The 2015-2025 Government Policy Statement Confirmed

Simon Bridges has released the final version of the 2015/16 – 2024/25 Government Policy Statement (GPS) following on from the draft version earlier this year. The GPS is effectively the top dog when it comes to transport funding and policy as in the words of the minister:

The Government Policy Statement on land transport (the GPS) sets out the Government’s strategic and policy goals for land transport, as well as the funding direction necessary to achieve them. It guides not only an investment of $3.4 to $4.4 billion per annum from central government, but around $1.0 billion a year from local government.

The GPSs relationship to other key planning documents is shown below.

2015 GPS - Document heirachy

Very little has changed from the draft version we saw with the Ministry of Transport saying some of the changes are:

  • The upper ranges of funding available for public transport have increased, so up to $115 million more will be available for public transport projects between 2015/16 and 2024/25. This takes the potential spending on public transport to a total of $4.585 billion.
  • The objectives set down in the final GPS 2015 have been amended to ensure they are clearer and more well-defined. A new ‘efficiency’ objective has been added, while the ‘demand’ objective has been clarified so it refers to access to social and economic opportunities.
  • A definition of major metropolitan areas (reflecting the Statistics New Zealand definition) has been added, clarifying those areas which are eligible for funding under the Regional Improvements activity class.
  • The Auckland Transport Package (announced by the Government in 2013), Accelerated Regional Roading Package (announced in August 2014) and the Urban Cycleways Package (announced in September 2014) have been referenced throughout GPS 2015. While funding for these will be provided in addition to funding for activity classes, the packages will be considered and undertaken in a way consistent with other projects funded under the GPS.
  • The role that technology and innovation can play in managing network access and capacity has been reflected throughout the document, including the new crosscutting reporting line which will ensure technology investments (and the returns on these investments) will be transparently recorded.

In other words there’s been some tweaking around the edges but no significant change. That means there is still some massive hypocrisy and double standards contained within the document. As a quick example, while noting that vehicle travel has basically flat-lined and will “remain more muted than in previous economic cycles“, the maximum possible funding for state highways increases by 4%. By comparison almost all talk in the document about improving PT services comes with the caveat of “if justified by demand“. Simplified you could say PT investment has to justify its existence but road investment doesn’t.

Related, the maximum possible funding for PT increases by 3.5% per annum and the MoT say “This rate of increase reflects current and projected patronage growth“. Of course that level of projected patronage growth only exists because of the level of funding being made available limiting services. If Auckland Transport had more funding they could roll out the new network much faster and of course by doing so we would see stronger patronage growth much sooner.

One of the key things about the GPS is the funding ranges it sets. These funding ranges are meant to give the NZTA some (small) amount of flexibility when setting the National Land Transport Programme (NLTP) which sets out the projects that are likely to be funded. The NZTA could theoretically use the maximum funding ranges in some categories at the expense of others however overall the exact amounts selected tends to be closer to the midpoint between the upper and lower figures.

GPS 2015-2025 Funding Range

And using the mid-point between the two figures, this graph highlights where the money is going over the next decade.

GPS 2015-2025 Funding Graph

In terms of the maximum extra $115m possible for PT, for the next three years the difference between the draft and the final version over the next 4 years are compared to the draft are just $5 million in 2016/17 and $10 million in 2017/18.

In addition to the table above the GPS also lists the funding outside of the categories above, in other words money the government is paying directly for transport projects such as the governments $100m Urban Cycleway funding that they announced in the lead up to the election. One of the things that’s odd about that particular funding stream is it seems to be broken up into state highways and local roads elements which is something that hadn’t been mentioned before.

GPS 2015-2025 Other Funding

Overall the direction of transport policy has changed little since 2008/09 and the focus remains on building massive state highway projects – most with low value outcomes – while the areas of the transport system that are seeing the most growth get ignored.

A Minister for Cities?

John Key by Platon

John Key by Platon

On the Monday night after his impressive victory in the election the Prime Minister presented a very statesman like and inclusive tone in an interview on Campbell Live:

“I will lead a Government that will govern for all New Zealanders” was a quote from Mr Key’s acceptance speech that stood out for many, writes Campbell.

Throughout the interview he gives a strong impression that he has no intention of standing still in the glow of this endorsement, he clearly has ambitions to cement his appeal across as a broad spectrum of the public as possible. If he is to achieve this then it will likely involve reaching across traditional divides in policy to bring even more people into his camp. Of course he will also want to carry his base with him if he is to initiate anything new, so it will need to be acceptable to general market-led philosophy even if  novel for National otherwise.

The other increasingly important issue to him now will be thoughts of legacy, of history’s judgement. I see an appetite for more than ‘steady as she goes’ for this term, both in terms of building for another or if it were to be his swansong. I believe we can expect a more creative and dynamic John Key, looking to make a make a mark beyond being a good manager and a great salesman:

Robert Muldoon’s ambition, “to leave the country in no worse shape than I found it”, Mr Key describes as having an incredibly low ambition.

“I want to leave the country in better shape than I found it,” he says. [ibid]

It is certainly the case that Key has a unique opportunity to be bold, especially within his own party, as no Prime Minister in recent memory has such a strong position to carry even the most sceptical and conservative caucus or cabinet into unfamiliar waters. But where are the opportunities for change?

I will argue here that there is one area that he can certainly do this, that is consistent with modern market-led conservatism [if less so with our own rather parochial traditions], that it is consistent with his type of leadership, and importantly, is already working for those he admires overseas. Furthermore he has already shown some movement in this direction. This opportunity is for him to position his government as the driver of the economic transformation already underway in our cities, and in particular in our one city of scale: Auckland [but not exclusively].

This is to place Key in the similar mould as the UK’s David Cameron [who he expressly admires] and other right of centre leaders such as London Mayor Boris Johnson and ex-New York Mayor Michael Bloomberg. These are three modern conservative leaders who have built their reputations in large part by championing the power of cities for economic, environmental, and social transformation.

John Key could go down in history as the man who added a new layer to New Zealand’s economy and identity: the man who added another support to our currently somewhat unstable economic structure, and added another, urban, thread to our social fabric, and who began the turnaround in our environmental performance. And it all starts in our cities.

This does not involve abandoning nor neglecting the countryside, that is already getting huge attention from this government which should continue. But that this is an additional opportunity to add to that work which would remain at the core of his government’s activity.

And conditions are perfect. This is the moment to seize. This is the direction being taken by governments and cities everywhere in the developed world, while perhaps radical here, it is rapidly becoming orthodox and necessary policy to invest in changing urban form to compete for talent and new business. It can be argued that this government has been lucky with the soft commodities boom but that now that is clearly on the wane, but we have already seen that the services sector is already there to at least soften that blow:

Gross Domestic Product rose by 0.7% in the June quarter, according to Statistics NZ, driven by strong growth in the services sector.

The main driver was a 4.2% increase in business services activity, which was partially offset by a 2.8% decline in agriculture, forestry and fishing.

There is economic growth to foster in town and it has different needs to the traditional industries based in the countryside. And we need as a country to diversify our economic base. Urban areas and Auckland in particular are growing in population, activity, and infrastructure requirement and offer just such an opportunity:

NZ city population growth 1926-2006

Data source: http://www.motu.org.nz/publications/detail/a_new_zealand_urban_population_database

A leader who rejects the mistaken idea that urban growth must somehow be restricted for the rest of the nation to prosper will be the one that can ride this economic force for the good of the whole country. And again Auckland in particular seems right now to be at the sweet spot in terms of scale, density, and growth for this boon. Furthermore his government has already set the foundation for a new urban policy with two earlier decisions that are now bearing fruit: the Super City amalgamation and the electrification of the rail network.

Also because of both the existing conditions in our cities and in the stated preference of their citizens there is actually much less risk to such a pro-urban policy change than it may seem to anyone familiar with the usual cliches of New Zealand Party politics. While it would be a bold move for a leader of the ‘country Party’ that is actually the genius in the idea. It seems clear to me that the notion that National must force the same policies on the cities as fit their core constituents in the provinces is as flawed as the corollary that other parties must try to force urban conditions onto rural communities. This is a lazy idea can can be easily blown open by confident leadership. Different horses for these two courses is clearly what is required for the good of all.

At the core of the policy difference required between urban and country areas is in the type of transport infrastructure investments that have the most effective outcomes. Roads, Ports, Rail for freight, are needed in the countryside. Cities need these too, but they also need the spatial efficiency of quality passenger transport systems. And nowhere is this more true than in Auckland right now.

Let’s consider the evidence: Stated preference, revealed preference, and overseas examples.

1. Stated Preference:

Such an astute student of public opinion polls and changes in sentiment will not miss the profound changes happening in cities all across the world and clearly in evidence in Auckland? Here is what Aucklanders say their city needs:

 

Stuff Poll - Govt Focus

Ok well this is all very good, but are they voting with their feet, are they using the public transport there already is? Well yes:

2. Revealed Preference:

This century has shown a very strong growth in uptake of our often substandard-but-improving Public Transport systems. Here is a recent example, the latest figures for the rail network:

14 - Aug AK Rail Patronage

And if we look at the figures in detail one very very clear theme stands out loud and clear: The services that approach Rapid Transit standards, ie are on their own right of way, have a high frequency, and offer better quality service are the ones that are growing way above all else. In Auckland that means the improving rail network and the buses using the Northern Busway, each of which attracted around 18% more users this August than last.

And in particular all of the growth in numbers accessing the vital economic heart that is the City Centre has been met by our Transit Systems. Especially Rail and the NEX, but also walking, cycling, and ferry use. So much so that the economic value of the City Centre can only grow through these modes, space for private vehicle access is finite and to try to expand it can only come at considerable cost to the economic performance and appeal of the area.

3. Overseas Example:

Mr Cameron said: “Big infrastructure projects like Crossrail are vital for the economy of London and the rest of Britain. They are the foundation-stone on which business can grow, compete and support jobs

From coverage of a visit by David Cameron and Boris Johnson to the tunnels of the Crossrail project in the Telegraph.

Cameron and Johnson in Crossrail

Cameron and Johnson in Crossrail

Crossrail, while in fact the third layer of underground rail for London, is, on a scaled basis, very similar to Auckland’s City Rail Link project. While it is much bigger and much more expensive it does exactly the same thing in exactly the same way. It comprises of a core section underground through the Centre of the City that connects to existing rail lines that reach out into the edges of the city. So while the new work is under the centre the reach and value of the project is spread right to the peripheries. It brings a new capacity to a growing Centre that is extremely spatially efficient: it delivers the economic power of concentrations of people without occupying land and buildings or clogging streets with vehicles.

But the key point here is in the UK, as in the US, understanding of the economic value of urban passenger transport systems is not captured by one side of the political divide. In fact the most dynamic conservative leaders, like Cameron, Johnson, and Bloomberg are leading the charge on these projects. Because they make the most economic sense in cities.

CROSSRAIL BUSINESS CASE SUMMARY REPORT

The Crossrail Business Case Summary Report published in July 2010 presents the latest update of the business case for Crossrail, a new world-class and affordable railway across London.

The report confirms the project is supported by the Coalition Government and forms a key part of theMayor’s Transport Strategy, published by the Mayor of London in May 2010.

And for Cameron as for other modern right of centre leaders it isn’t just about the biggest cities. Speaking at the launch of a programme for investment in Rail for Glasgow, Cameron said:

And for too long governments in London and Edinburgh have acted as though taking powers away from Britain’s great cities is the best way to create growth, rather than trusting the people living there to find their own specific solutions to meet their own unique needs.

Before the election our Prime Minister made a first move towards supporting the changing shape of cities by announcing a new policy to fund urban cycleways nationally. This surely is just the start.

So, in summary, I am proposing that were John Key looking for something fresh, something that will deliver results, something that could define at least this term of his leadership if not something that could lift him up to the ranks of our greatest Prime Ministers, like King Dick Seddon, then adding Minister for Auckland, or perhaps even Minister for Urban Growth, or Minister for Cities, to his roles could be the stroke of genius he is looking for. Perhaps with Nikki Kaye as associate.

In practice this would then mean:

  • Government working much more constructively with the Auckland Council and abandoning any petty obstruction that some less mature players on the right have towards it because of their dislike of Len Brown. Key is surely well above that.
  • Championing the economic potential of our cities for the whole country. Showing that this does not come at the expense of the rest of the country and the primary sector in particular.
  • Advancing the CRL expeditiously. After all; is there a better reading of those letters than: Centre Right Legacy?
  • Recognising that the idea that efficient urban passenger transport is somehow left-wing is a curious and outdated local relic.
  • Accepting the clear evidence that the top priority for the city in terms of transport infrastructure need is a full Rapid Transit System of a mixture of modes, like our CFN.
  • Listening to all the evidence on urban form and housing affordability, and not just the lobbying of vested interests and the Demographia lobby who monotonically urge more sprawl, as there is so much evidence in favour of the economic efficiency of a more compact urban form leading to more international competitive cities.
  • Taking seriously the opportunities that cities offer for improving our energy efficiency and environmental performance nationally.

This government has officially had a policy of being a ‘fast follower’ on climate change. In practice it has done little, fast or otherwise, and always claimed that the reason for this is that it won’t do anything to add cost to the primary produce sector. Well that doesn’t explain its failure to act in the urban areas, where transport, and especially personal transport, is the biggest contributor to carbon emissions. There is a great deal of opportunity to take on all fronts by listening to the desires of city people in the transport and housing sectors and one day some leader is going to take that opportunity. Could it be now? And could that be John Key?

Urban Change: Evolution or Revolution?

“Change is the law of life and those who only look to the past or present are certain to miss the future”

-JFK

Life is nothing but change, and cities being concentrations of human life manifest this fact in their physical fabric: They are constantly changing, always incrementally, sometimes abruptly. Positively and negatively. Investment versus entropy. Governments, local and central, are charged with understanding the forces at work behind this law of life and responding wisely with our taxes to attempt to maximise the potential positive outcomes within this reality for all citizens.

DRESDEN 1945

Dresden 1945: Catastrophic change

There is plenty of evidence that suggests there is a need for substantial change in transport infrastructure investment now in Auckland. This evidence is broad based and essentially adds up to the fact that the conditions that set the policy of the last 60 years no longer hold:

  • It is clear that demand growth is shifting away from driving towards the Transit and Active modes
  • It is clear that spatial arrangements are shifting including a substantial revaluing of the centre
  • It is clear that demographics of the city are changing to smaller households and denser communities
  • It is clear that the city’s growth path is continuing; Auckland now is already city sized and getting bigger
  • It is clear that environmental and geographical constrains are tightening; resource constraints in Transport sector ever more pressing
  • It is clear that the urban motorway programme of the previous era is nearing completion; we are in a new phase
  • It is clear that newer generations just don’t share the older ones’ ideas of what is important in urban form and how to move

It is in this context that we have developed our Congestion Free Network summarised here.

However while there is clear evidence that we live in a period of discontinuity from the previous era this does not mean that what was built up during this era should be abandoned or not maintained. Quite the contrary in fact. One of the primary aims of shifting our capital investments away from the urban highway network is to build up the complementary networks to such an effective and attractive level that will keep the highways functioning well and with more efficiency. And in this our programme is not only low risk and high value but also very different from the late 20th Century revolution that it builds on. If there is one lesson to learn from the last great shift in transport investment in Auckland it is to be sure to keep what you already have and build on it; not to disregard the last system in order to focus totally on the next one.

Let’s have a look back.

The decision last century to invest in a system of urban highways for Auckland became over time a total commitment. We not only invested nearly every penny of new investment into this system starving any alternatives we also actually removed existing alternatives.

Here is a view of the leafy and desirable old suburbs of the Auckland Isthmus:

Old 'tram built' suburbs of Auckland, from Mt Eden

Old ‘tram built’ suburbs of Auckland, from Mt Eden

And here is a map of the system that made this urban form:

Auckland Isthmus tramlines

After the second world war Auckland faced the three interrelated problems. It was growing, there had been little investment in infrastructure for decades, and it lacked financial resources. To that can be added that capital investment was dependent on a suspicious government that faced, as ever, competing demands. One critical area that this came to a head was our electric tram system. While by any measure it was a huge success, carrying huge numbers of people and at around a net operating profit, it was in desperate need of catch up investment both in the machines themselves and extension to new areas.

In the context of the times the car offered a way out of this problem. There were very few of them in the 1950s, and while their uptake was expected to grow this was also expected to remain manageable. It was argued that buses could replace the trams with the advantage of operating without fixed routes and be more easily extended to new areas and at lower capital cost to public finances. All true. But really this was a way to give Auckland’s relatively narrow roads over completely to private vehicles, as no priority was allowed for the tram-replacing buses. Contrast with Melbourne: where they not only kept the more appealing trams but took advantage of wide boulevards allowing separation of trams and traffic on many routes, plus tram priority systems at intersections where they are mixed.

Relying on the car could be rationalised as cheaper too, simply because the machine and fuel costs were privatised, and that petrol taxes were to be the source of road funding. Lost in the reasoning was the fact total reliance on driving is the most expensive way of ordering a city’s movement. So while the car/road system had a good funding mechanism [fuel excise] this does not mean it is the best system economically, and this is still true today . It would require ever more enormous sums and in fact add to the ratepayer burden and not relieve it as road taxes have never covered all road costs. Let alone other burdens of this system like parking and the loss of rateable land etc.

And motorways are subject to the laws of inverse success over time: they are best when they’re new, they never get better as they attract more users. Below, rural Penrose with new motorway 1963- nice flow.

Road traffic, new Southern Motorway, Penrose, Auckland. Whites Aviation Ltd :Photographs. Ref: WA-59290-G. Alexander Turnbull Library, Wellington, New Zealand. http://natlib.govt.nz/records/23080156

Road traffic, new Southern Motorway, Penrose, Auckland. Whites Aviation Ltd :Photographs. Ref: WA-59290-G. Alexander Turnbull Library, Wellington, New Zealand. http://natlib.govt.nz/records/23080156

Part of the world view of Modernism was a faith in the completely fresh start: The Brave New World. This is evident in art movements, new philosophies, individual building projects, but also at the urban planning level. That there was a huge desire for new beginings is not surprising after the experience of the first half of the century with two extremely destructive world wars and a devastating Depression. Auckland, although it didn’t come out of the war with whole areas of the city wiped clear by bombing it did have plenty of proximate bare land, and in the city itself the buildings and structures of the colonial era were now ageing and dated compared to what seemed possible in the new American-style future. It was ripe for this ideology of ‘rip it up and start again’.

We took our lead from the zeitgeist, and the zeitgeist was all California [well, the Autobahn, actually, but no one was admitting that].

Furthermore the beginning of this new project coincided with a rise in prosperity, price controls being lifted from private car sales, and the price of crude oil fell every year from 1947-1970 in real terms. Driving boomed in New Zealand as it did all across the western world and use of the new bus network declined proportionately. And then fell into a downward cycle of falling investment, declining quality of service, and uptake. The buses were never as accepted as much as the trams and nor could they ever command the control of the road as well either.

So when in 1976 Prime Minister Robert Muldoon exploited the divisions in the many local authorities in Auckland to kill Auckland Mayor Robinson’s ‘Robbie’s Rapid Rail’ Auckland was committed, by central government, to a bold ‘double-down’ on an urban motorway centred road only transport network.

What had began as a just part of the city’s movement systems as advised by North American consultants in the 1960s became an extreme and monotonal driving-only all-in bet. Bold, ambitious, and in terms of the communities and places in its path; pitiless. All directed by central government, with local concerns overruled.

CMJ

Whole areas of the city have never recovered from the burden of hosting this land hungry and severing system; in the most affected areas land value still remain low and land use poor. They have been sacrificed for the convenience of those from other, further out parts of the new city. Around 50 000 people were relocated and 15 000 buildings removed. This was a revolution, with winners and losers.

Newton then and now

Meanwhile investment in complementary systems froze. The bus network was stuck in aspic; even though it began carrying ever more people from the mid 1990s as the city grew and began to exhibit the kind of urban realities that make driving less optimal for more and more citizens. Each time the rail network won hard fought and tiny investments; second hand trains from Perth, Britomart Station, ridership leapt in response. But still no meaningful investment in extending these parts of systems into an actual Rapid Transit Network has been able to be wrestled from successive governments this century. Although important steps towards such a system were undertaken first by the last Labour led government by funding Project Dart, a long overdue upgrade of the rail network, and the construction of the Northern Busway, and the current National led government by enabling electrification to follow through a mixture of grants and loans to Auckland Transport. And, critically, AT and AC’s multi year overhaul of the bus system and introduction of the integrated ticketing.

Yet the future still looks no different, in fact central government’s programme is one of an aggressive return to the ‘revolution’ of the late 20th Century with no new Public Transit infrastructure funding at all, just enough to contribute to operate what’s already there: [chart of spending categories for the whole country 2015-2025]

2015 GPS - Spending graph

Proposed transport spending distribution in millions.

Yet despite the huge sums spent on more lane space the growth in driving has stalled, in contrast to uptake in the underfunded Transit mode: [VKT: Vehicle Kilometres Travelled].

VKT vs PT Trips per Captia 4

 

So it is very hard to understand this policy in terms of evidence, is its based on a nostalgia for the driving boom years of last century?, or perhaps it is simply an inability of our institutions to understand change and adapt to it?, or worse are the huge sums of public money in this sector subject to capture and control by special interests?: Big Trucking, Civil Construction, Consultants and Financiers, and Land Development Interests?

It is time to build balance into our city’s movement options and to do this we need a change in where spending is directed. And properly understood this is not another revolution but rather a return to moderation and balance and away from the current orthodoxy which is lopsided in the extreme. The current policy of investing so disproportionately in the driving mode is a revolutionary policy, but not seen as such because it has become an orthodoxy. We shouldn’t be surprised with its extremity as it is a 20th Century programme, from that age of extremes and extreme ideologies. Which while at times exhilarating, it also meant much was lost, like Auckland’s tram network.

Our position is that this kind of lurch is not what Auckland needs now but instead we should build on what we have by adding to the underdeveloped Active and Transit modes while maintaining and more efficiently utilising the mature driving resource.

Green GPS Funding graph

Above is a comparison of the proposed Green Party and National Party transport policies [for the whole country]. Note that the major difference is about what to build next, and that both plan to maintain current assets. We can change from extremity to balance without losing what we have. And it is long overdue:

Robbie's Rapid Rail MW

by Architect, Cartoonist, and National Treasure: Malcolm Walker

Poll shows people want more spent on PT

Stuff have released the results of a poll they’ve conducted asking about transport funding.

Auckland has sent a clear message to the Government over its transport priorities: Give us better public transport rather than better roads.

The latest Stuff.co.nz-Ipsos poll found that nationally people wanted a government focus on better public transport over roads by a margin of 30 per cent to 24 per cent.

Another 40 per cent wanted a focus on both.

In Auckland there was much stronger backing for public transport spending, which got the nod by a four to one margin over roads among those who had a preference.

Almost 43 per cent said the focus should be on both.

For Auckland in particular the results suggest a strong support for more being spent on PT with some quick calculations suggesting 46% of respondents wanted more PT spending, followed by 43% who wanted both with just 11% wanting more spent on roads alone. Understandably the support for PT isn’t quite as strong outside of Auckland but still saw a significant number of people supporting the call for more spending on PT. I’ve put together these graphs based on the results highlight the result

Stuff Poll - Govt Focus

Additionally when asked if the government was doing enough to address congestion once again Aucklanders voted differently to the rest of the country with the majority saying no – although to be fair I’m not sure if Aucklanders will ever think enough is being done.

There was a similar, but less pronounced, division between Auckland and the rest of the country when it came to traffic congestion.

Across the nation 57 per cent felt the Government was doing enough to ease traffic jams in their region.

Even in urban areas there was still a majority at 51 per cent backing the Government’s efforts with 42 per cent saying it was not doing enough.

But in Auckland a clear majority – 54 per cent – said the Government was falling short against 43 per cent who thought it was doing enough.

Perhaps unsurprisingly Brownlee has shrugged off the results suggesting that respondents are confused

But Transport Minister Gerry Brownlee called the result a “confused” message, saying Aucklanders did not use public transport to an extent that made it truly economic.

His response shows two things:

  • That he fails to grasp the difference between peoples aspirations and the reality they live in – we know that many people will only catch PT if it is rational for them to do. You could have a bus stop outside your front door but it isn’t likely to used if the buses that stop there take long convoluted and slow routes. My guess is most people probably want more investment in PT so that it becomes viable for them to use rather than the only realistic option being to drive.
  • That he is confused about the economic and financial viability of transport systems. Both roads and PT provide economic benefits to the country by allowing for the movement of people and goods. Neither roads nor PT are currently financially viable and both require subsidies. PT subsidies are well known and often pointed out by those opposing investing in it however roads also require subsidies. About $1 billion a year is invested in them by local councils – which comes primarily from property rates – and the government themselves are spending additional money from outside of the transport budget on many of their flagship roading projects like the recently announced Accelerated Regional Roads Package.

As the Stuff article says

The poll will be a blow to the Government’s transport policy which has emphasised road building, and in particular its flagship Roads of National Significance, and has rebuffed calls from Auckland Mayor Len Brown for an early start to the city rail link.

National also made its roading policy the centrepiece of Prime Minister John Key’s speech to National’s annual conference, with a promise to spend $212 million from the sale of state-owned assets to upgrade 14 roads across the country.

“Team Key has always been very focused on roads,” Key said at the time.

The hypocrisy of the GPS

If there’s one thing – more than anything else – that annoys me about the government’s approach to transport, it’s the double standard they apply between state highway projects (particularly RoNS projects) and public transport investment. Getting any public transport funding requires analysis after analysis, proof that the timing of the project is optimal, proof that it’s definitely the most viable and cost-effective option, links with triggers around the level of use or growth in the area the project is located – the list goes on. This would not be a problem if the approach was applied consistently, after all transport projects are expensive and we should be careful when it comes to the use of public funds.

Yet the same level of analysis is never applied to state highway projects, and even less analysis when it comes to the Roads of National Significance (RoNS). Despite major concerns around the cost-effectiveness of many of these projects and a complete lack of analysis when it comes to triggers for timing, the assessment of alternatives or even basic cost-benefit ratios the projects plough on ahead.

This double-standard is carried on through to the latest version of the Government Policy Statement (GPS), which was released recently. The justification for an $11b spend on state highways is fairly general:

Following more than a decade of increasing concern about under-investment in roading infrastructure, in 2009 the Government began a significant improvement programme. With an intention to invest nearly $11 billion in New Zealand’s State highways over the 10 years to 2019, the Government focused on enabling economic growth rather than simply responding to it, providing high quality connections between key areas of production, processing and export.

Continued funding under GPS 2015 (draft) for State highway improvements will bring benefits for national economic growth and productivity, particularly given that State highways carry most freight and link major ports, airports and urban areas.

This clearly leads to a number of questions that could be reasonably asked to check whether this is the best way of spending $11,000,000,000 of public money:

  • What proof is there of recent under-investment in roading infrastructure – what’s the major problem the investment is trying to solve?
  • To what extent does investing in state highway infrastructure actually boost economic growth – where are the international examples of state highways being a better investment than other transport, or investing in education, or just letting people keep that money and deciding what to do with it themselves?
  • How will success of the investment in state highways be measured?
  • How do we know we wouldn’t have achieved the same outcomes (or nearly the same) with a much smaller spend?
  • What other options for this level of investment were considered and how did they perform on a relative basis?
  • Has the investment been working (and how might we measure that), has it achieved its local goals (like reducing congestion) and has achievement of those local goals (if it’s even happened) contributed to greater economic performance to the extent we would hope from an $11b investment?

In some shape or form, these questions have all been asked of public transport investment (either recent or proposed) by government over the past few years – but surprisingly we don’t seem to have seen the same questioned asked of the state highway programme. You’ll also notice the comment about the investment enabling economic growth rather than responding to it. The only vague reference to the impact of billions spent on state highways in recent years comes in the section on Auckland:

Since 2009, the Government has undertaken a major programme of investment in Auckland’s transport infrastructure. By 2017, Auckland will have a completed motorway network and an upgraded and electrified metro rail network. This investment programme is delivering significant results, helping to hold congestion steady despite population growth.

But if we back up a bit, we see the GPS noting that VKT hasn’t grown in recent years:

vkt-change

It seems like the GPS is saying “despite flat traffic volumes and massive investment in state highways, we haven’t managed to reduce congestion at all“. That seems to be a pretty massive elephant in the room signal that the current approach isn’t working. Yet despite some pretty obvious questions about whether we’ve got any value at all from the billions in recent state highway projects, the GPS doesn’t question ploughing billions more into future state highway spending.

Contrast that with the much more cautious approach to spending on public transport improvements:

Considerable investment has been made in the public transport network to build patronage. Much of this investment has been ahead of patronage demand, particularly in metro-rail services. A period of consolidation is needed where the focus is on securing the patronage gains anticipated from measures such as integrated ticketing, reconfigured bus networks, and metro rail investments.

No “period of consolidation” to see whether the gains from state highway improvements are realised though? No checking whether the billions spent on state highways in the past decade has led to improvements in economic performance or even reduced congestion – as per their stated goal? If we were to compare the per capita use of public transport against the per capita use of the roading network in recent years, we find quite a compelling story:

VKT-vs-PT-Trips-per-Captia-2I’m kind of struggling to see how one can interpret the above graph as “we’re not sure whether the PT investment is working but clearly we need to keep spending billions on roads”.

Which is what the GPS does, showing its hypocrisy.

The Draft 2015-2025 Government Policy Statement

Yesterday the government released the draft Government Policy Statement (GPS) for 2015-2025 and it continues the 1960’s thinking that we’ve been stuck with for years. As things are currently set up the GPS perhaps the most important document in determining what is invested in. The Ministry of Transport describe it:

The draft GPS 2015 sets out the priorities, objectives and funding levels for land transport, establishing funding ranges for land transport activity classes and identifying the results expected from this investment.

How the GPS is linked to other transport plans is in the image below.

2015 GPS - Document heirachy

Overall the GPS doesn’t seem dramatically different from the 2012-2022 one that it will replace so there are definitely no surprises in it, although it does provide a little bit more detail in some areas. Overall there are three high level strategic areas that are meant to be being focused on.

  • economic growth and productivity
  • road safety
  • value for money

The sections on Existing Demand and Travel Forecasts are perhaps some of the most interesting and are something that didn’t exist in the previous GPS. However they seem to be an attempt by the MoT to continue trying to justify spending the XX% of the transport budget on massive new motorways. They do seem to be finally acknowledging that traffic volumes haven’t grown but then push the argument that everything is just a blip and will recover again soon.

30. GPS 2015 (draft) has been prepared following a period of modest increases in freight demand and flat demand in light vehicle travel, measured in vehicle kilometres travelled (VKT). This is illustrated in Figure 2.

31. Demand grew strongly through the early 2000s, easing back through the middle of the decade. Following the global financial crisis in 2008, demand returned to close to 2005/6 levels and remained at these levels through to the end of 2013. A similar period of flat demand occurred in the aftermath of the fuel crisis in the early 1970s. In that case, demand remained soft for more than 10 years.

2015 GPS - Travel Demand & Fuel

The problem with this is that overall the economy has already recovered and improved yet we are still to see any upward change in VKT or fuel consumption. The difference in the graph above where fuel consumption started increasing again is likely tied to fuel prices getting cheaper and there’s no sign that’s about to happen again anytime soon. In fact there’s not even a single mention in the document of what might happen to fuel prices in the future which in my opinion is a massive omission. Fuel prices can clearly have a massive impact on driving demand and without increased demand the already shonky economic cases for the massive roading spend up will be even worse.

Another of the new additions to the GPS is to more specifically talk about congestion, particularly in relation to Auckland and Christchurch. For Auckland we do get one brief admission which I’ve bolded below however they also talk about the need for further capacity increases.

44. Since 2009, the Government has undertaken a major programme of investment in Auckland’s transport infrastructure. By 2017, Auckland will have a completed motorway network and an upgraded and electrified metro rail network. This investment programme is delivering significant results, helping to hold congestion steady despite population growth.

In this GPS quite a large section is devoted to objectives and results with them being much more explicit than in the previous GPS. Of the things that caught my attention.

  • The Roads of National Significance continue to remain a key objective which is unsurprising however in the 2012 GPS the government also named four additional routes they said may be considered for future RoNS. They were Hamilton to Tauranga, Cambridge to Taupo, Napier to Hastings, State Highway 1 north and south of the current Christchurch motorway projects. The good thing is there is no mention of them in this GPS and the Q&A paper says it is due to the government wanting to concentrate on the ones still under construction. That will be because of the pressure they’re putting on funding sources which is being driven in large part by traffic volumes not increasing like expected.
  • For Auckland they talk about the need for liveable and connected cities being critical to economic and social prosperity however as we know a comparatively small amount is being spent to improve connectivity for anything but one mode.
  • On Public Transport they claim considerable amounts have been spent investing ahead of demand referring specifically to integrated ticketing, reconfigured bus networks and rail improvements. They say that a period of consolidation is needed where the focus is on securing the gains of that investment. In short that means they aren’t investing in any significant PT infrastructure. This of course ignores that since 2009 patronage in Auckland alone has risen by about 12 million trips or 20%.
  • On cycling the wording suggests a greater acceptance of the role that cycling has to play. It points to the positive results of the model communities initiatives as well as pointing out that in many places existing dedicated cycle facilities are often fragmented. It also notes that there are health benefits to having more people cycling but then seems to writes them off by basically saying cycling is dangerous. The real kicker with cycling is that the results talk about extending and improving cycle networks but only where it “can be achieved at reasonable cost, including impact on general traffic capacity”. This is a massive cop out and of course on the cost aspect the complete opposite of the approach taken with the RoNS where no expense is spared to get the best outcome. This is also at odds with the strategic focus the GPS says it puts on road safety.

The really key part of the GPS however is the funding section which puts in place funding ranges for each transport activity. This time the MoT has decided to make a few changes to the funding activity classes, joining some together. To me this is actually a fairly logical thing and should allow more flexibility. As an example in the 2012 GPS public transport services and public transport infrastructure were two different things and funding from one couldn’t be used for the other. The change should mean that within the funding class what delivers the best outcomes could be built regardless of whether it was a service or infrastructure improvement.

One new funding class has been added to specifically pay for regional infrastructure projects. Probably a way to try and combat the perception that Auckland gets all the funding.

Here are the draft funding ranges. The actual amounts to spent in each category won’t be known until the NZTA releases its National Land Transport Plan.

2015 GPS - Funding Ranges

To see how they compare to what was in the 2012 GPS I’ve taken the midpoint of the results and compared them to the midpoint of the 2012 GPS. The midpoint isn’t exactly the same as what the NLTP suggested but is useful for an indication. I’ve coloured the numbers green if they’ve gone up or red if they’ve gone down for the parts that overlap. Interesting that there’s actually a slight decrease in State Highway spending after 2018 from what was previously planned.

2015 GPS - Funding Ranges 2012 vs 2015 2

 

 

 

So using these midpoint figures I’ve also grouped the spending into high level categories

2015 GPS - Spending graph

All up this plan is very much a continuation of what we’ve had for the last 5-6 years which is hardly a surprise. A heavy focus on rural motorways with very little attention being paid to any other mode. It’s blinkered thinking that comes straight from the 1960’s.

New Waikato and Bay of Plenty motorways confirmed

The NZ Herald reports:

This afternoon Transport Minister Gerry Brownlee is expected to announce funding for two transformational roading projects. A $4 billion four lane motorway between Cambridge and Taupo, extending the Waikato Expressway a further 100 kilometres to the south and an $8 billion 50km motorway from Cambridge to Tauranga which includes a 14km road tunnel. Both projects were hinted at in the 2012 Government Policy Statement for Land Transport Funding. He will announce the projects at a ceremony to celebrate the extension of rail electrification into Britomart station. 

“These are critical projects for improving freight efficiency in the North Island,” says Mr Brownlee in a leaked copy of his speech. “While we realise a near $12 billion investment in two roads that each carries fewer vehicles than the Kopu Bridge did when it was still one lane may appear to some as slight overkill, we think that those opposing the project just oppose progress and want us to return to dirt tracks and horse carts.”

NZ Transport Agency Regional Director Harry Wilson said his office was in celebration mode over the Minister’s announcements. “Once the Waikato Expressway project is finished in a few years’ time, we really didn’t know what we’d do with ourselves as we’ve lived and breathed that project for the past decade or more. We’re so pleased to see the government commit to the future of the Southern Waikato and Bay of Plenty regions – even though combined they’re not really growing – which will keep us in work for many years to come!”

Mr Wilson also noted that his organisation had been instrumental in pushing for the inclusion of the two projects in the 2012 Government Policy Statement and were “enthused” the project had been given funding approval. “We’ve learned a lot from our Wellington office in the past few years about the tactics of getting unnecessary projects in parts of New Zealand that aren’t growing over the line. We’re just so proud to have come up with the two biggest and most expensive projects ever imagined in New Zealand and now have funding approval for it!” Mr Wilson added.

Minister Brownlee noted in his speech that “Much like other Roads of National Significance, the Cambridge to Taupo and Tauranga motorways will duplicate an existing route where upgrades to that road could achieve most of the benefits for a fraction of the cost, but frankly upgrading what we’ve got is just boring – I want more motorways!”

Traffic counts between Tokoroa and Taupo on State Highway 1 show a slight increase in daily vehicle volumes from 6500 in 2009 to 6700 in 2013. Mr Wilson noted that “our traffic modelling suggests traffic volumes will increase to 60,000 cars a day in the next 5 years – almost all of which will be trucks!”

On State Highway 29 over the Kaimai Ranges traffic had also slightly increased, growing from 9200 vehicles per day in 2009 to 9300 in 2013. In the next five years this route is expected to increase to over 80,000 vehicles per day. The high number of trucks is said to be a key part of the decision to construct a tunnel under the Kaimai Ranges which was first investigated by the NZTA in 2010.

Local politicians unanimously supported the project when spoken to.

South Waikato District’s mayor Neil Sinclair said the projects would boost the economic productivity of his region significantly and wasn’t worried about the impact of the new motorway bypassing Tokoroa. “Look at Pokeno, it recovered a mere 15 years after being bypassed by the Waikato Expressway,” stated Mr Sinclair.

Taupo District Council’s mayor David Trewavas also stated his strong support for the project. “We’re about an hour and a half south of the thriving metropolis of Hamilton. This motorway will cut that time by at least a minute or two, which will be transformational to our economy. A local resident walking past added that they “didn’t care what was built, as long as it meant the money couldn’t be spent in Auckland.”

New Zealand Road Transport Forum chief executive Ken Shirley said the two roads were great news and would allow trucks to even compete better with Kiwirail, especially on the Tauranga to Auckland route. “Everyone knows that the wider population and other road users subsidising trucking is a great investment and these two projects will be great for that” he said.

Details of the project’s exact route, the timing of construction and how it will be funded have yet to be determined but when questioned, Mr Brownlee said he was optimistic the money could be found for such important additions to state highway infrastructure in the Upper North Island. “Hey we could always push that silly rail loop under Auckland’s city centre back a few more years,” Mr Brownlee shouted at reporters while leaving the airport for Britomart station in a Crown limousine.

A business case for the motorway projects is expected to be presented to Cabinet for funding approval next Monday.

Cambridge to Taupo and Tauranga motorways

Does building roads harm the economy?

Most proposals to build new roads or widen existing ones seem to boil down to an ultimate belief that it will “help the economy”. Whether it’s by improving freight reliability or getting people to their jobs faster or helping business travel or whatever, there seems to be a fundamental belief among many that quite a strong relationship must exist between building more roads and improving the economy.

Clearly this is a contestable assumption, and some recent research in the USA details some pretty interesting trends – as reported on in Planetizen:

University of Minnesota professor David Levinson has written in the past that, because of the relative completeness of our national highway network and the cost of construction, the return on investment for additional mileage is approaching zero. One study estimates the return on investment for highway construction was just 14% between 1990 and 2000.

I recently decided to follow up on this line of research, so I dug through some Census data. What I found was shocking, though not altogether surprising. It seems that, besides wasting billions of taxpayer dollars, road-building may actually be holding back economic growth overall: from roughly 2000 to 2010, states that built the fewest urban road miles grew an average of 64 to 94 percent faster than their asphalt-enamored neighbors. Rather than increasing productivity through increased mobility and reduced congestion, as politicians and lobbyists so often promise, all this mindless road-building could be depressing statewide economic growth!

Let’s look at the details a bit more:

Looking at the numbers in aggregate, we see some interesting trends that seem to hold up just about any way you slice the pie:

  • States that increased their urban road mileage by less than 30% grew by an average of 14.40%, while those that increased mileage by greater than 30% grew by an average of just 8.77%.
  • If we set the cutoff at 20% mileage growth, states that built less grew by 17.97%, and states that built more grew by 9.24%.
  • At a 10% cutoff, states that built less grew by an impressive 20.70%, compared to just 10.66% for those that built more.

Statistically, analyzing the correlation between road-building and economic growth gives us an r-score (correlation coefficient) of -0.34, which implies that about 10% of a given state’s economic growth can be explained by how much urban road-building they did over this time period. Many things influence the overall health of any economy, obviously, so we shouldn’t expect the quantity of roads to wholly predict statewide economic growth by itself, but this does indicate a negative correlation between the two variables: more roads equals less growth. (As always, please remember that correlation does not imply causation.)

And for a graphed comparison:

roads_vs_growthThe post’s author, Shane Phillips, doesn’t think that these results are particularly surprising:

None of this should be particularly surprising. While politicians and advocates love to tout the job-creating value of new road and highway capacity, congestion reduction rarely lasts more than five years and widened roads ultimately only succeed in extending the boundaries of wasteful, unproductive sprawl. In the case of road widenings, it’s entirely possible that the disruption caused during the construction phase completely erases — or even exceeds — the fleeting benefits of reduced congestion.

Then there’s the opportunity cost: think of all the good that could have been done with the hundreds of billions of dollars spent on roadways over that period: more responsible transportation spending, education, renewable energy … take your pick.

I think it’s probably unlikely that building roads directly harms the economy, but there are logical reasons to think that it might cause indirect harm: particularly due to it not the best use of public funds and encouraging dispersed land-use patterns which undermine agglomeration. New Zealand’s heavy dependency on private vehicles also forces us to spend a lot of money each year importing cars and oil – basically cancelling out wealth that we create from exporting dairy to the the world.

The next version of the Government Policy Statement will be released some time later this year. If it’s anything like the current version it will stress the importance of transport’s role in improving the economy and then make a giant leap of faith in assuming that building more roads is the best way for transport to improve the economy. It’s time to fundamentally question that assumption.

Is the government trying to take over Auckland Transport?

In his column this morning, Brian Rudman covers an area we haven’t been paying enough attention to, how the changes to the Land Transport Management Act will affect the governance of transport in Auckland. Rudman starts out by explaining the situation:

By sheer weight of numbers, elections are won and lost in Auckland, so it would seem suicidal for a government to declare war on a third of the population. But that seems to be exactly what the Key Government is doing.

Of course it’s not the first government to see Auckland as “the enemy”. Labour’s finance spokesman, Michael Cullen, once infamously quipped to a Taranaki election audience that “Auckland now sits atop the nation like a great crushing weight”.

But National’s current behaviour has a pattern to it that goes beyond pre-election hyperbole. Having created the Super City less than three years ago, it is acting as though it was all a big mistake and the aim is now to emasculate the monster it created.

In recent times, the mortars have been lobbed across the Bombay Hills from Wellington in a near-continuous barrage. Last week, at a post-Budget meeting with Wellington businessmen, Finance Minister Bill English warned: “We cannot let 20 planners sitting in the Auckland Council offices make decisions that will wreck the macro economy. We cannot let that happen, and we won’t let that happen.”

This was hot on the heels of the charade of the Auckland Housing Accord. This was supposed to signal the working-out of a mutually agreed solution to the city’s housing shortages. Yet a few days later, Housing Minister Nick Smith was threatening to “intervene by establishing special housing areas and issuing consents for developers”.

The idea that the government is lobbing verbal and policy mortars over the bombays seems like quite an apt description. I suspect that there are much more than 20 planners sitting in the council offices, although perhaps Bill is just referring to the senior staff. Rudman continues:

Sailing below the radar is the most concrete example of the Government’s efforts to sabotage Auckland’s local democracy. The tool being used is the boring-sounding Land Transport Management Amendment Bill, which will become law early next month. It will usher in a significant transfer of power in the area of transport planning, from the Auckland Council to the Government.

The new law strips Auckland councillors of their power to decide how the $459.5 million of ratepayers’ money – 33 per cent of total rates income – spent on transport each year is targeted. Instead, the final arbiter will be the unelected board of Auckland Transport, which will have to follow the Government policy statement (GPS) on land transport. The only sanction the Auckland Council will have to control the board of Auckland Transport – a council-controlled organisation – if it goes feral is to sack it. But the new law insists the board’s first loyalty in setting transport priorities must be to the government GPS, so what would a replacement board do differently?

This is quite concerning, the GPS effectively sets out governments funding priorities and ranges. At the moment they have focused almost entirely on the building of new roads and specifically the Roads of National Significance at the expense of other state highway improvements, local roads and of course public transport. Being fair, the current government didn’t set up the GPS as it was brought in by the previous government. This also shows one major flaw when complaining about it, it can be changed by a future government. A change in government could see funding priorities for which we may be thankful should we ever have an anti PT council.

Its also funny how Bill English complains about a handful of planners sitting in Auckland making decisions that could wreck the economy but doesn’t object to probably a similar number sitting in the MoT offices in Wellington making decisions that will wreck the cities future transport network and economy. But it gets worse:

The new act also ignores another statutory document, the Auckland (Spatial) Plan, which sets out Auckland’s direction and policy, including the integrating of land-use with transport.

Speaking to the select committee on behalf of the Auckland Council, transport committee chairman Mike Lee complained of the impending loss of democratic accountability to Auckland ratepayers, pointing out that Auckland would be the only part of New Zealand where elected representatives would not set the local land transport plan.

He said that by law, the principal objective of a council-controlled organisation such as Auckland Transport was to “achieve the objectives of its shareholders, both commercial and non-commercial”. He said the situation “would in effect be creating two local governments in Auckland”.

It was “appropriate in terms of its statutory responsibilities and as owner, major funder and sole shareholder of Auckland Transport, that the Auckland Council continues to set the long-term direction for transport”.

The select committee did the reverse, noting that it had gone out of its way to recommend changes “to ensure that Auckland Transport may not delegate its responsibilities for regional land transport plans and passenger transport plans to the Auckland Council”.

It did this by repealing the Local Government (Auckland Council) Act 2009 clause that says the governing body of Auckland Council is responsible and democratically accountable for setting transport objectives for Auckland.

So not only are we being forced to have to follow the governments transport agenda but our elected representatives won’t even have the chance to set the high level strategy any more. This is effectively taxation without representation and is shameful. To me it also suggests that the government are scared of the amount of power the council has. They were expecting a different result 3 years ago but it backfired so now they are trying to back pedal as much as possible to regain control of the city.

In saying all of this, while it is a concern that the council is being shut out of the process for setting policy, I know that there are many very good people at Auckland Transport who are not about to quickly jump on the more roads agenda. Hopefully they will be able to keep things going in the right direction until such time as a future government can resolve this – although it is very rare for a government to give up acquired power so we will just have to wait and see.

If we did start to see some really bad projects being progressed ahead of much needed ones – well more than they are already – I wonder what ability the council will have to withdraw funding for them? If they say that they won’t provide any rates funding unless the projects proposed meet the councils goals then we could end up in a very public power struggle.

Kiwis want more spent on Public Transport

Well the title says it all really and it comes from a survey done by UMR Research, included in their Mood of the Nation Report for 2013:

New Zealanders are much more likely to support Government funding to go to public transport than they were 20 years ago. In 1992 they plumped for motorways by a 43% to 25% margin over public transport. In 2012 public transport is preferred by a 48% to 37% margin.

UMR Road vs PT poll

 

Going from 25% to 48% is a sizable change and ties in with how our transport preferences are changing.  The reality is that the government simply isn’t listening to public perception on this issue, as our current transport spending is woefully lopsided. Spending is dictated at a high level by the Government Policy Statement, the NZTA then takes that guidance when coming up with the National Land Transport Plan. Below is a breakdown of the NZTA’s share of transport spending for the 2012-2015 plan:

NLTP 2012-15 Investment Levels

And here is graph showing how much is going to roads and how much to PT (incl. walking and cycling):

NLTP 2012-15 Roads Vs PTThat is a big disconnect between what the public want, and what the government is doing.