We’ve talked quite a bit about how trends in New Zealand are changing and one that regularly talk about is Vehicle Kilometres Travelled which is the distance that vehicles in New Zealand drive. The results come collating the distance travelled from vehicle odometers which is something checked each time someone gets a Warrant of Fitness. The distance we travel on a per capita basis has been dropping for some time.
Last week at the transport debate Gerry Brownlee said new data would show the trend of declining VKT was reversing as the economy recovered. His suggestion being that just around the corner we’re going to need roads like Puhoi to Warkworth to deal with the extra driving that we’re all supposedly meant to be doing. But are we actually driving more? Well new data from the Ministry of Transport suggests that on a per capita in Auckland basis we each are still driving less than we did decade ago.
Other regions show an assortment of outcomes with some results up and others down.
In Auckland we’re driving less but of course we also know for the last decade or so the big story in transport has been the resurgence of PT use which has been growing strongly. This is growth is off the back of investments like Britomart, the Northern Busway and the bus lanes on the isthmus e.g. Dominion Rd.
So how does this growth in PT trips compare to the changes shown above for VKT? The graph below shows the two and there’s quite a difference as to where the growth is occurring.
Of course the number of PT trips is coming off a low base however a 30% increase in use is nothing to sneeze at. At the end of June 14 each Aucklander took approximately 47 trips a year on PT. That’s fairly low by international standards or even compared to what’s achieved in Wellington however with all that’s going on with PT right now we could see the result rise considerably in the next few years.
The Ministry of Transport has released a detailed and interesting look into some of the results coming out of the 2013 Census Journey to Work question. Both the executive summary and the full report are worth a read. As we’ve noted before, the 2013 census results confirm a shift in the way Aucklanders are travelling, with much stronger growth in public transport than in driving (especially in percentage terms). Interestingly, even within people travelling to work via private vehicle, there is a big difference between those who drove themselves (which increased and roughly maintained its modeshare) and those who were passengers (which declined fairly dramatically). This is shown in the graph below:
I’m struggling a bit to explain why private vehicle passengers has declined to significantly – perhaps they are the ones who are shifting mode to public transport to a greater extent than drivers?
The report compares Auckland’s mode-splits with a number of Australian cities, highlighting quite an interesting trend that although our public transport use is generally lower than those cities, our active transport modeshare is often higher:
Quite a lot of the report is analysis of different parts of Auckland, comparing travel patterns and modes for the CBD, CBD fringe area (called other central), inner urban (isthmus and lower North Shore), outer urban and rural areas. The graph below is a fairly nifty way of representing the overall share of Auckland’s trips that start and end in these different areas:
The Outer Urban area is reasonably “self-contained” in its trips, with a very large share of trips originating in Outer Urban areas also being destined for those areas. The CBD is a strong destination for Inner Urban areas, along with employment in other parts of those Inner Urban locations.
Looking closer at the CBD, the report analyses where people who work there are coming from, showing a strong focus on the isthmus and the lower North Shore – the “Inner Urban” areas highlighted above:
It is worth noting the difference between the west and the south in the map above – both areas reasonably equidistant from the city centre, but with the south having much more local employment and therefore much less of an employment connection with the CBD. One would expect, post City Rail Link, for the west to be even more strongly connected and also for the south to begin to benefit from improved city centre access and the employment opportunities that will provide.
Another interesting part of the report is the comparison between different local board areas, which unsurprisingly show some pretty dramatically different modal splits:
Waitemata Local Board obviously stands out from the rest, with a private vehicle modeshare of below 50% and a very high proportion of people walking or cycling to work. Clearly Waitemata benefits from having so many jobs located within the local board area, as well as the increasing number of people who live in the city centre unsurprisingly having a very high ‘walk to work’ share. Another point of interest is how work from home varies by Local Board – higher in rural and richer areas and very low in parts of South Auckland. I guess this reflects most ‘work from home’ jobs being either rural in nature or well-paid professional work.
One of the clearest patterns highlighted in the report is the relationship between residential location and trip length, with journeys to work getting longer and longer as you live further away from the city centre – even though only a relatively small proportion of Auckland’s jobs are actually located in the city centre:
This finding is unsurprising and a core part of why urban sprawl concerns us so much, because people living in far flung parts of Auckland need to travel a very long way to work – which is both expensive and places a lot of pressure on the transport network. It’s also clear that West Aucklanders are stuck with long commutes more so than most other parts of the city – highlighting once again the huge benefit City Rail Link will bring to the west as well as the need to increase the level of employment available in that part of Auckland.
Flipping the above map around, to instead focus on length of journey by destination reveals a much less clear pattern and some interesting anomalies – people who work at the airport have to travel a very long way to get there (rail to the airport will be very useful for them!) while people who work in the Howick/Botany area seem to have very short commutes, maybe highlighting the extent to which that area is disconnected and isolated from the rest of Auckland (only people who live in the area are prepared to work there):
Looking at private vehicle modeshare by point of origin highlights clearly the more and less car dependent parts of Auckland. The inner areas are doing pretty well here while the northwest and the southeast (in particular) are the most car dependent parts of Auckland. Hopefully the AMETI and Northwest busways will change this in the future:
Bus modeshare is highest on the North Shore and the Central Isthmus – reflecting locations where high quality bus service and infrastructure is available:
For rail, a key analysis relates to the question of “for trips heading to the CBD from a particular area, what proportion of those trips are carried by train”. The south does pretty well in this respect, reflecting that it’s a pretty long car journey from Papakura or Pukekohe right through into town:
Looking at the above map it’s quite telling to see how along the inner parts of the Western Line, rail is capturing a pretty low proportion of CBD-bound trips – I imagine due to the very long an convoluted path the train takes via Newmarket. With the City Rail Link in place there’s some huge growth potential in these areas for much higher levels of train use as there’s a pretty huge untapped market at the moment.
Looking at overall public transport modeshare, the dominance of the isthmus is quite clear. This is a large reason why we were so frustrated to see intensification on the isthmus watered down in the Unitary Plan to such a great extent last year.
There are a myriad of other fascinating maps and graphs within the report, but they can wait for a future post. Perhaps commenters might have a think about what they think might be behind a few of the results above – particularly:
- Why might private vehicle passenger trips have decreased so significantly compared to all other modes of getting to work?
- What impact might CRL, Airport Rail, AMETI and other major projects have on these patterns over the coming decades?
- What’s up with Stonefields? – its travel patterns are much more like an ex-urban piece of sprawl than a fairly dense inner-urban suburb.
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:
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:
I’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 Government yesterday announced it plans to spend over $200 million on a series of regional roading projects. This is clearly a result of trying to keep the regions happy from a potential backlash after they announced a motorway splurge in Auckland last year. Like the Auckland package these projects are being funding outside of the National Land Transport Fund and in this case the money is meant to be coming from their asset sales fund.
Prime Minister John Key has this morning announced $212 million from the Future Investment Fund for a package of 14 regionally important State highway projects.
Transport Minister Gerry Brownlee says the government is committing up to $80 million from the package to accelerate five critically important regional projects, with work beginning next year.
These five projects are:
- Kawarau Falls Bridge, in Otago
- Mingha Bluff to Rough Creek realignment, in Canterbury
- Akerama Curves Realignment and Passing Lane, in Northland
- State Highway 35 Slow Vehicle Bays, in Gisborne
- Normanby Overbridge Realignment, in Taranaki.
“These projects are fully investigated and designed, and address current safety, resilience or productivity issues, but construction wasn’t due to begin until late this decade or after 2020,” Mr Brownlee says.
“Following today’s announcement construction on these projects could begin in 2014/15, and be completed by 2016/17.
“The government is committed to fund the next six projects with an additional $115 million and subject to the usual investigations, construction would be expected to begin within three years on each of these projects.
The six projects are:
- Whirokino Trestle Bridge replacement, in Manawatu/Wanganui
- Motu Bridge replacement, in Gisborne
- Opawa and Wairau Bridge replacements, in Marlborough
- Taramakau Road/Rail Bridge, on the West Coast
- Loop road north to Smeatons Hill safety improvements, in Northland
- Mt Messenger and Awakino Gorge Corridor, in Taranaki.
“A further $12 million will be available to accelerate investigation and design of three large projects in Hawke’s Bay, Nelson and the Bay of Plenty,” Mr Brownlee says.
These projects are:
- Port of Napier access package, in Hawke’s Bay
- Nelson Southern Link, in Nelson
- Rotorua Eastern Arterial, in Bay of Plenty.
“Each project could then be considered for funding under the proposed Regional Improvements activity class in the next Government Policy Statement on land transport.
“By directly funding some of the most crucial State highway improvements, the government is freeing up more funding in the Regional Improvements activity class for other priority projects.
“This funding package also strongly complements the government’s Roads of National Significance programme, ensuring people and freight reach their destinations quickly and safety,” Mr Brownlee says.
Here is a map of roughly where they’re each located.
I imagine that some of the projects on this list actually make sense and were probably only so far away from being fund through normal procedures due to the Roads of National Significance sucking up all the new State Highway spending . The Ministry of Transport go further by saying that all of the projects in the first group have a BCR of greater than one and in some cases it’s more than four. That would put them better than some of the RoNS like the 0.2 for the Kapiti Expressway. The MoT say the next six projects are still being investigated and are expected to “also be high quality projects” however this document from 2013 shows the Whirokino Trestle Bridge replacement to have a BCR of 0.5 or 0.6 depending on what option is chosen.
What seems to be a common theme amongst many of the projects is that they are replacing bridges that aren’t able to carry the new super heavy trucks the government allowed a few years ago.
Perhaps the most worrying thing about this announcement isn’t so much the projects themselves but that the government is getting more and more involved in picking projects rather than leaving it up to the NZTA to decide on spending based on merit. It started with the RoNS and last year we got the Auckland package.
Even for the projects in the top 5 which are said to be ready to go there is very little information available. The only two I could find are the Karawau Falls Bridge and the Mingha Bluff to Rough Creek realignment.
The Karawau Falls Bridge is expected to cost $20-25 million and will replace the current 88 year old single lane bridge which they say could be renovated to provide a walking and cycling connection.
Mingha Bluff to Rough Creek realignment is roughly a 5km realignment of SH3 south of Arthurs Pass
Lastly here are some tweets from John Key’s twitter account when announcing this further road spend up.
It’s completely disingenuous to say that good roads are good for public transport. None of the roading projects pushed by the government over the last 6 years have had any benefit to public transport and many (like those in Wellington) will actually work against the PT system. What all of the projects have primarily been about is moving bigger and heavier trucks.
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.
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.
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.
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.
So using these midpoint figures I’ve also grouped the spending into high level categories
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.
Mother Nature gave the Wellington rail system a quite of a battering last year through multiple earthquakes and major storms. The major storm that hit on the night of 20 June was the one that did the most damage when it washed out the sea wall protecting the rail line that serves the Hutt Valley and the Wairarapa between Ngauranga and Petone leaving tracks dangling in the air. Kiwirail said the damage was unprecedented. The impact of the outage was felt throughout the Wellington transport system as people who usually caught the train needed to look to other methods of transport. It took almost a week to get the rail line restored with services resuming on the morning of 27 June.
Photo credit: David Morgan
If there was one positive to come from it, its that it gives a chance to study what the impacts of the outage and that’s exactly what the Ministry of Transport have done in a report released late last year.
Extreme events and disruptions to our every-day lives give us a chance to probe how we react in different circumstances, and consider how we can better react in the case of similar future events.
The storm on the night of Thursday 20 June 2013 severely affected Wellington’s transport network, with both immediate and flow-on effects for commuters in the region. Of particular significance was
the damage done to the Hutt Valley rail line, and the consequent disruption to passenger rail services for the six days following the storm.
This project surveyed 1,072 Wellington commuters to assess several impacts on Friday 21 June, Monday 24 June and Wednesday 26 June, including:
- the extent to which disruptions to the transport network (in particular the Hutt Valley rail line services) affected the time it took commuters to get to their destination
- how commuters changed their travel behaviour to respond to the network disruptions
- the extent to which communications by transport agencies (including radio, email and text messaging) may have influenced the behaviour of commuters.
And here’s a summary of what the study found.
- The closure of the Hutt Valley rail line put significant pressure on the road network. Delays for commuters were most severe on the Monday following the storm. Traffic on State Highway 2 was severely congested, with morning peak hour conditions lasting two hours longer than usual
- 80 percent of Wellington commuters from the Hutt Valley and Wairarapa experienced a longer than usual trip
- 32 percent of them experienced delays of over an hour
- the severity of commuter delays lessened over the week, with the number of commuters from the Hutt Valley and Wairarapa experiencing delays of over an hour halving by Wednesday 26 June
- traffic delays were slightly less severe on Friday 21 June. This may have been due to 27 percent of commuters (surveyed across the region) not travelling to work on the Friday. By Monday 24 June this figure dropped to just 4 percent
- on Monday 24 and Wednesday 26 June, roughly 45 percent of the typical Hutt Valley train commuters opted to drive themselves or be driven to work in a private car, and roughly 45 percent chose the train and bus replacements
- communications by transport agencies were effective, with 75 percent of people surveyed aware of transport delays before they headed to work on Friday, and over half of these people altering their travel plans to respond to conditions.
Research undertaken as part of this project estimated that the economic impacts of transport disruption resulting from the storm was between $12 million and $43 million. This included $5.3 million in cost to local and central government agencies who responded to disruptions and damage on the transport network, $5.3 million loss in value of travel time and between $2 million and $32 million reduction in outputs.
There’s a few interesting points in here. The first is day of the outage (red) compared to same day the week before and after.
The severe congestion probably helped to ensure that those who were previously using trains went back to doing so once the rail line was up and running again. This is the patronage from the Hutt Valley line surrounding the outage and you can see it bounced back to normal the following week.
Probably the most interesting part is the assessment of the economic impacts of between $12 million and $43 million depending on how it’s calculated. Some of those costs – like the $5.3 million in repair works – are unique to the outage however the same amount again is simply due to the travel delays caused by the mode shift and ensuring congestion. This might not sound like much but consider that it is just for four working days so equates to about $1.3 million per day. That helps to give us an idea as to just how much impact the rail network in Wellington is having on congestion relief.
My understanding is that the Hutt Valley line carry’s roughly half of the patronage on the Wellington rail network while the rail network itself only accounts for about 6% of all journey to work trips. Imagining for second that someone decided to close the all of rail lines in Wellington we can probably assume that similar travel delays would occur throughout other parts of the road network. Even just using the figure of $1.3 million per work day extrapolated over a typical year (~250 working days) would see travel time delays add up to over $320 million per year. By comparison the entire system only costs something like $80 million to run and that’s before passenger fares are taken into account.
Of course there would be a lot of other things that would need to be taken into consideration and the costs above are just very quick calculations but it does go to show that while the rail network might only play a small part overall, it does play a significant one.
In NZ, we don’t have many diesel cars. They make up around 8.4% of the “light passenger vehicle” fleet,1 similar to Japan (where most of our cars come from) and the US, but much lower than most European countries. Diesel engines are more common for “light commercial vehicles”, i.e. small goods vans and trucks. They account for 68.9% of these vehicles. Overall, across the entire light fleet – defined as all vehicles under 3.5 tonnes – diesels make up 16.2% of vehicles.
Diesel light vehicles pay Road User Charges of $53 per 1,000 km including GST, or $46.08 excluding GST. This charge goes straight to the National Land Transport Fund, paying for road maintenance and construction (and a token amount to public transport and other things).
Petrol vehicles don’t pay Road User Charges. Instead, they pay an excise on petrol, which currently equates to 53.524 cents per litre, excluding GST.
As I’ve written previously, the Ministry of Transport estimates that petrol light vehicles have an average on-road fuel efficiency of around 10.1 litres per 100 km. So, to travel 1,000 km, petrol cars use around 110 litres, and pay $54.06 into the National Land Transport Fund. That’s quite a bit more than the diesels – 17% more per kilometre.
That’s not really fair, especially considering that diesel light vehicles tend to be heavier than petrol ones (since many of them are vans, light trucks, big SUVs etc), and so they do more “wear and tear” on the roads. Plus, the diesel vehicles travel further on average – 14,580 km a year vs. 10,850 for petrol vehicles.2
Overall, a light diesel vehicle, travelling 14,580 km a year, will pay $672 into the NLTF. An average petrol car doing the same distance would pay $796 – even though it does less damage to the roads it’s driven on. The difference is a bit over $100, which may not sound like a lot – but it adds up over hundreds of thousands of vehicles.
The government could level the playing field by lowering the excise for the many petrol cars by a tiny bit, or by raising Road User Charges for the fewer diesel vehicles by quite a bit. Given that there’s currently a bit of a funding issue for the National Land Transport Fund – thanks, Roads of National Significance! – there’s a strong argument for picking the latter option.
I emailed the Ministry of Transport to check the figures I’ve used above, and they provided the following additional context:
Until 1 July 2008, light diesel vehicles contributed more to the National Land Transport Fund (NLTF) per 1,000km than petrol vehicles, because a large portion of petrol excise duty was being directed into the Crown consolidated fund, while all road user charges revenue went into the NLTF. When the Government fully hypothecated petrol excise duty to the NLTF from 1 July 2008, this resulted in petrol vehicles contributing considerably more to the NLTF per 1,000km than diesel vehicles.
I would note here that, even pre-2008 when diesel vehicles were paying more into the NLTF than petrol vehicles, the petrol vehicles still paid more overall per kilometre – it’s just that some of those funds were diverted for other purposes. In 2008, the Labour government shifted transport funding towards more of a user-pays system (still not entirely user-pays), changes which I think makes sense, and which National also supported.
The Ministry of Transport also mentioned in their email:
The rates of petrol excise duty and light road user charges are slowly being brought together. However, this is a gradual process, as recent Government decisions have capped the maximum increase in any road user charges rate at around 10 percent for a given year. For example, on 1 July 2013, the rate of petrol excise duty increased by 3 cents per litre, or 5.9 percent. The rate of road user charges for light vehicles increased by $5, or 10.4 percent.
As such, it seems the government is well aware of the issue, but at the current rate, it will still take several more years before this long-standing imbalance is fixed entirely.
There are other equity issues around the excise vs. Road User Charges system – for example, with petrol cars, there’s a greater incentive to choose more fuel-efficient models – and I’ll look at those another time. These kinds of issues will become clearer if we ever end up moving to a universal Road User Charges system – which is quite possible, although unlikely to happen for a few years.
1 “2012 New Zealand Vehicle Fleet Annual Spreadsheet”, tab 8.1a,b,c, Ministry of Transport
2 My calculations using “2012 New Zealand Vehicle Fleet Annual Spreadsheet”, tab 3.1,3.2,3.4,8.3, Ministry of Transport
One of the impressions I have of many of the government ministries is that they act on “you say jump, I ask how high” kind of arrangement. We seem to see this particularly strongly in the Ministry of Transport where staff appear to have gone to almost extraordinary lengths in the past to paint projects like the City Rail Link in a bad light while giving uneconomic RoNS projects a free pass, all of which is strongly in line with the positions taken by government ministers. (Note: MoT staff we know you read the blog so if you want to refute this feel free to provide information to the contrary)
So it’s interesting to see this article about a report by the Prime Ministers Chief Science Advisor suggesting a similar thing and recommending there be a similar position to his be created in a number of agencies including in the Ministry of Transport.
In a report on the role of evidence in policy formation and implementation, Gluckman reports a highly variable approach to the use of scientifically rigorous evidence in recommending, implementing and assessing the impacts of new public policy.
In some cases, senior public servants seemed to prefer “to work from their own beliefs or rely on their own experience.”
“At its extreme, I find this deficiency to be unacceptable,” he said, noting concern also about departments that rely “primarily on internal research of questionable quality and/or commissioning external advice that was not scientifically peer-reviewed.”
While there was excellent practice in some parts of the public service, but “some policy practitioners held the view that their primary role was to fulfil ministerial directives, rather than to provide an evidence-informed range of policy options on which Ministers could develop a position.”
“Surprisingly, this was held in some departments that most need to use objective evidence in their day-to-day operation,” Gluckman says.
Without naming names, he recommends the appointment of chief science advisors to the Ministries of Health, Education, Business, Innovation and Employment, Transport, and the Department of Internal Affairs.
It would be interesting to see what Gluckman – or someone in a position to push for evidence based policy – would say about current plans like the RoNS being built despite falling or flat lining vehicle ownership, kilometres travelled, licenses issued and even in many cases daily traffic volumes.
Equally it would be interesting to hear what they have to say about the impacts of current/proposed policies have on other areas like health, the environment or a number of other areas.
Of course this doesn’t mean the government’s policies would change but it would hopefully mean is much better information out in the public domain about the true impacts of the decisions that are made.
*** I recently wrote this post on the National Government’s LTMA Bill, which is currently before parliament. One of our readers felt sufficiently motivated by issues with this Bill to submit the following letter to his local National MP, in which he outlines his concerns. His local MP just happens to be John Key. ***
I really have a problem with the way aspects of the above Bill are re-aligning the objectives of Auckland Transport away from regional objectives set by Auckland’s elected Council representatives to those of National objectives set by nationally elected Politicians.
I am a constituent of yours and a long time supporter of the National Party, particularly its policies to reduce bureaucratic & Government intervention in our lives and enhance personal reliance. I am also a long time supporter of strong local government and supported the creation of Auckland’s single Super City Council. With the Council less than three years old and well before it has a chance to prove it’s worth it is not helpful to be hobbling it with legislation like this.
For me the biggest problem is that this legislation misaligns representation and taxation (as represented by property rates). The Council is clearly the rates collector so should be able to direct AT in how to spend its portion of those rates. If rate payers are dissatisfied with the direction of spend they can first lobby the Council then vote them out if necessary. When AT’s direction is set by the Government’s Policy on Transportation via NZTA it becomes a lot less clear as to who we should be lobbying and voting out should we be dissatisfied with the direction of spend.
I think there are probably other ways to ensure that AT’s activity and national objectives are aligned than this sort of draconian power grab legislation.
I look forward to hearing that you are reconsidering this legislative approach.
*** How say ye John? P.s. I emailed Nikki Kaye but have not yet received a response. If anyone out there knows Nikki can you please ask her to check her inbox? I know she’s busy, but you know, she represents Auckland Central. ***
In yesterday’s post Matt covered this recent article by Brian Rudman.
The crux of the issue is that the National Government – under the guise of the Land Transport Management Amendment Bill – is proposing to remove Auckland Transport’s obligations to Auckland Council.
In the brave new world created by the LTMA Bill, Auckland Transport will have to develop a Regional Land Transport Plan (RLTP) that “is consistent with” the Government Policy Statement on Transport. In contrast, this RLTP need only to consider the regional transport objectives established by Auckland Council.
For those who are not used to Big Brother policy-speak, “consider” is what you do when you flip through a report looking at the pictures before turfing it in the recycling bin.
The relevant section of the Bill is shown below (page 15).
Hence, the Bill proposes to establish a clear policy hierarchy, where central government’s GPS has precedence over Auckland Council’s transport objectives. The change in hierarchy is subtle but oh so significant.
The Bill then goes on to explicitly remove Auckland Transport’s ability (established in the LGACA 2009, when Auckland Council was formed) to delegate responsibilities for developing the RLTP (either in part or in whole) to Auckland Council:
Consequential indeed. The intended (and practical) effect of the proposed legislative changes is that Auckland Transport becomes an implementation tool for the National Government, rather than one of the Auckland Council. On a superficial level this immediately renders the term “Council Controlled Organisation” (CCO) something of a misnomer – Auckland Transport may as well just merge with the Auckland offices of the MoT and NZTA and be done with it.
I think there are, however, deeper and more fundamental issues with the proposed legislative amendments. In my opinion, one of the primary issues with the LTMA Bill – as it is currently drafted – is the degree to which it undermines the (already tenuous) connection between taxation and representation. This connection has been a bedrock of conservative political thinking ever since the American War of Independence.
More specifically, the thinking behind the LTMA Bill fails to acknowledge that it is the people of Auckland who collectively pay for transport projects in our region, by way of user charges and local taxes (actually Auckland historically more than pays for its transport projects – to the benefit of other regions).
One might argue, then, that Central Government does not actually “fund” transport in Auckland in any meaningful sense – they simply distribute hypothecated fuel excise duties that are collected from users. It is actually Local Government that does most of the “funding” – insofar as the money they contribute is collected not from users but instead via taxes. The collection and application of these funds are subsequently open to normal democratic debate.
In my view, one of the fundamental tasks of the Central and Local Government agencies involved in funding transport is identifying projects that align with the preferences of the people who might use, or be impacted by, the transport system. In turn, I have not seen much evidence to suggest that Central Government is better placed to represent the preferences of these people. In fact most people view transport as one of the key functions of Local Government.
There is also no reason to expect that preferences are homogenous at the national level. People in Auckland, for example, are likely to have different transport preferences from people who live in Rangitikei. The former probably walk/cycle and use public transport considerably more than the latter.
Differences in preferences are one reason why certain types of people choose to live in cities, and vice versa in rural areas. Put simply, people will partly “self-select” their location based on how it reflects their transport preferences. This might imply that Local Government is actually better placed to understand transport needs than Central Government.
Moreover, in most parts of New Zealand the majority of travel demands are regional or local, rather than national. The last time I looked, approximately 90% of the vehicles using Auckland’s state highway network, for example, were associated with regional/local travel demands. Put simply, most of our travel occurs locally or regionally.
All this seems to suggest that Local Government should have quite a bit of say on how transport funds are applied.
The underlying principle being invoked here is called the principle of subsidiarity. This principle is embedded in European Law and seems to hold general appeal across the political spectrum, for quite understandable reasons. In short, the principle argues for governance functions to be devolved to the lowest possible level at which they can be delivered effectively and efficiently.
Last year the NZ Productivity Commission – instigated by the National Government – produced this issues paper on local government regulatory performance. The paper discussed – and generally extolled – the merits of subsidiarity. The section of their report titled “Factors that may be relevant in allocating regulatory roles” (pg. 28) contains this cutesy diagram:
What this illustrates is that the “local customised” approach to public policy more accurately reflects differences in the population’s underlying preferences. And that – put simply – makes the affected people better off. In contrast, the “one-size-fits-all” approach to setting transport policy, which is what the LTMA Bill proposes for Auckland, is likely to result in some people – especially those who use public transport and who walk/cycle – much less happy.
I’d suggest the National Government has a major problem on its hands, and one that is entirely of its own making. How do National reconcile the LTMA Bill with the concepts of taxation/representation, as well as the more general principle of subsidiarity? In my opinion you can’t; what is being proposed in the LTMA Bill is nothing less than a naked power grab.
I’m actually rather outraged by what is being proposed here. As an Aucklander who is interested in transport, I’d like all the National MPs in Auckland to front up and tell us why they think it’s appropriate for Central Government to place their transport agenda ahead of Auckland’s democratically elected councillors.
Can Aucklanders not decide for ourselves what sort of transport projects our rates and fuel excise duties should fund? Or does Nanny National always know best? And I have not even mentioned land use and transport integration, which is another strong argument for retaining Auckland Transport’s obligations to Auckland Council.
If you’re as concerned as I am by what is proposed in the LTMA Bill then I’d suggest you send your local National MP (listed below [source]) an email and let them know how you feel, or possibly just point them to this post. Go well.