The transcript is here, and it has a quite revealing exchange with myself and Judge Newhook.

It is revealing because clearly the Environmental Protection Agency does not see it’s role to question or check whether the economic benefits of roading projects are actually realised or not. But the question is if the EPA won’t question the economics of roading projects, who will?

The BOI as I saw it was more interested in mitigating the environmental damage the project will create and taking the economics of the project as a given. It is frustrating to think that the Board may not give any consideration to the question of “is the project worth it?”

THE COURT: JUDGE NEWHOOK

Q. Mr Pitches can you just help me with something here?

A. Yes.

Q. How do you think, in a practical sense, we could gain reassurance from a model or a document that doesn’t yet exist?

A. The – a little bit further on I make a recommendation about how you can evaluate projects after the fact and compare that with the model, and that would suggest whether the model is consistent with the actual result.

Q. You are not suggesting that after the motorway is built there is an assessment of the thing against previous predictions?

A. Yes.

Q. And if it doesn’t stack up we rip the motorway up?

A. No, of course, by then it’s too late, but what we are suggesting is that if this project is modelled on a concept that there is a benefit of 1.2, and that’s the sole basis for this project proceeding, so what we are recommending, not just for this project, but for any motorway project, is if that is the case, it would be wise to do a post-implementation review to ascertain to ascertain if those benefits were met.

Q. But perhaps I should listen to you and then argue, but I will let you know what I’m going to ask you, and it’s this. What business is it of ours as a Board to impose a condition that there be some future economic study, ex post-facto the project, one supposes to inform future decision making. Isn’t that more a matter of National policy, isn’t that something you should be talking to the Minister of Transport about?

A. It is actually, yes.

Q. And you probably are?

A. Yes.

Q. Maybe, if you are not a lawyer, you may not be able to answer the point,

30 but I’m just wondering what business we have to direct that there be future academic or other – economic or other academic studies that might inform future decision making outside of this project. This hearing’s about this project.

A. Sure I understand that. Mr Arbury has a few comments on that.

Q. Thank you.

MR ARBURY:

In response to that matter I think the concern that the Campaign for Better Transport has is that often this hasn’t happened in the past and this is an opportunity to require a post-construction audit. Obviously it’s up to the Board to decide whether that’s appropriate or not or in the scope or not.

THE COURT: JUDGE NEWHOOK

Or indeed whether it’s within our legal jurisdiction Mr Arbury.

MR ARBURY:

Yep, yep.

THE COURT: JUDGE NEWHOOK

That’s what’s troubling me a bit.

MR ARBURY:

Sure. No I certainly understand that, we’re just suggesting the possibility.

THE COURT: JUDGE NEWHOOK

The desirability. Okay, carry on.

The CBT remains opposed to the project in its current form, as we consider it does not contribute to a more sustainable transport future for Auckland.

We also consider that many of the project’s supposed benefits have not been proven by NZTA’s evidence. Therefore, under section 5 of the RMA the ‘balancing act’ – outlined succinctly in paragraph 103 of NZTA’s legal submissions – has not been sufficiently met.

Furthermore, none of the supposed benefits have been evaluated in the context of rising fuel prices. Consideration of project risk is completely absent from NZTA’s evidence.

The current escalating petrol prices are a real risk to the economic viability of the project in our opinion:

The rebuttal evidence of Mr Tommy Parker, on behalf of NZTA, notes that the project’s ‘cost-benefit ratio’ (BCR) varies, according to the transport model used and whether or not wider economic benefits are included or not (paragraphs 36-40). Under the ART2 model the project enjoyed a BCR of 2.1: that is, the $2 billion invested in the project was estimated to generate $4.2 billion of economic benefits (mainly in the form of travel time savings) over the lifespan of the project.

However, in April 2010 the (supposedly new and updated) ART3 model was used to analyse the benefits of the project, and its BCR reduced to 1.2. That is, for the $2 billion spent on the project, the economic return was now only calculated to be $2.4 billion. It is unclear what happened to the other $1.4 billion in benefits, whether they ever existed or not. Nowhere in NZTA’s evidence, to the CBT’s knowledge, is this issue fully examined…

While the NZTA may have come up with an arbitrary BCR value to aid guidance of project options, it has conducted no risk assessment, which would be standard practice in the commercial world when considering a $2bn investment.

Since we made our submission in October of last year, petrol prices have risen from $1.82 per litre to $2.16 today. Based on the experience of 2008, this will lead to reduced private vehicle trips and increased pressure on the public transportation system.

Given that there is a statistical base for modelling the effect of petrol price increases, we find it negligent of NZTA not to produce risk scenarios for petrol prices of $2.50, $3.00 or even $5.00 a litre. There must surely be a price level where the project is no longer economically justified, and we put it to the Board that consent for the project should only be granted once this price level is known.

We conclude:

The CBT considers there are fundamental questions about the project’s justification that remain unanswered. However, we seek to narrow the matters outlined in our submission down to three particular matters:

- That NZTA should be required to conduct a risk analysis for the project with regard to the price of fuel, and determine the price level where the project no longer becomes economically viable. This will help inform the Board to make an assessment on the likelihood of that price level being reached.

- Should approval be granted, that NZTA should be required to construct (potentially in conjunction with Auckland Transport) a cycleway between SH20 and SH16, above the tunnel section of the project.

- Should approval be granted, that two additional transport related conditions be applied to the consent. These are as follows:

• That NZTA be required to undertake an “audit” of the project’s benefits at various dates post-construction to help inform the economic justification of future transport projects.
• That NZTA be required to work with Auckland Transport to find constructive ways of improving bus, cycling and walking infrastructure along main arterial routes that will experience reductions in traffic numbers as a result of the project, to ensure the project generates ‘modal choice’ and to ensure the traffic reduction benefits are ‘locked in’.

The Campaign for Better Transport’s submission is here .  In summary:

• It is questionable whether the project will achieve the objectives that NZTA have highlighted.
• The proposed bus shoulder lanes along State Highway 16 are an inadequate gesture to provide high quality “Quality Transit Network” standard public transport along this route. Suggestions to improve the quality of the lanes are detailed further in the submission.
• Further public transport improvements on local arterial roads must form part of this project package, to ensure that the traffic benefits of the project are “locked in” and not lost to induced demand.
• Extensions and improvements to the proposed cycle paths are required to ensure the project contributes to multi-modal transport benefits.
• The widening of State Highway 16 must be questioned and reassessed, as the documentation accompanying the application states it will not bring any congestion relief benefits – but will cause significant environmental effects. It is also noted that the State Highway 16 works have been “snuck into” this application – which is generally presented as only the Waterview Connection.
• Support of the designation’s protection of the Avondale-Southdown rail corridor.

If you feel inclined to make your own submission, you must ensure that the EPA receives your submission by 5.00pm, Friday 15 October 2010 at:

Environmental Protection Authority

Waterview Connection project

PO Box 10720

The Terrace

Wellington 6143

Or email:

Or fax: 04 439 7714. Please mark in the subject line: “Waterview Connection project”.

You must also send a copy of your submission to the applicant, the NZTA, whose address for service is:

NZ Transport Agency

Attn: Deepak Rama

Waterview Connection Project

Private Bag 106602

Auckland 1143

Phone: 09 368 2001 or Fax: 09 969 9813

Or email:

Think of a figure, double it, add your age and subtract the number of eels in Oakley Creek: that, it seems, is as good a guess as any for the price of completing the Waterview Connection.

I’m not surprised Transport Minister Steven Joyce and the NZ Transport Agency waited until the eve of the Christmas exodus to sneak out the highly embarrassing news that a tunnel was, after all, the most cost-effective and environmentally sensitive way to join State Highway 20 up to the Northwestern Motorway at Waterview.

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.

Their resolution expressed concern at an alleged lack of detailed assessment by the Transport Agency of social, heritage, open space, environmental and economic impacts of the proposal, and of funded plans for effective mitigation.

Although the council granted support last year for a more extensive set of tunnels beneath Waterview, an option promoted by the agency but quashed by the Government after the Treasury revised the estimated cost to $2.77 billion, chairman Mike Lee expressed annoyance that a Rosebank route had been consistently ruled out.

He accused the agency’s predecessors of ignoring a regional council investigation which assessed Rosebank as the best strategic option, and of trying to use his organisation as “a rubber stamp throughout this western ring route process”.

ARC parks and heritage chairwoman Sandra Coney said the original concept of the ring route was to allow traffic to avoid the harbour bridge, and it was only comparatively recently that part of the rationale of Government transport planners was to turn it into a faster route to the airport from central Auckland.

“The current route is more an inner isthmus ring route – it doesn’t take the most logical route,” she said.

Ms Coney said one advantage of a Rosebank link would be to reduce the need to widen the Northwestern Motorway causeway through the Motu Manawa-Pollen Island Marine Reserve, which she considered was already under considerable threat from pests and rubbish from vehicles despite being “one of the jewels in Auckland’s crown”.

Transport Minister Steven Joyce said he was “a little bit disappointed” with the regional stance and was confident the agency would provide adequate mitigation for the Waterview route.

“They are trying to balance the needs of the community [with] doing something reasonably cost-effective, even though it will still be the most expensive roading project New Zealand has ever built.”

Asked about the ARC’s preference for a Rosebank link, the minister said: “I don’t think Auckland road users would be happy to spend the amount of money being talked about and still not have a route to the airport.”

Auckland City’s transport committee has infuriated communities in the path of the Waterview motorway by supporting the Government’s preference for a revised “surface-tunnel” option.

“I’m absolutely gutted by the response from our council – I think they have been irresponsible,” Margi Watson, Waterview-based spokesman of the Tunnel or Nothing protest group, said yesterday.

“The council was elected to represent the interests of communities, not the Government.”

Members of the ruling Citizens and Ratepayers bloc, led by Deputy Mayor David Hay, outvoted minority City Vision and independent councillors in backing the revised scheme, which the Transport Agency estimates will cost $1.4 billion.

That differs from the council’s previous support for a pair of deep tunnels to carry traffic along most of a 4.5km link between the Southwestern and Northwestern Motorways, and will provide extra comfort to the agency’s board when it meets in Auckland late this month to approve the new plan.

City Vision councillor Cathy Casey said the council had “let down the people of Waterview and is no more than a puppet of the National Government” and teammate Graeme Easte warned of high mitigation costs from a project he claimed would undermine a key council policy of building stronger communities.

Leaders of the Eden-Albert and Western Bays community boards have also lashed out at the decision.

But transport committee chairman Ken Baguley said the previous Labour-led Government provided no funds for the costlier twin tunnels, which were not without their environmental challenges, including vehicle emissions.

He said the motorway link was needed to deliver $800 million of annual economic benefits from completing the ring route.

Given that there was no chance of persuading the Government to resurrect the twin tunnels, the council needed to concentrate on ensuring communities affected by the new scheme received fair compensation and mitigation.

The new scheme compares with a Treasury estimate of $2.77 billion for the twin tunnels, although that included $554 million in financing charges absent from the revised version.

It will include a 1.15km bored tunnel between Owairaka and Avondale Heights and a 700m covered trench beneath Great North Rd, with a strong likelihood the two structures will be joined to keep traffic underground for more than 2km. It will also keep the traffic further from the bush-clad lower reaches of Oakley Creek than other cheaper options, one of which would have entailed a 520m viaduct.

But it will involve demolishing up to 365 homes, as well as slicing through more than 1km of upstream green space in Owairaka.

The city council’s urban design review team is not satisfied the lower creek will survive unscathed, saying in a report that it was concerned to learn concrete “boxes” for the motorway trench under the Great North Rd ridge-line might be wider than first thought.

“We consider this could have a severe adverse impact on the corridor, with serious consequences for Oakley Creek, and is likely to mean an over-scale road on top of the motorway boxes that cannot deliver a best-practice liveable arterial.”

The basic premise is that for a city’s transportation system to be resilient – that is to be able to adapt to the changing world that we face over the next few decades – it simply can’t be as auto-dependent as many American cities, as well as Auckland, are at the moment. Whilst electric cars may come along and be the answer to our problems at some point in the future, to properly ensure that the effects of peak oil and climate change are not too horrific there is simply no alternative to making cities more public transport oriented.

One point that I found particularly interesting, before I get on to explaining the pointlessness of building more motorways, is the relationship between increased public transport use and decreased car use. Often it is simply thought of as a one-to-one relationship: that each increased ride for public transport is one fewer trip made in the car. However, it appears as though the relationship is actually stronger than that: that “there is an exponential relationship between increased transit use and declining car use.” This is further explained:

This helps explain why use of cars by inner-city residents in Melbourne is ten times lower than that of fringe residents, though transit use by inner-city residents is only three times greater. The reason is that when people commit to transit, they may sell a car and even more closer to the transit, eventually leading to lan use that is considerably less car dependent.

It is probably too early to tell, but perhaps it is this phenomenon that goes some way towards explaining some of the traffic patterns around Auckland over the last year and a bit. After the Northern Busway opened last year there was a significant increase in the number of people using public transport on the North Shore, but a far MORE significant decrease in the number of people driving across the Harbour Bridge each day. Clearly, rising petrol prices had a lot to do with lower car use (perhaps fewer discretionary trips were made), but perhaps people were starting to realise that with the Northern Busway in place they no longer had to live such auto-dependent lives. Over time, especially if we see some intensification around the busway stations, we may actually see this trend continue quite significantly.

Anyway, onto the main purpose of this post: to question whether building motorways really actually ends up achieving the purpose of what they were trying to achieve. Now, for a start, I must say that having spent a decent amount of today driving around on Auckland’s motorways I definitely do see a use for them: in shifting people around long-distances within the city fairly quickly – especially on weekends when the traffic flows are less concentrated and more all over the place. However, as I am certainly not advocating we get rid of any of Auckland’s current motorways, the question is mainly around “should more be built?” While Resilient Cities doesn’t mention Auckland specifically, some of the points it makes would certainly apply here – especially when considering many of the arguments put forward in support of the Waterview Connection.

Now, motorways are usually proposed to help ease congestion, and are considered to save time, fuel and emissions by avoiding the stop-start nature of driving on local roads. As we all know, cost-benefit analyses are used to justify motorways, largely based on these ideas. Resilient Cities strongly questions the supposed benefits of this approach to justifying the money that is sunk into motorway projects:

Will it really save fuel to build freeways? No, the data do not support these contentions. The data show that cities with higher average speeds use more fuel per capita as the faster roads just mean people travel farther and more frequently by car. Is congestion associated with higher fuel use in cities? No, on the contrary those cities with lower congestion use the most fuel. Although individual vehicles in less congested cities are moving more efficiently they are being used much more often and for longer distances while greener modes are being used less.

In my opinion this is the crux of the issue, at least to some extent, in that induced demand is often ignored when planning road development. Furthermore, by ‘demonising’ congestion, we ignore the fact that congestion is actually a pretty good indicator that we need to offer better alternatives to the car: rather than just providing more capacity for cars. It is congestion of the road system that – as long as alternatives are available – will give people the incentive to use those alternatives. We needn’t destroy our cities by fighting and endless battle of providing more capacity, watching that fill up, having to provide more capacity and then watching that fill up too. This is further elaborated upon in Resilient Cities:

Is removing congestion always a good thing? Not if it is attempted by increasing road capacity; car use will increase to quickly fill the newly available space. The Texas Transportation Institute, in a study of US cities over the past thirty years, found no difference in the levels of congestion between those cities that invested heavily in roads and those that did not. It is possible to make more car dependence and congestion out of a policy to improve traffic.

It certainly seems like this is the mistake Auckland has made over the past few decades – and in particular in the last decade where it seems like we’ve really tried to build our way out of congestion. Somewhat ironically, the only thing that has ever really had a major effect on reducing congestion in Auckland over the past decade has been rising petrol prices.

With $1.4 billion likely to be sunk into the Waterview Connection over the next few years, as well as $430 million on the Victoria Park Tunnel, $300+ million on the Manukau Harbour Crossing Project, $200 million on the Newmarket Viaduct replacement, around the same on the Hobsonville Deviation and the SH20-SH1 project, it’s pretty clear Auckland hasn’t yet learned that you cannot build your way out of congestion.

The Herald reports that the Government has canned the Waterview tunnel, but hasn’t announced what it will be replaced with just yet.  The Transport Agency is expected to make a decision today.  The maximum budget for the project will be $1.4bn.  Act MP John Boscawen thinks the whole thing can be done for $500m, so I’d be interested to see that proposal.

Now let’s look at two ways in which that money could be spent:

The first option is on a cheap and nasty Waterview Connection. This open cut, fully surface level option is projected to cost almost exactly $2.2 billion. This is a total of $1.456 billion for construction costs, $290 million for SH16 upgrades and $450 million for financing costs. This option will involve the demolition of around 500 houses, the loss of a huge amount of open space in a part of Auckland that is considered to already be short of open space. Because of its high social and environmental costs, its cost-benefit ratio may be below 1. Furthermore, 73% of the benefits it will supposedly bring are  internationally criticised ‘time-savings benefits’, which don’t actually seem to exist in the longer-term. So, to conclude, for this option we get a 4.5 km motorway driven through a suburb, a huge loss of open space and all justified on fairly dodgy time savings benefits that may not even exist.

The second option, which also costs $2.2 billion, would involve a two track railway line being built from Avondale to Manukau City via Onehunga and the airport. This option would firstly involve completing the Avondale-Southdown railway line – that has been designated since the 1940s. Because of its long-running designation no houses would have to be demolished to make way for the line. Completing the Avondale-Southdown railway line would open up rail access from West Auckland to the airport and south, it would offer freight trains an alternative route through Auckland to the congested Newmarket junction, thereby over time allowing higher frequencies of passenger trains to be operated. This part of the project would cost $729 million and include four train stations – for interchanges with high frequency bus services to the city along Manukau, Dominion and Sandringham Roads.

The rail option would also involve linking the airport to the city by rail – with trains able to travel from Britomart to Onehunga, then over the Mangere Bridge to the airport. Furthermore, it would also link with the existing main trunk railway line near Manukau City. This finally creates a high quality public transport link from the city to the airport, creates an alternative  rail link between Manukau and Britomart, increasing the capacity of the Otahuhu-Wiri section of the Southern Line. It makes running inter-city trains to Britomart a possibility, and they could even go via the airport for extra connectivity.

They both cost $2.2 billion.  They both compete for the same money, a crown grant. I wonder which has the most long-term benefit for Auckland? I wonder which will be built?

Take the proposed Waterview motorway extension, for example. Treasury and Ministry of Transport officials have worked out that for every dollar spent on the $2.8bn motorway connection between Mt Roskill and Waterview, the economy will receive $1.15 worth of benefits.

In the business case document now being considered by Cabinet, officials point out that “full tunnel” option means that the benefits are only a little in excess of their costs. Some above ground options might save up to $200m from the construction cost, but these have higher social and environmental costs, and also involve the loss of park land and a significant number of houses.

Considering the billions of dollars at stake, one would hope that the economic benefits and costs of the various options are as accurate and as realistic as possible. So are they? Well, no, actually.

Since the 1960s it has been standard practice for the majority of roading economic benefits to be derived from travel time savings that road users can expect to enjoy. For the Waterview extension, maximum travel time savings of 15 minutes are expected. By placing a dollar value on each road user’s time, this equates to $2.6bn worth of claimed benefits.

The reality, however, is quite different. In the long run, an individual’s travel time savings are replaced by longer trips as travel patterns change. Commuters utilise the increased roading capacity by travelling further distances to work and leisure destinations. Eventually, the average amount of time individuals spend in traffic remains unchanged.

This is backed up by recent research from the UK based Centre for Transport Studies. By analysing the outcomes of nationwide travel surveys, their study found that average travel times in the UK have held constant at around an hour a day since the 1970s, despite expenditure of £100bn on roads over the last 20 years in the UK.

Of course it could be argued that had it not been for this massive investment, then average travel times would be much higher than they are currently. However, the study points out that there were marked swings in expenditure over the 20 year period, and hence new capacity becoming available. Throughout all of this, average travel times remained steady.

Here in New Zealand there are no comparable studies, but similar results have been documented in the Netherlands and the United States.

It would seem that promised travel time savings never eventuate in the long term, yet the myth of travel time savings also permeates into other areas. For Waterview, $690m of benefits are attributed to “reductions in frustration due to traffic congestion over and above the benefits gained from travel time savings.” How mental health benefits like this are quantified is not fully explained.

Vehicle operating cost savings of $40m are also claimed, the logic being that faster cars consume less petrol per kilometre. However, there is no evidence at all that households are spending any less on transport as a result of the completion of roading projects in recent years. The most recent Household Economic Survey in 2007 suggests transport constitutes 14% of expenditure for the average household, but no data is available to cover the subsequent period of high petrol prices.

It would seem that the long term benefits of increased road capacity come not from travel time savings, but rather from the increased choice of destinations for road users. Businesses also benefit from a greater catchment area of potential employees. For the Waterview extension, these “agglomeration” benefits could be as much as $607m, but this is still well short of the almost $3bn cost of the project.

An alternative method of estimating economic benefits is based on the user-pays principle. Transport officials have calculated that if the Waterview motorway extension was tolled at $2, then just 50% of motorists, or about 75,000 vehicles a day would consider it economically worthwhile to use the route instead of the existing alternative local roading network. It also follows that if Waterview were to operate as a private toll road, hapless investors would stand to lose about a billion dollars over a 30 year time frame.

A substantial economic risk also exists due to volatile oil prices. Petrol and diesel prices could well return to the record levels seen last year, yet the probability of this occurring does not feature in any economic assessment for Waterview or any other roading project currently on the drawing board.

Right now Cabinet Ministers must decide which one of twelve different options for the Waterview motorway extension makes economic sense. The only honest answer is that none of them do.