10c petrol levy in Auckland

The Government is set to whack Aucklanders with a extra 10c petrol levy with one third going for rail electrification, and the rest on some roading projects.

I’m not actually against the petrol tax increase, but it needs to be done in a transparent way. At the moment it is onaque with some petrol tax going to roads, some to public transport and some to the cpnsolidated fund. And then on top of that the consolidated fund is paying for some ad hoc roading projects and some public transport projects.

Here’s what I would do:

1) Have any public transport projects funded from the consolidated account, just like other “public goods”. They should be scrutinised against clear criteria such as number of passengers helped, carbon reduced, no of cars off road etc. Some rail proposals will cost $3 million or so for every car they get off the road. Insane – you could just buy everyone a helicopter instead.

2) Have the Government set a benefit:cost ratio for road construction and repairs, over which funding will automatically be approved. Now you could argue anything above 1:1 but as the benefits tend to be indirect and the costs direct, I think 2:1 would be safer. Even this would see far far more road constuction than currently is the case.

3) The petrol tax should go solely towards roading projects, and automatically increase or decrease each year to meet the amortised costs of the roads that year so that every road proposal with benefits at least twice of the estimated cost is able to proceed. In the initial years there may be some timing issues.

This is not pro-roads or anti-roads. This is saying roads should be user pays and petrol tax (for now) is the best way to fund roads, and the tax should automatically adjust to fund necessary new roads to reduce crashes or congestion.

And public transport proposals, as a “public good” should come from taxation and be considered on their merits, and not be competing in a limited pool against roads. They are not competitors but complementary.

Any person who tells you that we can survive by having no new roads, and just investing in public transport is crazy, or lying, or ideologically blinkered (hates cars). You need better public transport and you need better roads.

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