Wednesday, July 27, 2011

Greens - Transport spend locks New Zealand’s economic future to the price of oil and greater debt

Tranzwatching - Green Party media release (reprinted in full)

The Government's short-sighted plans for transport funding will lock New Zealand's economic fortunes into dependency on the price of oil and further Government debt, the Green Party said today.

The 2012 Government Policy Statement (GPS) on Land Transport Funding was released today detailing how the Government plans to spend, on average, $26.6 billion on roads over the next ten years and only $5.8 billion on more sustainable alternatives like train and bus services, walking, and cycling.

"The National Government has prioritised spending on new motorways above more sustainable alternatives, effectively locking our economy in to the price of oil for at least another ten years," said Green Party Transport spokesperson Gareth Hughes.

"We need to move quickly to decouple our economy from the high price of oil.

"Research has shown that for every US$1 increase in the international price of oil, NZ$40-60 million of annual GDP is wiped out here at home.

"This is not a smart way to run an economy, to make our transport system so vulnerable to the price of oil," said Mr Hughes.  The Government has established a new borrowing facility for the New Zealand Transport Agency to enable them to obtain additional funds for new roads.

"The Government is effectively borrowing to pay for new motorways, many with low benefit-to-cost ratios," said Mr Hughes.

"This is poor quality Government expenditure made at a time of record levels of Government debt.

"The responsible way to invest in future transport infrastructure is to take a more balanced approach to transport funding — one that doesn't require further borrowing.

"We can future-proof our transport systems by investing more in better rail and bus services, coastal shipping, and the critical Auckland CBD rail loop without additional borrowing," said Mr Hughes.

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