Project Auckland: Funding Auckland's transport conundrum

Auckland is going to have to invest in roading infrastructure or our gridlock problems are just going to increase, says the EMA's Kim Campbell (above).

Many options have been considered to solve our traffic issues, says Kim Campbell.

Nobody wants to pay more for anything but it's either that or everyone in Auckland will be struggling with traffic gridlock within 10 years.

That's the stark choice highlighted by the modelling on Auckland's transport future. If we keep on the present business-as-usual track, slowly building more roads and adding more public transport, by 2021 the time we take to get to work and deliver goods around Auckland will have become untenable.

All the interests represented on the Alternative Funding Group set up by Mayor of Auckland Len Brown agreed with the recommendations put forward. These interested parties included:

• Auckland Business Forum

• NZ CTU

• Walk Auckland

• Campaign for Better Transport

• National Road Carriers

• Child Poverty Action Council

• Cycle Action Auckland

• Environmental Defence Society

The group was tasked to find the best way to get the money to develop Auckland's transport networks so we didn't end up not going anywhere.

The funds needed for a transport package that will keep up with the ongoing crowds of people coming here is estimated at $12 billion over 30 years -- an extra $400 million a year.

Over two years of work the group exhausted all options of possible funding sources. They examined many things such as visitor room taxes, parking levies, road cordon charges, property betterment taxes, a regional sales tax, regional fuel tax, even a regional lottery.

The problem was few of these raised much money, and when we focused on the things that would raise large sums, some of them were not very fair. For example, there's already a lot of pressure on rates revenues to be spent on other things, and to raise them for transport purposes affects people who may not use the roads much.

In the end, the group agreed its main recommendation was for a toll on the existing motorway network. Auckland Council politicians will be left to decide whether to advance this, but the group considered it held several compelling advantages over other options, including:

• A toll can act as sort of regional tax where "if you don't buy you don't pay".

• Though such a toll is "another tax" it would convey to central government that Auckland is genuinely prepared to pay its way for a more successful city.

• In the short term it could help manage traffic congestion.

• Over time it will encourage people to organise themselves so they live nearer where they work. There's a real, very large cost to the community having people travel all over the city every day.

Of course we have no law in place to enable such a toll, and neither do we have adequate governance arrangements to administer it and invest the proceeds to the public's satisfaction.

To do this we would need a Greater Auckland Transport Authority to combine the transport resources of Auckland Council, the NZ Transport Agency, Auckland Transport and the Ministry of Transport. By bringing these agencies together we could expect far better integration of the development, funding and administration of our transport systems.

Before going there Auckland has another elephant in the funding room -- we really need to sell some of our publicly owned assets.

There's a lot to choose from: a partial sell down of Auckland Airport shares; the Ports of Auckland business, though certainly not the land the port operates on; and numerous properties.

One of the largest assets is the Auckland Electricity Consumer Trust's $2 billion worth of shares held in Vector. These are Auckland Council property that the Council won't control until 2073. They should be handed over right away to invest in the infrastructure the city urgently needs now.

Asset sales could delay the need for tolls but Auckland will end up paying regardless. Either we'll pay by suffering traffic congestion and higher personal transport costs, along with the higher costs we pay in the goods freighted around the city.

Or we could pay through a low per entry road toll. Or, we could pay by investing the proceeds of an asset sell down in new infrastructure. The choice is ours to make.

Kim Campbell is chief executive of the Employers and Manufacturers Association.