KEY POINTS:
Aucklanders are to face higher fuel prices after the Government agreed to allow Auckland Regional Council to impose a fuel levy to fund new projects.
The levy, on petrol and diesel within the Auckland region, will be phased in over three years, starting with 2 cents per litre
from July 2009, 5 cents from July 2010 and 9.5 cents from July 2011 through to 2039.
The levy is expected to raise around $110 million a year once the full 9.5 cent levy is being collected.
Under legislation passed this year councils can impose levies up to 10 c a litre with Cabinet sign-off.
In May, as petrol prices soared, Prime Minister Helen Clark indicated councils would not get the approval.
Transport Minister Annette King said today that the levy funds would be used towards several projects with public transport able to use more levy money than others.
Projects to benefit are ferry terminal improvements, development of an integrated public transport ticketing system, and construction of a new road linking the Whangaparaoa Peninsula to State Highway 1 at Redvale (Penlink).
Ms King said the regional fuel levy was an "additional funding tool available to regions for transport projects they have identified as high priority, but that will not reasonably be funded from any other source in the timeframe desired".
Ms King congratulated the Auckland Regional Council and Rodney District Council for their successful proposals.
"The Government is already forecast to provide more than a billion dollars in Auckland land transport infrastructure this year, but this levy will see other high priority transport projects of the Auckland region realised much faster than they could have been otherwise."
Projects to be funded:
* Above-track rail electrification: about $500 million (100 per cent levy-funded);
* Non-electric rolling stock: about $150 million (67 per cent levy, 33 per cent Auckland Regional Holdings);
* Rail system upgrade: about $100 million (79 per cent levy, 19 per cent Auckland Regional Holdings, 2 per cent New Zealand Transport Agency);
* Ferry wharves and integrated ticketing system for buses and ferries: about $110 million (37 per cent levy, 10 per cent Auckland Regional Holdings, 53 per cent New Zealand Transport Agency);
* Below-track electrification: about $500 million (the Crown will fund the borrowing and repay the capital cost with the levy paying interest.);
* Penlink: about $180 million (80 per cent levy, 20 per cent Rodney District Council.)
- NZPA