expensive, prone to earthquakes and would take longer to build.
A report by New Zealand Transport Agency officials to Mr Joyce said the coastal highway could cost $1.227b to upgrade. However, that could escalate significantly to “mitigate impacts”, with the worst-case scenario costing $1.813b.
That would leave little change from the $2.3b set aside for the entire state highway upgrade from Levin to Wellington Airport.
“Transmission Gully represents a more affordable option to progress than the coastal highway upgrade,” the report said.
However, a separate Transport Agency report into the two options shows neither comes close to meeting the Government’s own benefit-cost ratio guidelines.
The Gully route has a benefit-cost ratio of 0.6, meaning the costs would significantly outweigh the benefits. The coastal highway, however, has a benefit-cost ratio of just 0.35 at best. That cost analysis was considered by the Transport Agency board when it decided in late October to give Transmission Gully the green light.
Mr Joyce said the benefit-cost ratio of the entire Levin to Wellington project was higher, taking into consideration the overall benefit to the wider community.
“You’ve got to look at it longer term,” he said. “I wouldn’t want to see us just do one part without the other part. On that basis, it stacks up OK.”
The briefing documents also found that Transmission Gully would improve amenity values at Mana, Plimmerton, Pukerua Bay and Paekakariki through reduced traffic noise and improved air quality. It would also provide a better connection to the Hutt Valley and Wairarapa.
Transmission Gully would be more resilient in the event of an earthquake, because the section of the highway that crosses the Ohariu Fault has been designed so it could be quickly reinstated.
“The construction of the Transmission Gully route when combined with the existing coastal route would provide enhanced route security during both major and minor events,” the report said.
Green Party transport spokeswoman Sue Kedgley said the low benefit-cost ratios for both highway options offered further evidence that neither should be built.
“They are so low that really they can’t be justified. If motorways worked, Auckland would be one of the most efficient cities to get around in the world.
“All over the world, nobody is building huge motorways into cities. They have come to realise that the only solution is a mass transit system.”
While I probably agree that Transmission Gully is a better option than the coast route, it seems crazy to flush $400 million down the toilet in the way that building a motorway with a BCR of 0.6 does. I’m guessing this will set a precedent for whether the Puhoi-Wellsford “holiday highway” goes ahead.
Steven Joyce has demanded that public transport projects offer good value for money, and “stack up” in a business sense. One has to wonder why the double-standard when it comes to these massively expensive motorway projects. Furthermore, what’s the point of undertaking cost-benefit analyses when you’re just going to ignore them anyway?