Rudman:

As Auckland Regional Transport Authority chairman Mark Ford noted, “to put it simply, where there has been investment, there has been growth on rail and bus”. These were 3.7 million trips that were not taken in a private car on our congested roads. Yet our masters still have difficulty grasping the obvious message. Provide decent, reliable public transport and people will use it. At both local and central government level, the penny doesn’t seem to have dropped.

Jeremy Sole:

There are also other concerns. While the Government is firmly committed to investment in transport infrastructure to achieve economic growth, it appears this will be subject to funding availability.

The recent $25 million a year drop in the lower threshold of the predicted spend range in the Government Policy Statement for 2010 and 2011 indicates Government’s expectation that councils will not be committing their own funds to roading projects – so not drawing down the Transport Agency funding share.

The federation’s concern has been what will happen to those funds earmarked for local projects, if they are not taken up?

The Government has recently agreed to allow unused funds to be diverted to other transport projects but the mechanism for this is not yet clear.

It is vital that local projects such as arterial roads keep rolling forward. One way to do this would be low-interest Government loans to local councils – restricted to essential infrastructure projects.

Yes. Every category of transport funding is about to be slashed apart from new state highways. We’ll post the details shortly.

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 government’s priority of investment in transport infrastructure for economic growth
• to reflect the modal choices that are realistically available to New Zealanders

 ”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.  Even though it is claimed that building more highways will boost economic growth, there is no supporting evidence that this is the case. 

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.