Key Dampens Rail Hopes (Update)


UPDATE: Finance Minister Bill English, answering questions in Parliament today said:

“The Government remains committed to the programme of roads of national significance, as well as reinvesting in rail and upgrading the electricity grid and in rolling out ultra-fast broadband. That is because we are committed to the long-term investment required to lift productivity and economic performance, and, therefore, produce more jobs and higher incomes.”

Big roading projects for the Auckland district already approved are to continue - but don’t mention new rail schemes like the CBD rail link.

That seems to be the signals today from the Prime Minister about how Auckland’s infrastructure projects will be affected by the government’s new emphasis on paying for the Christchurch earthquake.

At his post- Cabinet news conference he seemed to end any hope that a new Auckland transport project such as the CBD rail link would be signalled in the May Budget.  While not naming the rail project, John Key left no wriggle room for finding any more big money for new big projects. ”So no new money,” he told reporters. ”I wouldn’t expect a lot of new spending - if any.”

But he did name the Waterview Tunnel project in talking of existing roading plans on the table (which presumably would include Puhoi), and said such Auckland roading projects (plural) had to continue.

Key said paying for Christchurch infrastructure that the local council could not afford was one major cost area the government had to step in and do.

A reporter asked why he didn’t just defer infrastructure budgets in other parts of the country to pay for Christchurch’s quake-damaged infrastructure.

Key replied: “Why don’t we just stop paying just spending money in capital  in certain parts of the country? The answer to that is, that it in itself would slow economic activity in those areas.

“So while we are very supportive of Christchurch and we want to see Christchurch rebuilt, we can’t do that at the cost of grinding Auckland to a halt or delivering an infrastructure time-bomb in Auckland - and /or Wellington or other parts of the country.

“So actually that expenditure that’s happening in things like Waterview is all about delivering an efficient operating infrastructure in Auckland.”

Reporter: “That’s debatable isn’t it about creating a time-bomb by delaying projects?”

Key: No, I don’t think so. If you look at the benefit/ cost ratio and the process we go through in approving those roads, the bar is set quite high. I would argue very strongly with you that if you want Auckland to be an efficient city and one that’s likely to be the home of most internal and external migration,  we actually need to continue to invest there, as we do around the rest of the country. So we can make those choices.”

On Wednesday, the new Auckland City Council launches the important Auckland Plan – also referred to as the spatial plan – to guide the future development and growth of the unified Auckland over the next 20-30 years; a plan that should include economic boosters such as the business case for the CBD link clearly highlighted.

The Prime Minister will attend that summit.

So let’s join the dots in the last week and it looks OK for roads, but not good for the Mayor’s rail projects.

Key says Auckland can not grind to a halt- something the trains will do if we don’t get a through tunnel at Britomart and he talked up Auckland’s economic growth - which was argued as a key reason in the CBD business case for the CBD link .

But once he started talking about specifics, it was about existing big roading projects, which he said were justified on a BCR basis.

This of course is no real surprise.

Transport Minister Steven Joyce recently told parliament that he has told Auckland Mayor Len Brown that his public transport aspirations for Auckland “will not be any easier to fund” since the Christchurch earthquake.

Referring superficially to the CBD link, Mr Joyce said: “The Government has made no decision to fund that project at this point and it would not be funded from the National Land Transport Fund.”

And Rodney Hide’s recently released Cabinet papers make it clear the Government has ruled out any new investment in Auckland transport such as the CBD link for at least 10 years - and that the Government prefers Auckland road building over public transport. In fact public transport, other than buses, barely got a look in.

So is that a fair interpretation of the state of play? In the last week, the Mayor has said on Twitter:  ”The rail link is vital for AKL & NZ – council and govt will explore a range of funding options to make it work.”

It’s hard to see what part the Government will play other than defer any decision.

KEY: No new spending

Referring today to the Budget clampdown, Key said $600m to 800m more will go on health and education projects in the Budget but that will come from cutbacks to other government departments including some programmes ceasing.

He says everyone realises “we are in a difficult situation with Christchurch” and people want something done about it. The quake had placed big pressure on the Government’s finances.

He ruled out a levy on taxpayers but said homeowners would pay more through their home insurance levies. The Government wasn’t in favour of a land tax nor a capital gains tax.






  1. BD says:

    This isn’t a surprise at all guys the Christchurch Earth Quake has nothing to do with preventing the project from becoming a reality, lets face it guys the CBD rail loop will never happen under National, they don’t like the idea of the project getting built.

    They are just using it as an excuse not too fund it. They was surposed to give us a decision by April after reviewing the business case but they saw an oppertunity not too build it.

    Not too mention the government hasn’t even given us any certainty that the project will ever get built, but is pratically bending over backwards to prevent any delays in the big roading projects that will only make Aucklanders car habits even worse. We cannot afford to continue like ths, National are out of touch with reality and they have their head in the sand.

    The only way the CBD loop will get built is if the Auckland Council tells the government to screw it and find alternative funding methods which I think is very likely to happen as the government are very divided between their view and the governments plans.

  2. kalelovil says:

    “If you look at the benefit/ cost ratio and the process we go through in approving those roads, the bar is set quite high.”
    Yeah Right.

  3. Matt L says:

    If the government held roading projects to the same level of account as the CBD tunnel then P2W and many others wouldn’t see the light of day.

    They keep doing the same thing expecting a different result, in this case they keep building roads thinking that that last they will solve congestion.

  4. William M says:

    This was to be expected. National is well funded at election time by the Road Transport Forum and other lobby groups. If we need funding for the loop, we need to speak by voting in the next election. Another National govt is just going to continue driving Auckland infrastructure into the very roads they’re building.

  5. Cam says:

    They were never going to put any money into the CBD loop anyway. Anyone who thought they were was barking up the worng tree.

    @William sadly at the next elections they will win and win easily. Auckland council needs to look at other ways of funding this, we are stuck with these clowns in Wellington for a long while yet.

  6. Patrick R says:

    Cam I agree with your forecast, except that we will end up with an even more pronounced city/country split… which will just reinforce the ruling parties’ view that the cities are full of the wrong people deserving of even less investment of our money. Demogaphics are on our side in the long run but they are going to leave us swimming in debt used to fund low value projects and underfunded low quality cities in their wake…. as the oil get’s more and more expensive. What a bunch of witless inadequates.

  7. The Trickster says:

    kalelovil says:
    March 22, 2011 at 12:50 am

    I thought that was a rather good Tui billboard comment too!

  8. Nick R says:

    @Patrick, indeed Auckland needs to fund itself independently.
    Not much we can do about them pissing NLTF down the drain, but at least with a third of the country under one council the council should be able to get real about funding major infrastructure on its own.

    I had a thought… the council couldn’t toll the motorways without the support of Wellington… but couldn’t they toll each local road leading to them?!

  9. Patrick R says:

    Yes Nick but ‘Super’ AK is the biggest territorial authority in the Southern Hemisphere but with the lowest income base. It’s all concentrated in WGTN.

    So yes we need to get creative, without coming up with policies that make the local gov. unelectable. Josh’s scheme to get on with the planning of and preparation for the CBDRL and other routes is clearly the way to go. But Taxing every motorway onramp? Feasible? Popular?

  10. [...] also: New roads okay, but no new rail schemes Community Board concerned about Otaki [...]

  11. Joy Svendsen says:

    It is time to remove the infrastructure timebomb that Steven Joyce has been trying to deliver to the Kapiti Coast. The cost benefit ratio for this part of the project is minus not plus, so John Key has got it wrong on this one. We dont need a four lane motorway built on sand, peat and low lying water, next to a beach line with rising sea levels. It is time to “EARTHQUAKE PROOF the Kapiti Coast” and deliver a solution for peak time traffic bottlenecks now. We dont need multiple 5 metre high interchanges and overpasses which wont meet our current local connectivity problems and will cause major problems in the event of an earthquake or tsunami. We need a local linking Western Link Road built now. We need removal of traffic lights at Paraparaumu and Waikanae and an innovative and simple solution for Otaki. We need incremental changes to the existing State Highway One, creating smooth traffic flow not a high speed truckers racetrack. We need the promised Railway Station at Raumati South and double tracking and rail electrification to Otaki. Steven Joyce and Bill English stop your overpriced plan and implement the affordable solution that gives us results now. We will gladly give the unspent millions of extra borrowing to repairing the roads in Christchurch.

  12. Shayno says:

    Why can’t the Auckland Council tell the government where to stick it, and Auckland breaks away and becomes its own country :D . See how the government can fund their ridculous road projects then.

  13. Shayno says:

    Without Aucklanders’ taxes I should add.

  14. malcolm says:

    “No, I don’t think so. If you look at the benefit/ cost ratio and the process we go through in approving those roads, the bar is set quite high”

    Someone call the Tui people

  15. [...] today’s Auckland Unleashed, yesterday John Key and Bill English were pushing that the Christchurch earthquake wouldn’t hold up Auckland’s roads.  There was a marked lack of mention of any rail, despite the biggest project on the books, with [...]

  16. [...] today’s Auckland Unleashed, yesterday John Key and Bill English were pushing that the Christchurch earthquake wouldn’t hold up Auckland’s roads.  There was a marked lack of mention of any rail, despite the biggest project on the books, with [...]


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