KEY POINTS:
Doubt about the financial viability of the country's first big toll road has been fuelled by an amendment to an order-in-council by which the Government approved the project in 2005.
Transport Minister Annette King has confirmed a change to the order, removing a requirement that she be satisfied as to the long-term financial viability of Auckland's $360 million Northern Gateway toll road between Orewa and Puhoi.
Although the order was amended in November, it came as a shock last night to the Automobile Association as well as Puhoi-based finance and policy analyst and two-time Rodney mayoralty candidate Larry Mitchell.
AA spokesman Simon Lambourne said that although his organisation accepted a need for the new road, it was concerned about the change "and will be seeking clarification from the minister's office".
Mr Mitchell called the amendment "bizarre" and said it raised fundamental questions about Transit NZ's business case for building such an expensive road on the basis that tolls would cover half the cost, above a Government grant of $180 million.
"If you start off on a project and you say tolls are going to fund it over 35 years, and you're going to end up with a project that's basically debt-free, then that's what you've got to stick with," he said.
Ms King said that despite the change, the Government was confident that the new 7.5km motorway extension, which Transit expects to open in about nine months, would prove financially viable "over the long term".
That was because of consideration being given to other toll roads, which would offer economies of scale when added to a common electronic collection system being prepared for the Northern Gateway project.
The minister pointed to the "Penlink" road proposed by Rodney District Council for Whangaparaoa Peninsula and the possibility of using tolls to help to pay for Transit's $1.9 billion motorway tunnels through Waterview in Auckland and for the Transmission Gully project north of Wellington.
Ms King said: "The reason for changing the order-in-council with relation to Alpurt [the Northern Gateway] was that none of these other roads is advanced enough to be satisfied right now of financial viability over the long term in the context of a legal test, even though there is reasonable expectation that tolling will meet such criteria once more progress is made."
The minister insisted yesterday that the Government had to "start somewhere" in introducing tolls so that motorists had a choice between paying to use roads that might not otherwise get built and continuing to use existing infrastructure at no extra cost.
