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Hot Topic NBR Focus: GMO
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$24 billion Auckland transport package comes with a $4 billion shortfall

Congestion charges expected to be introduced. With special feature audio.

Sally Lindsay
Fri, 16 Sep 2016

A $24 billion package of transport projects in the next decade will form part of an $83 billion spend over the next three decades by the government and Auckland Council. The funding might be ambitious but the timetable for implementing the plan is unambitious. 

The package ­– the biggest in New Zealand’s history – is outlined in the Auckland Transport Alignment Project (ATAP), a joint government and council plan. Outgoing mayor Len Brown says it is designed to end 100 years of arguments and divisiveness between the council and the government.   

However, it is going to come with a $4 billion funding shortfall in the first decade and expectant mayor Phil Goff’s plan to introduce a petrol tax to pay for it will fall on deaf ears.  

Transport Minister Simon Bridges says Mr Goff has his own view on funding, but a petrol tax is not the preferred option of the government. “We have to be careful about imposing new taxes on Aucklanders.”

Mr Bridge expects there is more likely to be a congestion tax, but government mandarins and council staff have serious work to do on funding and “it is not about plugging the short-term revenue gap but changing the travelling public’s behaviours.”

Outgoing mayor Len Brown says road pricing is a fairer means of funding transport than raising rates, but it is unlikely to be implemented for a decade, by the time the council and government agree on a strategy.  

Meanwhile, the three-year “temporary” transport levy imposed on all ratepayers and businesses ends in 18-months and options for alternative funding will need to be put on the table by the middle of next year. Mr Brown says this may mean the levy is rolled-over for another term or the council and government can agree on some new form of funding before then. It appears to be unlikely.

 The plan for the first decade – 2018-2028 – of the package includes the first phase of the north-western busway from Westgate to Te Atatu, motorway improvements to ease congestion, upgraded access to Auckland airport from the east to address congestion and ongoing investment to improve Auckland’s rail network, including more electric trains and extending electrification to Pukekohe.

Plans for a second harbour crossing have been delayed to 2038.

“This is a serious long-term view of Auckland’s transport. It is no silver bullet but the government and council have prioritised projects where additional funding is needed,” Mr Bridges says.

“The city can’t keep adding lanes to motorways. This is neither affordable nor cost-effective for ratepayers and taxpayers.

“Auckland needs to look at better controlling travel demand. This is interesting and important work that is in the preliminary stages.” Mr Brown says Aucklanders will be urged to make different choices about how they travel and at what time of day and demand management will be crucial to achieving this.

The mayor and minister pointed out the projects are not set in stone and each will have to come with a business case with a cost-benefit ratio.

The plan places more emphasis on the first decade of the package because assumptions about the location of housing, employment growth and the timing and impacts of technological change become less accurate after that.

Goff criticised
Mark Thomas, the mayoral candidate who has admitted defeat before the election, says the ATAP recommendations are a kick in the pants for key parts of Phil Goff's transport policy.

"There will be no early move to his favoured light rail plan for the central isthmus and to the airport, and his request for a petrol tax has again been rejected."

Mr Thomas says none of Mr Goff's planned funding measures of infrastructure bonds, a slice of GST or increasing council's debt ceiling are highlighted.

“Neither has Mr Goff shown real willingness to look closely at any additional contribution the council can make, and he has no commercial experience working with public private partnerships (PPPs)."

Mr Thomas says the council could reverse its $113 million transport budget cut and the council’s existing assets could be swapped to help plus transport gaps. PPPs for transport projects could also be implemented.

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Sally Lindsay
Fri, 16 Sep 2016
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$24 billion Auckland transport package comes with a $4 billion shortfall