Brian Rudman: Proof that good for Auckland is good for all

We Aucklanders are normally too polite to shame our less fortunate country cousins south of the Bombay Hills by mentioning the size of the foreign aid we send off to them each year.

But between you and me, the flow of charity payments out of Auckland to the rest of the country is enormous.

Upwards of $3.8 billion enormous, according to this week's report by the Wellington-based New Zealand Institute For Economic Research.

Which is rather a different picture from the image of the greedy grasping Jafa that the rest of the country would like to believe.

Based on the NZIER research, I calculate that the difference between taxes paid out and Government expenditure back into the region adds up to the equivalent of an annual donation of $5823.75 by every Auckland worker to the rest of the country.

And they call us bludgers!

A few months back, I pointed out how in the 1990s, only 25 per cent of Transit New Zealand funding was spent north of Pukekohe, despite Auckland and North Auckland having nearly 40 per cent of the population.

The NZIER report, which analyses the fiscal year 2005, shows this sort of short-changing is widespread across Auckland's economy.

The starting point is that Greater Auckland, the home of 34 per cent of New Zealanders, supplied 35 per cent ($18.2 billion) of Government revenue, but received back just 31 per cent ($14.4 billion) of Government expenditure.

Only in core Government services and defence did Auckland get back the equivalent of what was paid in.

When it came to the Government's biggest spend, social welfare payments, we got a 30 per cent share. With Government superannuation it was only 29 per cent - apparently the result of a younger than average population.

We got only a 30 per cent share of the health budget for the same reason.

But even in an area of crucial need, transport, we still scored only 29 per cent of Land Transport's funding.

Apropos nothing at all, the researchers calculated Aucklanders pay 37 per cent of alcohol excise duty but only 27 per cent of fuel excise.

They agonised over this differential without coming to any firm conclusion. I like to think it has something to do with us accepting the "don't drink and drive" message.

The report was commissioned by the Auckland City Council and lobby group Committee for Auckland to underline their campaign that for the New Zealand economy to grow, the focus should be on taking the brakes off Auckland's economy.

With Auckland's productivity estimated to be approximately 20 per cent higher than New Zealand's national average, the argument goes, encouraging growth in Auckland will grow the national economy more rapidly than concentrating anywhere else.

When you see a figure like $3.8 billion suddenly popping up out of the blue, it makes you wonder why Auckland politicians - both local and national - weren't aware of this fiscal gap long ago - and highlighting it.

It's obviously not an aberration that popped up this year then suddenly disappeared.

How handy it would have been for rebutting Finance Minister Michael Cullen's smart quip that "Auckland now sits atop the nation like a great crushing weight." Or to have to wave in his face when he comes up with an umpteenth stalling tactic to delay approving the electrification of Auckland's rail system.

Take that example. The 25-year capital expenditure to create a modern Auckland electric commuter rail service running at 10-minute intervals is $1.45 billion. To build a CBD loop tunnel would cost a further $1 billion. You could throw in the cost of the flashest Rugby World Cup stadium in the world and still have plenty of change left over from just one year's involuntary "gift" from Auckland taxpayers to the rest of New Zealand.

I'm not saying we should demand every cent of Auckland's tax take be sent back to whence it came. I'm happy to help fund national forests and national entertainments like Parliament and orchestras and the like.

But by the same token, it would be nice to see politicians stand up for Auckland instead of ducking for cover every time some rural time-server starts whining about the bludgers from Auckland.

The NZIER report underlines not only how false that is, but that by cranking up the Auckland economy, the whole country will prosper.