By Bernard Hickey
Prime Minister John Key has announced to an Auckland business audience that the Government will bring forward construction of Auckland's two biggest road and rail projects by two years to 2018.
The two projects are expected to cost up to NZ$4.35 billion with a central Government contribution of over NZ$3 billion.
The announcement, which is the Government's first major one of the year, followed the Government's decision in December to loosen restrictions on capital spending and after the Reserve Bank called on the Government to increase its infrastructure spending to help it boost the economy and reduce pressure for lower interest rates.
Key said the Government would work with the Auckland Council on bringing forward the start date for the NZ$2.5 billion City Rail Link (CRL) from 2020, which was the Government's previous preference, to the 2018 date preferred by the Council. The Government and the Council are expected to share the costs of the 3.4 km of tunnels linking the Britomart station at the bottom of Queen Street to the western rail line at Mt Eden. The Council expects the costs to be shared 50-50 and Key later told reporters he expected the share to be "about NZ$1.25 billion." He agreed it was likely to be funded by borrowing, "subject to the timing of the payments."
He also announced the Government would bring forward work on the East-West project linking the Southern Motorway at Penrose with State Highway 20 at Onehunga. This project, which is projected to cost NZ$1.25 billion to NZ$1.85 billion, is fully funded from the central Government's petrol taxes. Economic Development Minister Steven Joyce said the project had previously not expected to be in place until well into the 2020s.
The Government had previously said it would only agree to an earlier start to the CRL project if rail patronage levels rose to 20 million trips per year well before 2020, and if Auckland CBD employment grew 25% from 2012 levels to 122,528.
Key said employment was still some way away from the target, but rail patronage levels were on target.
"It's become clear that we need to provide certainty for other planned CBD developments affected by the Rail Link," Key told an Auckland Chamber of Commerce luncheon at the Langham hotel.
"This means we see merit in starting the project sooner," he said.
"So I can today confirm the Government will work with the Council to bring forward the business plan and formalise our funding commitment from 2020."
Key's speech and separate announcements from Transport Minister Simon Bridges did not make clear when the Government would provide funding. Key also said decisions had yet to be taken on how the project costs would be shared, or who would own the tunnels and rail.
Key said the green light for the CRL from 2018 would allow the Council to get on with negotiating contracts and provide certain for investors in other Auckland CBD projects, including the NZ$350 million NDG Auckland Centre next to the new Aotea Station and the NZ$680 million Commercial Bay tower opposite Britomart. Commercial Bay is being developed by listed firm Precinct Property.
"Timely confirmation of these and other projects, alongside the Rail Link, will encourage more people, businesses and jobs into the heart of Auckland," Key said.
"It should also reduce the period of disruption in the central city by concentrating construction over a shorter timeframe," he said.
'Business plan for CRL later this year'
Key said the Government still had to work through a number of complex issues with Council.
"Providing these issues are resolved -- and I'm confident they can be -- we'll aim finalise the business plan later this year," he said.
Key also announced the East-West project would go through an accelerated consenting process lasting nine months because it could either be called in under the 'Roads of National Significance' clauses or progress under the Environmental Protection Act.
"We need to get the thing built. People need certainty. We can't spend 10 years getting RMA consent," he said, pointing to the successful acceleration of the Waterview project nearby, which is near completion.
He said the Government intended to fund the East-West connection through the Land Transport Fund "so construction can start as early as 2018."
Key said the NZ Transport Agency would also start early project work on a widening of State Highway 20 between Neilson St and Queenstown Road.
'Some money for the regions too'
Elsewhere, he also said the Government had confirmed it would spend NZ$115 million to complete four regional roading projects, including two in Taranaki, one in Gisborne and one near Blenheim.
The two projects in Taranaki to improve State Highway 3 to the North of New Plymouth were a NZ$9-15 million Awakino Tunnel bypass and a NZ$80-90 million Mt Messenger bypass.
The Gisborne project was a bridge replacement over the Motu river for NZ$3-5 million and the replacement of the Opawa Bridge in Marlborough for NZ$14-NZ$17.5 million.
(Updated with more detail)
31 Comments
Now that he doesn't have to do all the road maintainence in Northland ('cause Winnie won, and JK is such a sore loser). The capital drawdown is throughout rural NZ, and all the money that should be used to maintain our infrastructure is being pumped into Auckland. Even a lot of the money earmarked for the Chch rebuild has found it's way into Auckland houses and offices.
1.8 Billion on an east-west link that has a negative BCR. We should be more efficient with our tax spend and get more bang for our buck by building the better and simpler option. But no, we have to have a roading lobby motorway across the waterfront of the south isthmus.
"Option F has total costs of $800m and total benefits of $1550m. Relative to Option B, its incremental costs are $300m and its incremental benefits are -$100m. Its incremental BCR is therefore -0.3. [...] It costs a lot more while actually delivering fewer economic benefits than Option B"
http://transportblog.co.nz/2015/12/03/costs-benefits-and-east-west-conn…
I'm wondering if it is a deliberate tactic to ensure it doesn't go ahead. It will need to get resource consent, can anyone really see it being granted for a motorway right against the harbour, especially one with a very questionable BCR. There will be a lot of objections...
If it fails, National can tell the truck lobbies they tried their best.
I still think they should have done the whole thing above ground like what they did on the Gold Coast to connect to other rail system. Queensland Govt spent 1.8 bil on their 16km light rail track. Auckland CRL is estimated at $2.5 bil for 3.4km - that is $735,000 per metre
Britomart becomes a through station as the trains go in/out at both ends. This will increase the frequency of trains as they won't be limited by the two lines into Britomart. The CRL will tunnel under Albert Street up to K road and meet the western line. As an aside - the western line will get quicker as it won't go through Newmarket (I believe).
Auckland transport are planning to also do light rail above ground on Dominion road, Mt Eden Road, Manukau Road and Sandringham Road, and potentially to the airport. Very similar to gold coast.
The CRL is to get much better use out of the many kilometers of existing rail.
The per metre cost is irrelevant, the benefit is what is important. If the harbour bridge didn't exist today do you think we shouldn't build it just because the per metre cost is very high?
GREAT NEWS ! Really great news, it will obviously alleviate transport problems in our fastest growing city, provide a serious shot up the arm for employment, lower commute times which means housing can be developed on cheaper land at cheaper prices further from the centre and be beneficial for the whole of NZ as Auckland is the gateway to the rest of the country.
NOW GET ON WITH IT AND MAKE IT HAPPEN
GREAT NEWS ! Really great news, it will obviously alleviate transport problems in our fastest growing city, provide a serious shot up the arm for employment, lower commute times which means housing can be developed on cheaper land at cheaper prices further from the centre and be beneficial for the whole of NZ as Auckland is the gateway to the rest of the country.
NOW GET ON WITH IT AND MAKE IT HAPPEN
...ummm if you think it will alleviate, I believe you are incorrect. I did read (haven't the time to locate source at present - a transport blog i recall) that even if all these projects are implemented all they might do is prevent matters getting worse at the rate they are.
Thanks to the fixation with more imigration is better, you will still be spending half your life going to work and most of your weekends on the motorway to the beach (or to therapy). Enjoy the rates hike, but dont expect to get anywhere quicker......
Good infrastructure spending/investment generally gets captured in land values...
ie.. gets capitalized into land values.... land values go up.
This announcement seems to just be part of pushing things onwards and upwards...
(Wise Leaders might hold the view that the Best time to spend that money on new infrastructure might be in a recession.... )
I drove past Pokeno last week.... Amazing development going of there..
I'm guessing that alot of people who buy new houses there are commuting to Auckland for work..
Its in the Waikato District...
Seems weird that there is such growth in Pokeno..???
There is so much bare Land between Pokeno and Papakura....????
I'm guessing that it may be easier and cheaper to subdivide in the Waikato district than the Auckland district...???
Might be a lesson in there about how people are smart enuf to know what suits them best..... rather than a centralized urban planning committee trying to make those decisions for them, thru policy..???
Maybe someone should do a case study on that..???
Pokeno just seems to add to the picture of craziness.. that seems to be super high Auckland land prices
Pokeno is in Auckland, not Waikato. Looks like the growth there has been planned by council for a while..
http://www.aucklandcouncil.govt.nz/EN/planspoliciesprojects/plansstrate…
This is simply a fix for the worlds only one way - originally diesel - underground train station - Britomart.
This should have never been built and is simply a whim from a previous mayor - not a systems designed for a traffic solution to all segments of Auckland's transport requirements.
The $'s are not going where the customers are - under the harbour to the North Shore, East to Howick.
The system has failed miserably to segment the market and offers nothing for those trying to get around the city.
It is simply a cure for the monumental Britomart one way cxxk up.
Heavy rail should have stayed at the old rail station which offered an exit around the Orakei loop,
all well thought through by traffic engineers in the distant past.
Light rail - basically a tram system of yesteryear with modern hybrid technology could then offer movement within the city and link to the major heavy rail stations i.e. Newmarket - something the new Britomart extension does not do. It simply provides an exit from Britomart to the western line.
Do we really think there is a big market for travel from Britomart to Boston Road ?
I pass through Glen Innes every day and observe the near empty trains heading south post peak hour.
The heavy rail system is primarily a peaking system designed to get commuters into the central city.
It is not and never will be a system for inner city transport.
Already the Council is talking incremental costs of $ 143 million pa of the new system - the bulk of which will be paid by ratepayers to run near empty off peak trains every 10 minutes leaving buses to move around inner city.
This is going to be a hugely expensive approach that does nothing to address inner city transport.
Spoken by someone who has no idea about how the rail system will work post CRL, its capabilities and the future expansion potential that it will allow to the north shore which currently does not exist. You should read up on any one of the many resources that explain this in detail e.g www.transportblog.co.nz
Thanks for the link.
I am an advocate for rail to the north shore which would provide a Britomart exit and run on top of the current busway - quite normal in many cities.
As a Sydney / Brisbane rail user - I compare what is planned with what they have - which works in my view very well.
We should simply copy what we know works.
Please note there is no analysis by time of use in the data link - which is my point where a huge number of trains off peak run near empty and will continue to run empty at huge costs for a large part of the day / night at huge costs to the ratepayers.
Note Glen Innes has falling passenger numbers over the years. How can that be ?
I suspect the free car parks are full and that a lot of the park and ride growth is simply driven by avoiding inner city parking costs and have little to do with using public transport as a first preference.
Te CRL is an inner city loop. It's not about moving people around the city once they are there. Its about getting around the city and into the centre, and adding massive capacity to the existing well used rail network.
Britomart has been a huge success and has surpassed the patronage targets in it's business case decades early.
The station itself is almost at capacity, adding more inner city stops will distribute the passengers around instead of having one bottleneck.
The rail network is also at capacity, pretty much no more services can be added because of the Britomart track bottleneck. CRL will solve this. Trains on the easternline are already packed and leaving passengers behind. No more services can be added to the eastern line.
The Aucklanders who do not live by a beach also have valid traffic needs, why should we only solve the Shore and Howicks traffic needs?
The rail network already services Newmarket.
Yes there really is a big market for this. Patronage has been growing at 25% pa for the last two years. Have you been to Auckland before? The parts of the City that lie between Britomart and Boston Road are called the CBD. Aotea Station will be more busy than Britomart, and the CRL will knock 20 minutes off many peoples commute from the West. The CRL will take loads of cars off the Northwestern because of this.
JB, there is a huge amount of information published over many years on that blog but trawling through it is obviously not everyone's idea of a good time.
The electric trains that have been transitioned to over the last few years were obviously a requirement before an underground link was an option as the fumes from diesel trains wouldn't work. Now they are in place and working pretty well the patronage has increased ~23% in the last year largely due to the improvement in reliability.
For significantly more people to want to start using the trains things like frequency become a big deal. If anyone can walk up to a station and expect a train to come along in 5-10 minutes that's a whole lot more appealing than waiting for up to half an hour. For this the CRL is required as with a dead end station (Britomart) there just isn't the capacity to run more trains up and down the same tracks.
Obviously there are periods of the day that are quieter on public transport as there are on roads. That's why the peaks are called exactly that but for public transport these services need to be run so that people can rely on it. Every city I have been to in the world has quiet periods late at night and in the middle of the day when you can sit down relative to the bursting at the seams peak time be it Shanghai, Chicago, London, Berlin or Sydney but this is just how it has to work. Rest assured that as soon as the CRL is up and running (short of any apocalyptic catastrophe) the results will speak for themselves and the people of the north shore will want in on it too and rightly so. This will be a game changer for transport in Auckland.
Question for all the JAFAs commenting on this blog in support of the rail system. why have you waited until now to get it built? Why did you wait for Government support? Sir Dove-Meyer Robinson was advocating this type of solution in the late 70s early 80s and got shouted down and eventually lost his seat because of his position. History has proven him more than correct. Auckland already has the population base to fund the project on its own.
This is a problem created by Aucklanders refusing to pay their own way. It is another example of the cancer that Auckland has become bleeding resources from the rest of the country. JK has bought into the myth that the rest of the country must support Auckland. Yet 80% of the country's wealth is generated from places other than Auckland. Which means that a city that hold 25% of the population is actually a drain on resources, not a benefit. The Government would be better served to put these resources into building economic activity in the regions.
You make a good point in that. Auckland has been hindered by democratic bureaucracy for too long.
Robinson (and many others) foresaw this current position clearly, however no bugger wanted to pay for it. Roll on 40 years and the welfare loss from this lack of action has been astronomical.
The marginal increase in levies it would have likely easily paid off the the nominal value of the infrastructure by now.
I don't know where you get your "80% of the country's wealth is generated from places other than Auckland" - I would check my numbers if I were you.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.