Wednesday, November 30, 2005

Transmission Gully advocates defy economics

I noticed Porirua City Council is talking nonsense about the coastal highway route vs. Transmission Gully claiming that a broader economic evaluation was needed. You can see Porirua's submission here. I've read it, and it has the holes of Swiss cheese.
It is nonsense to say the coastal route will take 24 years to complete.
It is nonsense to say there is an "over-emphasis" on cost - whose money is it?
It is nonsense to say the coastal route will destroy tourism assets - find one that anyone in Wellington regards as significant!

It’s rather simple, Transmission Gully isn’t worth it – it is a $1.1 billion investment that returns benefits worth $550 million, and the coastal 4-laning will be worth it eventually, but not yet.

Porirua City Council – which wont for a minute commit any of its ratepayers money to Transmission Gully, is keen to commit other people’s money to it.

It reckons Transmission Gully is affordable if you:

- defer “lower priority road projects”. In fact, lower priority projects don’t get funded ahead of higher priority ones. What this means is defer higher priority, higher quality projects – and to do this you need to defer every single other new roading project in the region for 10 years, such as the proposed Basin Reserve flyover, and any improvements in the Hutt – all projects that return benefits several times their costs. The same time the submission says that all these sorts of projects can still proceed

- toll the Gully (brings in around 10% of the funds and reduces the benefits down to around a third of the costs, because few will pay to use the Gully when the current road isn’t congested );

- securing funds from the National Land Transport Programme (Land Transport NZ is only meant to fund efficient projects, which does not mean projects with benefits half those of costs).

Porirua City would kill the Petone-Grenada link road because it wouldn’t be needed – though Ngauranga Gorge and the Hutt motorway will both still be congested – and Petone-Grenada has the net benefits of Transmission Gully at a quarter of the costs.

If you left the running of highways to the private sector, you’d know whether Transmission Gully is a good idea or not. Mountains of analysis say it’s a dog – and the private sector could try and build it now, nobody is stopping them – it just doesn’t stack up as a road that enough potential users would be willing to pay enough money for, not by a long shot.

Porirua City Council wants to waste taxpayers money and road users money on a project that would mean no other major roading improvements are undertaken in Wellington for 15 years – it wont raise rates from the anticipated increased property values for landowners near the current highway – which shows it wont put its money where its mouth is – its mouth isn’t connected to a brain applying economic rationalism, and should be ignored.
No matter how you hold your mouth, nobody can get beyond this fact.

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