Government To Reduce Local Road Funding By Up To $225m
The Government Policy Statement (GPS) on transport guides central and local transport planning throughout the country, so it’s an important document.
The Government has announced changes to the GPS. The new GPS has not been released yet, but the Minister of Transport has signalled his intentions with this document, which discusses the amendments that are about to be made in general terms, and also reallocates funding across different categories.
I’ve crunched the numbers, and the results are somewhat surprising.
The Minister’s reasons for changing the GPS are:
- to reflect the governmentâ€™s priority of investment in transport infrastructure for economic growth
- to reflect the modal choices that are realistically available to New Zealanders
Â ”Transport infrastructure for economic growth” is code for building more roads, even though there is very strong evidence that the benefit cost ratios used for roading projects are fundamentally flawed. (More on this in an upcoming post). Reflecting “modal choices that are realistically available to New Zealanders” is code for reducing spending on public transport.
The upshot is that almost $1bn will be diverted from other categories into new state highways, in spite of the fact that none of the proposed “highways of national significance” stack up economically. The current GPS is here.
By comparing the two documents, this analysis shows the seismic shift in funding to new state highways:
Note that spending by activity class is expressed as a range, not a single number. So, for example, funding for public transport services will be cut by 45 – 85m (or 7 – 12%) over the next three years.
What is also surprising is that the maintenance and operation of local roads could take a hit of $150m over the next 3 years, putting more pressure on local council rates.
The Minister is diverting as much money as possible into the “New and Improved State Highway” category.Â Even though it is claimed that building more highways will boost economic growth, there is no supporting evidence that this is the case.Â
I can’t help feeling the Minister of Transport is rushing in to this. In the next post, I’ll explain why putting all your eggs into new highways could be a big mistake.
5 Responses to “Government To Reduce Local Road Funding By Up To $225m”
Leave a Reply
You must be logged in to post a comment.