The government’s change of heart on charging for use of Auckland roads at last releases the handbrake on planning for the region’s transport future, writes Matt Lowrie.

Auckland’s transport problems are pretty well known, even to those outside the city. They are the result of a toxic mix: decades of political bickering, poor decision making (in both housing and transport), under funding and rapid population growth.

How to “fix” transport in Auckland has long been the subject of debate around barbecues or water coolers.

That debate extends to the halls of power and in the years following the creation of the super city there have been plenty of exchanges and disagreements between the Auckland Council and central government on the issue. Disagreements might be understating it, however: it was more the council would want to do something and the government would give their best impression of Winston Peter’s infamous NO sign, even when government agencies were involved in the assessment of projects.

One of the key disagreements has been around the Auckland Plan, the 30-year vision for Auckland signed off in 2012. The Auckland Plan’s transport strategy was to effectively build every project ever thought of in Auckland and unsurprisingly that resulted in a $12 billion funding gap. Yet, despite building a lot of stuff, congestion was still projected to get worse.

The government and their agencies disagreed with the Auckland Plan on transport but that wasn’t because they had their own alternative, they just didn’t want to agree to “Len’s Plan”.

Mayor Brown pushed on and to address the funding gap he pulled together a number of disparate organisations into a Consensus Building Group which was tasked with looking at how to extract more money to pay for Auckland’s plans. They ultimately came up with two options, summarised as:

• Increased rates, (regional) fuel taxes, tolls on new roads
• Tolls on the motorways or for entering areas such as the central city

The major flaw in both of these options is they both required buy in and legislative change by the government, who again delighted in saying NO.

Then in August last year the government and council announced they were going to work out their differences and come up with a joint evidence based plan for Auckland. They called this the Auckland Transport Alignment Project (ATAP). As well as looking at projects and when they might be needed, the terms of reference included that they could look at road pricing from a demand management perspective.

This was the first hint at a softening around the idea of road pricing but the focus on using it demand management that was a key point. When it comes to pricing roads it is done for one of two primary reasons, either to gather revenue or to manage demand. These aren’t mutually exclusive outcomes but they can have different fundamental impacts on how a system is designed.

As the name suggests, a revenue gathering based system is about collecting more money, ideally as efficiently as possible. Gantries on motorways or a cordon around an area are usually the preferred way of doing this but can have negative impacts such as encouraging people clogging local roads to avoid paying.

Demand management is fundamentally about using pricing in an attempt to change behaviour to get a better use of the transport resource we have. As the transport minister, Simon Bridges, said this morning, there’s a limit to how many more motorway lanes we can build. While some people may pay more to use the road, the system could potentially be designed to be revenue neutral, perhaps substituting rates or fuel taxes.

The ATAP process doesn’t finish till the end of August but yesterday they released an interim report on what they’ve found to date. They say the analysis shows that using road pricing to manage demand has the potential to make a major difference to transport in Auckland, much more so than just building a lot more stuff faster or changing the order of when things are built.

For this first stage of analysis, ATAP looked at a variable charge of between 3 cents and 40 cents per kilometre depending on time of day, location and type of network travel occurs within. An indication of how prices would vary is shown in the table below. As a quick comparison, current fuel taxes work out at approximately 6 cents per km. In this situation some could end up paying less than they do now.

ATAP stress that their analysis is only early days and a lot more work will need to be done to truly understand the impacts and just what prices might be. They suggest it could take 10 years before any road pricing scheme is fully operational.

Len Brown is of course happy with this outcome, especially coming hot on the heels of the City Rail Link finally starting construction. These may not be quite the motorway tolls he was looking for, but Bridges has indicated the government now agrees with the road pricing approach as an option that needs to be further considered.

In my view this is a very positive and important step. Road pricing is a discussion numerous cities have had but very few have actually been able to introduce any form despite it having long been accepted by many who are involved in the transport sector or who follow it closely. It has always suffered from a lack of political will and/or negative public perception. Now at least at a high level we appear to have some political consensus.

I suspect a lot will need to be done to address the public perception issue but we can look to some overseas examples. Stockholm presents one of the best case studies in this regard. Following much debate, a congestion tax for entering the central city was imposed at the start of 2006 as part of a seven month trial. Almost immediately they discovered a 20-25% reduction in traffic passing the cordon and that also corresponded with improvements in air quality. Seven months later when the trial ended the traffic returned. Following a subsequent referendum it was decided to introduce the congestion tax permanently and as of 2011 there is 65-70% support for them.

There are a number of issues that will need to be addressed, not least of which is we will need to have in place a much more viable set of alternatives for those who want to avoid driving. But that discussion and the how and when can come later though. For now this decision means that planning for the future of transport in Auckland can continue without having one hand tied behind its back. It also gives confidence that both the council and government will, come August, be able to produce a lasting and agreed transport plan for the region.