Tuesday, April 03, 2012

Roads and waste

Last week, Auckland transport blogger Stu Donovan pointed out the central flaw in the government's transport planning: kiwis are driving less. Overall road use has been stagnant since 2005, and per-capita demand seems to be dropping by about 1% a year (neatly offsetting population growth). And its not just New Zealand - this is a worldwide trend. So why is our transport planning predicated on endless increases in demand?

Today in Parliament, Green MP Julie Anne Genter asked exactly that question. The answers were unsatisfactory:

JULIE ANNE GENTER (Green) to the Minister of Transport: Why is the Government prioritising State highway projects with low benefit cost ratios, given that traffic volumes are back to 2004 levels and the Crown is borrowing $12 billion a year?

Hon GERRY BROWNLEE (Minister of Transport): There has been a slight fluctuation in measured traffic volumes over the years, but it is not enough to show a trend that would mean that this Government would abandon its proposals for the ongoing road-building programme. Taking no action to improve our roads would assume that our roads were at their optimum point in 2004. The previous Government did not believe that, we do not believe that, and we are going to go ahead with our programme to build roads, because of the economic benefit, the social benefit, and the safety benefits for New Zealanders. The assertion that the Government is borrowing for the roading programme is wrong. That is paid for by the Land Transport Fund, which is funded by road users.

Julie Anne Genter: Why does the Government claim that the roads of so-called national significance have been selected because of their economic importance, when the projects were announced in early 2009, well before the business cases had been undertaken?

Hon GERRY BROWNLEE: I think the point is that a Government comes in with a programme and does what it thinks is necessary to create the environment for economic growth. There is not a successful economy in the world that has achieved results by stopping roading progress.

Julie Anne Genter: What evidence supports the claim that the roads of national significance will increase economic productivity, given that they have not been updated to reflect the reality of higher oil prices and stagnant traffic volumes?

Hon GERRY BROWNLEE: I think the roads of national significance are going to have a massive effect on economic growth in New Zealand. And I think it is very hard to argue against history, where you would find not one country in the world that has abandoned roading projects and achieved economic success.

[snip Point of Order]

Hon GERRY BROWNLEE: Those last two criteria are very cyclical, so there is no reason to believe that in the long term, they would make a difference to the business case.

Julie Anne Genter: Will he review the plans to prioritise the roads of national significance, given warnings from the New Zealand Transport Agency and the Ministry of Transport that the programme could lead to a budget blowout of billions of dollars?

Hon GERRY BROWNLEE: No, but I will challenge him to make sure that does not happen.

This is troubling, to say the least. Transport is a huge area of government expenditure, costing us $3.2 billion dollars in 2011 [PDF]. That money should be spent wisely, and in line with actual demand. Instead, it seems to be being spent based on a dream of endless growth, with the empirical evidence that that model is false dismissed by a fact-free Minister, so they can keep funnelling public money to their construction-industry cronies.

This ought to concern people across the political spectrum. In a time of austerity, we can't afford waste. And here we're talking about hundreds of millions of dollars a year of bad spending, "justified" by business cases predicated on fiction rather than reality (assuming they get done at all - because as the above shows, the decisions get made before the case is made). Whether you're left or right, that's just not acceptable. And the people responsible for it should be sacked.