KEY POINTS:
WELLINGTON - The Government has hit back at National leader John Key's criticism of its funding of roading and call for more reliance on borrowing.
Mr Key said National would borrow money to build roads, get the private sector more involved in infrastructure construction and urgently reform the
Resource Management Act.
In a speech to the Road Transport Forum, Mr Key said the reliance on petrol excise duty and other taxes had placed an artificial cap on building new roads.
"We have been in maintenance mode, we have had few actual additions to the road network. In Auckland, we haven't completed the motorway network that was thought necessary to cope with traffic in the 1960s," Mr Key said.
Mr Key said road building planners needed more long-term certainty of funding and this could be done from borrowing.
"If a project has a good benefit-cost ratio then the government can borrow to do that project, pay the money back with interest, and, at the end of that process, society is better off."
Transport Minister Annette King said since Labour came to power in 1999 it had invested $1 billion in land transport, forecast to reach $2.75b in 2007-08. Central Government spending on roading had doubled to $1.7b in 2007-08.
"The Labour led Government has made and is making a tremendous investment in new roads, in maintaining roads and in making our roads safer," she said.
"And we are not doing this by borrowing up madly. We are funding our roading programme in a fiscally responsible way and we will continue to do so, including working in partnership with private enterprise where this is possible."
Finance Minister Michael Cullen said Mr Key's comments reflected a desire for looser fiscal policy and contradicted the stance of his deputy Bill English.
"John Key may want to take us back to the borrow and spend policies of the Muldoonist administration but this is not something most New Zealanders, including his own caucus, could ever support," Dr Cullen said.
In his speech Mr Key said a National government would look at issuing infrastructure bonds in the name of projects with a payback period in tune with the economic life of the project.
Mr Key said it would also look to more private-public partnerships (PPPs), with the government buying the use of privately built roads.
"National is not adverse to using tolls on occasion to help pay for major roading projects, particularly where there is private sector involvement in financing," Mr Key said.
National would not allow tolls to be charged on roads that had been funded through taxes.
Mr Key said National would reform the legislation which restricted PPPs as well as the Resource Management Act which meant long delays in building roads as well.
"We have committed to introducing a resource management reform bill in the first 100 days of a new National government. This will include such measures as direct referral of major applications to the Environment Court."
Mr Key said National wanted "appropriate consultation" but wanted it to deliver a final and certain outcome within a defined and reasonable timeframe.
- NZPA
