National’s flagship Roads of National Significance policy has come in for a load of criticism. Interestingly, given it is the brainchild of National’s political “genius” Steven Joyce, the policy’s main selling point – its claim as a boost to economic growth – is also it’s great weakness.  Gerry Brownlee and Steven Joyce before him have tried to sell these jumbo motorway projects as an investment in economic development but their economic value is dodgy to say the least.

While there should be no argument that we should be investing in transport infrastructure to make our export supply chain more efficient, we should surely be making sure the investments are wise before we spend billions of dollars of taxpayers money.

In a speech this week I summarised the various ways the RoNS fall short of the Government’s claims for them as some sort of economic development policy:

1. National have over-sold their likely economic impact, misleadingly suggesting that the Benefit Cost Ratios are an indicator of economic development impact. In fact, the BCR simply puts a dollar value on things like reduced journey times and deaths prevented by reducing accidents.

2. By hand picking these huge projects and giving them the green light even before the most basic economic assessment had been done on some of them; by elevating projects with such low Benefit Cost Ratios that a few years ago would never have been built; and by pouring so much money into what is patently a political project the Government has undermined the credibility of the system we use for assessing, prioritising and deciding on new state highway projects.

3. The Government’s obsession with these big roads projects means that other modes for moving freight around like rail and coastal shipping aren’t getting a look in, even though they can more efficiently carry certain types of freight. The Government cut Labour’s policy of support to coastal shipping, and under its unrealistic rail policy Kiwirail is forced to do ridiculous things like laying off 200 staff and deferring three years of network maintenance.

4. The Government is running down the existing road network to free up the funds to build new state highways. This is a common phenomenon overseas where politicians try to woo voters with big shiny new projects while allowing existing infrastructure to fall into disrepair. It’s bad asset management.

5. New public transport projects have been cut for the next three years, even though in Auckland particularly public transport is the only way to keep the state highway network from grinding to a halt. For example the Northern Busway which has taken the equivalent of two lanes of traffic off the Harbour Bridge every morning.

What would Labour do?

We will take a much more hard-headed look at the economic value of new transport projects.

We will reform the funding and assessment processes and criteria to ensure when new projects are being considered that alternative solutions are weighed up.

We are committed to an evidence based approach, investing where it will make a difference.

We will look to invest strategically in all modes of transport, and their connections, to deliver the greatest efficiency for the export supply chain.

We will restore prudent asset management so that we are not running down one part of the network (like local roads) in order to pour money into another (like new state highways).

A Labour-led Government will build a transport system that moves people and freight with maximum efficiency, supporting an economy that allows New Zealanders to do what they do best – come up with world leading ideas and put them into action.

Read on for the full speech. (more…)