NZ Herald editorial: The big city can pay half its transport bill

Auckland can afford to pay a fair share of its transport development costs. Photo / Greg Bowker

Few Aucklanders probably remember that two years ago a special transport levy of $114 was added to their annual rates bill for three years.

It was supposed to be an interim arrangement while the Auckland Council waited for the Government to approve an alternative source of revenue for the council to provide its fair share of the investment needed in roads and public transport.

The then mayor, Len Brown, and his council were commendably willing to present road users with the bill for improvements and suggested a number of options including a regional petrol tax, tolls or congestion charges. None of them appealed to the National Government.

Now, with just a year of the interim transport levy remaining, it is evident that no alternative local revenue source is likely to be approved by this Government.

Consequently, the Government's share of the cost of Auckland's scheduled transport improvements will rise to 70 per cent over the next three years and the council's contribution will drop to 30 per cent. This is far below the 50-50 split the council sought when it pushed for the major project in the transport programme, the $3.4 billion underground city rail link.

It is tempting to accept Auckland's good fortune. After all, its council did offer to raise its full half share of the expense.

If the Government would sooner saddle national taxpayers with the bulk of the bill than allow Auckland motorists to be additionally taxed or tolled, the rest of the country cannot hold it against the city. But it is a question of fairness.

Aucklanders stand to receive the bulk of the benefit of a project such as the city rail link. It is not like a motorway that forms part of the national highway system used by travellers passing through the city as well as those who live in it.

Even motorways mainly benefit residents of the region. Traffic making journeys within the region will far outweigh traffic passing through it most of the time.

National taxpayers should not be carrying the greater part of the costs of Auckland's growth. Auckland is reaping the economic growth that comes from immigration and a rising population.

Auckland home-owners have enjoyed the boost to their equity and wealth effects of increasing property values. They should not begrudge paying higher rates to meet the costs of alleviating the road congestion that comes with the population boost.

In other words, the interim transport levy should be extended. It is already a dedicated tax, going into a fund for transport projects, it is not simply fattening the council's purse for dubious or inefficient general purposes.

The transport levy is now built into household budgets, few remember it is there and even fewer would face additional hardship if it was to continue, at least until the city rail link is paid for.

The Auckland region has a quarter of the country's population. It is by far the richest concentration of activity in the nation's economy.

Wellington might need disproportionate state support, Auckland does not. Auckland is big enough to contribute an equal share of the investment it needs and its council should not be afraid to say so.