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Dr Don Brash: Stuck In Transit

Don Brash MP - National Party Leader

10 April 2006

Stuck In Transit
An address to the Warkworth Community Liaison Group

Mr Chairman, Ladies and Gentlemen.

I’m delighted to be here this evening with my Parliamentary colleagues, in what is one of the fastest growing parts of New Zealand.

But I wish I was here to celebrate that growth with you. Instead, I’m here because it is clear that future growth is being strangled by an extraordinary bureaucratic and legislative nightmare.

Your journey to a stronger, more vibrant community is colliding with obsolete regulatory and funding roadblocks.

You are stuck in Transit.

And tragically, what is happening in Warkworth is happening all around this country.

You know and I know that in recent years the gap between after-tax incomes in Australia and after-tax incomes in New Zealand has got steadily wider: in 1999, after-tax Australian incomes were, on average, 20% ahead of those in New Zealand. Last year, that gap had widened to 33%. And, as a consequence, more and more New Zealanders have been heading across the ditch to Australia. You will have seen the excellent series of articles by Simon Collins in the Herald on this subject just a couple of weeks ago.

Now, I am not going to pretend that improving our roading network is the only thing we need to do to narrow that widening gap in living standards – we need to reduce tax rates, fix the Resource Management Act, reduce compliance costs, and so on.

But I do contend that inadequate roading is a very major impediment to growth, and that unless we improve the roading system in a major way, even beginning to close the gap with Australia will be difficult if not impossible.

Sadly, the problems you face with roading in the Rodney district are similar to those faced elsewhere in New Zealand.

That is not in any way to diminish the importance of your issues.

But as the Rodney Economic Development Trust submission to the Draft Transit New Zealand 10-year plan stated, “we are concerned not only for our own communities but for lost opportunities for New Zealand”.

We face not just a Rodney problem but a systemic problem: a problem of poor funding mechanisms, and of substantial regulatory, legislative and political barriers to sensible decision-making.

Recently, and since the passage of the Land Transport Management Act by the Labour Government in 2003, we are seeing Transit, by law, becoming a land-use planner by virtue of its power to veto land-use consents based on traffic loadings on the State Highway network.

You are familiar with the situation here in Rodney, where projects backed by your local government, and backed by the Auckland Regional Council, are suddenly stymied by Transit.

And similar situations are occurring all over the country. When I was in Queenstown earlier in the year, I was told that a school planned by the Ministry of Education had been stymied because Transit was refusing to let the school connect to the road.

I’ve heard of a kiwifruit grower who had a resource consent under the RMA to build a coolstore and pack-house, but who was unable to go ahead because Transit refused to allow him to use his existing exit onto the roadway for the trucks servicing the pack-house and coolstore.

There are many such examples.

And, of course, we are all too familiar with the extraordinary situation where Transit published its 10-year programme for road building in February – its third such 10-year programme in just nine months – a programme that clearly envisages the more or less indefinite deferment of major roads all over the country - roads that were planned to be built within 10 years as recently as last August.

These issues are tied into complex political processes, at both central and local government level, and are the result of the inter-related regulatory regimes that affect roading decisions.

We need leadership from the top to cut through this complicated mess, and we’re not getting it. Certainly, nothing much will happen if we just leave the numerous agencies to keep scrapping it out issue by issue.

These problems are festering because of a simple lack of will, at the highest level, to get these problems fixed.

There seems to be little appreciation in the Beehive of just how crucial roading is to the health and vitality of our communities. Many in Parliament are actively hostile to roads and seem to imagine that simply talking about trains and buses will solve our problems.

And if more needs to be done, perhaps the problem can be solved by appointing another political lackey to the board of Transit, to join Mike Williams, the President of the Labour Party, and John Wright, a former Alliance Member of Parliament.

To get these issues resolved will require real political leadership: a determination to cut through the welter of obstacles and get these problems addressed.

I can illustrate the lack of resolve of this Government by quoting to you a recent exchange in Parliament.

My colleague, National’s Transport spokesman, Maurice Williamson, asked the Minister, Pete Hodgson, this question:

Is the Minister concerned that the Rodney Economic Development Trust, which is contracted to implement the Rodney District Council’s economic development strategy, has calculated the cost to the district of Transit’s policy at 6,251 lost jobs and $129 million in lost export earnings?

To which Peter Hodgson replied:
I am aware of issues in general around the Rodney district, particularly in Wellsford and Warkworth. Warkworth is a very interesting case in point, because now the proposition is that there be a bypass built around a bypass because of earlier land-use mistakes.

At that point my colleague, your MP Lockwood Smith, interjected: That was 50 years ago!

And Pete Hodgson went on:
If it was built 50 years ago, I ask Dr the Hon Lockwood Smith whether that means that in every town in this country we continue to build a bypass around a bypass around a bypass.

Now that is a very interesting response.
Essentially, the Minister is using as the excuse for his inaction some decisions made in the distant past.

The arrogance and condescension are breathtaking. We are talking about the issues of today, and the Minister is talking about decisions made far in the past.

But it got worse. The Labour Ministers then started to joke about it.

Trevor Mallard interjected: A triple bypass!
And Pete Hodgson agreed: It is a triple bypass.

Well, we all know this is no joking matter.

We are talking about more than 6,000 jobs, and well over $100 million of lost export earnings.

We are talking about the health of this community, and its ability to grow and prosper.

We are talking about the dangers of having Transit determining land use. We are talking about Transit’s power to act without notice and substantially influence the property rights of landowners, and to do so without compensation and without appeal.

Anyone else who wants to restrain the property rights of landowners has to go through a process of submission and appeal.

Although, as they discovered in Whangamata recently, even after going through all the hoops for the best part of a decade, the Conservation Minister can still kill a project at the last moment.

As your Rodney Economic Development Trust submission said, Transit New Zealand now gets to decide:

- Where people will live.
- Where people will work.
- Where we will develop our infrastructure.
- Where our children will go to school.
- How we use our land.
- And where businesses will locate.

The submission concludes that “meaningful consultation is dead”.

Let’s step back from this immediate issue, and consider the broader issues of roading.

There have been numerous reports on the problems in our roading infrastructure.

A common theme is that one of the reasons our roads are inadequate is that we have failed to build properly connected roading networks.

Another is that we are substantially under-investing in roads. This is evident from the extremely high estimated returns available from the best roading investments - returns which substantially exceed the normally required returns from investment projects of similar risk.

It seems mad.

It is mad.

The will to drive this process forward has to come from the top. But there is no sign whatsoever that the Prime Minister or the Cabinet has much interest in these issues.

Such belated progress as there has been – such as the increased funding announced as we got close to the election last year – has come much too late.

Labour’s moves last year were a grudging response to increasingly severe congestion in many parts of the country, especially in the greater Auckland region, and were a deliberate attempt to blunt the appeal of the roading policy which I announced on behalf of the National Party at the beginning of April last year.

Make no mistake about it. For National, a much improved roading network is essential to the future of this country.

If the political leaders at the beginning of the last century had taken the same approach that Labour is taking now, then we would never have got a national roading and rail network.

Before the last election, National announced plans to shift, over six years, to a system where all the petrol tax collected on the roads would be spent on the roads.

That is just a start.

We have to fix the Resource Management Act so the consent process does not drag on interminably. It often takes longer to get the necessary consents to build a road than it does to actually build the road itself. That has to be absolutely daft!

We have to fix the Land Transport Management Act, the Act you pass if you don’t want to build roads and the Act that gives Transit so many of its most objectionable powers.

And then we have to become a lot more creative and innovative about how we fund and operate our roads. Most of the world has moved on from hang-ups about private sector investment in public infrastructure, but under the Labour Government of New Zealand is hanging on grimly to an obsolete and ideological hang-up about the private sector, to New Zealand’s enormous cost.

And finally, we need a streamlined land transport management structure – a structure that’s capable of carrying out more sophisticated analysis of costs and benefits, and that is empowered to use a wider range of funding options to move road developments from the drawing board to the commencement of construction in no more than 12 months.

As a heavy road user myself, I want safer roads, and a much better connected roading network. And that’s certainly what all parents whose kids venture onto the roads – whether on the way to school, or as teenagers out on the town – want.

And there can be no doubt it is what the business community wants also.

Like you, I’m only too aware of the white crosses on our roads, and the black spots in our roading network.

Our roads are increasingly congested and increasingly unsafe.

It’s the same story – whether you’re in the Auckland region, the Bay of Plenty or Canterbury, the Waikato, Nelson, or Wellington.

In the Bay of Plenty, the combination of kiwifruit, logs, dairy products, and coal has put the roads between Katikati, Tauranga, Mount Maunganui, and Te Puke under huge pressure.

The main highway between Hamilton and Auckland is getting better, but still falls a long way short of what is required.

State Highway 2 between its junction with State Highway 1 just south of the Bombay Hills and the junction with State Highway 27 is both congested and dangerous.

The roads north of Orewa are now under huge pressure and little relief is in sight. At Puhoi, ALPURT will spill huge volumes of traffic out onto a grossly inadequate roading system.

In some parts of rural New Zealand, the roading network is simply not adequate to carry the traffic which will be involved in getting our logs and other primary produce to market.

In Warkworth, of course, your whole economic future is threatened by Transit roadblocks.

Reputable estimates put the cost of road congestion in Auckland alone at around $1 billion a year.

Multiply that across all the congestion black spots on the roading network, and add in the cost of vehicle damage and the environmental impact of emissions from idling vehicles.

You can see the mammoth cost to the country of a substandard roading system.

Over the past 20 years, our level of investment in new roading infrastructure has lagged seriously behind the growth in traffic volumes - volumes that have more than doubled in the last 20 years.

Consider also the human costs.

Road fatalities per 100 million kilometres driven are 20% higher in New Zealand than in Australia, and 50% higher than in the United Kingdom. And for every fatality, there are many seriously injured.

Labour’s answer to our road toll has been heavier policing – more speeding tickets issued. More speed cameras. More revenue.

But we know it takes far more than that to make our roads safer.

A major effort to build better roads is long overdue.

We top the world in terms of cars per capita – more cars per head of population than any other country on earth.

But New Zealand’s spending on roads per motor vehicle is significantly lower than in all but two of 21 countries surveyed by the OECD.

Relative to GDP, public spending on roads here is well below that of other jurisdictions of roughly comparable size – like New South Wales, Victoria, and Queensland. And well below the United States and most European countries.

Moreover, in the United States, Europe, and Australia there are significant levels of private investment in roads on top of the public investment.

We don’t have any of that at this stage.

Even by our own past standards, investment in roads has slipped.

During the sixties, seventies and early eighties, New Zealand spent around 1.3% of GDP on roading – about the average for OECD nations.

In the belt-tightening of the mid-eighties, expenditure on roads slumped to around 1%, and stayed there for the best part of a decade, until entrenched fiscal problems were overcome.

In the late nineties, the last National Government lifted road spending to a little over 1% of GDP, by starting a process to move more petrol tax out of the Consolidated Fund into roading.

At that time – 1998 – we said that, as circumstances allowed, more transfers would be made.

Labour came in the following year, and stopped the process. Under Labour, the level of investment in roads, relative to GDP, slumped again.

The consequence of all this is that the value of our road network as a percentage of New Zealand’s GDP has fallen dramatically. Between 1993 and 2003 it fell from 45% of GDP to 27%.

As a result of our under-investment in roads, the degree of “connectedness” of New Zealand’s major urban road networks is lower than in major urban centres in comparable countries. In other words, there are big gaps in our urban roading networks.

And it is therefore not at all surprising that, in recent years, congestion in our major cities has become markedly worse, and is now worse than in both Sydney and Melbourne.

Most reputable international research shows that investment in roads can and does generate excellent returns.

The US National Bureau of Economic Research found that during the eighties and nineties “higher local government spending was associated with lower economic growth, unless that spending was on highways.”

Roads generate growth.

Modern transport runs on roads.

New Zealand doesn’t have enough of them, or enough with the capacity and of the quality to meet the demands of our economy.

We can expect to see significant national productivity gains arising from investment in the improvement of New Zealand’s road network.

By not investing, we are keeping New Zealanders poorer than we need be.

The solution requires a government determination to spend more money on our road infrastructure, and that particularly applies to the roadblocks you face here in Warkworth.

You should not be left stuck in Transit.

ENDS

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