IA Offers Auckland $1.2 Billion By 2008
IA Offers Auckland $1.2 Billion By 2008 For Transport & Stormwater
- IA announces additional $230 million and funding four years earlier -
Statement made by John Robertson, Chairman Infrastructure Auckland
Infrastructure Auckland today announced that it will increase the funds it will make available for Auckland’s urgent transport and stormwater needs to $1.18 billion by the year 2008.
This is $230 million more than previously announced and also brings its granting programme forward by four years.
The $1.18 billion (including grant commitments to date of $173 million) comprises notional allocations to the following: Passenger Transport gets a 78% increase from $410 million to $730 million Stormwater gets a 50% increase from $100 million to $150 million Regional Debt Servicing, for urgent implementation of the Regional Land Transport Strategy (which is a new funding category) gets $136 million Roads remains unchanged and gets $90 million Travel Demand Management remains unchanged and gets $75 million.
Auckland and New Zealand is facing its biggest transport and infrastructure challenge ever. There is a need to move the Regional Land Transport Strategy to a fully fundable programme of work. This would enable projects to be commenced on a “build as becomes buildable” basis and maintain the urgency required to implement the strategy. IA has responded to that challenge with an accelerated funding offer to the region.
For the Land Transport Strategy to be fully fundable the region has identified a requirement for $5 billion for Roading and Passenger Transport Projects. Less than $3 billion will be available from currently identified public funding sources including IA’s contribution. This leaves more than a $2 billion funding gap. A borrowing programme is currently under consideration by the Region to fill all or part of this gap.
The largest portion ($730 million) of IA’s $1.18 billion funding announced today is allocated to Passenger Transport (PT). A large part of this $730 million allocation is planned to provide most of the capital component funding for the Regional Rail Upgrade programme.
A further $136 million has been allocated to Regional Debt Servicing.
The Regional Debt Servicing allocation will be applied by way of grants to service the region’s borrowing programme for up to the first four years. These additional funds from IA are the equivalent of every ratepayer in the Auckland region not having to pay an additional $70 per year for four years to fund the region’s borrowing for transport infrastructure. These funds are likely to be used to fund the priority roading projects identified in the Regional Land Transport Strategy for which the largest funding gap exists.
Of the $5 billion funding gap identified by the region, approximately 80% is needed for roads.
The first $94 million of IA’s $230 million in additional funding will be sourced from investment returns and special dividends. Additional money will also be sourced from IA’s “just-in-time” cash management policy which means the funds can be accessed by the region earlier than previously planned.
The remaining $136 million will come from IA borrowing. To support the region’s borrowing programme, IA has amended its own borrowing policy to be consistent with the region’s local authorities to allow the region to make rapid progress on its transport plans.
We believe it is better for the region to have the benefits of new infrastructure say in four or five years’ time, than to wait 10 or 15 years.
IA is responding to the region’s urgent need for funds while retaining ownership of its strategic regional assets.
IA will continue to ensure that the money it grants leads to the region achieving major infrastructure gains.
IA is pleased to significantly assist the region by increasing the amount of funds available and accelerating the funding timeframe at a time when the region and country faces its largest infrastructural challenge ever.
seeking public endorsement of this proposal to the region
through its Draft Annual Plan and Long Term Funding Plan
that was adopted