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PT Funding Announcement Full of Spin

The NZTA is out busily spinning stories about how much money it is going to be spending on PT in the next three years  but as usual the the reality isn’t quite as good as they make it out to be. An article on Stuff (most likely written for the Dom Post) states:

Frustrated Wellington rail commuters will benefit from a massive Government investment in public transport designed to reduce congestion and delays.

The announcement of nearly $900million for national public transport projects will buoy proponents of Wellington’s costly proposed light-rail system.

The New Zealand Transport Agency announced yesterday it would pump $9billion into upgrading existing local transport systems over the next three years.

The money includes nearly $900m – a 33 per cent hike – devoted to public transport, “with a particular focus on improving the reliability and punctuality of commuter rail services in Auckland and Wellington”.

NZTA chief executive Geoff Dangerfield said it was the biggest investment in public transport under the National Land Transport Programme.

The investment followed discussions with councils about their transport priorities over the next three years and would give them certainty as they prepared long-term infrastructure programmes.

Details of exactly what would be funded would not be released for several months. But the increased spending on public transport was targeted at “improving peak-time services which help to reduce severe congestion”, Mr Dangerfield said.

$900 million is obviously a lot of money but it seems that it might be a case of someone not knowing how to round properly as the Radio NZ story on this says:

The agency’s board has outlined investment levels for five key areas in its $9 billion National Land Transport Programme for 2012 – 2015.

Public transport will receive $830 million in the next three years, an increase of 33%.

Its a bit odd to round $830m up to $900m but I guess it helps them to make it sound better and they know that journalists don’t bother checking the facts of these things.  You will also notice that this PT funding is out of a total pool of $9 billion so only really represents about 10% of all transport spending. But where does this money come from, the funding comes from the National Land Transport Fund (NLTF) and spending of the money is dictated by the Government Policy Statement (GPS) which sets a funding range for various transport activities. This old post by Josh explains the GPS but here are some of the key tables:

Current GPS funding ranges

The NZTA has to fit funding into the various activities into the groups above but one of the key things is that the exact figure for each category isn’t set in stone but rather a range is set.  To try and make a bit of sense of that Josh took the midpoint of each activity and grouped them together which gives us the table below

We see that based on the GPS the midpoint of PT spending over the next 3 years was $925 million, the NZTA has now decided that it will spend $830m which is almost $100m less than what the midpoint number is and as a percentage is actually about the same as what we spent in the 2011/12 year. My reading of this $830m of funding is that it is also to cover all PT infrastructure and services

I also notice that in the Radio NZ report they mention that funding for maintenance and renewal of State Highways and local roads will increase by about 2% to $2.7b however that also is less than its midpoint of $2.9m. Most likely these activity classes are being squeezed to help prop up the money for the “New and Improved State Highways” group which doesn’t even get a mention yet is the biggest single category. I wonder if that is because if the general public saw just how much more we were spending on a handful of motorways vs everything else then perceptions will continue to change.

17 comments to PT Funding Announcement Full of Spin

  • Peter M

    Most of the increase in PT funding is to help pay off the govt loan for Auckland’s electric trains. With interest.

  • Cameron Pitches

    The New Zealand Transport Agency announced yesterday it would pump $9billion into upgrading existing local transport systems over the next three years.

    I’m utterly confused by this statement. The $9bn must be for spending across all funding classes, not just upgrading existing local transport systems, right?

    • Peter M

      Yeah pretty sure that’s the whole spend. What does “upgrading existing local transport systems” even mean? As opposed to building a giant new monorail? What’s with the phrase “local”, very misleading as people could think it means local roads when it fact it doesn’t.

      Spin spin spin from NZTA. Well done calling bullsh*t on it Matt.

  • Cameron Pitches

    Meanwhile, Mr Dangerfield warned that, though public transport funding had increased, other funding to maintain local roads and state highways remained tight. The agency hoped to shave up to 15 per cent in costs through “efficiency gains”.

    This is the real story. Local roading budgets getting slashed to support the RoNS. Putting more pressure on rates, given that local roading is split funded between councils and the NLTF.

    • Patrick D

      So the Government is in effect pushing rates up, and then have the check to attack local councils for their huge rates bills.

      Ofcoarse joe blog is just too ignorant to really see whats going on.

      Any comments for our neo lib and liberatarian commentors?

      • Yes fellow Patrick, this is the same as their technique of a big tax cut for higher earners causing a shortfall in the tax take being used as ‘prooving’ the need to cut services for others. Nifty eh?

        Note they love to tell the provinces that the reason there is no money to grade their local roads is because city slickers taking all the money for their fancy trains….

  • bbc

    Amazing a 10:1 ratio basically of new motorways: everything else. How can anyone honestly think this is a good idea? It’s beyond me.

  • More blue governmental loot and pillage. Disgusting. Its going to be a long two years til we get to turf these bastards out on their ear.

  • Dave

    I hate to have to say it though I’m sure everyone here knows it: IDIOT NZers for voting National back in last time around! All this could have been stopped in its tracks. So many sheeple blindly voted for National (=Key’s smile) in woeful ignorance of just what National planned to do in regard to spending large rafts of our money and assets on roads while cutting everything else. Labour opposition was useless. When John Key asked Phil Goff to “Show me the money”, Phil could have responded, “Simple. We’ll cancel the Roads of National-party Significance and save $12bn” (gone up to $14bn now I see). But he didn’t. Instead Goff just spluttered “Err, Um, well, we’ve got it all costed you know, I think…”. Unbelievable! And Labour is no more awake on this issue even now.
    The news media is clearly reluctant to tell it like it is, so Joe public falls for the spin, over and over. Thank goodness the Greens are awake.

  • John W

    While the roads of national “significance” (I note that no one is pretending that they are important) are a massive limitation on public transport the real drag on government funds is, and will continue to be national superannuation. But somehow we need to halt the proliferation of new roads because it seems that such a policy is clearly unsustainable and will become even more so as the worlds’ supplies of fossil fuels diminish.

  • Brent C

    In the article, it says $70m has been put aside for the Wellington transport spine. If this is the case, out of the measly $20-40m set aside for transport infrastructure every year, CRL, CHCH and other NZ regional cities will have to fight for the leftover $$$.

  • Mr Anderson

    Well this Generation Zero bunch really seem to know what they’re talking about – pretty comprehensive media release on NZTA’s bullshit numbers: http://www.scoop.co.nz/stories/PO1206/S00020/reported-public-transport-funding-boost-an-illusion.htm

  • James Millar

    John W:

    Steven Joyce says concerns over the affordability of super are a ‘distraction’, presumably from spending billions more on unnecessary highways with poor returns on investment.

    Once again – our single largest source of welfare spending taking up almost half the social welfare budget, projected to rise dramatically, which is essentially unfunded (thanks to Muldoon cancelling compulsory super saving, and this government halting contributions to the Cullen Fund) – and it’s a ‘distraction’ to even talk about it.

    Steven Joyce is shaping up to be NZ’s single biggest economic disaster since Muldoon.

    http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10808596

    • Matt

      The Cullen Fund was never going to fully-fund super, it was only going to contribute about, from memory, 8%. Which is a lot, but it’s not 100%. Blame Piggy for our PAYGO model for paying for super.

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