Government paying more than council to fix transport woes

The Government is increasing spending on projects such as the Waterview tunnel while the Auckland Council is cutting spending on transport, according to the Ministry of Transport.

The Government's share of fixing Auckland's transport network is steadily increasing as spending by Auckland Council drops, says the Ministry of Transport.

The ministry has painted a grim picture of council's transport spending as the Government and Auckland prepare to spend $24 billion over the next 10 years on an agreed transport programme, but are $4b short.

Auckland mayor Phil Goff says population growth has increased the shortfall to $7b, a view shared by the ministry - which also blames rising construction costs and project sequencing for the widening gap.

Ministry briefing papers for Finance Minister Steven Joyce and other ministers show combined Government and council transport spending has been relatively constant at about $1200 per person since 2008.

The steady per capita spending has seen billions of dollars being spent on rail electrification, new trains, the Waterview tunnel and the City Rail Link. But rapid population growth is not enough to keep up with increasing traffic chaos on the city's roads, with a dire prediction by Auckland Transport that one in three roads will be congested by 2020.

The briefing papers, obtained by the Auckland Ratepayers' Alliance under the Official Information Act, forecast the Auckland Council's transport expenditure would fall from $798 million this year to $432m next year.

The ministry said the Government's share of transport funding in Auckland over the next three years will increase to more than 70 per cent and the council's share will drop to less than 30 per cent, based on current assumptions.

It said the main reason for the drop in council funding is the end of the council's interim transport levy of $114 for households and $183 for businesses next year.

The levy was introduced in 2015 on the assumption the Government would provide the council with new funding sources. Since then, the Government has ruled out a regional fuel tax and said plans for tolls were some years away.

The ministry said another reason for a drop in council transport spending was its debt situation, which it projected to get worse over the next three years before improving after 2022-2023.

Last night Transport Minister Simon Bridges said he was pleased to see council had increased spending on transport in this year's budget to $798m but said after that it was more uncertain.

"We continue to do more and more as we will, but we also want to see a commensurate strong response from council," said Bridges, saying the Government wanted the council to come to the party, look at its options and to help pull its weight.

He said about two-thirds of transport funding in Auckland came from central Government and it had to be mindful of the split between the taxpayer and the ratepayers, and also between Auckland and the rest of New Zealand.

In April, Joyce took said it was up to the council how much it wanted to spend on transport.

"We're certainly doing it . . . unfortunately at the moment, the way the budget is set up for Auckland Council, they're looking at reducing their expenditure over the next few years," Joyce told TV3's The Nation.

Goff said council was prioritising investment in transport infrastructure, including $800m in this year's budget.

He said the council had a clear preference for road pricing to be brought in quickly to replace the interim transport levy, saying only that he was looking at a range of options for when it ends next year and transport spending plummets to $432m.

Goff talked up the council's commitment to spending on transport, saying it had recently signed an agreement with the Government to pay a half share of the $3.4b project.

"Council is borrowing to the maximum allowed within our credit rating and we have made it clear to Government that we want to contribute our fair share to transport infrastructure in Auckland,' he said.

Auckland Ratepayers' Alliance spokeswoman Jo Holmes said that at a time Aucklanders were demanding more transport spending the council was cutting funding.

With the council having borrowed up to their eyeballs, she said, it needed to cut waste and get back to core services.

Council spending on transport

Auckland Council steadily increased spending on big transport projects up until 2015 before spending took a tumble last year.Documents obtained by the Herald under the Official Information Act of the top 20 capital council projects each year show the most expensive transport project over the period is a new fleet of electric trains costing $577m.

This is followed by $350m on Ameti, a group of roading and public transport projects in southeast Auckland, and $290m on the City Rail Link, which will cost ratepayers $1.7b by the time it is completed in 2023/2024.

Since the end of the first full financial year in 2012, the council has spent $1.5b on big transport projects out of a total big-ticket spend of $3b.

After the council's controversial 10-year budget in 2015, which featured a interim transport levy costing households $114 a year, spending on big transport projects fell to $230m. The budget featured big cuts across the board to hold down rates and control debt, which had risen from $3.9b to $7.3b and near a ceiling that threatened the council's credit rating.