New Zealand has long had a body at arm's length from governments to allocate roading funds around the country. Once it was called the National Roads Board, these days it is the Transport Agency. It operates on the principle that finite funds should be spent on projects that meet objective measures of urgency and economic value, not political reward. Sadly, the principle has been often superseded by political considerations and it has happened again. Looking for an electoral gift to unwrap at the National Party conference last weekend, the Government issued a programme of roadworks.

For the most part they were modest - bridge replacements, curve realignments, passing lanes - and the total cost was just $212 million, a sum that could pass unnoticed in the annual state Budget. But they served to suggest that National was responsive to regions and committed to roads. This Government takes pride in putting money into roads rather than the alternatives favoured by Greens and elements of Labour.

Undoubtedly, the public is on the Government's side, particularly in places such as Northland, Gisborne, Taranaki and Otago that stand to receive the first projects. If these are not top of NZTA's priorities, the regions that might otherwise have benefited will be unaware of their loss. Ultimately, though, it is not in the national interest to have priorities chosen for political purposes. The Government says the money for the projects is coming from the proceeds of its partial asset sales, as though that money is somehow exempt from principles of good public finance.

The capital released from public assets is public money. It is not a political slush fund that can be used to reward the Government for its courage in putting the sales programme to the previous election. The capital was earning a good return in the assets and if its release is to be justified it needs to earn a better return for the country in new investments.


Transport Minister Gerry Brownlee says the Government's chosen road projects have been identified as high priority by local governments for a number of years. If so, the fortunate regions will readily contribute their share of the costs and the projects will proceed on no more than the consistent subsidy being set by NZTA for work that is due.

The agency has lowered the subsidy to 53 per cent, reflecting reduced rations from the Government. Some see the cash splashed around country roads at National's conference as a deliberate distraction from the cut.

Whether it was so or not, the roading announcement was hardly inspiring for a pre-election party conference. National and its prospective voters needed a policy announcement that would give some direction and purpose for the Government in a third term. National might congratulate itself on an economy running at 3 to 4 per cent growth last year and this, and rest its election campaign on that success, but it could do better.

The Labour Party holds its pre-election conference this weekend. It has every chance of producing a policy that might give its supporters a sense of direction. Labour already has announced new taxes on high incomes and rental property sales. The revenue it stands to gain gives it room to announce that it can finance something more productive than an extension of social benefits.

Then again, Labour could surprise all pundits by promising to pay down debt faster than National and resume contributions to the Cullen Fund earlier. Promises such as those might not set its conference alight but they would be a sign it is seriously ready to return to power. National offered a future of little more than road cones; Labour can probably do better.

30 Jun, 2014 7:05pm
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