Auckland Rail “Funding Gap”

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There have been a couple of stories this week in the Herald. The first one talks about Transport Minister Steven Joyce claiming there is a “funding gap” for rail operational costs. The second is a response from Auckland Councillor Mike Lee claiming Steven Joyce is trying to stymie Mayor Brown’s vision. It’s all a bit confusing, but fortunately Josh Arbury over at  has got to the nub of the matter in this post here.

It is appropriate that the Auckland region pays a fair value for track access. It has been doing so since 2003, paying an average $5m per annum.

But now Transport Minister Steven Joyce wants to unilaterally increase this fee to $16m annually. Included in this are loan repayments at commercial rates of interest for the purchase of $500m worth of new electric trains for Auckland. The new trains were originally to be funded through a regional fuel tax of 2c per litre until the Government decided against this in March 2009.

Instead now it is obvious that central Government has decided to stick ratepayers with the bill for the new electric trains. It is disingenuous of the Minister not to mention this and to present this as a fait accompli to the new Mayor.

The Minister also needs to explain to Auckland ratepayers why Wellington’s new electric trains are 90% funded from central Government, and what “track access fees” Wellington ratepayers are expected to pay.

UPDATE: A well placed source tells me that in fact Steven Joyce is still considering how Auckland trains should be funded and what the funding split should be between Auckland and central Government.  Funding of trains is not included in the higher track access fee. It makes the decision to increase the track access fee from $5m to $16m even more confusing.  We will have to wait and see.

Mike Lee: The Government is no longer listening

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Mike Lee pretty much hits the nail on the head with CCO’s and Auckland Transport:

According to the explanatory note to the third bill currently being deliberated by the select committee, the Super City was intended to “create one Auckland, which has strong regional governance, integrated decision making, greater community engagement and improved value for money”.

But what has become quite obvious is that Auckland isn’t getting this at all.

He bullet points the unacceptable features of Auckland Transport: Read the rest of this entry »

Brian Rudman: Cheap won’t be a bargain for Auckland’s new rail system


Following on from the ARC’s media release of last week regarding funding for rail electrification in Auckland, Brian Rudman comments in the Herald:

When the new Government pulled the plug on the regional fuel tax six months ago, killing Auckland’s ability to buy itself a modern, electrified rapid-rail system, Transport Minister Steven Joyce told Aucklanders not to fret. He would come up with alternative funding arrangements.

Then in late May, after a trip to Australia, he returned full of the wonders of using a public-private partnership to buy the rolling stock.

He added that the PPP was not the only option being juggled by the Government and once more patted us on the head and said not to worry, electric rail was still on track for completion in 2013.

Reports now leaking out of Wellington paint a dispiriting picture of the alternatives being considered.

Read the rest of this entry »

ARC: Where’s the Money For Electric Trains?

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Responding to the announcement that the petrol excise tax will increase by 3c in October, ARC Chair asks the obvious question in this media release:

Auckland has renewed its calls for Government action on funding for electric trains before fuel taxes rise on 1 October.

“When the Government cancelled regional fuel tax funding for electric trains six months ago, the Transport Minister promised to fill the gap,” said ARC Chairman Mike Lee.

“He was going to have a plan by July, when he was to report back to cabinet. We heard nothing then. We in Auckland are running out of patience.

“As of this week, Auckland has lost half a year in its electrification programme. People in Auckland will soon be paying higher fuel taxes and road user charges, and still there is no sign of electric trains.

Read the rest of this entry »

ARC cool on hybrid Waterview link plan

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The ARC feels insufficient information has been provided to properly assess the Waterview motorway link and it still prefers the option of a longer link through Rosebank Rd.  The Herald reports:

Auckland Regional Council’s transport committee has withheld support for the latest cut-down version of a motorway through Waterview involving a mix of surface and tunnelled sections.

The committee yesterday deemed it had received insufficient information to assess the $1.4 billion scheme before the Transport Agency board meets in a fortnight to consider submissions and decide whether to push ahead with the final link in Auckland’s western ring route.

It also restated its preference for a longer link through Rosebank Rd as “the superior strategic alignment” to connect the Southwestern and Northwestern Motorways, even though the Government ruled that out early this year as too expensive, while instructing the agency to review various Waterview options.

The regional councillors affirmed their support for completing the 48km ring route between Manukau and Albany, but questioned the strategic justification for running it through Waterview, where the latest proposal will require the demolition of up to 365 homes and loss of 5ha of public open space.

Read the rest of this entry »

Shunted into ’70s

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John Landrigan investigates the progress being made on electrification of Auckland’s rail network in this article in the Aucklander.
The Government insists that electric rail is still on, dare we say, track. But Auckland is borrowing to buy an ageing diesel fleet of British cast-offs.
 All abooooard the great traans-Auckland rail jooourneeey. Bear in mind, folks, there will be many stops before we reach your preferred destinations.
 Where do Aucklanders want to go? For more than 80 years Aucklanders have wanted modern, affordable and regular train services to drop them off near work and home.
 But plans have been derailed more times than Amy Winehouse has been booked into rehab and left many of us nose-to-tail, alone in our cars, listening to her croon about it.
Under the previous Government, trains were to be modernised, electrified and run underground from Britomart to Mt Eden. This would be paid for through a 9.5 cent regional fuel tax that the Auckland Regional Council championed.
But the new Government abolished regional levies in May, ostensibly to share the burden with the rest of the country through national taxes.
Now, the plan is for the Government to lend the regional council $33 million to help buy six diesel locomotives built in the 1970s, with carriages from British Rail.
To mind the gap until the money can be raised? It would seem so, but at what cost?

No matter how hard The Aucklander tried to find out, no one could tell us how much of our rates was going to subsidise our taxes for this.

Read the rest of this entry »

New Stations Put Extra Pressure on Ratepayers

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The Herald reports that it looks most likely that ratepayers will be picking up the funding shortfall created by the axing of the regional fuel tax:

Money has been assured for new Auckland railway stations, but at extra cost to ratepayers, after the Government’s cancellation of a regional fuel tax for motorists.

An integrated public transport ticketing project will also be scaled back under Auckland Regional Council budget decisions made yesterday.

Although regional rates will be held to an average 3.93 per cent next year, as originally programmed, the council has approved a revised 10-year funding plan including annual rises of up to 6.73 per cent by 2014. Its new schedule would lift the average rates bill from $336.79 this year to $350.03 next year.

Chairman Mike Lee acknowledged a council-imposed rates rise ceiling of no more than 5 per cent honoured since 2005 would be breached in three of the next 10 years, from 2013 to 2015.

He acknowledged that the budget commitments would be inherited next year by the new Auckland Council, at which point he said their impact on overall rates would be “fairly minimal”, equating to annual rises of under 1 per cent.

Although the council made an assumption in March that it would have to hand control of most of the stations to the Government to overcome a $202 million funding hole left by the aborted fuel tax, chief executive Peter Winder yesterday disclosed compromises to avert that. These followed agreement by the Transport Agency to:

  • Pay a 60 per cent subsidy for new railway stations including at Newmarket, New Lynn, Manukau, Onehunga, Grafton and Avondale.
  • Make a $5 million grant towards costs already incurred by the council on Newmarket Station.
  • Lend the council $32.8 million over four years to pay for six new six-car diesel trains already on order from KiwiRail until the Government buys electric rolling stock.

Mr Winder said those concessions would still close only 22 per cent of the funding gap… [more]

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