The Government's road-heavy transport plan, which could see fuel taxes and road user charges rise further next year, has been criticised by the Greens for "locking our economy to the price of oil".
The National Land Transport Fund will invest $36 billion over the next 10 years, which the Ministry of Transport says is generally the same as that envisaged in the current Government Policy Statement on Land Transport Funding (GPS). The GPS outlines the government’s priorities for expenditure from the fund and determines how funding is allocated.
The GPS 2012 will make around $2.95 billion available in 2012/13 for investment in the land transport sector, rising to $3.25 billion in 2014/15. However, it outlines three significant changes:
- increasing the funding available for new and improved state highways by $125 million to $3.65 billion for the first three years
- increasing the funding available for public transport services by $140 million to $920 million for the first three years
- enabling increases for new state highways and public transport services partly by reducing the funding available for some activities classes, such as, transport planning and management of the funding allocation system.
“Continued funding for state highways and the roads of national significance will help encourage business, tourism and jobs, and will improve road-user safety," says transport minister Steven Joyce.
"State highways carry most inter-regional freight and link major ports, airports and urban areas. Further progress on the RoNS will be made, reflecting the government’s commitment to substantially progress the RoNS, to complete the Waikato Expressway within 10 years, and to significantly progress the construction of the Waterview Connection."
Fuel taxes likely to rise
The New Zealand Council for Infrastructure Development has chimed in, saying the GPS provides direction but points to "significant funding challenges" in the near future.
Joyce says it's likely road user charges and fuel excise duty on petrol will increase to fund the programme.
"These increases could be in the order of 2 cents a litre in 2012 and 1.5 cents a litre in 2013."
But NZCID chief executive Stephen Selwood says more efficient vehicles and drivers are lowering the relative tax on each litre of fuel sold, while the regulatory costs of delivering transport infrastructure increase.
"That means we're getting less road for our dollar and less tax every time a commuter uses one. It's a double whammy and the GPS only recognises 1-2 cent per litre per annum increases over the next three years."
He says items such as an additional Waitemata Harbour Crossing will need funding within the next decade if it is to be delivered before restrictions start affecting the existing Auckland Harbour Bridge.
"The GPS provides no assurance that these costs have been recognised and will be met."
Joyce says a key concern raised by stakeholders was that the proposed funding ranges for the maintenance and renewal of roads would be insufficient to maintain the roading networks at current levels. In response, upper funding ranges for local road maintenance have been boosted to $260 million and local road renewals to $240 million from 2012/13.
In contrast, public transport infrastructure will get $60 million at most.
Green Party transport spokesperson Gareth Hughes says spending $26 billion on roads over 10 years compared with $5.8 billion on public transport, walking and cycling is "not a smart way to run an economy".
“The National Government has prioritised spending on new motorways above more sustainable alternatives, effectively locking our economy in to the price of oil for at least another 10 years,” he says.
He says the government is effectively borrowing to pay for new motorways.
“We can future-proof our transport systems by investing more in better rail and bus services, coastal shipping, and the critical Auckland CBD rail loop without additional borrowing.”
Joyce argues most of the government’s capital investment in public transport infrastructure is being made outside of the National Land Transport Fund. In addition to the fund, it plans to invest $1.6 billion in Auckland public transport and $488 million for Wellington:
- $1.6 billion in the development of Auckland's metro rail system, which comprises: $600 million for Project DART; $500 million for the infrastructure required to support electrification; $500 million loan funding for the purchase of electric trains
- $400 million on Wellington’s metro rail upgrade
- $88.4 million for upgrades to the Wellington metro rail network as part of a funding and ownership package with the Greater Wellington Regional Council.
The majority of metro-rail infrastructure improvements will be paid for directly through Crown funds rather than through the national fund.
Joyce says this is the most significant investment in public transport infrastructure since the Ganz Mavag trains were introduced in Wellington in the late 1970s.
“Taken together, the National Land Transport Fund investments and the parallel rail investments we are making are a huge investment in transport for a country of New Zealand’s size.
“Further benefits will accrue in the walking and cycling area as most of the major roading projects have special provision for walking and cycling, and this isn’t counted in the walking and cycling budget."
But the NZCID says Auckland mayor Len Brown's CBD rail project is conspicuously absent from the plan—"reaffirming that the government has no capacity to contribute to this $2.4 billion project".
"That's $2000 that every Aucklander is going to have to stump up if the region wants a CBD rail loop," says Selwood.
The GPS 2012 will come into force on July 1 next year.