Council bails out Govt on transport

Auckland Council has put forward $100 million to help with public transportation in the city. Photo / Greg Bowker

Auckland has picked up the Government's slack and given it a multimillion-dollar bailout because of a massive transport funding shortfall.

Auckland Council will contribute $100 million over the next two financial years because the NZ Transport Agency has run out of funds to cover the city's transport projects. In return, the Transport Agency will increase its subsidy for Auckland projects in the 2013/14 and 2014/15 financial years to pay the city back.

This is the first time a local body has bailed the Government out to keep a city's transport projects on track.

Labour transport spokesman Phil Twyford said Aucklanders deserved an explanation why they were being asked to "fork out money for work that should have been properly costed and funded".

Mr Twyford said the Government pushed through major motorway projects to have them completed before the election.

"Now Auckland Council is being asked to plug a massive funding gap."

The Transport Agency's regional director of Auckland and Northland, Stephen Town, said the agreement was a means to continue work on Auckland's major transport projects.

The agency approached Auckland Transport in August about the agreement, and the Auckland Council soon after. Since then the bodies had been working to "finalise paperwork" before announcing the agreement yesterday.

Mr Town said the shortfall was because of major events this year such as the Canterbury earthquakes and the deferral of a 1.5c increase in fuel tax. As well, the accelerated construction of the Victoria Park Tunnel, the new Hobsonville motorway link and the Waterview tunnel also used up significant amounts of cash.

The alternative would have been a 12-to-18-month delay on projects such as Glenfield, Wolverton and Tiverton road upgrades, ferry and train station improvements and work on the Auckland Manukau Eastern Transport Initiative.