Friday, March 29, 2019

The false economy of cuts

When they were in government, National cut funding to NZTA's compliance section to save a few pennies. People died as a result. But it turns out that their "savings" were illusory:

The New Zealand Transport Agency (NZTA) has planned a rebuild of its $30 million regulatory functions, but investigations into its failures are far from over.

In October, it emerged NZTA had not been properly checking up on companies who certify vehicle safety and give out licenses, and when problems were identified were often not following up.

Law firm Meredith Connell was appointed to lead the NZTA regulatory compliance function to clear a backlog of 850 open compliant files, which it has now completed.

To date this has cost taxpayers about $5m and looks set to increase by about 20 per cent during the next three months, as the non-compliance project continues.


The second stage of the project was under way with a blueprint and plan for regulatory compliance being created.

'Future State' would require about $30m to start, to "get NZTA back to the position it should always have been in" but that cost could increase, he said.

And that's the false economy of cuts. If its an actually essential service - a category which includes most of what government does - then you just end up having to repay it all later, plus interest, to get things working properly again. Unfortunately, some things - like the lives of the people National killed - can't be replaced.

And now I'm wondering how many other similar messes have been created by National's penny-pinching, and how much we'll have to pay to clean up the mess they left.