Friday, June 12, 2009

Exclusive: shoddy work on the cycleway

Back in February, Prime Minister John Key came up with a bold and radical plan to end the recession and create jobs: a cycleway the length of New Zealand. As it became apparent that the plan was not a joke, and was in fact being taken seriously, I got curious: did the government have any backing for its claims that 3,700 jobs would be created? Had it done any cost-benefit analysis, or assessed the economic impact of the proposed cycleway to see if this was the best (or at least a non-stupid) way money could be spent? So, I did what I usually do when I get curious: I asked.

Unfortunately, the Ministry of Tourism did not want to answer. And after a successful complaint to the Ombudsmen, I can see why: because they hadn't done any of those things. The advice released - an initial briefing (17 March), followup (2 April) and final Cabinet paper (20 April) - while full of claims of both short and long-term economic benefits, make no attempt to put a dollar figure on them. They do not include any assessment of the effect on economic activity or on jobs of the project as a whole (the closest they come is some data on the impacts of the Otago Central Rail Trail, but no attempt is made to generalise this to get even rough numbers for the proposed investment). And they do not attempt any form of cost-benefit analysis to see whether the proposed $50 million over three years will be money well spent. The closest they come on the latter is a note in the cover letter to their response that

cost benefit assessments and net economic benefits will be required for each individual cycleway project at the time of their development and submission for funding approval.
Which is all well and good (cost-benefit ratio is a great way to rank projects for funding purposes), but when the government is planning to spend $50 million, you'd expect them to do some cost-benefit analysis on the overall decision, not just the projects it is given to.

Ministry of Tourism are hardly policy heavyweights - normally they're a research and marketing shop - but this is shoddy, shoddy work. Cost-benefit analysis is not rocket science, and they clearly had some raw numbers to get at least some ballpark figures. But they just didn't bother. I guess when its the Prime Minister's baby, the policy outcome is a foregone conclusion.

(This post was brought to you by the Ombudsmen's Office, who recognise a meritless OIA decline when they see it, and without whom I would never have received the documents it is based on)