Over the last few weeks there has been a renewed media focus on Auckland’s transport issues. This has been spurred on by two main events the first was the Green Party launching their Reconnect Auckland campaign and the second was the announcement of alternative funding options to help pay for future transport projects. Along with that it has seen a resurgence of an annoying myth that members of the government like to perpetrate. In an effort to try and make their transport policy sound more balanced than it actually is they love to state that the government has invested $1.6 billion into the rail network. Government MPs talk about it on social networks or at meetings, Gerry Brownlee mentioned it in his recent interview on Campbell live and Steven Joyce, repeated it this morning on The Nation (on TV3).
Now $1.6 billion certainly sounds like a lot of money and of course it is. It is also true that it the amount of money that central government has, or will be spend on rail up until the electrification project has been completed. The issue I have is that a decent proportion of the money was approved or spent before the current government even came into office. So let’s look at the figure a bit more closely, the $1.6 billion can be boiled down into three key areas:
- $600 million for Project DART
- $500 million for the electrification infrastructure
- $500 million for the new electric trains
As the government are using the total figure to suggest that they are investing in a more balanced transport system, the question becomes whether the money was invested by the current government or not, so lets have a look.
Amongst other improvements it included double tracking the western line, various station upgrades, the Newmarket Station and changes to the junction, the New Lynn trench and station, reinstating the Onehunga Line, building the Manukau branch line. Kiwirails page on the project also states:
The 2006 Budget included funding of up to $600 million for rail infrastructure improvements to speed development of the Auckland network.
So yes this was paid for by central government but as you can see, funding started before the current government came to power which was late in 2008. Of course not all funding is spent in one year and as Brownlee said the other day, they didn’t cancel it. But even if they wanted to, how much could they have cancelled anyway? Well probably not much.
Interestingly the funding for this project was kept out of the normal transport budget and instead is listed under the finance budget. The government’s budget documents for the 2006/2007 financial year shows that the money was to be spent over a four year period and it was only the fourth year that National had any control over the budget. By then pretty much all of the various aspects to the project were either already completed or well under way meaning it was probably impossible to cancel anyway.
To me there is no way that the current government can claim the $600 million spent on Project DART as their spending or that they had anything to with it.
This includes new signalling, modifying existing infrastructure like bridges and of course the wires themselves. Funding for electrification was initially included in the 2007 budget and was separate to the funding allocated for Project DART.
Now from memory the government intended to pay for the Auckland work via a regional fuel tax which would work in conjunction with one the region would also impose to fund other projects, including new trains. When National came to power they stopped the regional fuel tax and put a hold on the electrification project. They eventually agreed to let it go ahead and paid for it out of the nationwide fuel tax increase. It is however quite clear that funding for the project was initiated in 2007, over a year before National came to power.
There is obviously not much point in paying $500 million for electrification without trains to run under the wires. As mentioned, the original electrification proposal was to see Auckland pay for the trains out of a regional fuel tax imposed by the regional council. The national governments cancelling of that fuel tax took that funding option off the table. When they finally agreed to let the project go ahead it was announced that the trains would be paid for by way of a loan that Auckland would have to pay back (without the extra source of funding). Worse still was that even after paying back the loan the proposal meant that Auckland still wouldn’t own the trains, Kiwirail would, however this has now changed and Auckland will own the trains directly.
Since then there has been some positive news, it was announced that Auckland would end up getting more electric trains that first proposed, that was partly possible due to better than originally expected exchange rates along with the government kicking in an extra $90 million. The NZTA are also going to contribute to the loan payments in the same way they provide money for PT operating costs however oddly it turns out that the government appears to be clipping the ticket on the loan by charging a margin on top of their cost of funding.
The first EMU will be here in a few months time
So when the government states that they have invested $1.6 billion in to rail in Auckland, it is frankly untrue. In fact the only new funding they seem to have provided is the extra $90 million they provided to buy extra EMUs and the 50% share of funding for loan repayments. Other than that all of the funding is the same as what was agreed to before they came to office.
With the release of the station boarding data in the post yesterday by Mr Anderson, and the recent sluggish patronage growth, its perhaps worthwhile looking at how things are going compared to projections. Again we can look at the supporting report for a lot of information as AT/AC attempted to answer one part of Steven Joyce’s question relating to evidence of patronage growth, particularly in the morning peak.
First of all, anyone who has followed this blog for long enough will know about how rail patronage has increased. In 2003 before Britomart opened rail patronage was sitting at about very low base of 2.5 million trips per annum, since that time it has shot up to over 10 million trips per annum now. While it is off a low base, it has easily outstripped population growth and the report says it has seen per capita usage jump from 2.2 trips per person to 7.3. over the same time morning peak patronage has increased very strongly going from 1,012 people arriving at Britomart during the two hour peak to 6055 in 2012. What the report notes is interesting however is that the percentage of off peak patronage growth, particularly in recent years has outstripped the level seen during the peak which is useful for showing that the improvements aren’t just about getting more peak users but that there are benefits off peak too.
It is pretty clear that that there has been some pretty big increases but the next question is if the increases were a result of a cannibalising of bus patronage. So the reported looked at the AM peak numbers and compared those with private vehicle numbers over time and from that we can see that both rail and buses have increased there share when it comes to accessing the city centre although for some reason ferry patronage wasn’t included which would explain why private vehicle usage is at 56% when the 2012 numbers were 50:50 between PT and car.
But what about those projections, well each of the projects over the years have had some form of projections attached to them. In 2001 when the council of the time was putting its case together for Britomart the report notes that the current transport model used was still being developed however it was working enough to get some basic results. There appear to have been two years that were modelled forecasting 10 and 20 years out (2011 and 2021) and the numbers are below:
So with the exception of outbound passengers in the morning peak, the actual numbers are considerably higher than even the 2021 projections (40% higher than 2011 prediction and 15% higher than 2021). In fact the change in daily patronage out of the station just between 2010 and 2011 was greater than what was predicted to occur between 2011 and 2021. What’s more the author of the report notes that the projections included the network and frequencies being in a similar state to what they are in now and included electrification.
The next set of projections come from the 2006 rail development plan which is what really kicked off project DART and electrification. While it appears we are tracking at less than what was forecast, there are some fairly important reasons for that. The forecast was based on by now there being more frequent services and importantly was based on electrification being started almost straight away and completed in 2011. It was however delayed by both the previous and current governments and we are now not expecting all the trains to roll out to the network till 2015/16. The report notes that the 2016 forecast patronage has now been revised up higher from 15.7 million trips to 17.3 million.
Electrification had been forecast to be completed in 2011
We also have projections for Onehunga, which ended up opening later than expected (from memory it was initially said that it would open in 2009 but didn’t open till late 2010. Even so AM actual numbers seem to be a little bit ahead of projections while the all day numbers are not far off.
This post is starting to get a little long so tomorrow I will look at some of the reasons that have been identified as being responsible for the increase in patronage but it is pretty clear from reading through the report so far that we seem to constantly underestimate rail patronage. As the same modelling is being used, that means it is quite likely that projections in the CCFAS and the original business case have also been underestimated and that could have significant impact on the outcome of the economic analysis.
One thing that perpetually annoys me is when Steven Joyce rolls out the “we’re spending $1.6 billion on rail in Auckland so please stop complaining about all the money we’re spending on roads.” We see this line being trotted in in some of the Questions and Answers section to the Government Policy Statement:
It is also important to note that the majority of central government funding for public transport infrastructure is provided outside of the National Land Transport Fund and so not included in the GPS. Most of this funding is for metro rail. To date more than $2 billion in Crown appropriations has been agreed, of which $1.6 billion is for Auckland and $485 million for Wellington.
It is true that $1.6 billion is being (and has been) spent on upgrading Auckland’s rail network over the past few years (and over the next few years). The money is comprised of:
- $600 million for Project DART
- $500 million for the infrastructure side of rail electrification
- $500 million for new electric trains
So in total that is $1.6 billion. But there are two important questions to follow this up with: how much of that is being funded from central government and how much is being funded by this central government.
Looking first at Project DART, the rail project in Auckland that included double-tracking the Western Line, building Newmarket, New Lynn, Onehunga and Manukau stations – and other upgrades to the network. This $600 million project was actually funded in the 2006 budget – according to the Project DART website:
The 2006 Budget included funding of up to $600 million to fund these improvements and speed development of the Auckland rail network.
The project is the most significant redevelopment of the rail network in New Zealand since the 1980s.
So this passes the threshold for being funded by Central Government, but doesn’t pass the threshold of having been funded by this government.
Turning next to the infrastructure side of electrification – which includes stringing up the wires, raising a few bridges, putting up poles, building electrical sub-stations and so forth. According to the electrification webpage, funding for this was set aside in the 2007 budget:
In the 2007 Budget the Government announced its support for the electrification of Auckland’s rail network, and gave ONTRACK the funds to build the necessary infrastructure…
…Planning and concept development started immediately and physical work began in 2008.
We expect it will take about five years to electrify the Auckland network, and the Government has indicated that it wants the project completed by 2013.
So this is basically in the same situation as Project DART: yes, funded by Central Government outside the NLTF, but once again not funded by this government.
Finally, if we turn to funding for Auckland’s electric trains, it doesn’t even pass the very first base of being “outside the NLTF”. The very reason public transport services funding has actually increases in the Government Policy Statement is because this money will go into repaying the loan for the electric trains. Loaning $500 million to KiwiRail to pay for these trains, which Auckland Council and NZTA will need to repay, is quite different to actually giving the $500 million for the trains. So the trains aren’t being paid for outside the NLTF, they aren’t being paid for by Central Government – and obviously not by this government.
So really, I’m struggling to find a single cent that this government has set aside for passenger rail in Auckland.
Broadly speaking, there are two distinct types of trains in Auckland: the “Diesel Multiple Units” that we bought second-hand from Perth in the mid-1990s and the locomotive hauled carriages that were bought second-hand from the UK and then significantly refurbished, and now get hauled around by locomotives leased off KiwiRail. Some of those locomotives are 40-50 years old, while some of the Perth DMUs also date back to the 1960s (the ones without air-conditioning, known as the ADKs). (Note to rail nerds, I haven’t forgotten about the SX). Below are a couple of carriages from an SA train:
Up until around the time Britomart opened the rail network was pretty much solely operated by the ex-Perth DMUs. The impending patronage boom that Britomart was to bring (and obviously has brought) meant that additional capacity was required, and the SA/SD trains have provided that over the past few years. When there are debates about whether or not to sell the Port of Auckland, it’s worth remembering that the dividends on profits from the Ports are pretty much what has paid for the purchase and refurbishment of all the SA/SD trains that now form the majority of Auckland’s rail rolling stock.
But that’s enough history, the point of this blog post is to look forward. In the near future, it seems that we will have the last of the SA carriages coming online within the next couple of months to add capacity to the southern and eastern lines, now that their platforms have been lengthened to accommodate six carriage trains. This was outlined in a recent Auckland Transport media release:
Longer trains are being added to the rail network to help cater for the increasing popularity of Auckland’s public transport, which was up eight per cent for the year to 30 April.
From 17 July trains will use five and six carriages on the southern line, following the completion of platform extension works. Six carriage trains began operating on the Western Line last September. Longer trains allow more passengers on each service.
It’s worthwhile to note that under the current plans, these will be the last additional bit of rail rolling stock capacity that will be added to the network until electrification in 2013/2014. Unless we can find some ‘stop-gap’ measure to get more trains (or longer trains) on the network, my understanding is that from July this year until the new electric trains are operational in 2013/2014 we will have to manage with the same number of trains. An interesting prospect if rail patronage continues to grow at 10-15% a year. This issue was noted in Auckland Transport’s April business report:
I‘m still yet to quite figure out how the further optimisation will work in early next year. Not only will this include the improvement of peak time frequencies on the Western Line from a train every 15 minutes to a train every 10 minutes, but it will also include the introduction of trains to Manukau Station – presumably achieved by extending all the current ‘short-runner’ services to Otahuhu all the way down to Manukau before terminating them there. With the longer running time between Manukau and Britomart compared to between Otahuhu and Britomart, there will clearly be an increased number of trains required. I’m starting to think that having six carriage trains could be a pretty short-lived exercise – as from next year the carriages will need to be distributed to a larger number of trains.
As I have discussed previously, the concept of having fare differentiation between peak time rail travel and off-peak travel is a good one. Shifting some of the “peak of the peak” into times just before and after the main crush of passengers means that you can use your existing rolling stock more efficiently and effectively. Adding off-peak services is pretty easy as you don’t need more rolling stock and you don’t need more track capacity – you just need to work the system at the peak level for a bit longer. Getting 15 minute inter-peak frequencies on weekdays, longer peak-time frequencies in the evenings and at worst half-hour frequencies on all lines at weekends would be easily and quickly achievable without having to purchase any more rolling stock. Having hourly weekend frequencies on the Western Line, and no trains past Henderson on Sundays, it just downright stupid – as the Western Line passes near five large shopping centres (city centre, Newmarket, St Lukes, New Lynn and Henderson) and could be hugely popular on the weekend.
But even with fare differentiation and better off-peak services, I think by the time we get close to the rollout of the new electric trains on the network things are going to be pretty squashed. Which is why I have found the never-ending delays to the electric train procurement process so utterly infuriating.
The order of electric trains (well, my understanding of it) includes 35 three-car electric multiple-unit trains, plus a number of electric locomotives. The locomotives are necessary for the obvious reason that we have a large number of SA/SD trains around Auckland at the moment and not only would it be stupid to get rid of them when they have a lot of life left, but also that we don’t have enough money to purchase sufficient EMUs to operate the network alone. My understanding is that at peak times the EMU trains will generally be “paired up” to form six carriage trains, and will operate on the Eastern and Western lines. Single three-carriage trains will operate on the Onehunga Line, while the Southern Line will be served by the current SA/SD trains, but pulled by new electric locomotives rather than the ancient diesel locos that pull them along at the moment. Because there will be a lot of SA carriages available, my hope is that the current platform lengthening exercises being undertaken on the Southern Line will provide for eight-car trains to be operated.
One great irony of electrification is that it won’t actually result in any more trains being operated on the rail network at peak times – compared to what we’ll have in early next year. Until the CBD Rail Tunnel is constructed, Britomart can only handle around 20-21 trains per hour – which means six from each of the three main lines plus two from Onehunga. Of course electrification will enable the trains to be faster, quieter, smoother and longer – which will add capacity to the system – but until we build the CBD tunnel our ability to get more trains into the city at peak times is constrained.
Furthermore, the desire (and need) to operate the network as efficiently as possible will mean that the mixing of diesel and electric trains is likely to be avoided wherever possible – as the diesels obviously accelerate slower and would therefore “hold up” electric trains. So that means all trains from beyond Papakura and Swanson will only be shuttle trains to the end of the electric line. The newer of the Perth DMUs (known as the ADLs) should fulfill this function fairly effectively, and they could serve out to Hupai (or beyond if demand was there) on the Western Line and also potentially beyond Pukekohe on the Southern Line.
So in the period between electrification and the opening of the CBD rail tunnel (so say between 2014 and 2021 if we’re optimistic about the CBD Tunnel) the new electric trains will be used in combination with SA Trains being hauled by new electric locomotives, plus the use of some of the DMUs for shuttle services. Additional capacity could be added (if the trains were available) by running services between the Western and Southern lines directly, without having to have every train go into Britomart. I know that maximum loading points on the Western Line generally occur between Mt Eden and Grafton station as many Western Line users have their destination at either Grafton or Newmarket. So that’s a potential way of squeezing the most out of the system up until around 2021 when the need for the CBD Tunnel will be dire.
Now, if we look at rolling stock requirements post-CBD Rail Tunnel, things become rather interesting. In the CBD Tunnel’s business case a rather bizarre operating pattern was suggested: The option above requires a lot of additional trains, so an interim option was considered that would utilise the existing number of post-electrification trains: I thought both options were far too complicated, and suggested my own operating pattern:
One big spanner in the works of all this is the likelihood that the SA Trains won’t be able to operate through the CBD Rail Tunnel, because it’s too steep (and also something to do with fire-ratings). EMUs can generally handle steeper gradients than locomotives, because the train is being driven from more points – kind of like how a four-wheel drive vehicle provides more control on slopes than a two-wheel drive vehicle. Because the CBD Tunnel is going to be very much at the maximum end of track steepness, it seems that in all likelihood it will only be EMUs that can operate through it.
That gives us a bit of a headache about what to do with all our electric locomotives and SA/SD trains – that still will have a lot of life left in them come 2021. I wonder if Wellington would be prepared to swap some of its Matangi Trains for loco-hauled SA/SD trains? It’s an interesting possibility.
Measuring the benefits of transport projects is usually done through a process of comparing how long it took someone to get from A to B without a particular project, how long it is expected to take from A to B with that project, compare the difference, apply some value to the time, multiply it up by how many people will benefit and get a big round number. This methodology has its own flaws (what if people just travel further, rather than taking quicker trips), but it also potentially ignores many of the benefits that enhanced transport access can provide. What if a particular project encourages employment to concentrate in a city centre and thereby generates agglomeration benefits? What if people owning property in a particular place see their land values skyrocket through enhanced accessibility? These are all benefits, but not necessarily benefits that are frequently captured.
An interesting study by Motu Research attempts to capture and quantify some of the benefits from transport projects that tend to be ignored – looking at the example of the upgrades to Auckland’s Western Railway Line. Further to that issue, the paper also analyses the ‘anticipatory’ nature of these impacts: the extent to which house prices started increasing even in advance of completion of the upgrade – because people knew it was coming. It’s important to note that the benefits analysed were only those in the former Waitakere City.
A summary of what is analysed is outlined in the introduction: A bit more on the findings is outlined below:
So there seems to be a statistically significant impact. I suppose the real question is what the level of that impact was – and potentially how we might ‘tap’ that effect to help fund future projects.
But first, it’s worth having a read through the theory behind the idea that rail improvements will boost property values. This is broadly summarised below – although the study itself goes into quite a bit more detail: Interestingly, the house price benefit seems to largely occur within the pedestrian catchment of the train station – and most particularly when the station wasn’t constructed with “park and ride” users being prioritised:
There’s a lot of complicated maths in the way the effects are all worked out, and the study splits the railway stations in the west into three groups: those around New Lynn, those around Henderson and then Ranui & Swanson as a third group. The result show a definite uplift in house values in the areas around the stations compared to similar areas during the post-announcement period: after around 2005 when it was known that the rail upgrade would go ahead. The graph below averages out the two time periods to make the “jump” clearer:
Interestingly the biggest increases were for the stations closest to the city. It makes one wonder what effect the CBD Rail Tunnel might have on property values in the Grafton to New Lynn corridor along the Western Line: as that project will shave a huge chunk of trip times to the city centre.
When the value uplift is aggregated, you can some pretty big results in terms of the impact the project has had:
Now remember that this type of ‘benefit’ is not even included in the typical cost-benefit analysis. It’s also worth thinking about what the value uplift of the CBD Rail Tunnel might be – as typically rail projects have a greater effect on commercial land values in city centre than they do on residential values. We could be looking at some pretty massive numbers that haven’t even been given consideration in the business case for that project.
I suppose my final point of interest is in how this value uplift could potentially be used as a funding mechanism for rail infrastructure projects like the CBD Tunnel. Perhaps if a proportion of the value uplift was taxed (by way of a targeted rate or some sort of capital gains tax) then the revenue raised from that tax could help repay loans that were taken out to fund the project.
In any case, the article is certainly an interesting read – both in terms of identifying a benefit from rail projects that seems to have been previously overlooked, while at the same time also potentially highlighting a possible source of revenue. After all, if you owned property in the CBD you’d probably prefer it increased in value by 100% as result of the CBD Rail Tunnel, even if you saw a third of that taxed, than if it didn’t increase at all because the project could not go ahead.
The NZ Herald reports that the rail upgrade work taking place over the next couple of weeks – which will involve significant improvements to big chunks of the network in preparation for electrification – has swung into action:
About 200 rail workers threw themselves into a hectic summer construction programme throughout Auckland yesterday, including erecting the first of 3500 power supply masts for the $1 billion electrification project.
Several masts were erected through the Newmarket railway junction and above a new platform being built at the Baldwin Avenue station on the western line, as work began elsewhere around the region demolishing bridges and lowering tracks to create enough head-room for electrification.
I went to the cricket match at Eden Park yesterday and there were a number of KiwiRail staff around Morningside Station doing upgrade works.
Although five bridges are being replaced between Papatoetoe and Papakura and the 800m Purewa railway tunnel is being lowered this summer, Mr French he said the premier job of the season was probably the re-signalling around Quay Park.
That is needed to ensure trial runs of “bi-directional” Rugby World Cup rail operations can take place early in the New Year, in which trains will run in the same direction on both sets of tracks from Kingsland Station.
The first such trial is due on February 19 for a rugby clash between the Auckland Blues and Canterbury Crusaders at the opening of the Super 15 season at Eden Park.
I would agree that the signalling work at Quay Park is the most interesting and useful part of the upgrade works that will happen over this break. Not only will it allow bi-directional running of trains for one-off events like matches at Eden Park, it will also enable Britomart to handle a few more trains at peak times. That should it won’t be too long before we can have 10 minute peak frequencies on the Western Line.
I’ll try to get out and about – particularly around Baldwin Ave station – over the next week and a bit to take some photos of what’s happening.
As the year draws to a close I have been having a few discussions with friends about whether 2010 has been a good year for public transport or not. There are probably arguments either way.
On the bright side first
- Perhaps the biggest boost was the results of the Auckland Council local government election, and in particular the election of Mayor Len Brown on a very strong public transport platform. As well as the final result of the Super City election, I was also heartened by the emphasis we saw throughout the election period on the necessity to improve Auckland’s public transport system. For example, we saw survey results in the NZ Herald showing rail to the airport was the project most people thought we should prioritise.
- We’ve also seen the CBD Rail Tunnel business case released, showing an excellent cost-benefit ratio of 3.5 – once you include employment-related wider economic benefits (which, contrary to what Steven Joyce says, are also included in all the BCR calculations of the roads of national significance).
- We saw a number of railway stations open: including Newmarket, Grafton, New Lynn and perhaps most satisfyingly, Onehunga. 2009 was a bit of a ‘hard slog year’ when it came to PT: much work done but not many results to show for it. In 2010 we saw the results of that hard work, which has been great.
- The ARC came up with the 2010 Regional Land Transport Strategy, just before they disappeared. This is probably the best transport strategy Auckland has had in 60 years – although it remains to be seen to what extent it’s implemented.
- Patronage continued to boom: particularly on the rail network and on the Northern Busway. It’s only a matter of time before we achieve a million rail trips a month: perhaps in March next year, perhaps in September or October when the world cup is on.
Of course not everything has been great. On the down side:
- Steven Joyce’s reaction to the CBD tunnel business case was disappointing and exceptionally hypocritical considering his illogical support of the Puhoi-Wellsford “holiday highway”.
- The relentless pursuit of the Puhoi-Wellsford “holiday highway” has been disappointing, especially considering its cost-effectiveness seems to become worse and worse the more it’s analysed.
- The farebox recovery policy didn’t get much news, but over the long term could prove to be exceptionally destructive to public transport in New Zealand. Once again, it seems that this was an arbitrary decision from Steven Joyce to impose a 50% requirement with absolutely no supporting research.
- The emergence of a $30 million rail funding gap – entirely caused by the policies of (you guessed it) Steven Joyce.
- The whole bus lane ticketing saga. While Auckland City was certainly acting a bit daft, the Herald’s general crusade against bus lanes may end up being particularly damaging to the cheapest and fastest way of dramatically improving public transport in Auckland – extending the bus lane system.
On balance, I do think we’re in a better place than we were this time last year. Electrification is about to kick into its next phase and become visible, integrated ticketing (despite its many flaws) looks like it’s going ahead. We have a Mayor and Council who are willing to take the fight to the government’s transport policies if need be, and who appear to be strong PT advocates. This year could have a been a whole heap worse, that’s for sure.