As a country we spend a lot of money on transport, at three levels: central government, local government and personally. In the 2012 budget, around $3.8 billion of expenditure on transport by central government was proposed. Further to that, transport is generally the biggest item of expenditure for local government – the Auckland Council spends over half its money (more than half your rates bill) on transport each year. Plus we obviously spend a lot of money ourselves: paying for petrol, buying cars, fixing cars, registering and warranting cars, paying for parking, paying for insurance, bus fares and so forth.
Obviously at an individual level we pay because we need to get around. Plus we need stuff to get around as well, so that we can get that stuff ourselves. I’m not going to go into the amount we pay for transport individually much in this post – except perhaps to point out that transport costs that are worn by individuals clearly varies and the impact of different transport decisions we make, especially different funding priorities, has an impact on the amount we may need to pay at an individual level. For example, if the public transport system is good enough for one member of a family to rely on for every day commuting, then maybe that family only needs to own one car instead of two (or three) – and therefore they avoid the need for a massive expense in owning, fueling and maintaining that car.
So why do we spend a heap of money (by my reckoning, only social development, health and education would be funded more by central government) on transport? At a high level, it’s so that we can achieve benefits to society that cannot be achieve if there was no public agency managing the revenue collection, planning and implementation of transport improvements (though crazy libertarians will always disagree with this). Each government of the day tends to outline what its broad goals are at a general level, with policies designed to help achieve those goals. The current government wants to focus mostly on boosting the country’s economic performance and productivity. The Auckland Council wants to make Auckland the world’s most liveable city.
Where it becomes really interesting is the next step down – how does transport policy and spending help to actually achieve these broad levels goals? This obviously requires specifying a number of transport goals that contribute to achieving the over-arching vision – whether it be the government’s vision or the Council’s vision. The government thinks that spending big money on reducing traffic congestion on the roading network – particularly parts of the network that are busy freight routes (or, by the look of it, busy during holiday weekends) will make a huge difference to economic performance. The Council’s vision also focuses on reducing congestion, but suggests that this is likely to be best achieved through the creation of an outstanding public transport system and better integration of the transport system.
Occasionally, the two visions conflict – something which doesn’t please the government at all:
Given the cost and the forecast increase in congestion, despite this substantial investment there are fundamental questions over value for money and whether the right mix and timing of projects has been chosen to address forecast travel patterns. A priority for the Auckland Council, potential funders and infrastructure users is to reconsider the proposed projects and undertake the strategic review to determine whether individually, and as a package, they are the right projects to address the long-term transport challenges facing Auckland.
This view is consistent with the official Government response to the Auckland Council, released in July, which noted “… the Government also remains to be convinced that the programme as a whole represents the right mix of projects and will provide value for money. To improve the prospects for alignment on transport policy, the Government encourages the Council to review the proposed projects to ensure the transport strategy is optimised to address forecast congestion under the likely land use pattern”.
I actually strongly agree the Council needs to undertake such a piece of work, but the outcomes of the review might end up being the complete opposite of what the government thinks – the removal of a large number of pointless and eye-wateringly expensive roading projects.
But all of these plans are based on an assumption that reducing traffic congestion will actually lead to better economic growth and/or better liveability. Those are actually assumptions worth testing – as did an article in Atlantic Cities a few months back, which looked at the link between congestion and economic performance. The results will surprise some:The article explains the relationship, which actually shows that per capita GDP is higher where there’s more congestion:
…regional GDP and traffic congestion are tied to a common moderating variable – the presence of a vibrant, economically-productive city. And as city economies grow, so too does the demand for travel. People travel for work and meetings, for shopping and recreation. They produce and demand goods and services, which further increases travel demand. And when the streets become congested and driving inconvenient, people move to more accessible areas, rebuild at higher densities, travel shorter distances, and shift travel modes.
Stated another way, people adapt to congested environments. Because cities provide greater access to job opportunities than do rural areas, as well as wages that are more than 30 percent higher than their non-metropolitan counterparts they have a powerful economic incentive to do so.
Economic development is also intricately related to the density of employment – agglomeration benefits as they are commonly known. Putting more people in close proximity will inevitably lead to more congestion, but the negatives of that congestion (if there actually are any) are seemingly more than outweighed by the benefits of density.
Well what about Council’s assertion that reducing congestion will lead to improved liveability? Well just yesterday Mercer released their 2012 list of the world’s most liveable cities - with Auckland doing really well at number three (for the fourth year running). Let’s take a look at the top 10:
- Berne & Sydney
The bulk of these cites are dense European cities, which generally have quite a lot of congestion due to their limited road network in the inner areas (although obviously they tend to have pretty good transport choices). Other cities that do well include Vancouver, which decided to not build any motorways in its inner areas, and Copenhagen which is famous for being the world’s best city for cycling.
Perhaps what I’m really getting at with this post is highlighting that perhaps we’re focusing on the wrong thing in trying to achieve the ultimate goals of investing in transport? In both achieving stronger economic growth and better liveability, what if relieving congestion actually doesn’t help much? What if it actually undermines our efforts? What if it uses up a whole heap of money that could be better used on transport interventions which actually would assist in achieving the high level visions of both Central Government and Auckland Council (like encouraging greater employment densities or encouraging greater transport choices or reducing the amount of money we need to personally spend on transport so we can spend it more usefully elsewhere)?
For some reason an assumption has been made that reducing congestion will magically result in these strategic outcomes and therefore we need to focus on transport spending almost exclusively on the reduction of congestion. Well I’m calling bullshit on that assumption. And as there’s billions of dollars at stake here, we need to do better, quickly.