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Released Auckland Transport Documents


At an extraordinary meeting held on Monday 1 December 2003 the Auckland City Council considered a report prepared by the Auckland CEOs' forum for consideration of the Auckland Mayoral forum on 28 November 2003.

Auckland City passed the following resolutions at its extraordinary meeting and then adjourned the meeting to allow further consideration once the working party established by the resolutions has had the opportunity to discuss Auckland City's position with other councils.

The over-riding objective of the Council is for governance arrangements to be put in place which have the most chance of delivering transport and related economic, social, environmental and land use outcomes in the best interests of the Auckland region.






His Worship the Mayor moved:

The Deputy Mayor seconded:

A. That Auckland City urges the Government to act in the best interest of the Auckland region through the formation of an integrated transport entity, which is described as "Auckland Transport" in Attachment 1 to these resolutions, the essential elements of "Transport Auckland" being:

- It will be a CCO or statutory entity with an independent board of directors appointed to achieve an optimum mix of skills and experience

- It will integrate the implementation planning, development, management and contracting for infrastructure and services relating to all modes of transport in the region including roads, rail, buses and ferries.

B. That Auckland City's strong preference is for "Auckland Transport" to be a stand-alone entity outside the ARC which will receive direction from and report to an Electoral College made up of elected members appointed from the ARC and each of the 7 territorial authorities in the Auckland region. This is described in Attachment 2 to these resolutions.

C. That Auckland City notes that it is critical that the public have confidence in the new governance arrangements for transport and it is strongly of the view that a stand-alone entity as described in Attachment 2 is more likely to achieve such confidence than a Transport entity under the ARC because

(i) there is a greater chance of developing a stable non-hierarchal and genuine partnership in the region dedicated to achieving successful transport outcomes. This approach is inherently more democratic.

(ii) the basis for a partnership approach is the significant funding for transport currently coming from the Territorial Local Authorities which also have broad responsibility for land use and the economic and social well being of their communities, all of which are dependent on successful transport outcomes.

(iii) Large investment decisions are made by Territorial Local Authorities which contribute to and are affected by major transport decisions.

(iv) the success of this model has been demonstrated by the effectiveness of the shareholder representative groups for Watercare Services Limited (WSL) and Auckland Regional Transport Network Limited (ARTNL)

D. That a Transport Entity under the Auckland Regional Council is clearly not preferred by Auckland City, however, if the Government decides to follow this route, Auckland City submits that

(i) In order to achieve the best integration between transport, land use, economic and social development decisions, it is essential that "Auckland Transport" must be a Council Controlled Organisation (CCO) and have significant Territorial Local Authority input into and representation in the governance process including the appointment and review of directors, the development of the statement of intent and review of performance.

(ii) Without appropriate Territorial Local Authority involvement and influence in these governance processes, Auckland City Council would not agree to arterial roads being controlled by the "Auckland Transport".

E. That if the Government is considering changing the governance of Infrastructure Auckland (IA), Auckland City Council's strong preference as stated in the attached description for "Auckland Transport" is for

(i) all IA's cash assets, after setting aside an appropriate amount for stormwater but including proceeds of debt raised against Ports of Auckland Limited (POAL) shares, being transferred to "Auckland Transport" in order to match funding capacity with implementation responsibilities.

(ii) The POAL shares and any debt raised against them being held by a Holding Company.

F. It is noted that the model preferred by Auckland City supports the Regional Land Transport Strategy being developed and adopted by the Regional Land Transport Committee, a committee of the ARC, but Auckland City is of the view that the review of membership required by the Land Transport Management Act should ensure stronger representation and influence from those organisations, including the territorial authorities who have responsibility for implementing the regional land transport strategy.

G. That a working party be formed, consisting of:

His Worship the Mayor

Deputy Mayor

Councillors Hucker




and that this working party:

(i) meet urgently with some or all Councils if necessary, to determine a combined approach to central Government.

(ii) be delegated the authority to change the resolution while retaining the spirit and approach. (actioned)

and that any significant variations to the resolutions be referred back to this council for approval.

H. That His Worship the Mayor be authorised to make these resolutions public, as appropriate.



Auckland Region

Transport Funding - Key Facts


- A conclusion of this analysis is that the public sector spend on transport in Auckland is around $660m per year. Of this:

- Road users contribute about $300m per annum via Transfund;

- Ratepayers contribute about $260m;

- A further $100m is derived from other subsidies, primarily Infrastructure Auckland and additional income earned by councils from investments and parking charges.

- Transfund spent $300.5m of taxpayer/roaduser funds in Auckland during the 2002/03 year. This was allocated as follows:

Transfund's Actual Expenditure in Auckland 2002/03

Maintenance - Local Roads $50.9m

Maintenance - S/Hwys $49.7m

Construction - Local Roads $18.5m

Construction - S/Hwys $121.3m

Walking and Cycling $0.2m

Alternatives to Roading $13m

Passenger Transport $41.3m

Administration $5.5m

TOTAL $300.5m

Source: Transfund 2003 Annual Report

2003/4 Council Budget Transport Capital and Operating Expenditure

Capex Opex

Gross Spend

Funding Gross Spend inc Depn


$m Subsidies & Asset Sales

Rates Funded

Cash from Depn inc in Opex Subsidies & Asset Sales Rates Funded

ARC - - - - 102 47 55

ACC 73 14 19 40 87 17 70

FDC 9 3 0 6 13 7 6

MCC 39 15 7 17 40 10 30

NSCC 53 43 0 10 20 8 20

PDC 8 2 4 2* 5 2 3

RDC 27 9 6 12 29 16 13

WCC 27 7 12 8 20 6 14

Total 236 93 48 95 324 112 211

*Estimated. Derived from councils' 2002/03 Annual Plans and 2002/03 Annual Reports.

- Transport operating costs in the Auckland region for 2003/04 will require rates funding of $211m based on data extracted from councils' 2002/03 Annual Plans. Of this $158m will be funded by Auckland Territorial Local Authority rates and $55m by ARC rates. Transport Capex requires $48m of rates funding. This gives a total of $260m rates funding for transport in Auckland.

- The total transport expenditure and projected split of capital and operating expenditure for Councils for 2003/04 is:


- Private bus, ferry and rail operators all invest in passenger transport in Auckland. This is partly funded by subsidy income from service operation. The remainder is funded from income from either subsidised or non-subsidised services.

- In the future private sector investment could occur in passenger transport operations and infrastructure and roading infrastructure, to the extent that a commercial return was available either from tolls, fares, access charges or subsidies.



In considering the CEOs' report to the Mayoral forum and advice from the Mayor as to what transpired at the Mayoral forum meeting on 28 November, the Council took account of the following matters when formulating its resolutions.

Matters taken into account

- The Auckland region's critical role as a significant driver for the economic well-being of New Zealand is being severely hampered by transport problems.

- These problems arise from a large shortfall in available funding, fragmented governance through too many organisations, and a regulatory framework which hinders the procurement of effective transport services, particularly with respect to bus services.

- The funding problems are being addressed through a joint project between the region's Councils and the Government which will result in announcements from the Government on 12 December 2003.

- To ensure any new funding measures are effective it is also necessary to address the other issues. The subject of debate in the CEOs' report to the Mayoral forum and the extraordinary meeting of the Council was Governance.

- Transport is not an end in itself and cannot be considered in isolation. It affects and is affected by economic and social issues, environmental quality, and land use.

- The Auckland Regional Council is responsible for environmental quality and, through a partnership approach with the territorial local authorities and other organisations, for the regional growth strategy and the regional land transport strategy.

- The territorial local authorities are responsible through such instruments as district plans, regulation and general policy for economic development, land use, the environment and transport, particularly for the management and development of arterial and local roads but also for elements of public transport. Their collective spend from rates for transport far exceeds the transport rates requirements of the ARC.

- The Government also has a strong role to play in an over arching policy sense and in ensuring the continuity of national road and rail networks. The Government also provides a large share of the funding for transport through charges and levies on transport users.

- Any new governance arrangements must ensure an integrated approach which recognises these respective interests and also must ensure that there is alignment between the various components and modes of transport. Auckland City therefore strongly supports the formation of a comprehensive transport entity which integrates the planning and management of various transport interests. This does not necessarily mean that ownership should transfer.

- Based on its experience of effective implementation agencies Auckland City also supports such an entity having a corporate structure (eg a council controlled organisation) with an independent commercial board appointed to achieve an appropriate mix of skills and experience.

- Its experience of regional implementation agencies, such as Watercare Services Ltd (WSL) and Auckland Regional Transport Network Ltd (ARTNL) also leads Auckland City to strongly support a co-operative partnership approach in the exercise of political governance over the entity through

- the appointment and review of directors

- the development and review of the statement of intent and

- the review of the entity's performance

- Auckland City firmly believes that this co-operative approach will be best achieved through the creation of a stand-alone Transport entity which stands outside of the ARC, with political governance being exercised by an electoral college, comprised of elected members appointed from the ARC and each of the seven territorial local authorities.

- Auckland City is concerned that optimum outcomes will not be achieved if the Transport entity sits under the ARC and there is a lack of effective influence and representation from the territorial authorities in the political governance processes. Without that there is a severe risk of insufficient integration between transport and land use and between various components of the transport network. Thus if the Government decides that the transport entity should sit under the ARC, Auckland City strongly urges the Government to require that a structure akin to an electoral college be established to ensure there is significant influence from the territorial local authorities in the political governance of the entity. Without this level of influence Auckland City would be unwilling to see its arterial roads managed by the entity.

- Auckland City has a strong belief that it is necessary for the transport entity's implementation responsibilities to be matched with funding capacity. It therefore supports the cash assets of Infrastructure Auckland being transferred to the transport entity. The available cash can be enhanced by raising debt against Infrastructure Auckland's shareholding in Ports of Auckland Ltd (POAL). The shares in POAL and associated debt would be held in a holding company reporting to the Electoral College.

- The Regional Land Transport Committee (RLTC) is a committee of the ARC with broad external membership from territorial local authorities and other organisations with an interest in transport. The Regional Land Transport Committee has responsibility for the developing the Regional Land Transport Strategy (RLTS). Under the recently enacted Land Transport Management Act, the responsibility of the Regional Land Transport Committee will continue. However, under the Act the membership of the Committee must be reviewed. Auckland City contends that the review of membership should ensure stronger representation and influence from those organisations (including the territorial local authorities) which have accountability for implementation and funding the strategy. Other organisations who have an interest in transport and associated outcomes, but who have no accountability for its implementation should not be able to dominate those who do. This is not to say they should not be involved in the development of the strategy and the monitoring of its success but the method of their involvement requires careful consideration.



Form - Corporate (either a CCO or statutory entity)

Governance - An independent board of directors appointed to achieve an optimum mix of skills and experience able to deliver transport outcomes.

Scope and Direction - will be determined by



Statement of intent

Functions - the following functions may be grouped into a number of subsidiaries for the purpose of transparency, commercial efficiency and integrated network management to deliver outcomes. For example, a subsidiary may be established to hold rail assets which the operator is contracted to manage in an integrated manner. The functions and assets of ARTNL will be transferred into the entity.

- Contribute to development of RLTS

- PT infrastructure and service planning

- Contracts with Ferry, Rail and Bus operators

- Development of Bus, Ferry and Rail stations. In some cases this may involve joint venture or partnering arrangements with TAs and developers

- Management of stations (which may be contracted to third parties or operators where appropriate)

- Development of Rail Corridor (contractual arrangements to be co-ordinated with Trackco and operator)

- Planning and management of regional strategic road ie state highways and arterials - ownership would not change - contractual relationship would be established as appropriate with Transit, TAs, contractors

- Co-ordination with TAs re management, funding and development of local roading network insofar as it affects the strategic network, PT infrastructure, bus priority measures, TDM initiatives and roading pricing. Contractual relationship would be established as required.


- The cash assets of Infrastructure Auckland (after setting aside an amount for stormwater to be administered by the ARC) would be transferred to Transport Auckland for capitalisation but subject to suitable controls in the governance structure (eg charter, constitution or statement of intent) as to how those funds would be applied to deliver outcomes.

The amount made available could be enhanced by debt raised against Ports of Auckland shares and the management of the debt and POAL shareholding would be managed through a holding company.

- Funds to be obtained through Transfund and future road pricing mechanisms.

- Transport Auckland can issue debt instruments such as Infrastructure bonds

- Rates funding would be made available through the TAs.


Auckland Transport as a Stand-alone Entity Outside the ARC




- signs-off Regional Policy Statement; RGS; RLTS

- convenes RLTC - Transport Auckland would play a lead role in the development of the RLTS.

- roading strategy;

- PT strategy;

- 10 year funding plan

- high-level trade-offs

Political Governance

The Electoral College exercises governance responsibilities

- appointment and review of directors

- agreeing statement of intent

- monitoring performance of entity

In view of the Crown's significant interests in terms of funding and national networks and strategies it may wish to participate in these governance processes or alternatively seek direct appointments to the entity boards.


- Infrastructure Auckland's cash assets

- Transfund - basis to be determined

- Future road pricing

- Debt

- TAs' direct rate to meet levies from Transport Auckland. Level of rates agreed by the TAs through the Electoral College.

Legal Framework

- Legislation required to abolish IA

- Legislation required to establish Transport Auckland. This would

- Establish Electoral College

- Establish right to levy

- Require Transport Auckland to act in best interest of the region in accordance with the RLTS

- Set parameters around use of IA funds.

******** ENDS *********

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