TE HUIA --- WHY?
Why should the taxpayers of New Zealand subsidise the small number of people who travel between Auckland and Hamilton on the Te Huia services?
The service has been operating since 2021 and currently carries an average of approximately 5,000 passengers per month.
The objective of this service was to provide a commuter service between Auckland and Hamilton.
Te Huia has transported a total of 160,919 passengers between the two cities, an average of 5,029 per month.
The original investment was $68.7 million to develop the capital infrastructure to support the Te Huia service, including building train stops and bus depots in Hamilton to help enable the service to operate, with $29.3 million approved for operational costs for the five years following launch.
Te Huia has been funded through the taxpayers of NZ and the ratepayers of the Waikato Region by:
75% Waka Kotahi
21.2% Waikato Regional Council
3.3% Waikato District Council
Te Huia currently operates on a cost-plus contract with Kiwi Rail where there is no risk to Kiwi Rail, so if the operational costs for Te Huia rise, then KiwiRail charges an increased fee to cover those rises.
The Waikato Regional Council (WRC) pays a monthly fee based on a percentage of the ‘Operating Costs’, therefore if the operational costs for Te Huia rise, then KiwiRail receives an increased fee.
Te Huia provides four trips per day with 147 standard seats available per train, which under current passenger numbers means on a work day there is an average of 34% usage.
There has been a gradual increase in the number of passengers on Te Huia since the start up, but this growth in numbers seems to have stopped at around 5,900 per month on average, and given these average passenger numbers Te Huia is currently not competitive as a commuter option compared to alternatives.
The service which is being run as a five year trial, by the Waikato Regional Council, continues to use an excessive amount of government funding to carry out its operations.
The specific targeted Te Huia rates paid by the Waikato ratepayers are circa $1.6m or 1.3% of rates and this is over and above the government subsidies that they also help fund through their taxes. So all of the ratepayers in the Waikato Region are being charged twice (through their Rates and through their Taxes) to fund this service which benefits a very small number of citizens.
Given the current extreme upward pressures on the regions rates with huge increases projected for the coming year and the failure of this service to reach its proposed outcomes, cancellation of this service is something that I believe the average ratepayer would be more than happy with.
In January 2022 the service, which starts in Frankton, was extended to finish at the Strand in Parnell and this journey was expected to take 145 minutes. Both of these stations are approximately 2Km’s from their respective central business districts which meant there would likely be further additional travel time on other modes of transport required.
When we look a bit deeper at these figures and take them as hourly figures the picture suddenly looks different. 145minutes becomes 2hrs and 25 minutes and if we then think about a return journey this becomes 4hrs and 50minutes, almost five hours and this is without allowing for any other travel time to reach the CBD at either end of the journey.
So this means that if they are trying to attract patronage to Te Huia on a commuting basis, any regular passengers would have to add approximately 5hours extra to their working day which suddenly goes up to 13hrs minimum. This then makes any time saving immediately become quite critical and therefore the time saving from using your own vehicle (over two hours) suddenly becomes a huge attraction.
In my opinion, based on this simple analysis of the Te Huia project so far and the forward projections for this project, there should be a recommendation to cease this service on the grounds that it has and will continue to, fail to achieve the basic outcomes that were used as the foundation of the business case for Te Huia.