Ardern wrong on National fuel tax plans: Bridges

The previous Government received advice on increasing fuel taxes but decided not to because it could pay for its roading plans within existing Budget allocations, National leader Simon Bridges says.

"We committed to building the next generation Roads of National Significance, New Zealand's busiest and safest roads, within existing Budget allocations by rolling over annual Budget allocations and not starting new roads until existing ones were complete," Bridges said yesterday.

The Labour Government released its draft 10-year transport plan on Tuesday, including cutting more than $5 billion from state highway upgrades and channelling the money into public transport such as light rail, urban cycleways and safety improvements on urban and regional roads in a bid to lower the road toll.

Big ticket items include about $4b over the next five years for the beginning stages of light rail in Auckland, one of Labour's election promises.

To pay for it, Prime Minister Jacinda Ardern said further petrol tax hikes of between 9 and 12 cents a litre would need to be phased in over the next three years.

That would be a double whammy for Aucklanders who also face Auckland Council's plans to introduce a 10-cent regional fuel tax to pay for its share of transport projects.

The prospect of the double whammy came as a surprise to senior Auckland councillor Desley Simpson.

"We have consulted on 11.5 cents, not double that. Who saw this coming?" said Simpson, a member of Mayor Phil Goff's leadership team.

Simpson said her concern is around transparency and the expectation Aucklanders had for the regional petrol tax, which has been consulted on as part of the council's 10-year budget.

"To my knowledge the expectation was that the Government would legislate so Auckland Council had the tool to add a fuel tax of 11.5c should they wish, not that the Government would legislate extra national taxes as well," said Simpson.

Ardern said yesterday that the previous Government was told it would need to hike fuel excise by 10 to 20 cents a litre.

"Simon Bridges was told that to meet his last Government's ambitions around dual-carriage highways and large-scale roading projects, they would need to increase excise by between 10 and 20 cents. We're consulting on the lower end of that range because we didn't agree with that," she told reporters.

National's transport spokesperson Jami-Lee Ross today accused the Prime Minister of misleading motorists.

"Motorists and communities right around New Zealand are about to be hammered at the petrol pump – yet get fewer new roads – and the Prime Minister's justification amounts to 'Well the previous Government was going to charge 20 cents a litre more too'. Well that's bogus," Ross said.

"The previous government had committed to new roads right around New Zealand because the National Party understands how important they are to our regions. But while officials had recommended an increase to pay for some of them, we rejected that advice and committed to the projects under existing funding allocations."

Ardern said today that the plan to raise petrol excise by 9-12 cents a litre did not breach her pre-election promise of "no new taxes" in her first term.

She told Newstalk ZB's Mike Hosking this morning that Tuesday's Government Policy Statement on land transport was a "routine" review that happened every three years and did not propose new taxes.

Ardern promised before the election last September that any tax changes arising out of the Labour Party's proposed tax review would not take effect until after the 2020 election.

Finance Minister Grant Robertson said at the time: "There will be no new taxes or levies introduced in our first term of government beyond those we have already announced."

Ross said today the Prime Minister had announced a hike of up to 25 cents after just six months in office.

"That includes the proposed new nationwide fuel tax increase and the upcoming Auckland regional fuel tax which could be rolled out to the rest of New Zealand in three years."