Fuel Up, Prices Up

Wage Earners Carry the Brunt!

by Joanne Taylor

by Joanne Taylor. — On 31 May 2018 Auckland Council agreed to implement the Regional Fuel Tax (RFT) to unlock more than $4-billion of investment in Auckland’s transport network.

Mayor Phil Goff has been quoted saying, “$1.5-billion of the fuel tax money collected will be used on the transport network, but will unlock more than $4-billion additional investment in transformative transport projects across Auckland. The funding will go towards increasing the provision of public transport, improving our roads, cycleways and walkways, and making Auckland less congested and safer”.

This month the fuel tax comes into effect. How will the introduction of higher fuel prices effect our community to fund much-needed transport infrastructure within the greater Auckland region? Will it be accepted for the greater good as many of the Auckland Wide projects are not local. Or is there a growing resentment of an area that continues to feel let down by the ‘Super City’ policies.

What is the fuel tax?

Legislation to introduce a process for establishing a regional fuel tax, initially for the Auckland region, was introduced into Parliament on 22 March 2018 by Transport Minister Phil Twyford. It was a mechanism to raise funds for transport infrastructure programmes that would otherwise be delayed or not funded. It has long been touted by council that there is a serious funding shortfall but criticism that the introduction of a fuel tax is just another example of a council big on plans, but lacking in significant action.

elocal conducted surveys in Franklin to find out how the community feels about the increase. Many of the responses came from business owners with most of them indicating that they will need to increase their rates and prices to customers to cover the extra fuel cost burden. Others responded that they will cut back on other important business expenses to compensate for increased fuel spend, a few indicated that their business will weather the increases but fear that employees will suffer with the extra commute expense, and only one business owner agreed with the fuel tax if the money is used for the proposed transport projects.

What projects?

Out of the total estimated $1.5-billion infrastructure spend coming from the fuel tax, $225-million will be spent on road safety across the Auckland region to reduce deaths and serious injuries by 60% over ten years through measures including red-light cameras, addressing high risk intersections, speed management, and improved skid resistance and roadside barriers. Deaths and serious injuries have increased by over 70% since 2014 in the Greater Auckland region and is it any wonder that a recent report released into AT is scathing of the polies of the last 7 years. “Auckland has had no new road safety strategy approved since Auckland Transport was formed. Safety on the road network has not been a priority at Auckland Transport in that time.” 1 Given the size of this new budget, there should be strict supervision to ensure a complete reversal of current safety trends.

$102-million is planned to be spent on the Mill Road corridor which connects Manukau and Drury, $99-million on capacity improvements across the whole Auckland region and $126-million is planned for growth related transport infrastructure in the north, west and south Auckland regions, particularly of interest is the growth region of Pukekohe, Paerata and Takanini. South, west and central Auckland is also to see $213-million spent on electric trains and stabling. Once the City Rail Link is operational there will be increased demand on rail services. Growth and rail improvements, including electrification to Pukekohe, will need more electric trains along with maintenance and stabling facilities. There is nothing new here. elocal reported that 2.5 Billion of spending was already factored into the Long Term Plan for much of the above. 2 What we need to see is a ramping up of actualities to get these promised improvements happening.

Joe and Jane Soap

Many people are concerned that a regional fuel tax will have a greater impact on lower income households. The politicians, however, insist that low income households would benefit from the new transport projects funded by a regional fuel tax, in particular, more public transport. The new bus station at Pukekohe has definitely seen an improvement in public transport offerings locally and if the promised electrification can happen sooner then as an area we will be benefitting directly from the fuel tax.

Most of the non-business owner respondents from the surveys indicated that the increased fuel price will significantly affect their personal budget, with quite a few more saying they will have to cut back on other personal household and leisure expenses to balance out the extra fuel spend.

History proves to us that increasing prices of anything anywhere, especially if it’s the government hiking up prices, always produces an initial outcry from the public, but the fact remains in this instance – Auckland transport infrastructure is begging to be improved and expanded.

Our May 2018 issue article “17 800 Homes Planned Pukekohe to Drury” highlighted the transport infrastructure crisis that will naturally be a reality with so many new houses being built in the next ten years. The money for transport improvement and expansion needs to come from somewhere, so it is natural to place the burden on road users.

A few survey respondents said that they support the fuel tax if the money is actually spent on the transport projects as planned. Perhaps there is sense in spending ten years paying for better transport infrastructure and reaping the benefits when they arrive, which is what 25% of those surveyed seem to agree on, and one particular respondent, summed it up quite well: “That 10 cents helps to maintain the roads [all road users] use, as well as pay for new transport the same way people before [us] paid for what we have today.”

And, finally, how will the money reach Auckland Council? The fuel tax will be paid by fuel distributors when they deliver fuel to service stations and commercial users inside the region. Rebates will be available to those that do not use fuel on roads. Eligibility for rebates will be confirmed when the regulations are finalised.

A regional fuel tax will have a maximum initial duration of ten years. If a regional council wants to extend beyond ten years, it will need to consult with the public and obtain Ministers’ approval. Any number of things can happen in a ten year time frame. Lets hope one of them is an incredible amount of progress on decided, funded projects to address the grossly underfunded Auckland transport network.



www. transport.govt.nz


1. http://www.greaterauckland.org.nz/wpcontent/uploads/2018/05/Road-SafetyBusiness-Improvement-Review-Report-FINAL. docx.pdf

2. https://www.elocal.co.nz/Magazines/elocal-Papakura/187?page=6-7