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New Zealanders' Views On What's Fair When It Comes To Paying For Infrastructure

The New Zealand Infrastructure Commission, Te Waihanga, has released the results of a survey that asked New Zealanders what they think is fair when it comes to paying for infrastructure services like roads, drinking water, and electricity.

"Survey findings reveal highest support for usage as a fair way for charging. Specifically, nearly three-quarters of respondents thought it was fair that what households pay for electricity (74%) and water (72%) should be based on what a household uses," says Te Waihanga General Manager - Strategy, Geoff Cooper.

"Just over one-third (34%) of respondents thought that usage was a fair way to fund roads. However, this was still higher than the other ways of paying for roads presented in the survey," says Cooper.

The survey asked whether it is fairer that what households pay should differ based on what the household uses, what the household’s income is, or on the cost of supplying the service to the household’s location. The survey also asked whether it is fair to charge more at times of peak demand.

"What’s fair is a very subjective thing. Views varied based on age, gender, ethnicity, and region. Views also varied depending on the type of infrastructure," Cooper says.

The New Zealand Infrastructure Strategy highlights that New Zealand has significant challenges ahead when it comes to delivering and maintaining infrastructure. Addressing these challenges will require us to do things differently, which might mean changing how infrastructure is paid for and delivered.

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"Gaining a better understanding of what people perceive is fair when paying for infrastructure services is an important step toward meeting this challenge. For example, while many people think it’s fairer to pay for the infrastructure services they use, they don’t view it as fair to have to pay for the full cost of supplying those services, especially where the costs are higher, such as in remote locations," Cooper says.

The findings feed into a broader research programme being conducted by the Commission about how and how much New Zealanders pay for infrastructure and what New Zealanders think is fair.

The survey findings highlight a number of key points that may support policy development, including:

Volumetric charging for water: Nearly three-quarters of respondents (72%) think it’s fair that what households pay for water should be based on what a household uses. Decision-makers have the opportunity to harness this broad support for use-based charging as a fair means of paying for water and adopt volumetric charging where it is not already in place. This could be done by incorporating a low fixed charge for basic needs and the discretion to have lower charges for some households.

Congestion charging in Auckland: Despite most respondents (65%) not viewing congestion charging as a fair way of charging for road use at peak times, Aucklanders were more likely to think it was fair (31%) than those from elsewhere (22%). This is comparable to the levels of public acceptance of time-of-use charging in cities overseas before congestion charging was introduced.

Cost of supplying infrastructure: Over half of (55% to 60%) survey respondents did not think it was fair for households to pay for services based on the cost to supply. New Zealand has a long-standing approach that everyone should have access to infrastructure services regardless of where they live. This includes rural and remote areas where the cost of supply is higher or where the population is too small to meet the costs. But there are some tough decisions for the future about who should bear the cost of, for example, of rebuilding infrastructure in remote communities after damage from extreme weather events or in adapting infrastructure to be resilient in the face of climate change.

About the survey: The survey was conducted by Kantar Public. A total of 3002 New Zealanders over the age of 18 took part in the research. The data was post-weighted, so the final sample is representative of New Zealanders aged 18 plus by age, gender, ethnicity, and region. The maximum margin of error on a sample size of 3002 (at the 95% confidence interval) is +- 1.8%.

About the ‘What’s Fair? Providing and paying for infrastructure’ programme of work: Te Waihanga is undertaking a research programme that looks at what’s fair when it comes to paying for infrastructure in New Zealand. The findings from this work will help inform the next New Zealand Infrastructure Strategy and underpin the Commission’s advice to local and central government and other infrastructure decision-makers. Learn more: https://tewaihanga.govt.nz/our-work/key-topics/what-is-fair-providing-and-paying-for-infrastructure

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