Rail subsidy four times more than Wellington's, says Lee

Councillor Mike Lee says Aucklanders deserve a better deal.

Aucklanders facing a new transport rate are paying far too much to subsidise the city's trains, says councillor Mike Lee, a long-time champion of rail.

Mr Lee, the council's infrastructure chairman, has calculated that Auckland trains are costing ratepayers and the Government four times more to run than those in Wellington for each kilometre travelled by passengers.

He has worked out from figures published for each rail operation that the subsidy paid for every "passenger kilometre" travelled on Auckland trains last financial year was 65c, compared with just 16c in the capital.

Mr Lee, one of two council appointees to Auckland Transport's board, says the proportion of rail operating costs covered by fares in Auckland declined to 22 per cent last year, compared with 24 per cent in 2012-13, and 50 per cent in Wellington.

"Government expectations are that farebox ratios should be 50 per cent, but Auckland has been moving in the opposite direction," he said in a memo to Mayor Len Brown and fellow councillors as they debated a budget which includes a new targeted transport rate of $114 per household.

His revelations prompted a call from the council's budget committee for chief executive Stephen Town to work with Auckland Transport and report back on options for cost savings in the next round of annual planning.

Mr Lee said the extra burden on households meant the council had "a moral obligation to make sure we are getting value for money".

"If the people of Auckland have to pay this extra burden in order to fix transport, then there is a moral responsibility to make sure the money is well spent."

He said subsidies covered $107.2 million of Auckland's total rail operating costs of $139.3 million last year, when 11.4 million passenger trips were made on trains.

That compared with just $42.7 million of subsidies towards the $85.09 million cost of providing 11.6 million passenger trips in Wellington.

Although the Government covered $63.92 million of Auckland's bill, ratepayers forked out $43.3 million.

Auckland rail passengers also paid more for each kilometre they travelled, 18.5c against 16c in Wellington.

An Auckland Transport spokesman queried Mr Lee's finding that fares covered only 22 per cent of rail operating costs, and sent the Herald a report prepared for the council by the organisation's chief financial officer, Richard Morris.

But the report, despite pointing to difficulties in comparing the Auckland and Wellington rail operations, did not directly challenge Mr Lee's figures.

Mr Morris cited extra expenses for Auckland last year, such as $13.6 million in loan repayments on the electric trains, and the higher cost of running more diesel units than in Wellington.

He predicted cost rises in the capital as it moved to an electronic card similar to Auckland's Hop system. Conversely, he expected Auckland's cost rises to be overtaken by passenger growth as its rail network became fully electric from the end of July.

Mr Lee said the introduction of Hop cards was supposed to have been more cost effective.