Over the last few weeks there has been a renewed media focus on Auckland’s transport issues. This has been spurred on by two main events the first was the Green Party launching their Reconnect Auckland campaign and the second was the announcement of alternative funding options to help pay for future transport projects. Along with that it has seen a resurgence of an annoying myth that members of the government like to perpetrate. In an effort to try and make their transport policy sound more balanced than it actually is they love to state that the government has invested $1.6 billion into the rail network. Government MPs talk about it on social networks or at meetings, Gerry Brownlee mentioned it in his recent interview on Campbell live and Steven Joyce, repeated it this morning on The Nation (on TV3).
Now $1.6 billion certainly sounds like a lot of money and of course it is. It is also true that it the amount of money that central government has, or will be spend on rail up until the electrification project has been completed. The issue I have is that a decent proportion of the money was approved or spent before the current government even came into office. So let’s look at the figure a bit more closely, the $1.6 billion can be boiled down into three key areas:
$600 million for Project DART
$500 million for the electrification infrastructure
$500 million for the new electric trains
As the government are using the total figure to suggest that they are investing in a more balanced transport system, the question becomes whether the money was invested by the current government or not, so lets have a look.
Project Dart
Amongst other improvements it included double tracking the western line, various station upgrades, the Newmarket Station and changes to the junction, the New Lynn trench and station, reinstating the Onehunga Line, building the Manukau branch line. Kiwirails page on the project also states:
The 2006 Budget included funding of up to $600 million for rail infrastructure improvements to speed development of the Auckland network.
So yes this was paid for by central government but as you can see, funding started before the current government came to power which was late in 2008. Of course not all funding is spent in one year and as Brownlee said the other day, they didn’t cancel it. But even if they wanted to, how much could they have cancelled anyway? Well probably not much.
Interestingly the funding for this project was kept out of the normal transport budget and instead is listed under the finance budget. The government’s budget documents for the 2006/2007 financial year shows that the money was to be spent over a four year period and it was only the fourth year that National had any control over the budget. By then pretty much all of the various aspects to the project were either already completed or well under way meaning it was probably impossible to cancel anyway.
To me there is no way that the current government can claim the $600 million spent on Project DART as their spending or that they had anything to with it.
Electrification
This includes new signalling, modifying existing infrastructure like bridges and of course the wires themselves. Funding for electrification was initially included in the 2007 budget and was separate to the funding allocated for Project DART.
Now from memory the government intended to pay for the Auckland work via a regional fuel tax which would work in conjunction with one the region would also impose to fund other projects, including new trains. When National came to power they stopped the regional fuel tax and put a hold on the electrification project. They eventually agreed to let it go ahead and paid for it out of the nationwide fuel tax increase. It is however quite clear that funding for the project was initiated in 2007, over a year before National came to power.
Electric Trains
There is obviously not much point in paying $500 million for electrification without trains to run under the wires. As mentioned, the original electrification proposal was to see Auckland pay for the trains out of a regional fuel tax imposed by the regional council. The national governments cancelling of that fuel tax took that funding option off the table. When they finally agreed to let the project go ahead it was announced that the trains would be paid for by way of a loan that Auckland would have to pay back (without the extra source of funding). Worse still was that even after paying back the loan the proposal meant that Auckland still wouldn’t own the trains, Kiwirail would, however this has now changed and Auckland will own the trains directly.
Since then there has been some positive news, it was announced that Auckland would end up getting more electric trains that first proposed, that was partly possible due to better than originally expected exchange rates along with the government kicking in an extra $90 million. The NZTA are also going to contribute to the loan payments in the same way they provide money for PT operating costs however oddly it turns out that the government appears to be clipping the ticket on the loan by charging a margin on top of their cost of funding.
The first EMU will be here in a few months time
So when the government states that they have invested $1.6 billion in to rail in Auckland, it is frankly untrue. In fact the only new funding they seem to have provided is the extra $90 million they provided to buy extra EMUs and the 50% share of funding for loan repayments. Other than that all of the funding is the same as what was agreed to before they came to office.
Campbell Live has been running a lot of stories on Auckland issues recently which has been nice to see and has obviously also provided us with a heap of material to talk about. Last night the entire episode was devoted to transport in Auckland. There were three parts to the show, the first was the kind of story done by news organisations from time to time where various staff members try to reach a specific location using various transport methods.The second section was the most interesting as involved Gerry Brownlee actually giving an interview on Auckland transport issues while the third section was about a lady who was having trouble topping up her daughters Snapper Hop (SNOP) card. I’m not going to look at the third section primarily because the SNOP card will hopefully be phased out soon although you can watch it here if you are interested. Here is the first two sections.
The First Section
If you haven’t watched the video, a bunch of staff were tasked with reaching their office in Eden Terrace by 9am using only public transport and it it seems the first mistake they made was by using the Maxx website to plan their journeys. To be fair there isn’t a lot of other options, yes there is Google and some apps but MAXX is what Auckland Transport provide. However the planner seems so woeful and doesn’t seem to ever have improved, AT really needs to put the thing out of its misery and replace it with something more modern. That said the results were not unexpected but also show how vital it is to communicate the benefits of the high frequency new bus network and that a lot of effort is made to make transfers easy. Further not all of the journeys were practical to take by PT, Lachlan Forsyth’s trip for example shows the benefits of commuting by bike and it would be better to encourage more people to do that where appropriate.
The Second Section
This was of course the most interesting and the part where I at times felt like pulling my hair out. To cover this I’m just going to go through bullet point my thoughts.
At least Brownlee admits that Auckland is growing and that the transport problems will only get worse. It also seems that he has now read the report, something he hadn’t done before ruling out some of the options in the funding proposals a few days ago..
Brownlee repeats quite a few times that Auckland is getting $1billion in transport spending annually. The emphasis he places on it makes it sound like Auckland is gobbling up the spending but in reality, it is less than 1/3 of the total transport spend in the country. It would have been good for Campbell to ask him how much Auckland provided in fuel taxes annually.
I actually agree with Brownlee when he questions whether the suite of projects in the Auckland Plan are the appropriate ones and if they are timed right. However I don’t think that we would agree on what projects should be dropped or having their timing changed.
Brownlee is asked his thoughts on the CRL and he is either trying to be deliberately misleading or has been badly informed. He suggests the project is about a short little loop that goes around in circles. This is exactly the kind of reason why it is so important that Auckland Transport actually publicly state the routing pattern that trains will use so that people can see it is about opening up the entire rail network. To put it another way it will have the same impact on the rail network that the Central Motorway Junction does for the motorway network.
Brownlee talks about how the cost of the project is $3 billion which of course is an inflated and then rounded up figure. He also repeats the lie that Steven Joyce loved to use, that the government is spending $1.6 billion on the rail network. The reality is $600m was approved and budget for from before this government came into office while half of the remaining amount is a loan that Auckland is having to pay back.
I’m really glad that Campbell actually asked him where he would spend $3 billion differently, as I pointed out yesterday, it is really important that people who oppose what is being planned actually say what they would do differently (not that Brownlee did). It was almost comical that Brownlee then went on to list a whole suite of road projects the government has already built or is building.
At first I thought it was really odd the way that Brownlee talked about AMETI and whether that would happen as it is well under way and he has even visited the construction site. Re-watching the video, it then becomes clear that he is talking about a reviving of the eastern motorway. Did Brownlee just let slip that the government is now considering building it? It would certainly fit in with some whispers I have heard.
Brownlee’s comment that “Aucklanders like roads” really does take the cake. For 60 years this city only ever invested in roads at the expense of almost everything else, it isn’t surprising then that most people drive when that has been made the easiest thing to do. The recent and comparatively modest investment in realistic alternatives has had a big impact and stronger investment in them is likely to see big changes in behaviour. As Stu pointed out yesterday, on a per capita basis people are already driving less.
Brownlee is correct that we do need to sort out our bus routes and information systems. The good news is that is under way with the new bus network and should be completed by 2016, well before the CRL is suggested to be opened.
The comments from Simon Lambourne are very rational and in line with what I feel. The big question of course is how many would still chose to drive if some good quality alternatives were in place.
Brownlee is also correct when he states that the documents released on Monday about funding transport are really just the start of the discussion. This was actually something mentioned quite a few times by the CBG themselves. They suggest that a decision doesn’t actually need to be made on how to fund transport till 2015.
Once again Gerry sidesteps the question of what the government are actually going to do to improve transport issues in the city.
After the video from Len Brown, Brownlee goes on to talk about tolling new roads. The reality is that there aren’t that many new roads proposed that could be tolled. We have the Puhoi to Wellsford motorway, Penlink, An additional Harbour Crossing and The East West Link. Effectively every other roading project is an upgrade of an existing road, adding a lane here or there and under the criteria, they couldn’t be tolled.
Brownlee talks about how they have had to put up fuel excise taxes due to falling revenues and gives a couple of reasons but misses the biggest one that vehicle use is dropping, both in real and per capita terms.
All up most of the comments Gerry made were a bit frustrating but not all that surprising given his previous statements. The more I think about it though, the more it seems as though that he let slip that the government is looking at reviving the Eastern Motorway proposals.
What were your thoughts on the video. Did I miss anything?
While the council and government battle over when the CRL, a project that will create transformational change in the city, the NZTA is pushing on with building a motorway on the edge of town. The NZTA has just announced that an alliance of companies are about to spend $17.5 million on getting the preparation done so that the agency can start the process to obtain consent later this year. Here is the press release:
The NZ Transport Agency has taken the next step towards construction of the Pūhoi to Warkworth section of the Ara Tūhono – Pūhoi to Wellsford Road of National Significance by naming a special alliance that will prepare the NZTA’s case for the consents its needs for the new highway.
The Further North Alliance, which includes both engineering consultants and lawyers, will support the NZTA’s application to the Environmental Protection Authority (EPA) for the Notice of Requirement to obtain the necessary land.
The NZTA plans to lodge its Notice of Requirement with the EPA in the third quarter of this calendar year, and is seeking to be ready to start construction on the Pūhoi to Warkworth section as early as the end of 2014, subject to property purchase and funding.
The NZTA’s Regional Director for Auckland and Northland, Stephen Town, says alliances to construct projects are common but this is the Transport Agency’s first planning alliance and the $17.5m contract is a sensible option.
“The alliance reflects the ambitious timetable we have set for this project, and It makes good sense to have our specialists working together in a team rather than as individual companies. The combined experience and expertise of the Further North Alliance will help us meet our timetable for a very complex project and at the best possible price.”
The planning alliance comprises Sinclair Knight Merz (SKM) and GHD, who are both engineering consultants the legal firm Chapman Tripp, and the NZTA.
Further geotechnical investigations are already underway between Pūhoi and Warkworth and the Alliance thanks property owners for their co-operation and patience with the on-site teams. A range of environmental specialists are also walking the entire alignment for initial surveying with sampling scheduled to take place in coming weeks.
There is this little note for editors
The four-lane, 38-kilometre Ara Tūhono – Pūhoi to Wellsford RoNS is crucial to supporting growth in Northland and improving transport links between economic centres in the Northland, Auckland and Waikato/Bay of Plenty regions.
Ara Tūhono – Pūhoi to Wellsford is part of the NZTA’s roads of national significance programme (RoNS for short), which represents one of New Zealand’s biggest ever infrastructure investments. Once completed, the seven RoNS routes will reduce congestion in and around our five largest metropolitan areas, and will move people and freight between and within these centres more safely and efficiently.
This route will only really help congestion problems that exist at holiday times, when everyone tries to leave the city at the same time. The rest of the year it will allow vehicles to get from Warkworth, or further north to the congestion on the Northern Motorway a little bit easier so far from easing congestion this will likely add to it. And here is the statement from the minister, Gerry Brownlee.
Transport Minister Gerry Brownlee is welcoming the creation of a new planning alliance which marks another step forward in the process to construct the 18km Puhoi to Warkworth section of the 38km Ara Tuhono – Puhoi to Wellsford Road of National Significance.
“The value, innovation and flexibility of the alliance approach, bringing together companies with different engineering and other skills working together as one team, has already been demonstrated in the construction of large projects which this Government has prioritised and progressed,” Mr Brownlee says.
“Auckland’s Victoria Park Tunnel is a great example – where the innovation of the alliance approach combined to construct a much improved highway and preserve the city’s heritage – a project that came in early and under budget.
“The Government welcomes the decision to extend the alliance concept for the first time to the planning process of a project to improve transport connections between Northland and Auckland, and the rest of New Zealand.”
The planning alliance, to be known as the Further North Alliance, comprises engineering firms Sinclair Knight Merz and GHD, legal firm Chapman Tripp, and the NZ Transport Agency.
The new highway between Puhoi and Warkworth is the first stage of a four-lane motorway project that will eventually extend to Wellsford, replacing the existing State Highway 1 and expected to cost around $1 billion to construct.
“This project was identified by the Government as one of seven Roads of National Significance, to help stimulate economic development in Northland, and provide a safer and more reliable transport connection between Northland and Auckland and into Waikato and the Bay of Plenty,” Mr Brownlee says.
“Northland is blessed with great agricultural, mineral, tourism and other resources but has been starved of proper infrastructure investment for too long, something this Government is addressing.
“Northland’s economy currently accounts for just 2.5 per cent of GDP, even though the region has 3.8 per cent of New Zealand’s population.
“Investment in new highway infrastructure through the Roads of National Significance programme will help Northland’s economy to grow, rather than simply responding to growth.
“Investment and innovation go hand in hand to ensure projects of this scale and importance are delivered successfully,” Mr Brownlee says.
One thing that I always find really odd is just who this project is meant to benefit. As Brownlee, and his colleagues like to tell us, it is about unlocking Northland. Yet the road doesn’t even go into Northland, it stops well short of the border. Yet oddly, because the road itself sits within the Auckland region, it gets added on to all of our plans, whether we want it or not. If we really wanted to spend money on improving transport in Northland then spending the $1 billion that is planned for just this section alone on upgrading and even sealing some roads actually within Northland would likely have a far more positive impact. This was even acknowledged in some OIA documents I received last year.
We also learned last year that to get the time savings promised on the route, vehicles would need to be travelling at speeds of up to 250kph. What is particularly interesting is there is still no mention about any intention to build the section from Warkworth to Wellsford. We have learnt in the past that the terrain though there is particularly challenging plus has extremely low usage by vehicles currently. I wonder when they will finally tell us they are dropping that section?
In a surprise announcement, Transport Minister Gerry Brownlee yesterday asked the New Zealand Transport Agency (NZTA) to commence investigations into a motorway between Panmure and Downtown: along a very similar route to the alignment of the Eastern Highway that cost John Banks the Auckland City mayoralty back in 2004.
Mr Brownlee confirmed that the need to investigate this project further was the most significant outcome of a four-month review of the ‘City Centre Future Access Study’ by Ministry of Transport officials.
“In December last year the Auckland Council released the City Centre Future Access Study. At the time I highlighted some concerns that this study had not reviewed a wide enough series of options to deal with future access problems to downtown Auckland and I also highlighted some doubts over the extremely optimistic assumptions made by that study. Today’s announcement vindicates my concerns,” said Mr Brownlee at a media conference at Orakei point, where the six lane motorway is planned to pass through.
“The Future Access Study’s findings showed that while the CBD Rail Loop performed the best of the options considered, by 2021 and especially by 2041, congestion for private vehicles travelling into downtown Auckland at peak times would be significantly worse than it is today – even with the rail loop built. This is an unacceptable outcome, which is why I requested by officials to look into other options.”
In plans released today by the Ministry, a series of roading improvements are scheduled for construction over the next six years across Auckland – with the main goal being to alleviate congestion. These plans include construction of a six lane motorway from Parnell Rise at the bottom of Grafton Gully through to Panmure where the road will connect to the AMETI project, already under construction by Auckland Transport. To save on costs, the motorway will be built at grade rather than in a tunnel, an option previously considered when the Eastern Highway was being promoted by Auckland City Council last decade.
Other projects proposed for construction include a second level on State Highway 1 between the central motorway junction and Mt Wellington, as well as the Northwest motorway between Waterview and the city.
The Ministry’s report offers only a preliminary analysis of the costs of these projects, noting a likely ‘turn out’ cost of between nine and thirteen billion dollars. “We believe this is a small price to pay to rid Auckland of the daily scourge of congestion” stated Mr Brownlee.
Auckland Mayor Len Brown did not attend the media conference, but later released a statement saying that he was “outraged” the government seemed to be “taking over” the planning of transport in Auckland. However, Mr Brown also noted that he strongly supported all the findings in the report.
“Auckland’s population is due to grow by a million people in the next five years, so we need to invest in Auckland’s future. Today’s announcement is a huge step forward for the City Rail Link project.”
Government sources confirmed that today’s announcements are seen as an alternative to the rail loop project, not in addition to it. When this was put to the mayor, he was heard muttering “incompetent fools” before shrugging his shoulders, sighing loudly and stating that he would “continue to work constructively with the government on transport issues in Auckland”.
Auckland Chamber of Commerce Chief Executive Michael Barnett stated that he “strongly supported” today’s announcement. “Congestion costs Auckland businesses $5 billion a year and finally there is an agreed plan to tackle this problem. Our only criticism is that the current plan is to have the Eastern Motorway completed by 2017 and a second level on the southern and northwest motorways by 2019. We think that both projects simply must be completed by 2015 at the absolute latest!”
NZ Council for Infrastructure Development Chief Executive Stephen Selwood also noted his strong support for the transport package announced today. “We’ve been working closely with the Ministry of Transport over the past four months to come up with a solution to Auckland’s traffic problems that can be implemented in a way that most benefits our members, I mean most benefits the Auckland public,” said Mr Selwood, from his desk at the Ministry of Transport’s offices in Auckland.
The announcement was not met with total support however, local resident Anthony Pearce said that he had thought the Eastern Highway was “dead and buried” after it cost Mr Banks the 2004 Auckland mayoralty. “Little did I know that much of the designation was never removed!” wailed Mr Pearce. “At least they’ll never be able to get consent for a six lane motorway through the Purewa Valley and across Hobson Bay!”
Environment Minister Amy Adam confirmed that, with the current changes proposed to the Resource Management Act, consenting for the project would be “not a problem”.
Construction of the motorway causeway is set to begin in June.
A Herald article last month highlighted strong support for more Government spending on public transport improvements in Auckland. It included the following quote:
But a spokesman for Transport Minister Gerry Brownlee said that with $890 million budgeted for public transport in Auckland over three years “it would be grossly unfair to suggest the Government hasn’t given this mode of transport the priority it deserves”.
The story was analysed in a bit more detail in this post, but the question of where the $890m figure came from remained unresolved.
A total of $3.4 billion is being invested in the Auckland region’s transport system between 2012/15 through the National Land Transport Programme alone, including $1.6 billion for state highways, $968 million for local roads and $890 million for public transport.
In the above context it looks like NZTA is investing $890m in public transport in Auckland, funded through fuel excise and road user charges. I sought clarification from Gerry Brownlee’s office on how the $890m figure was arrived at. My request was referred to the NZTA, who responded earlier this week:
So almost half of the $890m figure actually comes from Auckland Council ratepayers, and the remainder also includes public transport service operating costs as well. (From memory I think the transport services figure includes repayment of the EMU loan). Very few people would know that the National Land Transport Programme includes local council contributions.
This leaves an actual public transport infrastructure spend of $39m from fuel taxes and road user charges over the next three years in Auckland. This really is a pitiful amount compared to the hundreds of millions being spent on new roading projects. It would seem more than fair to suggest that central Government hasn’t given public transport the priority it deserves.
Edit: Sacha suggested a simple column graph would add some clarity. Here it is:
Gerry has clearly taken the first question very literally and his response was at least a little bit funny. Now I generally tend to be an optimist so I’m going to say at least Gerry wasn’t completely dismissing the project. What’s more he seems to have softened his stance a little bit and clearly isn’t ruling it out. He even used the non inflation adjusted price, saying it would cost $2.4 billion, which is probably the first time a minister has done that.
Perhaps the most interesting aspect of the exchange was when Julie tabled the document showing that over the last decade, the number of vehicles entering the city centre had dropped by 20%. This is something that Mr Anderson has pointed out before although it actually seems more like a 15% drop. The point went straight over Gerry’s head though as he started talking about what would happen in 2021, not realising that a shift has been happening already.
An interesting article in the NZ Herald on Tuesday, noting some comments made by Transport Minister Gerry Brownlee and Auckland Council head planner Roger Blakeley, in relation to the City Rail Link project. Starting with Brownlee:
Transport Minister Gerry Brownlee told a transport summit in Wellington yesterday that the case for the $2.86 billion rail link would be stronger in 2030 than the council’s target.
This is quite a shift from what Brownlee seemed to be saying in his immediate response to the release of the City Centre Future Access Study, where I think his key quote was this:
Transport Minister Gerry Brownlee says the Sinclair Knight Merz report “City Centre Future Access Study” released this afternoon by Auckland Mayor Len Brown is a useful addition to the debate on long term transport management in central Auckland.
“It also falls some way short of convincing the Government it should provide financial support to any fast tracking of the proposed City Rail Link (CRL),” Mr Brownlee says.
“In a nutshell the report says the case for building the CRL is weak now, improves somewhat if it’s built closer to 2030 – based on some extremely optimistic assumptions about employment growth in the Auckland CBD – and even then would only provide about 20 per cent of the additional transport capacity needed to deal with increased congestion.”
My understanding is that the purpose of CCFAS wasn’t to justify when the project should be constructed but rather to look at the impact the CRL and other transport options would have on providing for continued access to the city centre in the medium to long term. Fully understanding when the project should happen is the task of a detailed business case – which seems to be the next step for the CRL to take.
Dr Blakeley noted in the same article that waiting until 2030 for the project was “untenable”:
Speaking at the summit today, Auckland Council chief planning officer Roger Blakeley responded that such a delay would be “untenable”.
He said further delays to the rail link would limit employment, growth and economic benefits.
“I’m aware that the Minister of Transport Gerry Brownlee said yesterday that, in his view, the case for the city rail link is stronger at 2030 rather than 2020.
“The council and Auckland Transport’s view is that it should be implemented by 2021 … We think that it’s untenable to have New Zealand’s only international-sized city with traffic at speeds at peak in the morning reduced to around 7km/h.”
From a pure “can we find a way to provide sufficient transport capacity to meet demands up to 2030″ perspective we probably could delay construction of the CRL to that point. We can turn most streets in the CBD over to bus-only operation, we can run more trains directly between the west and the south, we can make all trains (aside from Onehunga services presumably) six cars long at peak times and so forth. We might get through.
Of course the down-side of that approach is missing all the transformational benefits of the City Rail Link, not just for the city centre but for the whole of Auckland. Stations along the western line simply won’t be “close enough” (in terms of travel time) to the city centre to stimulate intensification. We’ll probably see the employment targets for the city centre (where the most productive jobs are located) missed and lose out on the agglomeration benefits for all of Auckland and New Zealand that increased employment density would provide. We’ll lose the opportunity to reallocate street space in the city centre to pedestrians, thereby making it a less attractive environment. We’ll lose the improved connectivity between major regional centres on the rail network and the increased frequencies throughout the rail network that the City Rail Link enables. We’ll see further extensions to the rail network like a line to the airport and the Mt Roskill spur line pushed back another decade, and so forth.
In essence, I feel that building the City Rail Link by 2021 reflects the project’s key role in transforming Auckland into the world’s most liveable city and significantly boosting our economic performance. Finding a way to “get by” until 2030 simply views the project from a narrow transport perspective and really only in terms of it providing increased capacity to the city centre. Let’s just hope that the detailed business case looks at these wider issues when finding an answer to the question of “when”.
On the bright side, I think it’s a step in the right direction to even have Brownlee focused on the “when” question rather than the “if” question.
The Government will increase petrol tax by three cents a litre each July 1 for the next three years.
Transport Minister Gerry Brownlee said road user charges would also be increased by an equivalent amount.
He said the increases were required to deliver the “Roads of National Significance” programme and other roading projects to the timeline set out in the Government’s land transport funding policy.
“Excise increases in recent years have helped maintain the real value of the Land Transport Fund. These latest increases will also achieve that, and allow for continuing investment in the Government’s state highway building programme and other transport projects,” Brownlee said.
In particular, the extra money would allow work to begin on the Rangiriri and Tamahere-Cambridge sections of the Waikato Expressway, the Mackays to Peka Peka section of the Wellington Northern Corridor, and the four-laning of the Groynes to Sawyers Arm section of the Western Corridor in Christchurch.
“We have considered innovative ways to deliver the RONS [Roads of National Significance] programme, agreeing to the procurement of Wellington’s Transmission Gully project through a public-private partnership and asking the NZ Transport Agency (NZTA) to investigate tolling the route.”
NZTA chief executive Geoff Dangerfield said the certainty provided by the increased funding had allowed the NZTA board to approve construction funding for projects.
“The certainty that this guaranteed funding stream provides means we can proceed with confidence in developing and delivering these and other major projects which will enable economic growth and provide safer journeys for New Zealanders.”
This pretty much confirms the impact of lower than expected fuel sales over the past few years have been hurting the transport budget more than the government has admitted. This is a fairly significant increase in fuel taxes, for projects of pretty debatable merit. I wonder how it’ll go down with the general public.
Edit by Matt: I was just working on a similar post, here is what I was about to say:
Well it wasn’t too hard to see this coming. The government has announced that fuel taxes will be increased by 3c a litre for the next three years with road user charges increasing by an equivalent amount. The increases are largely to cover a shortfall of $1.7 billion that is being brought about by road building binge that the government is on with its Roads of National Significance programme. One of the key reasons for the need of this increase is finally starting to be addressed by the MSM, that the expected growth of traffic is not occurring. This is leading to less money in the kitty to pay for these projects, many of which have such poor economic returns that they shouldn’t even be considered. On the TV one news piece about this, Andy Foster from the Traffic Institute, had this great quote:
“They’ve been predicting a significant amount of traffic growth and therefore significant revenue growth, [but] the traffic growth hasn’t been happening.”
The problem of course is that just like here, all around the world traffic demand is dropping off. This latest announcement of tax increases are only likely to put even more people off driving which will further impact on tax revenues. In a way it seems that traffic volumes are now heading into a bit of a death spiral, less are driving requiring taxes to be raised to which in turn leads to even less people driving. And these tax revenues have turned out to be fairly important as also today Bill English has announced that without the increases, the government would not have reached its goal of getting back into surplus.
There is of course one thing that could really help out here and that is cutting back the RoNS but that is the one thing that the government simply refuse to even consider.
Following on from my post yesterday, Radio NZ had a number of discussion about the CCFAS yesterday including a chat with Gerry Brownlee and Len Brown about the response. Here is Brownlee:
Most telling is at 1:25 when after being questioned if his officials don’t agree with the report responds with “Well they certainly agree with the position I’ve taken today”. That to me sounds like the minister has dictated to them the response he wants. And here is Lens response to that.
Also if anyone from any government agency would like to comment off the record, or perhaps even provide some leaked information that would be relevant then you can do so anonymously. My details are in the contact us section.
So I attended the councils release of the City Centre Future Access Study (CCFAS) today and came away pretty happy with the outcome. Within a few hours though that happiness ground away due to the governments head in the sand response to the study. This post will look at the announcement from the council and response from the government. First though a quick recap on the history that got us to this point so far.
In November 2010, shortly after forming, the Council/Auckland Transport released the initial business case for the CRL which had started under the previous local body setup.
In May 2011 both the government and council released their own ‘independent’ reviews of the business case that had vastly different outcomes.
In July 2011 this was followed up with a letter from transport minister at the time Steven Joyce which started the process that led to the CCFAS. You can read that letter here.
In December 2011, after working with officials from various government agencies, Len sent a letter to new transport minister Gerry Brownlee outlining what had been happening with the CRL and included the scope for the CCFAS. You can read it here.
In February 2012, Gerry Brownlee responded to the previously mentioned letter. I will cover that in more detail soon but you can also read it here.
So lets break down Gerry’s press release
Mr Brownlee says he had expected a broader review of potential transport solutions for Auckland than the relatively narrow case studies in the report released today, which include a rail tunnel (the CRL), some enhanced existing bus services, and underground bus options.
“The consultants’ own report says they were ‘commissioned to develop a robust and achievable multi-modal programme for transport into the Auckland City Centre which considers a thorough analysis of alternatives.’
“Yet the report underplays State Highways entering the Auckland CBD from the south, both SH1 and SH16, and how improvements to these might impact central city traffic.
“Completion of the Western Ring Route in 2017 will also draw many thousands of traffic movements away from the CBD, yet none of these major transport corridors is explored in detail.
It was made stressed time and time again at the mayors press release that this study had not only be done by the Council/Auckland Transport but that senior officials from the Ministry of Transport, NZTA and Treasury were deeply involved in agreeing on the assumptions, options and outcomes of the study. In fact SKM who completed the report say this:
The CCFAS is an independent study undertaken by SKM.
The Study was commissioned by AT and has been overseen by has been overseen by the Transport Planning Senior Officials Group (TPSOG)
This group includes representation from the Ministry of Transport, Treasury, the New Zealand Transport Agency, Auckland Council and Auckland Transport.
Workshops were held throughout the study with all those parties.
Key decision points required agreement from all partiesto proceed to the next stage of the Study
The Feb 2011 letter from Gerry also states quite clearly that he was comfortable with the scope of the project.
The letter even goes on to state how he is concerned that AT are trying to complete the study to quickly and that he wanted the timeline extended to ensure the it was done properly. It is very odd that he would now question the scope when both he and his officials, who were involved all the way through the process, were happy with it. As for there not being a broader review of options, how many does he want, the study investigated 46 different options as a way of providing improved access to the city centre. The options included pretty much every bus option known to man along with the wacky elevated rail option, light rail, an elevated bus options and it even looked at PRT.
The press release also talks about the benefit cost ratio:
“With a modelled benefit cost ratio of just 44 cents in the dollar, the benefits of the CRL are nowhere near the cost of building it.
“That benefit cost ratio looks decidedly questionable when you take into account the report’s assumed employment growth of 46 per cent in the Auckland city centre over the next 10 years, compared with actual growth of only 18 per cent in the previous decade.
The whole point of the study wasn’t about produces a cost benefit ratio to justify the project but to look at the range of options and assess them using the same criteria with the BCR indicating which one performs best. The results of this study are then to be fed into a comprehensive new business case to work out what the actual benefit is. He also questions the level of growth but once again, the government agencies involved agreed to this number and from memory the 46% employment growth was over the 30 year lifespan of this study but I will have to go and check this. Further we were told that the assumptions used in this study were the mid growth forecasts from Statistics NZ which is in comparison to the high growth scenario that was envisaged as part of the Auckland Plan
I am left with the feeling that this outcome means one or more of the following:
That the government has just completely rubbished the work of staff within their own agencies showing they don’t have a high regard for them.
That the government agencies have deliberately worked to sabotage the study by agreeing to assumptions and options that they knew they could challenge later
That the government has its head so far up its ideological backside that it can’t see daylight.
I tend to think it is the latter option.
Lastly:
“In the meantime the Ministry of Transport and the Government’s NZ Transport Agency will continue to work on the best and most cost effective solutions for freeing up central Auckland congestion now and into the future.”
So what are those options Gerry. Your officials have been deeply involved with this study so unless they lied during the months of involvement they had with it, why would they come up with any different options.
I imagine that staff at the various agencies (and SKM) who have worked their arses off to produce this study will be feeling pretty deflated tonight. We will be doing some more detailed posts looking at the study over the coming days.
Note: Auckland Transport has also provided some clarification, likely in response to the governments statement, some of which is similar to what is said above.
The reference base case included all transport projects in the Auckland Plan including the Additional Waitemata Harbour Crossing, Waterview, SH16 and Puhoi to Wellsford and the Study therefore represents a best case scenario of the problems of access.
The Study provides a comparative assessment of options which were agreed with Central Government. The Benefit Cost Ratios (BCRs) reflect the comparative benefit of the options; they are not a business case evaluation.
The Study used Statistics New Zealand medium population growth projections agreed between local government and the Ministry of Transport, NZTA and Treasury.
The models used to inform the Study are the same as those used on a number of major projects such as Puhoi to Wellsford, Waterview and the Additional Waitemata Harbour Crossing.
The comparative BCR assessment took into account the assessment of Wider Economic Benefits (WEBs) as is common practice for large infrastructure projects. If these WEBs are excluded, the comparative BCR for the City Rail Link option would still be more than four times better than the next option of surface bus.
The Study considered a total of 46 options including light rail, mobility pods, ferries and multiple bus and rail options. They were refined using multi criteria analysis to reach agreement among central and local government agencies about those shortlisted.
The Study was designed to select the best option, not to justify funding. The next step in this process is a detailed business case in which the options will be optimised and the fundability of the project fully worked through in a considered manner.
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