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Increase in transport spending sustains investment

Media Statement
31 August 2012
Increase in transport spending sustains investment

The release earlier this week of the National Land Transport Programme demonstrates that the Government and Transport Agency are serious about addressing the country's backlog of transport investment in order to realise the nation's economic potential.

Spending on transport will top $12 billion over the next three years, representing an 8 per cent increase on the previous 2009-2012 programme. Included in that spending is $5 billion on the state highways, up 7 per cent, $4 billion on local roads, up 14 per cent, and $1.74 billion on public transport, up 21 per cent.

Those figures indicate that local roads and public transport are relative winners over the next three years, after highway expenditure increased significantly in the previous three year period. Local authorities will be relieved to see a strong commitment to both these areas, especially with local roads budgets coming under pressure in the last few years.

An overlooked but important statistic released by NZTA was the 8.4 per cent reduction in recorded congestion in Auckland between 2011 and 2012, despite transport demand increasing by 3.7 per cent. That is a huge improvement on just a few years ago when congestion indicators were heading in the opposite direction. Recent significant investments in public transport over the last decade, together with some behavioural shift in response to fuel increases, have created a genuine alternative for commuters and provides support for the idea that demand management tools might be workable in the future. Also, the completion of the first Road of National Significance - the Victoria Park Tunnel - has demonstrated that you can address congestion with well-conceived investment.

But perhaps the most interesting aspect is not what the plan said, but what the Minister and Transport Agency said during the release in relation to funding. Transport Minister Brownlee made a strong and timely reference to funding mechanisms currently available, most notably fuel taxes, and the limitations of this tool given increasing fuel efficiency.

Future NLTPs are going to have to become a lot more innovative in order to sustain investment in productive infrastructure. Public-private partnerships, tolling and other means are being investigated by the Transport Agency and the next three years are going to be critical in the development of the future national land transport system.
NZCID is New Zealand's peak infrastructure industry body. Established in 2004, NZCID's purpose is to advance best practice in national infrastructure development through research, advocacy and public and private sector collaboration. NZCID members come from diverse sectors across New Zealand, equity owners, service providers, public sector agencies and major infrastructure users. Further information about NZCID and its members is available at www.nzcid.org.nz.

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