Subscribe to RSSWhat Does English Mean?
The NZ Council for Infrastructure Development conference opened today - and Infrastructure minister Bill English talked up the government’s willingness to consider public-private partnerships.
But it was a comment to the Herald’s Fran O’Sullivan that should have us worried.
Welcoming the fact Auckland would soon have one local body voice, he spoke of the need to “get the basics righ”t and singled out the proposed CBD rail loop which he labelled “horrendously expensive.”
He added that there need to be “clear understanding about just who is going to pay for such projects so people can see the conseqeuences of their decisions in their own pocket.”
The parties involved are working through the business case for the CBD loop which will be finished shortly. ARC Chair Mike Lee says he believes it will be a compelling case but the issue would be getting funding. The guess-timate for the loop is $1.6 billion and said transport minister Steven Joyce was focused on ensuring that such rail projects stack up so a thorough process was needed.
Accordingly, Mr Lee thought the Greens-initiated campaign to fast track the CBD loop was premature.
Mr English told today’s conference that the government was spending $11 billion over 10 years on state highways. Total spending on roading and other Land Transport priorities is now about $2.8 billion a year.
The Government plans to introduce a new requirement for public-private partnerships (PPPs) to be considered for all new public infrastructure projects worth more than $25 million.
The Minister said: “The Government wants to see as much private sector expertise and discipline used as possible. We welcome engagement.
That’s because we believe there are big gains to be made by exposing the public sector to private sector skills and techniques – particularly in the area of risk management and better assessment of whole-of-life costs,” Mr English said.
Greens co-leader Metiria Turei said tonight about the announcement: ”Opening the floodgates to PPPs will simply result in the transfer of large parts of the health, justice, education, and transport sectors into private ownership.It feels like the beginning of the 1990s all over again.”
13 Comments
National really don’t like rail do they, they are going to find any excuse they can to avoid funding the tunnel. The thing that really annoys me is not that they are holding rail accountable but that roads aren’t equally held accountable.
PPPs and rail don’t work. Check out the London Tube Network for a great example (the PPPs got years behind on the overhaul, blew their budgets and handed (forced) back their contracts to TFL).
PPPs are just code for “privatise the profits, socialise the losses”. Or, in English (thank you, thank you, I’ll be here all week), the private sector gets paid to build it, then declares it’s uneconomical to run and the state is going to have to buy it back. Having spent so much money on the construction the state forks out to buy back its own asset earlier than contracted and then takes over the operation. It’s nonsense that the private sector can do everything more efficiently than the public sector, especially when it comes to projects that will require significant debt funding and the credit rating of the state comes into play.
Hopefully the BCR for the CBD loop will come in at at least 2, without considering wider benefits, so that there’s a conclusive argument to be made in comparing it with the SH1 extension and its WEB-inclusive BCR of 2. Not that that’ll stop National and their rail-hating, of course, but it will make it less-defensible to ignore the tunnel in favour of a highway that’ll decimate the economies of existing communities (not considered in the business case) and return a hot $30m in WEB to communities currently unserviced by SH1.
Horrendously expensive, huh? Have I got some horrendously expensive projects for you minister that I would like the Wellingtonian crowd to feel in their pocket books!…
National will NOT fund the tunnel within the coming years. We should be ready to “accept” that fact - i.e. we will need to play to the wider crowd, rather than to some close-minded ministers.
The best way to do that is to make sure that rail electrification and integrated ticketing will be a success.
Perhaps they hadn’t noticed by every transport project in an established city is horrendously expensive.
They question is which of them pay off on the cost, which are pissing money into a hole in the ground, and which we should prioritise.
With over ten billion being spent on new transport infrastructure in Auckland over the next decade it’s not like we don’t have the money, we just have to spend the money on the right things and get the best value out of it.
I think the CBD rail tunnel (which unleashes heaps of untapped capacity and value from the existing rail network) would be a much better use of $1.5 billion than an extension of the expressway up to Wellsford (which would only feed more congestion into the existing motorway system).
National really really have no idea.
Auckland needs a decent alternative to the car but they cannot see it.
The PPP model is more or less what is the basis our bus services. Private companies such as Infratil making a lot of money from rate payers in subsidies and passengers in fares to provide so called public transport services but funded by us in a most nontransparent manner, ironically set up by the last National government.
Profit driven to suit the private companies share holders is not what Auckland needs. Cheaper fares and better services are not what the PPP system is about.
I am thoroughly unimpressed with PPP and I reckon it has held public transport back in Auckland at least for years.
This is a weak government whose major driver is wanting to be liked so let it know its on to a loser with this idiotic pseudo privatisation idea.
When’s the next election? Time for a change by the sounds.
Hear hear Paul
Bill, paying someone to live in his own house is “horrendously expensive”. If it wasn’t for the Dom Post exposing your housing arrangement you would still be at it. The tunnel has more going for it than you do as minister of finance.
Paul, I believe the answer is “Not soon enough.”
And are you asking that as someone who voted the current lot in? Or as someone who didn’t want them in the first place? Just curious as to whether or not the transport issue is really harming National as much as some of us are hoping it is.
Sadly most NZers see building more motorways as the solution and in that sense National is seen to be doing a good job….unfortunately it’ll take a while for the importance of PT to actually sink in before people vote with that in mind. That said the local body elections seem once again to have PT as a major issue so perhaps we’re closer to PT being an election issue nationally than we think.
rtc, Aucklanders definitely seem to be getting the message about public transport. Joyce’s attitude, especially if fares go up significantly in October and it’s publicly pinned on the “farebox recovery” policy, will hopefully hurt National.
“especially if fares go up significantly in October and it’s publicly pinned on the “farebox recovery” policy, will hopefully hurt National”
Matt - that link is far too difficult for the average punter. To them, buses are local / commercial. They will blame the bus company and/or ask the Council to do something. They will probaby think it’s the supercity!
I may be cynical, but hoping that rising PT fares will make National unpopular among the masses is a short at the moon. Possible but hugely unlikely.