Govt spends $600m on road property

Victoria Park Tunnel in central Auckland. Photo / NZ Herald

Auckland Western Ring Route most expensive with more than $140 million outlaid on acquisitions

The Government has spent more than $600 million acquiring properties to make way for its flagship Roads of National Significance programme, Transport Agency figures show.

The figures, released under the Official Information Act, also reveal that properties were bought from more than 900 owners between July 2008 and last November.

The Auckland Western Ring Route has been the most expensive project in terms of property acquisition with more than $140 million spent, followed by the Waikato Expressway ($138 million), and the Wellington Northern Corridor ($112 million).

The other projects are the Puhoi to Wellsford motorway extension - the so-called Holiday Highway ($11 million spent acquiring property), the Victoria Park Tunnel in central Auckland ($52 million), Christchurch motorway projects ($79 million) and the Tauranga Eastern Corridor ($78 million).

The Transport Agency said the costs also included payments to advisers, such as valuers and accredited suppliers acting for the Government.

Some of the acquisitions were by agreement, others were compulsory and some owners were given government land as part of their compensation.

NZTA acting group manager of highways and network operations Neil Walker said the Roads of National Significance programme involved 320km of new or improved highway and property acquisition was a necessity.

"We view property acquisition as much more than simply a project cost; it is a process in which we are impacting significantly on people's lives.

"It is important that landowners are treated sensitively, that they receive their full legal entitlements, and that they are paid a fair price for their property."

The costs associated with property acquisition were commensurate with the scale and land requirements of the programme, he said.

"It's important to view property costs in proportion with the projects themselves; to date, for example, the Wellington Northern Corridor section is approximately 100km long, and budgeted at $2.6 billion."

When a project was completed there was almost always surplus land which could be on-sold, meaning the initial property acquisition costs would be partly recouped.

A Ministry of Transport spokeswoman said the amount of compensation paid simply reflected the Crown's obligations under the Public Works Act.

"Significant property acquisition costs are consistent with transport projects of this size and nature," she said.

Labour transport spokeswoman Darien Fenton said she would not be surprised if the true cost was much higher than $600 million because some properties were yet to be bought and some settlements were outstanding.

"We can probably expect they will spend at least that much again," she said.

"Most if not all of the Roads of National Significance have a benefit-cost ratio that shows they will cost more than the benefits they provide, which has long been one of Labour's criticisms.

"Spending that kind of money purchasing property and knowing that there's outstanding claims still to go to court and more properties to be purchased just increases my worry about the whole Government programme."