Government Policy Keeps Auckland Poor

Auckland communities will be poorer and less resilient in future if they allow Central Government’s narrow focus on the GDP growth benefits of road construction to frustrate the popular planning consensus that has steadily taken shape under Local Government leadership here over the past fifteen years.

Transport Minister Gerry Brownlee’s blunt dismissal of Auckland Council investigations into road tolling, fuel tax and parking levy options to fund public transport infrastructure is the latest central government intervention as Auckland struggles to develop local solutions to its growth problems. Brownlee criticises Auckland Council for even thinking about tolling “my roads” to fund “your projects”.

Auckland is suffering from a discrepancy between the priorities of central and local government. Buoyed by a resurgence in the popularity of alternative modes of transport, a balanced approach to growth and development of urban form is being advocated by Auckland Council Whereas central government continues to invest heavily in highways while paying little more than lip service to alternative forms of transport, and advocates relaxing the metropolitan urban limit (MUL) instead of increasing density within the existing urban area.

It hasn’t always been this way.

Much of Wellington’s suburban railway infrastructure was funded by a central government imposed “Betterment Tax” on new development. Until the National Roads Act in 1953, a proportion of the uplift in value of private land in newly developed areas formed the revenue for rail infrastructure and state housing. Similar practices are common in other western countries today, but not New Zealand, where speculative land development is encouraged and where the true costs of infrastructure and subsequent living costs are born by communities.

Auckland’s suburban rail development plans came too late to benefit from land development tax funding. They were replaced by state highway plans funded by car registration and fuel taxes leading to unprecedented suburban development. While communities and families have been able to realize the Auckland version of the American Dream, it has come at a cost and with a set of risks that are no longer hidden.

Quite apart from the loss of horticultural land and the cost of infrastructure (roading, electricity, water, stormwater wastewater), travel options for those unable to drive themselves (including school aged children, and the elderly) have declined in quality and amenity, and the costs of private transport are higher for those in distant suburbs as fuel costs increase and because distances and travel times to work, shop and school increase.

The risks of unemployment and more expensive fuels strongly indicate a need for resilience. That requires a range of transport options and urban form that is less demanding of travel, enabling people and communities to spend less on essential travel freeing investment for more productive economic activities.

These costs and risks are no longer hidden from Auckland communities who, with increasing voice since the late 1990’s, have accepted and voted for the need for regional change. In 1998 all of Auckland’s Councils adopted the Auckland Regional Growth Strategy which put in place the Metropolitan Urban Limit restricting sprawl. In 2002 Auckland Councils led the development of new legislation enabling the collection of development levies to pay for new infrastructure. And in 2005 all eight Auckland Councils adopted a Regional Land Transport Strategy which advocated shifting $1 billion funding from state highways to public transport.

At the time, the Labour Government’s Minister of Finance Dr Cullen was noisily and strenuously opposed to investment in rail. But after Auckland Councils took the next step and called for a 5 cents/litre regional fuel tax to fund public transport operating costs – receiving strong public support – Central Government accepted the regional consensus and explored ways to strengthen Auckland local government. This eventually led to amalgamation and the Super City.

It should have come as no surprise to the Key Government that Auckland would vote for a Council largely committed to continuing the momentum in favour of efficient urban form and further investment in public transport options.

However the new Government lost no time in imposing its plan for Auckland, dismissing the regional fuel tax, and rolling out a program of roads of national importance to rival state highway plans not seen since the 1960’s. These are to be funded by fuel taxes exclusively collected by Central Government.

Communities will continue to be forced to own and run cars to meet their travel needs. They will congest Auckland roads, and Auckland Council will be required to provide alternatives on a skimpy budget, without recourse to fuel taxes and road tolls.

The Government’s emphasis on GDP as the sole measure of economic success is also a throwback to the 1960’s. Alongside new motorway infrastructure plans, this year’s budget highlighted the rebuild of Christchurch as central to national GDP growth – as if another earthquake in Wellington or a volcano in Auckland is the solution to economic woes. As if another motorway is the solution.

Auckland’s urban form and reliance on private car travel is keeping us poor. Not all, but many. Property speculation and motorway construction certainly enrich some, but New Zealand’s steady decline to the bottom of the OECD in wealth inequality, which is at least partly driven by escalating costs of private travel, needs to become a bigger driver of Government transport investment decisions.