The Big Auckland Transport announcement

Written By: - Date published: 1:30 pm, April 26th, 2018 - 39 comments
Categories: auckland supercity, labour, local government, phil goff, phil twyford, public transport, supercity, transport - Tags:

Minister Phil Twyford and Mayor Phil Goff announced the ATAP, the transport programme for Auckland for the next ten years.

At $28 billion it is the largest civil infrastructure programme since World War II.

That $28 billion comes from:

– $8.45 billion of borrowing and rates from Auckland Council

– $1.5 billion fuel tax (which also attracts FAR subsidy, so there’s
more in that)

– $16.3 billion NLTP

– $1.4 billion City Rail Link contribution

– $ .36 billion from Crown Infrastructure Partners

And that $28 billion is about 38% of the National Land Transport Fund
– just a fraction above Auckland’s national share of the population.

That goes to:

– $8.1 billion in operational costs (especially more for public transport subsidy as more people take public transport)

– $3.3 billion in asset renewals

– $8.4 billion in rapid transit, which covers busways, rapid rail, and light rail

– $3.8 billion on strategic and local roads

– $1.3 billion on roads etc for green fields areas

– $ .9 billion safety improvements, targeting a 50% reduction in death and injury

– $ .9 billion walking and cycling

– $ .7 billion bus and ferry improvements

– $ .7 billion network optimization

You will see more of the detail debated on GreaterAuckland, but I’m
keen to see how this lands politically, which is our speciality here.

Whangaparoa’s Penlink will be done as a ppp, and will also include busway improvements to Silverdale

Mill Road gets $.5 billion.

A busway to the airport from Puhinui will be very fast off the rank, with bus lanes to start, then full busway separation.

AMETI busway Panmure to Botany gets full funding.

There’s $1.8 billion in seed funding for light rail for both SH16 and first stage of light rail to airport. More on that later.

This Lake Taupo-sized volume of money will be difficult for both AT and NZTA to spend (AT rarely spends the capital it has in any year, and NZTA are full of motorway-heads resisting this Minister and are poorly led by their CE: let’s see if the new Chair makes a difference).

It will also be difficult for the infrastructure construction industry, especially with Fletcher Building not bidding for anything major in infrastructure any more. And skilled people very very hard to find. Let me know if you’re qualified and interested.

This is what transformation looks like.

Plenty will argue that this is a supply-driven response, not a demand-driven response to Auckland’s transport constraints. The same number of cars will be imported every week. Except, the fuel tax move is a pretty big demand lever.

Others will say it’s taking too much time. Or it’s somehow not enough. Or what about the … (insert special interest group). Worth checking the public transport stats in case you’re skeptical about spending on public transport.

My view is: this smells and looks like leadership.

It’s what they both campaigned on, so it tastes like Good Old Fashioned Politics.

It unites central and local government on transport like we haven’t seen before in this country.

It taxes, it spends, and spends to tilt Auckland’s future the right way.

This is as big as when they tore up the tram tracks and started building motorways in the 1950s.

It’s a really big deal.

39 comments on “The Big Auckland Transport announcement”

  1. Adrian 1

    This is a once in a century opportunity to resurrect a form of Ministry of Works.
    I drove north from Christchurch yesterday and while there was no actual work going on ( Anzac Day, and the workers do need a break ) everywhere there were signs of provider capture, ticket clipping and for want of a better word profiteering.
    An example, on a several sort sections of roadworks a pilot truck and driver and half a dozen lollipop holders a at guesstimate cost on figures given unofficially to me,
    of over 1000 dollars an hour.
    For no obvious reason that a few restricted speed signs etc could control.
    And then there is the ubiquitous road cones. God knows who has cornered this scam but figures of up to $4 a day for every one have been bandied about. The total for the Kaikoura Coast must be in the millions a year. Once again I have heard of 25 million for a year.
    I’m sure the old MOW didn’t get anywhere near this for tea and biccies in its entire life.

    • Ad 1.1

      NZTA will already be massively strengthened over this announcement, and will need to be hugely transformed and geared up.

      I am also seeing NZTA take more of the major works off Auckland Transport, and as a result no major CAPEX within AT.

      But don’t for a moment think that everything is going to be brought back in-house again. It isn’t.

      • Adrian 1.1.1

        Don’t expect everything Ad, just enough to keep the bastards honest and put a lot of pressure on the cartelering ( if that’s even a word ) and the collusion. Yeah, it happens, a lot of it happens.
        Getting the money back for all those fucking roadcones would be a good start.

    • patricia bremner 1.2

      True Adrian. I always think of that song ” You don’t know what you’ve lost ’till it’s gone”

      Someone smarter than me will do a link to utube !!

    • “And then there is the ubiquitous road cones. God knows who has cornered this scam but figures of up to $4 a day for every one have been bandied about. The total for the Kaikoura Coast must be in the millions a year. Once again I have heard of 25 million for a year.
      I’m sure the old MOW didn’t get anywhere near this for tea and biccies in its entire life.”

      Well said Adrian. As Arther Daley would say ” A nice little earner”

    • Macro 1.4

      It’s not just road cones! Think of those movable barriers – put up to protect workers, and a legal requirement under OHS. One company has the rights for those in Auckland, and they charge megabucks to hire.

    • Wayne 1.5

      I think you will find modern health and safety rules explain a lot of modern practices. The look of construction sites is very different to what it was even 10 years ago. Makes no difference if it is state provided or private provided. Also modern roads are way flasher than those of 30 years ago, and a whole lot more expensive as a consequence.

  2. Tuppence Shrewsbury 2

    looks good. Cohesive regional policy built on community needs and facts, not just hopes regarding peoples behavior. Clever use of PPP’s and Tolls too. Maybe some changes to the RMA to make it happen in a more timely fashion could be next? But then waterview was done pretty quickly without any changes

  3. Stunned Mullet 3

    Yes good – now enough waffle get on with it.

  4. Cinny 4

    Really hope it works out for those who live there. Auckland traffic sounds like a daily nightmare at present, was bad enough when I was living there.

    Girls made a new friend at Kaiteriteri yesterday, she was from Auckland. Girls asked what it was like up there….. ‘lots and lots of roads, cars and houses’ was the reply. Made for a great conversation on the short drive home about the importance of public transport in cities, especially rail, especially to the airport.

    • Bewildered 4.1

      The nightmare is over played Cinny , normally your moving, waterview tunnel has made difference, as they say at least the roads in Auckland lead somewhere: in contrast to empty roads going no where😀 a great city to work and play

  5. Grafton Gully 5

    Advantage wrote in the above article –

    “It will also be difficult for the infrastructure construction industry, especially with Fletcher Building not bidding for anything major in infrastructure any more.”

    This only applies to the Buildings and Interiors Divisions.

    The Fletcher CEO was reported in the Herald today as saying –

    “Fletcher was interested in the two big Auckland roading projects announced today.

    “It’s in our sweet spot,” he said of Penlink north of the city and Mill Rd in south Auckland.

    “We do big road infrastructure projects and we have Higgins which is a roading specialist, so we had a large amount of capacity.”

    http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12039869

    The end of the media conference video says the company’s Buildings and Interior Divisions will complete existing projects but won’t be bidding for new projects in the foreseeable future.

    • Ad 5.1

      Yes it was good to hear a bit of life left in the old dog.
      The industry needs to stay competitive; it needs Fletchers to be in there keeping each other major player sharp.

      But when they first announced they were in trouble this year, they quickly pulled out of AMETI, then City Rail Link C3, and then pulled out of a bunch of other live bids, then didn’t even get onto the main AT contractor panel, it really did look like they were no longer in the big game.

      Even in the Americas Cup job a couple of months ago with Auckland Council they were wiped out fast.

      But when they took over Higgins in 2016 they got some good business development people. Regrettably Higgins have done roading and motorway jobs, and honestly after today the motorway budget is fucked.

      Fletcher are good for the remaining medium-scale road operations and safety improvement jobs. And through Brian Perry Civil they will have a shot at some Watercare jobs. But so far that’s their ambit. They are retreating to New Zealand and Australia, a long, long way up from where they were.

  6. Adrian 6

    After Fletchers are sued for a billion bucks for Chch maybe the Govt just takes whatever is left of one of the worst run companies in the country and nek minit there’s our new MOW. Now that’s shadenfrude .
    Saw the smug CEO on the news tonight, now there’s a dodgy looking Bugger if I ever saw one.

  7. Jenny 7

    Weird that the Mill Road motorway gets half a $billion, when there is no bus service from Papakura down this route, and Clevedon commuters, who also use this route, don’t even have a bus service at all. Putting public transport on this route would be a far cheaper and sustainable way of relieving traffic congestion during rush hour on Mill Road than turning it into a motorway.

    The new mill road motorway which will connect with the Southern motorway at Wiri has the potential to deliver thousands of more cars to the Southern motorway at a junction that barely moves now, this is a recipe for gridlok.

    This is completely crazy.

    Just because Judith Collins (with the aid of the developers, who hope to make a killing out of the opening up of the Greenfield sites around Papakura), ran a petition calling on the government to build this boondoggle?

    Judith Collins has even told locals that she wants this new motorway to continue straight through the heart of Papakura to join the Southern at Drury. That this will bowl hundreds of low cost housing is no matter. They are all renters they can move, she said. And Twyford goes along with this?

    • Molly 7.1

      I was wondering about the Mill Road connection too Jenny.

      The fairly newly built Manukau overpass/junction has been a disaster from the word go, and the design seems to have come from people that would never use it. I have seen no improvement in the traffic flow at all.

      The landbankers seem to have a hefty say out this way, and none of them like public transport.

    • Ad 7.2

      I have a sneaking suspicion that the Minister will require them to significantly down-scope it. I also see a fair bit of delay as the job shifts from AT to NZTA.

      The big one to watch for is the revival of the big East-West expressway, There’s still quite an allocation set aside for that. The debate will come back to whether sufficient gains can be made rebuilding Neilson Street for the freight fleet. I strongly prefer Neilson Street because East-West simply ruins much of the remaining connection between Onehunga and the foreshore – such as it is.

  8. cleangreen 8

    Goodbye to climate change emission targets; – and the much muted “zero carbon” idea!!!

    More roads for trucks and cars simply put.

    Labour are simply just another “populist” Government ‘driven by polls’.

    There should have been a ‘real switch to rail freight and passenger services country wide beginning in Auckland here as a message as to where we are headed as is happening around the world!!!!

    And not just continuing to carry on building just more roads for trucks and cars.

    So much for Jacinda’s “climate change is her generation nuclear moment.”

    Labour in their very first term between 1936- 42 built the Gisborne rail and now it was closed under National (due to them dropping any rail maintenance) Labour still has not advanced the regional rail freight and passenger services as they promised in 2016 to Gisborne that they would restore the gisborne rail again “when next in Government”

    http://gisborneherald.co.nz/localnews/2535803-135/three-parties-say-fix-rail

    • crashcart 8.1

      Agree CG. I drive from Glenfield to Devonport each day. Takes just over 30 mins in the morning and 45 to an hour home in the afternoons. I would love to take public transport and just relax maybe even make a start on work emails on the way. Unfortunately I would have to take at least 3 busses and leave far earlier getting home far later to make that journey. It would cost more than twice as much per week.

      Serious priority needs to be given to providing cheap reliable public transport across all Auckland or we will forever be confined to our cars.

      • indiana 8.1.1

        Anyone that has ever worked in a network planning role, you will understand that “providing cheap reliable public transport across all Auckland” is a myth. In your example, it just show how inefficient public transport is in a wide metropolitan area can be – the fact that you would need to make 6 connections for a return journey and the cost.

      • Stunned Mullet 8.1.2

        Is cycling an option ? Great cycling routes in place down to Devonport now.

      • Anne 8.1.3

        So crashcart, you’re one of the people who clog up our Devonport isthmus roads every morning and night and we locals can’t even get out of our driveways. 😉 I tell a lie, they are courteous drivers who allow us in to be part of the twice daily gridlock we have to endure every day of the week and all weekend!

    • Ad 8.2

      This is the Auckland package not the Napier-Gisborne package.

      And this package will do more for rail in the Auckland region than anyone has done in a century.

  9. Anon 9

    Ok but public transport in christchurch is fucked, and Labour haven’t restored ecan to a democratic regional government nor have they restored public transport funding cut by National.

    • Ad 9.1

      The announcement had nothing to do at all with Christchurch.
      Focus.

      • Anon 9.1.1

        Exactly. NZTAs fairbox requirements affect all regions and makes even bus travel unaffordable to run. Labour want to spend billions on trains and let bus service further degrade – urgh.

  10. Tracey 10

    At last something the whole parliament will agree on. Whodathunkit?

  11. Paul Campbell 11

    I’m looking forwards to the announcement for the rest of the country, here in Dunedin we’re hoping to get rid of the traffic lights in the middle of the Southern motorway ….

  12. UncookedSelachimorpha 12

    While National are being disingenuous and don’t give a damn about the poor – they are factually correct when they say the petrol tax is mostly a tax on the poor.

    It is a flat consumption tax, like GST. The car Graeme Hart (with USD10.3b wealth) travels in probably uses a similar amount of fuel as that driven by a person going to work at MacDonalds for poverty wages.

    With 60% of NZ’s wealth owned by just 10% of the population, this entire project could be funded without any taxes on 90% of the population at all – while still leaving the top 10% very wealthy.

    Neoliberal Labour – talking about inequality but not doing anything very concrete about it.

    • The Chairman 12.1

      “With 60% of NZ’s wealth owned by just 10% of the population, this entire project could be funded without any taxes on 90% of the population at all – while still leaving the top 10% very wealthy.”

      Indeed, UncookedSelachimorpha

      Placing more fiscal burden on the poor is counterproductive to addressing poverty and inequality.

      It’s also something Labour’s tax working group need to keep in mind. Taxing the top 10% will be a far easier sell come election time.

  13. Rob 13

    Advantage, lets get this correct.

    Fletcher Building are seriously in the business of infrastructure development with their Higgins business. What they have exited out of is vertical building projects which are not roads or bus lanes or electric light rail. But you know that right?

    You were going quite well till that point.

    • Ad 13.1

      What I know is a whole bunch more about Fletchers and infrastructure in Auckland than you do.

      You need to dig deeper than the ce’s comments.

  14. Rob 14

    Pfffft , geez you are very quick on the assumptions.

    Where has Fletchers ever stated that they were not entering into further infrastructure projects. Vertical building projects, convention centres, fixed price design & build projects all stopped, but not infrastructure. Its a real shame as many of us cut our teeth at Fletchers, but you know that right.

    So as you claim to be a great expert on construction and infrasture I am sure you will be telling Ken L at Higgins that he wont be tendering on any of these infrastructure projects. I am sure that would be news to him.

  15. savenz 15

    I wish I could get more excited about our public transport being potentially fixed. But because it seems to have the same people in charge with the same ideologies of taking public money and transferring it to the public sector, and the same stupid decisions, intentional complexity and lack of practicality, so I can’t.

    Just some information about PPP’s. They don’t work and are death, they cost more, they are unwieldy, the risk transfer doesn’t work because when the private sector screw up and goes bankrupt, the public still has to use the roads and public transport, so there is no risk transfer.

    Essentially we are paying more hard earned money so that companies like Fletchers and Finance companies, many already on the ropes or earning excessive profits being shipped offshore, can wallow in more public funds, import more low wage people and go as slow as possible before ultimately screwing up and then the rate/tax payers pick up the bill and contribute to more inequality and lack of working public assets.

    If you want something done, do it yourself and if you can’t do it yourself, then you should not be in the job!

    • savenz 15.1

      “UK PFI debt now stands at over £300bn for projects with an original capital cost of £55bn”

      https://www.theguardian.com/commentisfree/2017/aug/30/pfi-britain-hospital-trust-debt-burden-tax

      “Conservatively estimated, the trusts appear to be paying a risk premium of about 30% of the total construction costs, just to get the hospitals built on time and to budget, a sum that considerably exceeds the evidence about past cost overruns.”

      For roads:

      This report: https://image.guim.co.uk/sys-files/Society/documents/2004/11/24/PFI.pdf

      found that PPP “contracts are considerably more expensive than the cost of conventional procurement”, resulting in higher returns for the companies running the PPP’s compared to their industry peers.

      While hard to compare because of the opaque nature of many contracts and large amounts of subcontracting out, it looked like the actual cost of capital of the PPP’s was 11% compared to Treasure borrowing of 4.5% i.e. 6.5% higher. This is supposed to represent the cost of risk transfer but in practice there was no risk transfer so it’s money for nothing.

      “In conclusion, the road projects appear to be costing more than expected as reflected in net present costs that are higher than those identified by the Highways Agency (Haynes and Roden 1999), owing to rising traffic and contract changes. It is, however, impossible to know at this point whether or not VFM (value for money) has been or is indeed likely to be achieved because the expensive element of the service contract relates to maintenance that generally will not be required for many years.”

      Overall, for both roads and hospitals they concluded there was no risk transfer and not value for money.

      “The net result of all this is that while risk transfer is the central element in justifying VFM and thus PFI, our analysis shows that risk does not appear to have been transferred to the party best able to manage it.

      Indeed, rather than transferring risk to the private sector, in the case of roads DBFO has created additional costs and risks to the public agency, and to the public sector as a whole, through tax concessions that must increase costs to the taxpayer and/or reduce service provision. In the case of hospitals, PFI has generated extra costs to hospital users, both staff and patients, and to the Treasury through the leakage of the capital charge element in the NHS budget. In both roads and hospitals these costs and risks are neither transparent nor quantifiable.

      This means that it is impossible to demonstrate whether or not VFM has been, or indeed can be, achieved in these or any other projects.

      While the Government’s case rests upon value for money, including the cost of transferring risk, our research suggests that PFI may lead to a loss of benefits in kind and a redistribution of income, from the public to the corporate sector.

      It has boosted the construction industry, many of whose PFI subsidiaries are now the most profitable parts of their enterprises, and led to a significant expansion of the facilities management sector.

      But the main beneficiaries are likely to be the financial institutions whose loans are effectively underwritten by the taxpayers, as evidenced by the renegotiation of the Royal Armouries PFI (NAO 2001a).”

  16. savenz 16

    Nobody can borrow money cheaper than the government and so it any scheme relies on borrowing off financial markets aka the private sector then you are already wasting money and adding to complexity…. it’s margins on margins… and when you are talking billions off the backs of people of probably on less than $30p/h (since poorer people are more likely to live further out and therefore need to drive more, the richer people will be more centrally located to their work) to be take as profits for the construction and finance industries, that’s where I’m not sold.

    And of course the people further out seem to be getting less public transport, than those who live closer to the centre…

    So good news they have a transport plan, bad news is that they are relying on the private sector which is why they need so much extra money for their profits and there is plenty of evidence around in the UK and NZ on why that does not work aka leaky buildings and the housing market in general, finance sector and the massive bail outs etc.

  17. Philg 17

    Migrants are swamping Auckland, boosting property values and the economy, and locals who can are leaving. This is not the brighter future.

    • savenz 17.1

      I agree too much immigration and work permits being handed out like candy, as well as not adjusting for the change of asset ownership in the last decade and thinking tourism is such a boom for everyone (those were the days when locals owned and worked in the hotels so benefited from tourism, not any more, they are subsidising other people’s businesses by paying for the upgrades needed for the roads and wastewater and increased pollution and diseases like Kauri die back).

      It is the government’s fault through and through with by far the majority of blame going to National for handing out the work permits, bringing in low waged low skilled people and allowing it to get out of control and then trying to cover it up and make other people pay for it.

      I’m starting to wonder if we are going to end up like the Philippines in the next decade, a poor low waged country where it’s people go overseas to escape the low wages, a huge focus on overseas trade and currently being run by a crazy right winger whose getting the military to go around and assassinate ‘drug dealers’ for the ‘war on crime’. (Because it was not the overpopulation, lack of jobs and having outward migration of skilled people that led to the drug issues.)

      At least under Helen, they at least acknowledged the ‘brain drain’, under National that issue, has completely disappeared because who needs them, when there a truck full of dirt to transport or a coffee to be made by minimum waged, zero hour contract type workers who are no longer students but actually expected to survive on that type of work.

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