Order Paper and questions

Questions for oral answer

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Date:
3 April 2012
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7. Transport Funding—Value for Money

[Sitting date: 03 April 2012. Volume:679;Page:1557. Text is incorporated into the Bound Volume.]

7. 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.

Julie Anne Genter: I raise a point of order, Mr Speaker. My question was quite clear. It said “What evidence supports the claim … ?”. It did not ask for an opinion. The Minister did give his opinion—he thinks these projects will be good for the economy—but I asked—

Mr SPEAKER: Order! Because I could not hear the member’s question very well because of the noise—mainly on my left, I must confess, on this occasion—I invite the member to repeat her question.

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: 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.

Julie Anne Genter: If the economic situation is so tight that the Government will be announcing another zero Budget, why does it still have money for motorways that, on the Government’s own numbers, will never pay for themselves?

Hon GERRY BROWNLEE: Largely because New Zealanders use them and they pay into the fund, and that is where the money comes from.

Julie Anne Genter: Given that New Zealand’s current account deficit of $8.5 billion matches nearly exactly the amount we spend each year on importing oil, and that the cost of importing oil has risen 500 percent in the last 15 years, is it a good use of the Crown’s resources to lock us into a future where our transport system is even more dependent on oil?

Hon GERRY BROWNLEE: We are not doing that. If the member is going to rely on fluctuating vehicle movements, then the member would have to accept that the oil price is a very sensitive point in people’s decisions over which mode of transport they use. We are investing a huge amount of money, $1.6 billion, in electrification in Auckland. We have got the very, very large commitment to the KiwiRail rebuilding programme. We have also got huge amounts of money going each year into public transport across the country, and, what is more, the public transport operating model has been widely accepted and welcomed by regional councils throughout New Zealand. We are by far and away leading ahead of any other Government before us in this matter.

Julie Anne Genter: How is it balanced to spend $14 billion, over 75 percent of all new transport infrastructure spending in the next decade, on a few motorway projects, with increasingly shoddy business cases, that will not help motorists, will not help freight, and will not help New Zealanders avoid rising oil prices?

Hon GERRY BROWNLEE: Working backwards, it will help New Zealanders minimise the cost of their transport if they use cars, it will help freight, and it will help general passenger movements. The member makes these assertions as if she is an authority; she is not.