Phil Twyford is promising a $54 billion transport binge over the next ten years, with a focus on safety

Wednesday, 18 March 2020

The Government will plough $54 billion into transport investment over the next ten years, upgrading and building roads, rail and cycleways.

Transport Minister Phil Twyford brought forward the announcement of the package in a bid to give infrastructure builders certainty the Government was committed to big transport spending as the economy took a hit from Covid-19.

'This GPS shows our Government is putting the pedal to the metal on our balanced transport policy while committing to a massive infrastructure spend over 10 years,' Phil Twyford said.

But Associate Transport Minister Shane Jones wants the Government to go further and faster, allowing its road-building agency the New Zealand Transport Agency (NZTA) to raise its own debt, potentially giving it many billions more in funding.

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He said NZTA should be like Kāinga Ora, the Government's housing agency, which can borrow up to $7.10b on its own, without drawing on the core Government balance sheet.

'It's not Government policy, but I've been lobbied incessantly about it, so I've invited people to send submissions to us,' Jones said.

He also wants to work with other ministers to bring 'Christchurch Earthquake-style' powers to the transport portfolio, allowing the Government to steamroll red tape and planning restrictions to speed-up construction.

He's working with Environment Minister David Parker on potential law changes to bring forward projects.

The Detail: Nearly one person a day died on our roads last year. (Video first published in September 2020)

'I'm full of eagerness for such an outcome because I've learnt the hard way how long it takes my Provincial Growth Fund Projects to bear fruit'.

For the first time, the Government will also allocate money to coastal shipping services, which will get a maximum of $45 million over the next three years as part of a move to take freight off roads and onto other forms of transport like ships and trains.

But controversially, it will be road users who pay for this funding through fuel taxes and road user charges.

The plan for spending this money is set out in the Government's draft policy statement or GPS on land transport, which will spend $48b, the NZ Upgrade Programme will add another $6.8 billion to the pot.

At this stage it is only a draft, so the plan is likely to change slightly before it is finalised later in the year.

It doesn't fund any specific projects — those decisions are made by officials at the NZTA - but it does suggest how much money should be spent on different parts of the transport portfolio.

The big winners are road safety and public transport, each receiving a healthy injection of funding. This suggests big improvements to public transport and cycleways up and down the country.

Road safety improvements will be given a massive funding injection, receiving a maximum of $2.8b over the first three years of the package.

Phil Twyford has unveiled a plan to spend $54 billion on transport over the next decade.

Public transport services will receive $1.9b over the first three years while public transport infrastructure will receive $2b over the same period.

The package also signals changes to the way things like light rail are likely to be funded. Light rail was given its own funding category in the 2018 GPS, titled rapid transit, and given a maximum of $760m over the three years from 2018-2021.

It's now been folded back into a new envelope of funding for public transport infrastructure.

'There is provision in the public transport infrastructure budget line in the GPS for all public transport infrastructure including the light rail project,' Twyford said.

Other projects, like a potential rapid transit system for Christchurch involving either high speed busses or light rail look set to progress over the next decade.

State highway improvements will receive $3.2b in funding over the next three years, while state highway maintenance will receive $2.6b.

The money will come mainly from fuel taxes and road user charges, which are not currently slated to increase. This tops up the National Land Transport Fund to the tune of $4.5b a year.

Cycling and public transport will receive large envelopes of funding under the plan.

It comes on top of the $6.8b the Government promised to invest in transport as part of its NZ Upgrade programme.

The Government draws up a GPS to give NZTA and local government a picture about what it wants to build and when it would like to build it. Although the GPS sets out how much it wants to spend over the next ten years, the Government actually issues a new GPS every three years, meaning the long range forecasts can change substantially.

The NZTA then works with local councils and draws up a National Land Transport Plan setting out how it plans to spend the money raised from fuel taxes in line with what the Government set out in the GPS. These also come out every three years.

The Government brought forward announcing the next GPS to give certainty to big infrastructure providers at a time of increased uncertainty. The current GPS isn't due to enter into force until next year.