A government review of roading subsidies could cost Wanganui millions and damage the region's rural productivity.
District councillor and rural community board member Hamish McDouall is sounding the alarm bells over a review of the Funding Assistance Rates, a system which subsidises local authority work and maintenance to roads, including rural and suburban roads.
Mr McDouall said Wanganui spent millions of dollars on roads each year but this was alleviated by the subsidies. The review by the New Zealand Transport Agency could cost the region dearly - both in lost subsidies and damage to the rural sector.
While many councils throughout the country, including Wanganui, made submissions to the review, the Wanganui board was the only community board to do so. An economic analysis in 2011 of the Wanganui region showed the primary sector's gross domestic product was worth more than $400 million - 20 per cent of the area's total GDP.
Mr McDouall said industries such as sheep, beef and forestry relied on rural roads, many of which were unsealed, to access markets. A reduction in services on these roads could threaten their future.
Work and maintenance to roads in the region attracts a subsidy of between 60 per cent and 62 per cent under the formula which has been in place for more than 30 years.
"Places like Wanganui and Gisborne have big inland roading networks and the cost of maintaining these is huge," Mr McDouall said.
He said every 1 per cent of subsidy lost would cost Wanganui more than $100,000.
"Even if we lose only 10 per cent, it's still over a million dollars. Where are the ratepayers of Wanganui going to find that?"
State highways have not been included in the review, which Mr McDouall said appeared to favour Auckland over the regions because of its higher population.
"It's a typical draining of the regions to fund an oversized metropolis."
Mr McDouall believed the Roads of National Significance, which is the Government's plan to improve seven state highways at a cost of many hundreds of millions, was driving the review. None of the seven RONS highways are in the Wanganui region.
The review will finish in 2014 and its outcome is likely to affect the funding for 2015 to 2018.