So, John Key announced he was resigning as Prime Minister yesterday. I’m sure that over the coming days and weeks there will probably be a nauseating amount of coverage about him, his decision and whoever his replacement ends up being. Below are a few thoughts on the role Key has played in the discussion of urban transport in Auckland
Perhaps Key’s biggest influence on urban issues has been in relation to the City Rail Link. If you cast your mind back, in 2008 he first appointed Stephen Joyce as Minister of Transport and then in 2011 he appointed Gerry Brownlee. Both men, and obviously with the backing of Cabinet, were extremely critical of the project, primarily by appearing to completely misunderstand and misrepresent its purpose and the impact it would have. For example, Joyce once said of the project “that is not smart transport; that is pouring money down a hole”, while Brownlee was perhaps even more opposed, at one point in late 2012 saying “I take big issue with the suggestion that the city rail link is useful or popular”. Even in May 2013 Brownlee was downplaying the project and suggesting it was unimportant.
But everything changed just a month later in June 2013 when Key overrode his ministers and announced for the first time that the government would support the project – albeit not till 2020 and with uncertainty around the exact level of funding from the government. At the beginning of this year Key again weighed in on decisions about the project by announcing the government would support the project starting sooner than 2020. In both cases the business community had a strong part to play in changing the government’s position.
Even though it took a lot longer than hoped, I suspect we could still be hoping for the project now if the likes of Joyce or Brownlee were in charge.
The second big transport area Key has played a important role has been with cycling. He was instrumental in creating the Urban Cycleway Fund (UCF), which has resulted in unprecedented levels of spending on cycling after decades of almost no investment in bike infrastructure.
John Key while on a visit to the Netherlands
But it wasn’t just his support for the CRL and cycling projects that was positive, he turned up to a lot of transport events, from cycleway celebrations, to business lunches and even to celebrate the arrival of the final electric train, and speaking about urban transport incredibly well, often making comments that are not too dissimilar to what you might find here on the blog. As one example, here’s one part of what he said at the EMU celebration last year.
When it comes to public transport, there’s nothing unique about New Zealanders or Aucklanders. You know this sort of thing that’s put out there that the average Aucklander isn’t going to get on an electric train or bus or whatever. It’s not true because those very same Aucklanders when they go to London and live there for the big two years on the OE the first thing they do is get on the tube. So what’s the difference, well the answer is sheer convenience and reliability and in the end people will get on trains alright provided they turn up when they want them, they’re there and working, and they’re clean and tidy, and that’s exactly what you’ve got going on here.
He may not have been perfect but at least he seemed to understand urban transport issues when he wanted to, although perhaps it’s just the mark of a good politician to say the right things to the right audience.
It’s also worth noting that his government is currently trying to stop Light Rail from being an option on Dominion Rd with a remarkably similar approach/feel to it as the opposition to the CRL prior to 2013.
With Key going, of course now focus is going to shift to who the next leader will be, and the likely Cabinet lineup. Here are a few things to think about.
- At this early stage, Bill English is widely tipped to become the new leader. As I understand it, he’s been quite important behind the scenes in understanding the urban economy argument which has helped in getting the government to support some of the investment mentioned above as well as things like the Unitary Plan. If he becomes the PM a lot of people are picking Stephen Joyce to be the next finance minister. Given his stances he’s taken in the past on many of the issues we advocate for I can’t see this being a good thing.
- With a new leader, and election a year away, it’s highly likely we’ll also see a cabinet reshuffle. I actually think Simon Bridges has done a relatively good job in the role over the last few years and I’m not sure if there is a better person for the job within the government at the moment, especially at that Cabinet level.
- There always seems to be a resentment towards Auckland from the rest of the country as to how much is spent here by the Government. Across all areas combined, Auckland typically gets a smaller share of government spending than its share of population or GDP. Key was possibly one of Auckland’s biggest allies in the government so with his departure does it mean we could see the National Party shift focus and spending away from Auckland in a ‘play for the regions’?
- On some more specific questions,
- Will the government still share the costs of the CRL 50:50?
- Will we see a repeat of the Urban Cycleway Fund after the next election?
- Will we see light rail down Dominion Rd?
What are your thoughts on John Key’s resignation? (as they relate to transport and urban issues).
Aucklands newest and one of its most prominent cycleways was opened this morning on Quay St by John Key along with transport minister Simon Bridges, Mayor Len Brown and a host of other officials. The opening was certainly helped by the thunderstorms of we had overnight easing and the clouds even parting to make for a calm winter morning.
John Key, Simon Bridges, Len Brown and AT Chairman Dr Lester Levy all spoke before the ribbon was cut. I thought all spoke well about the need for us to develop integrated networks that are safe for all and not mixed with other vehicles like cars and buses. Lester also put his health hat on reminding people that on top of the transport benefits of being about to move a lot more people in the same about of space, those cycling also tend to be healthier which has benefits to the health system.
After the speeches it was time to cut the ribbon and for officials to take a ride.
Like other cycleways, AT have installed cycleway counters but for the first time they’ve also added a visible counter so everyone can see how many people have passed every day and year.
I suspect this will quickly become the busiest cycleway in Auckland. Before and even during the speeches there were cyclists passing by on a fairly frequent basis.
As part of the project the entry to the port has also been made safer.
Congratulations to everyone involved in making this project happen..
Here’s the official release from AT on it which also highlights that there are a couple of consultations for other major project coming up soon including Ian McKinnon Dr later this month.
Auckland’s waterfront will be an improved urban space and an even busier cycle route following the opening of the Quay St Cycleway today.
The Prime Minister, Transport Minister Simon Bridges, Mayor Len Brown and a large group of people on bikes, were the first to use the city centre’s newest cycleway. The opening was preceded by a dawn blessing with Iwi representatives.
A new cycle counter on the promenade, a first for Auckland, will highlight the number of people cycling along one of Auckland busiest routes.
On the waterfront side of Quay St, the 1km, two way cycleway goes from Princes Wharf at Lower Hobson St to Plumer St. The $2.18m cycleway is being delivered by Auckland Transport and has local funding and an investment from the Government through NZ Transport Agency and the Urban Cycleways Programme.
It will benefit everyone who spends time at the waterfront and will encourage more people to start cycling into the city centre says Kathryn King, Auckland Transport’s Cycling and Walking manager.
“Having a dedicated cycleway like this means there is more space on the promenade for people to walk and enjoy the harbour views. The planter boxes, which provide protection from traffic, improve this wonderful space by adding some greenery.
“The cycle route into the city centre along Tamaki Dr is the busiest route in Auckland, and this will make cycling from the east even more attractive. Providing a protected cycleway on Quay St gives people working in the downtown area greater travel choice and an excellent cross-town route that avoids a lot of city traffic.”
Mayor Len Brown says it’s another important chapter in his vision for Auckland as the world’s most liveable city as it transforms the city centre into a pedestrian and cycle friendly destination.
“This project is another example of Auckland Council, Auckland Transport and the Transport Agency working well together to achieve a great outcome.”
Bike Auckland, chair, Barbara Cuthbert says the cycleway is a great addition to downtown Auckland. “It’s hugely exciting to have a safe separated space for people cycling and those walking close to rail and ferry services.”
Map QuaystThe three-metre-wide cycleway connects with the Beach Rd Cycleway at Britomart Pl and by the end of 2018 will link with the Nelson St Cycleway and Westhaven to City Cycleway at Princes Wharf and the Tamaki Dr Cycleway.
When phase two of Nelson St Cycleway is constructed next year, the city centre cycle loop will be complete. This loop includes Lightpath, Nelson St, Grafton Gully, Beach Rd and Quay St cycleways.
Auckland Transport is working with project partners Auckland Council and the Government through the NZ Transport Agency and the Urban Cycleways Programme on a $200m programme of cycle improvements from 2015 to 2018.
Quay St Cycleway
- The Quay Street Cycleway is delivered by Auckland Transport and is one of the projects funded in the 2015-18 Urban Cycleways Programme (UCP).
- Auckland Transport is working with project partners Auckland Council and the Government through the NZ Transport Agency and the Urban Cycleways Programme on a $200m programme of cycle improvements from 2015 to 2018.
- The UCP involves central government partnering with local government to accelerate the delivery of $333 million of key cycle projects around New Zealand over the next three years
- The $2.18 million cycleway is funded from $0.70M Central Government, $0.75M National Land Transport Fund, $0.73 million Auckland Transport. This project is part of the wider Auckland city centre package project announced through the Urban Cycleways Programme.
- The one kilometre long, three metres wide, two-way cycleway goes from Princes Wharf, Lower Hobson to Plumer St. The majority of the route is on-road, physically protected from traffic with concrete separators (similar to Nelson St Cycleway) and planter boxes.
- This cycleway connects with the existing shared path on Quay St in the east. By 2018 AT will have delivered another cycleway that will connect Quay St Cycleway at Plumer St with the start of the Glen Innes to Tamaki Dr Shared Path at Hobson Bay. People will be able to cycle and walk from Glen Innes to the city centre.
- Beach Rd Cycleway connects with Quay St at Britomart Pl allowing people to cycle all the way to the Northwestern Cycleway via Beach Rd Cycleway and Grafton Gully Cycleway.In the west, people can now cycle over Te Wero Bridge to Wynyard Quarter and around the Viaduct. Ultimately it will connect with Westhaven Dr to City Cycleway and Nelson St Cycleway when they are completed in 2017.
- When Nelson St Cycleway phase two is complete next year, a city centre cycle loop will be complete including the pink Lightpath, Grafton Gully Cycleway, Beach Rd Cycleway and Quay St Cycleway. The project team is currently working on how best to connect Nelson St Cycleway (which currently ends at Victoria St) with Quay St Cycleway.
Cycling in Auckland by numbers
- 750 cycle trips per day on pink Lightpath since it opened December
- A doubling of the number of people cycling into the city over three years.
- 50% increase in people cycling in Symonds St/Grafton Gully corridor following opening of Grafton Gully Cycleway in 2014
- 20% increase in people cycling on Northwestern Cycleway in May 2016 compared with May 2015.
Upcoming cycle projects in Auckland
- Mangere Future Streets opening late September
- Mt Roskill Safe Routes opening late October
- Ian McKinnon Dr Cycleway public consultation starts July
- Karangahape Rd Streetscape Enhancement and Cycleway public consultation by August.
- Great North Rd Cycleway public consultation by the end of 2016.
Yesterday the Government announced its latest policy on addressing the housing crisis in Auckland and increasingly in other centres, a $1 billion infrastructure fund to pay for the bulk infrastructure needed to support *some* of the new houses needed in greenfield areas.
The Prime Minister today announced a new $1 billion Housing Infrastructure Fund to accelerate the supply of new housing where it’s needed most, Finance Minister Bill English and Building and Housing Minister Dr Nick Smith say.
The contestable fund will be open to applications from councils in the highest growth areas – currently Christchurch, Queenstown, Tauranga, Hamilton and Auckland.
Mr English says the Housing Infrastructure Fund will help bring forward the new roads and water infrastructure needed for new housing where financing is a constraint.
“The Government will invest up front to ensure the infrastructure is in place. But councils will have to repay the investment or buy back the assets once houses have been built and development contributions paid.”
As we know Auckland is growing at rate faster than any other region in the country – there are a few districts growing faster, such as Selwyn following the Earthquakes but they are also off a much lower base. The Q&A suggests that the high growth areas are defined as the areas expected to see a 10% growth in the 10 years to 2023. In that time frame, Stats NZ predictions suggest that Auckland will see 58% of the country’s population growth. That figure is even higher if just comparing the five areas listed with Auckland taking around 70% of that growth. As such we can expect the lion’s share of that $1 billion to be used in Auckland. Auckland’s growth over the following years doesn’t slow down either and in the 30 years to 2043 over 60% of all growth in NZ is expected in Auckland.
One big issue right from the start is that for those other cities, a share of $1 billion would go a long way. But in Auckland with its infrastructure needs on another scale, it would be gulped down so fast it would barely touch the sides. The recent work that AT and the NZTA have been doing on Transport for Future Urban Growth suggests that over 30 years around $10 billion is needed in the greenfield just for transport infrastructure. On top of more funding is needed for other physical and social infrastructure that will be required to ensure these new developments have the level of amenity that will be expected/required such as parks, community facilities and much more.
There is of course a lot more infrastructure that’s needed in Auckland but seems that only the greenfield stuff counts for this funding.
Dr Smith says the fund will be available only for substantial new infrastructure investments that support more new housing, not to replace existing infrastructure.
“To access the fund, local councils must outline how many new houses will be built, where they will be built and when they will be available. Ideally, they will have agreements with developers on these issues.
“Funding may also have other conditions attached, such as faster processing of resource consents. All of this will require close collaboration between central and local government.”
Mr English says infrastructure, and its financing in particular, is one of the three key constraints to building more houses – alongside land supply and consenting requirements.
“Councils have strict debt limits which means some lack the headroom to invest in infrastructure now and then wait for future development contributions to recover the costs. The fund will help provide more infrastructure sooner by aligning the cost to councils with the timing of revenue from development contributions.”
Depending on the number and timing of applications, it will require the Government to temporarily borrow up to $1 billion, which will increase net debt until it is repaid.
Only funding new infrastructure is kind of understandable but it does raise some questions, such as just what constitutes new infrastructure. In many cases building new roads or pipes also requires upgrading existing infrastructure to cope with the demands of new areas. We know we can’t just build tens of thousands of dwellings on the edge of town and expect the motorways to work. We also know that there are plenty of areas within the existing urban area for which replacing existing infrastructure is likely to be needed to enable new development. One such example would be the NW Busway which enables growth in existing urban areas such as Te Atatu but also will be critical in enabling growth in the entire North West.
I guess that if councils can assume this fund will pay for some of the greenfield growth they would have otherwise needed to build, it enables them to re-prioritise budgets to focus their normal funding on improving existing infrastructure.
One aspect I do like is the idea of linking funding to developments, the last thing we want is the council or government spending precious funds building infrastructure to an area only for a developer not to build anything and then profit off the increased land value. That of course also raises the question of why the government doesn’t just build a heap of homes themselves.
Perhaps the biggest issue with this announcement is that it’s not going to have any real short term impact. Even if the funding tap was turned on tomorrow – and it seems the details are yet to be worked out – the types of infrastructure projects that this fund will help deliver are not quick things to enable. They normally take years of planning, consenting and construction before any house can be built and so it will be many years before any housing this fund enables will have any impact on our current crisis.
Overall the fund seems useful but not quite as useful as the government’s headline suggest. A lot of it is going to end up coming down to the details and rules put in place and those have yet to be worked out. Ultimately the whole thing just seems like a way of loaning money to councils in a way that sits on their books differently. It will also be critical to see just what projects get built with this funding. If it just results in trying to quickly build a pile of auto-dependant sprawl that would be a terrible outcome but if it also is focuses on good quality outcomes such as decent walking, cycling and PT facilities it could be quite useful.
In addition to the infrastructure fund, the government have also said they’re looking at setting up urban development authorities.
Dr Smith says the Government is also considering establishing Urban Development Authorities (UDAs) to help further speed up the supply of new housing.
UDAs have streamlined powers to override barriers to large-scale development, including potentially taking responsibility for planning and consenting and other powers.
In some form or another we already have a few of these with the likes of Panuku Development Auckland, the Tamaki Redevelopment Company and the Hobsonville Land Company. How will a government UDA be different from these, with the possible exception of having the power to compulsory acquire land. If they did allow for compulsory acquisition it would be interesting to see if they also extended that to at least Panuku.
So yesterday was the symbolic ground-breaking, or perhaps more accurately the ground-exploding for the City Rail Link. If you weren’t there and didn’t watch the live stream the video is below and the actual ceremony starts from about 48 minutes. I thought I would give some of my views of it.
Over the years now I’ve been to a number of ground-breaking ceremonies and this was by far the most interesting. Auckland Transport and the Council certainly put a bit of effort in here but I guess when you’re celebrating the start of largest single transport project that is kind of justified.
AT held the event right out in front of Britomart which was a good choice. While they had a marquee (and some tasty CRL cupcakes) for those who had been invited, it also allowed members of the public to join in too and there appeared to be quite a few people doing so. The people in shot below were outside of that invited area. For those outside of Auckland, as you can see the weather also turned it on which was a nice change after the last 3 weeks or so.
Some of the CRL cupcakes
Right off the bat one aspect that was quite different and I thought a nice touch, was to have quite a strong focus on youth. This was optimised by having a 17-year-old from Waitakere College as the emcee for the event. She brought a lot of energy to her role which was refreshing to see.
John Key was the first speaker and I thought his comments were very good, in particular this part.
Second thing I think is that ultimately what we’re seeing in cities around the world that are doing well and progressing is that they’re places where people want to work, obviously, but they’re also places where people want to live and people want to be entertained. And what we’re seeing as Auckland grows up and indeed grows out, is a lot more apartments being built and I think over time you’re going to see more and more people live in the CBD, they’re not going to own cars, they’re going to get on the City Rail Link, they’re going to get on the train for transportation, they’ll get on the bus, and frankly they’ll probably take a taxi or Uber. And they’ll have their living, working and entertainment happen here in the CBD and that’s really what this is about, it’s an investment in the future, it’s an investment in Auckland, it will make a great difference in transforming the city, it’s a very futuristic project.
It’s not the first time I’ve heard Key speak positively about transport or urban issues and I guess some of that comes from his time spent overseas in the likes of New York so it’s all the more surprising that these attitudes haven’t flowed through to some of his ministers or transport priorities.
Key was followed by Simon Bridges who also talked very positively about the project and the impact it will have even referencing the council’s “World’s Most Liveable City” goal. Both Bridges and Key also paid respect to Len Brown for his ongoing advocacy for the project which has been instrumental in getting it to this point.
Next up it was Lester Levy who talked about what it takes to make a project like this happen including highlighting that they’ve got experts from around the world working on the CRL
Then it was time the speech that most were keen to see, Lens speech. As expected Len was ebullient and so he should be given the history of the project and the attitude of the government up until recently. Len covered off a lot of topics in his speech but one I thought was quite important was that today probably would never have been possible without the government having amalgamated the councils of Auckland in 2010. On a personal level it was nice that he acknowledged the role of transport advocates in helping to get to this stage. As John Key said, Len should rightly be proud at what he’s achieved with the CRL.
One interesting fact that came out in Len’s press release after was this showing just how much patronage to the city is expected to increase in just the first year.
“Auckland Transport is forecasting in the first year of operation an 88% increase in rail passengers travelling to the city centre and a 40% increase in rail patronage across the network in the morning peak.
Following the speeches there was a flash mob before the grand finale of Bridges, Brown and Key pushing an oversized detonator to set off some pyrotechnics and balloons to start the project – although as Bill Bennett pointed out, that detonator is reminiscent of something else.
Although as Luke discovered later, that sod has been unturned and filled back in again
Did AT go over the top with the dancing and pyrotechnics? It was certainly a unique ceremony for a unique project.
With the ceremony out of the way we can now look forward to the project really getting under way, despite the disruption that will bring.
Did you attend the ceremony or did you/have watched the live stream? What did you think of it?
One side effect of the government’s announcement in late January to allow for the CRL to start on time in 2018 has been for a string of senior government politicians to visit the CRL team to see what’s going on.
Just over a week after the announcement Auckland Central MP Nikki Kay was getting a virtual tour of the Aotea Station
Two weeks after that Transport Minister Simon Bridges had a tour.
Now another two weeks on, Prime Minister John Key has had a look at progress and with the Herald in tow.
The Prime Minister yesterday took a tour around a busy railway station which doesn’t yet exist.
Mr Key slipped on a virtual reality headset for a walk around Aotea Station – one of the proposed underground stops for Auckland’s $2.5 billion City Rail Link.
The station is projected to handle around 12,000 people in peak hours and be one of the busiest hubs on the network.
Describing the visit to a downtown control room as a chance to grasp the complexity and potential of a crucial venture, Mr Key stressed the importance of making sure one of the biggest engineering missions in Kiwi history gets a “successful execution”.
“This is something that’s been talked about for decades. It’s exciting, but something you’ve got to get right,” Mr Key told the Weekend Herald. “The successful execution of the plan will allow it to be delivered on the broad budget of $2.5 billion to $3 billion.
Perhaps my favourite quote from him is at the end of the video where he says:
In one sense it’s a tremendously exciting time for Auckland, you know, you can see a world class city that can rival Sydney and Melbourne emerging before your eyes and you’ve got to go through all the planning phases and construction phases of that, but you know Auckland’s here for the long haul and they know the potential. And personally as someone who lives in Auckland I’m pretty excited by why I see. I think that for long period of time I’ve felt that Auckland could do a lot better than it has done, it’s got that natural beauty but it actually now needs the capacity and facilities to back that up.
That last line in particular is something we’ve also said many times before and one of the reasons we’re so passionate about improving this city.
We’ve seen the images of what’s proposed at Aotea before but the most interesting aspect of the whole piece had to be the video. AT have recreated the Aotea station in virtual reality and the video gives the best idea to date of what the finished product will look like. I personally thought it looked very good, especially the entrance on Wellesley St.
Radio NZ have also published the video but with just the shots of the station.
With various members of the government now visiting the project offices it suggests that they have rapidly getting on-board and wanting to be associated with the project and given even the PM has visited perhaps even suggests that they’re actually quite impressed by what they’ve seen.
Certainty is the word I’d use to describe the announcement by John Key yesterday that the government would support for the City Rail Link main works beginning in 2018. While it was widely expected it was an announcement that was both very low on specific details but also contained a lot of information.
As readers may remember, the government had long opposed the CRL with former transport ministers at the time Steven Joyce and Gerry Brownlee seemingly taking great pleasure in dismissing reports at that time. That all changed in 2013 where in a similar speech Key announced the government would accept the CRL from 2020 onwards but entertained the idea of an earlier start/finish time if patronage doubled to 20 million earlier than expected and CBD employment grew by 25%.
While the government hasn’t put in place targets for any other project before (or after), having one for patronage isn’t too bad an idea but we were always very critical of the employment growth one for a number of reasons. In the end the employment target was irrelevant in the decision.
CBD employment levels are still some way from the 25 per cent growth threshold.
But strong growth in rail patronage since 2013 means it will reach the 20 million annual trip threshold well before 2020.
It’s become clear that we need to provide certainty for other planned CBD developments affected by the Rail Link.
This means we see merit in starting the project sooner.
As we posted the other day, patronage on the rail network reached 15.4 million to the end of December, a 22.9% increase on the year before. The scale of the growth and that it has been sustained at around that level for a year are impressive and highlight just how quickly things can change. It’s meant that at current rates we would hit the CRL target up to three years early. Perhaps the more interesting aspect is the impact the business community have had on getting an earlier start date. There is a huge amount of development planned along the CRL route and much of it is premised on CRL happening. Providing a commitment which then allows the private sector to get on with investing billions makes a lot of sense.
Emmerson in herald yesterday
In quite a shrewd move Key actually only confirmed the government share would arrive after 2020 which is in line with his original time frame from back in 2013 but just by having that commitment now means that the council can use it’s share to start in 2018.
So I can today confirm the Government will work with the Council to bring forward the business plan and formalise our funding commitment from 2020.
The Council has indicated this would allow construction of the Rail Link’s main works to start in 2018 – at least two years earlier than currently envisaged.
It would also allow the council to get on with negotiating contracts and providing certainty for investors in other important Auckland CBD projects.
By providing the commitment he has it’s likely he’s saved more than just the two-year gap. The big reason for this is it means that those at AT working on the project can get on with the tender process and engage with potential suppliers knowing that will definitely be there from 2018. That can allow them to optimise the built, possibly reduce the amount of time the main works will take and definitely reduce the overall amount of disruption the city will experience from the construction. It of course also means we start getting the transport and economic benefits sooner.
One quite interesting statement about the project was that the council and government need to sit down and work out just who will own and operate the infrastructure. I can’t imagine the council/AT paying for half of the project and then being keen on say Kiwirail owning it.
On the funding, Key confirmed in this interview with Duncan Garner that the money would come from the government’s consolidated account and not the National Land Transport Fund once again highlighting the issue that rail infrastructure is funded differently to other land transport. This is something that really needs to be changed. Also of note in that interview was him being quite positive about development around the rail network which is encouraging.
It remains to be seen how the council will pay for its share. Funding for it was already included in the Long Term Plan agreed last year for 2018 onwards however Len was also talking yesterday again about using road tolls to raise funding for it. Interestingly the government also appear to have softened their stance on this. Previously they’ve outright refused to even consider it but Key is now saying they will if there is a good case for it.
Phil Goff has called for the project to be treated like one of National Significance and be fully funded by the government.
The council yesterday released this short video of the change that that Albert St and the surrounding area is about to go though
Congratulations and thanks to Len Brown for is effort over the last 5 or so years in turning this project into a reality. At times it’s looked like it may never happen but the persistency has paid off and Auckland will be considerably better for it. There are a lot of others that need to be congratulated too and many of whom we may never know just how important of a role they played
Following on from Key’s announcement on the CRL there have been a few of frankly bizarre press releases from some politicians that are worth mentioning. Top of the list is the response from David Seymour who has used the announcement to call for more money to be spent on schools in his electorate and this statement. Odd as the government have already shown they are prepared to fund greater investment in schools to deal with changing roll sizes – such as this at the beginning of December.
“The reality is that we have a train looking for passengers, rather than the other way around. That’s why the Rail Link requires heavy intensification around Mt Eden Station, among others, to be viable.
“The Council has not considered the implications of changing land use on education in the area, where schools are already bursting at the seams. The Mt Eden Station development, for instance, will bring hundreds of new residences into already-full school zones.
Yes a train looking for passengers, I guess that’s why they’re often so full that people can’t get on. I haven’t checked but I’m also fairly confident the Ministry of Education would have submitted on the Proposed Auckland Unitary Plan currently before an independent hearings panel.
In a separate release he also suggests the government should have blackmailed the council by withholding infrastructure funding until they allowed unfettered sprawl subsidised by existing ratepayers.
The Government has let Auckland Council off the hook, gaining no concessions on land supply or rate rises, according to ACT Leader David Seymour.
“Writing a big cheque was the time to bring Auckland Council to the table,” says Mr Seymour, “but instead the Council got away with the money and the bag.”
“The Government could have set up ongoing incentives for the council to provide infrastructure. Instead, with no sign that the council will focus on core services, the largesse of the Len Brown era will continue.
Yesterday’s news is also not good for those that have spent their careers first telling us the project wasn’t needed and after being surprised at the government’s support in 2013, that the council shouldn’t do anything till that time. Chief among those was Cameron Brewer who used the news as an opportunity primarily to take a swipe at mayoral candidate Phil Goff.
Shortly Prime Minister John Key will be delivering his State of the Nation address at a luncheon being held by the Auckland Chamber of Commerce. It’s been widely expected that he’ll announce the government agreeing to start the main works on the City Rail Link in 2018 – in line with when the council/AT wanted to start them – instead of 2020 like they had announced when they supported the project in 2013. I’ll actually be at the event and trying my best to cover it live on social media so follow us twitter for the latest updates.
But it won’t be the only announcement with Key saying:
“As New Zealand’s largest city, our biggest commercial centre and the main gateway for international tourists, we all need Auckland to succeed.”
He said the Government was already putting billions of dollars into Auckland as it grew and he would highlight some of the priorities for the year ahead.
“It’s a speech that looks very heavily at infrastructure projects, not just in Auckland, but it does look at those issues and gives the Government perspective on next steps.”
“We are spending billions and billions of dollars as a Government on infrastructure. So the announcements we make tomorrow will ultimately mean the Government increases even further its expenditure on infrastructure. We are doing that because that infrastructure underpins the efficiency and competitiveness of our economy. We are not doing this because we need to stimulate the economy per se.”
Mr Key said housing in Auckland was a focus for the Government, but it was not the main issue of his speech. “We are saying we need to build more houses faster. It is our expectation the demand in Auckland is going to continue, that the growth in the Auckland population is going to continue and we just need to build a lot more houses between now and the next five to 10 years.”
It’s also been rumoured that he’ll make comments on the East-West Link, Additional Waitemata Harbour Crossing and Penlink. Further while he says housing won’t be a main issue of his speech I suspect that other aspects of infrastructure provision such as funding for water infrastructure that would enable more housing to be developed more quickly might be.
I imagine we’ll see media reports of the announcement coming in fairly quickly after the speech so the main purpose of this post is for somewhere to discuss what’s announced – I’ll have a more detailed analysis tomorrow.
Of course with the CRL getting so much attention it begs the question how many times will the media or some media commentator refer to it as a loop, suggest it’s just about trains going around in circles or that it’s just about Len Brown wanting a toy trainset.
Anyway it should be an interesting few hours. Keep an eye on our twitter account for the latest updates.
The media are once again going off on the topic of housing affordability, after the release of the latest report by Demographia saying that Auckland is one of the most unaffordable cities in the world.
A survey of the median house prices around the world has revealed Auckland to be among the five least affordable cities to buy a house. The annual Demographia survey, released today, compares prices to incomes in 367 cities. Auckland is one of the worst in the world due to extremely high house prices coupled with moderate wages.
We’ve often talked about the issues with how Demographia produce their results. They take an overly simplistic view of the discussion, and exclude important factors. But while the scale of the issue is likely wrong, that doesn’t mean the general outcome – that housing affordability needs to be improved – isn’t correct.
We also disagree with their proposed solution of unfettered greenfield development. For Demographia, it seems that opening up greenfield land is always the solution, regardless of the question being asked. While land supply is an issue, they like to conveniently ignore the impact of planning regulations on existing urban land that prevents development across most of Auckland. They also like to ignore the cost to tax and ratepayers of providing the infrastructure needed to enable that greenfield development. For example, based on Auckland Transport’s figures it will cost about $67,000 per dwelling to provide the roads needed in the major new greenfield areas that are proposed.
Many people may want a home with a large backyard on the fringe of town, but many just want a home. A lot are prepared to forgo a large backyard for the added amenity of living closer to the city or other urban centres – but they are unable to do so, as so much development has been restricted.
This brings me to the main point of the post, the media (especially the Herald) who want to have it both ways.
While today they’re lamenting house prices, the Herald has spent much of the last few years championing opposition to one of the key tools that will help address housing supply, the Auckland Unitary Plan. From when the draft plan was released almost three years ago, they’ve given countless space to those opposing any change in Auckland. They’ve deliberately misled the public and recently they’ve even become so absurd as to call two-storey townhouses “Highrise” in their bid to whip up fear and anger over the plan.
Of course politicians of all stripes shouldn’t escape blame. Whether they’re also trying to whip up fear, generally oppose change or just have it happen in some other neighbourhood they are as much to blame. They also seem to me to have less desire to actually fix problems. After all, which of them are really going to stand up to house owning voters and say they’ll enact policies which could result in existing house prices falling or at best stagnating for many years as a result of changes.
Regardless of what you think the solutions are, it still feels like we’re some way off any real changes happening.
On a related note: I suspect we could see John Key include housing announcements in his announcement on Wednesday when he also announces support for the CRL to start in 2018. There have been suggestions the government have been talking to the council and CCOs like Watercare looking at what other big infrastructure projects could be brought forward to help speed up housing supply.
Next week John Key is expected to announce the government’s support for starting the main works of the City Rail Link in 2018, at least two years ahead of what he said in 2013. He is expected to announce this at a luncheon being held by the Auckland Chamber of Commerce and it’s expected the announcement will cover not just the CRL but likely a package of projects. Many have suggested that they think he’ll also announce details about the Additional Waitemata Harbour Crossing and the East-West Link, both of which the NZTA and Auckland Transport are expected to progress getting consent for this year. In the NBR’s article on Key’s announcement they included some thoughts from Chamber of Commerce Chief Executive Michael Barnett.
Auckland Chamber of Commerce chief executive Michael Barnett said Key’s address would cover the issue of infrastructure funding for the region, similar to the June 2013 speech to the chamber’s membership in which he confirmed joint funding for CRL.
“I’m expecting a significant funding package similar to what Key gave in June 2013 and that he will use this occasion to say ‘ok, we can give more certainty to some projects’. What we have at the moment is so conditional, it’s difficult for plans to be put in place,” Barnett said.
Barnett said the other projects he expected Key to comment on include the East/West Connections project which would improve connections between Onehunga and Mt Wellington which is heavily used by industry, the $380 million Penlink arterial route between Whangaparoa Road and State Highway 1 which is touted as a potential public-private partnership business model, and a second harbour crossing.
It’s the middle of those three projects in the last paragraph – Penlink – that raised my eyebrows. There are a few reasons for this.
Auckland Transport recently applied for and obtained approval to widen the existing designation to create a 4-lane divided expressway. Perhaps Auckland Transport have been looking longingly at the NZTA and really want a motorway they can call their own. We also know that the NZTA had been pushing for Auckland Transport to progress the project as a PPP tied in with the one they are planning for Puhoi to Warkworth – however they’ve already short-listed contractors for that project.
The council and government are deep in the middle of the Auckland Transport Alignment Project (ATAP) which is meant to be reviewing options and timings for future transport projects in Auckland. Projects already underway or with funding confirmed for the near future are excluded, as are projects such as the City Rail Link but based on the timing as far as I’m aware that doesn’t include Penlink (I also believe AWHC is included within the ATAP scope). If Key was to come out and accelerate these projects or make funding announcements, it would undermine one of the key reasons for undertaking the alignment process in the first place.
Even putting aside ATAP, the councils recent Long Term Plan doesn’t have the project starting till the decade starting in 2025 (page 11). It did include the project in it’s everything including the kitchen sink funding package paid for by tolls or increased fuel costs but that wasn’t passed. Interestingly Auckland Transport’s website lists the project starting construction in 2021. What do they know that the council don’t.
The biggest reason for concern is the project itself and what AT claim it will achieve. They say the key objectives are:
- Improve travel times and reliability.
- Improve network performance and resilience.
- Facilitate economic activity, planned growth and transport mode choice.
So let’s look at Penlink does based on information AT provide.
The project is about enabling more growth in the North however critically there is actually very little growth that is expected to occur on the Peninsula itself, most of the growth is around Silverdale or west of the motorway. A summary of the residential and business growth expected is below.
There’s also almost no growth in employment on the peninsula
Developments in Orewa have access to the motorway at Grand Dr and at Millwater a new set of motorway ramps have been built at Wainui Rd so the main argument seems to be that Penlink is needed to get cars from the Peninsula off the Hibiscus Coast Highway where more business growth is expected. Given how much of a pet project Penlink was to the former Rodney District Council it makes me wonder how much the growth there was part of a deliberate strategy to help justify Penlink in the future.
Looking at the issue of travel time and reliability as well as network performance AT include a number of outputs from their modelling and they present some very odd results. The show the predicted travel times both with and without Penlink to three destinations, to Grand Dr, to Silverdale Township and to Beverly Dr which is where Penlink joins into Whangaparoa Rd. They’ve also broken down the journey into three parts. From Oteha Valley Rd to Redvale where the Penlink Interchange would be, from Redvale to Silverdale interchange and from Silverdale to the final locations.
Here are the results for all three and they seem completely not believable or based on any kind of plausible reality. The first thing that strikes me about them are the claimed travel times in 2041 both with and without Penlink. At more than an hour just to get from Oteha Valley Rd they seem to be assuming that traffic is going to merrily just pile up and no one will attempt to change their travel time, mode or both. It’s worth noting that the base case for both options also assumes the NZTA will widen SH1 between Oteha Valley Rd and Silverdale to three lanes each way at around 2031.
What I also find odd is that within none of the documents AT have published is there any mention of the impact of the traffic volumes on SH1 south of Oteha Valley Rd. If they’re this bad north of there it must require SH1 pumping a ton of traffic north or alternatively a lot joining at Oteha Valley Rd to head north. If traffic is this bad then as some readers like to frequently suggest, perhaps some road pricing to better manage demand is needed – and before we embark on spending $380 million on this motorway.
Speaking of road pricing the documents do talk a lot about Penlink being tolled. They say it would use the same system as used on the Northern Gateway motorway north of Orewa and the cost would match that toll road – at the time $2.20 for light vehicles and $4.40 for heavy vehicles. By 2041 the predicted 16,600 vehicles a day crossing the Weiti Bridge (where the toll gantry will be) will be paying about $13.5 million a year in toll revenue. Interestingly the modelling suggests that without a toll, traffic volumes would be 23k-24k per day across the bridge.
Over 30 years they say the estimated toll revenue is $321 million which has a net present value of $112 million. Toll collection costs over that period are $77 million with a NPV of $28 million so at NPV that leaves around $84 million to go towards paying for the project. Of course the project is expected to cost around $380 million so the tolls won’t cover all that much.
Despite the cost of project roughly doubling over the last few years AT claim the project is positive economically. They actually list two Benefit Cost Ratio’s, a National BCR of 2.5 and a Government BCR of 3.1. Please correct me economists but as I understand it the Government BCR counts all benefits but only accounts for the net financial cost i.e. project costs minus toll revenue while the National BCR accounts for the full cost of the project.
Based on the language in the Business Case it seems almost certain that Penlink will be built as a Public Private Partnership where they finance, build and operate the road while AT pay for it to be open. This is the same as is happening with Transmission Gully in Wellington and will happen with Puhoi to Warkworth.
On the final objective facilitating transport mode choice. It seems to me there’s a very high chance that if built AT would leave buses to go the long way via Silverdale and Whangaparoa Rd which will only serve to further reinforce driving. The business case talking about buses seems boil down to a “buses can use roads too” argument and the only thing excluded from the project scope is:
Whilst facilitating and providing opportunities for improved public transport is part of the Project, the provision of public transport services and prioritised bus lanes on Whangaparaoa Road is not part of the Project.
Lastly it’s worth comparing the approach taken to the discussion back in 2010.
Back then widening Whangaparoa Rd was seen as a better option as the $20-26 million cost delayed the need for the hugely expensive Penlink. They now say that option isn’t viable as they’ll eventually need Penlink anyway.
So overall it seems like Penlink stacks up but that’s on the back of some very odd figures around travel times. The business case suggests that in the absence of funding constraints the project could have started in July this year – although that would be unlikely given the lead in time needed to procure it through a PPP. So perhaps John Key will kick that process off next week.
Auckland could be about to get a late Christmas present. It’s appearing more and more likely that the government will agree to start to the City Rail Link in 2018, two years earlier than the 2020 date they set back in 2013 when they first agreed to the project. To go with the what, we also know the where and when, Stuff reports:
Prime Minister John Key is expected to announce the Government will help fund Auckland’s $2.5 billion inner city rail link two years earlier than originally promised.
It’s understood the PM will make the commitment in a speech to the Auckland Chamber of Commerce on January 27.
Auckland Chamber of Commerce chief executive Michael Barnett confirmed Key would address its membership on the issue of infrastructure funding for the city.
It would be similar to his announcement in 2013 in that he would outline the government’s future commitment to the city “and I think give some clarity and certainty to some of the investment in infrastructure that needs to be made”.
Asked if that would include a statement on the timing of the CRL funding, Barnett replied: “If they put a stake in the ground and then there’s clarity, then everyone can work around that.”
The Chamber of Commerce supported a 2018 start for the rail project, he said.
Early works are underway but are we about to get a Go for the rest of the project?
As I pointed out in my year ahead post last week we’ve been hearing noises that an agreement between the council and government is close for a while so it hasn’t come as a surprise that something may be about to happen. In fact I think the main thing stopping it from having been made earlier has been the Christmas/New Year holidays and lead up to them putting a dampener on the level of political credit the government will want to bask in.
Pressure has been mounting on the government to do something for months and one reason has been the stellar patronage growth that we’ve been witnessing. It has risen an impressive 23% over the last year Auckland is on track to reach the 20 million target by 2o20 around three years early.
As I also mentioned in my year ahead post, the announcement be the council funding their share from 2018 with the government still not committing any cash till 2020. If this occurs perhaps they’ll off some sort of deal.
Making the announcement to the Chamber of Commerce is significant for a few reasons.
As I understand it, Auckland’s various business lobbies have been quite active behind the scene, pushing the government to commit to an earlier start date. They see the value in the project and also the value in minimising disruption. Waiting till 2020 leaves roughly a two year gap during which many businesses in the city – but particularly those along the route – will be in a state of limbo. Delaying the project also affects more than just the rail network as it also delays other projects to improve Auckland that are dependent on the CRL being completed, one example is the proposed Victoria St linear park but there are a heap of others.
It was to the Chamber of Commerce back in 2013 that the government first announced it would support the CRL after years of bitter opposition to it. Again back then the business lobbies were also a key factor in getting the government to change their position on the project. Of course as part of the same announcement the government also launched their accelerated Motorways package that fast tracked projects such as the Kirkbride Rd grade separation, southern motorway widening and the big package of works planned for the area around where SH18 joins SH1.
It raises the question of whether John Key will announce support for the CRL alongside any other projects. As we know the Reserve Bank of NZ has already said the government should consider accelerating infrastructure projects in Auckland. As such it’s entirely possible any announcement could also contain funding for other projects too (including non-transport projects). The concern would be if the announcement also included a number of projects designed to encourage significant growth on the urban fringe at the expense of enabling greater housing supply closer to the city.
Lastly an announcement would be a significant win for Mayor Len Brown. When he first became mayor the project was in its infancy and he has pushed it as the number one project for the city since that time with the backing of the council. To Len, if the government support the project starting sooner, then thank you.
I’ve already been counting the days till January 27 to see just what is announced.