No to another mega-Ministry

One of the ideas getting traction within the Government is the idea of merging the Ministry for the Environment (MfE), Ministry of Housing and Urban Development (MHUD) and the Ministry of Transport (MoT) into a mega agency. The “logic” behind it is threefold:

• More integrated policy thinking that will not only enable more housing to be built, but also the infrastructure to support it;

• Diluting the de-growth and pro-central planning culture of MfE (which most recently decided it was appropriate to submit on the Regulatory Standards Bill);

• Saving money (through administrative rationing).

This is a mistake, because its theoretical basis is rooted in some assumptions that don’t bear close scrutiny. Working backwards the notion that mega-departments are more efficient is largely a chimera. The larger the bureaucracy the slower it works and the less responsive it is, and it more difficult it is to retain specialised knowledge and experience as it gets swamped within multiple layers of management. Treasury likes mega-agencies for two reasons:

• Fewer managers is said to be more efficient;

• Fewer agencies makes them easier to monitor and hold accountable.

Unfortunately, this ignores the behavioural responses of public servants to this sort of structure. In a large department it becomes harder to get the attention of the top layers of management. In some cases that can help, because clever and competent public servants can get on with their work unbothered by the chief executive or deputies, but that also means the less clever and competent have their work not subject to the same scrutiny. The Adam Smith Institute in the UK has called for the UK Home Office to be broken up for exactly that reason. The incremental savings of a few fewer managers (which is disputable when you look at the structure of MBIE – New Zealand’s existing mega-Ministry – which has large units, with branches under them and sub-branches) is lost when there is significant failure both in delivery and public policy.  

The UK already has had experience merging Transport, Environment and Local Government, from 1997 until 2002. Transport was split out again because the cultures of the agencies clashed internally, slowing down progress and making it difficult to get institutional focus on major reforms.  

Australia by contrast does have a mega-agency responsibility for transport policy at the Commonwealth level, in an organisation called DITRDCA (Department of Infrastructure, Transport, Regional Development, Culture and the Arts), which struggles to retain institutional knowledge in any segments of its activity. However, as a Federation, many of the functions in those sectors are carried out by States and Territories, so it is less of a day to day concern. Similar mega agencies do not exist at the State level.

The benefit of smaller agencies is that they can be nimble and responsive, and can pivot quickly when policy priorities change.  They can readily collaborate and work together with each other, if there is clear project leadership across agencies. The idea that collaboration within a large agency, with managers and branches with their own interests is necessarily easier than between smaller agencies is largely theoretical, because it depends on the individuals. Bear in mind MoT implemented radical restructuring of ports, airports, land transport funding, the governance and delivery of urban passenger transport all as a small agency, stripping down its functions over the years.  It's not clear what radical reforms MBIE as a major agency has done, and it is abundantly clear that DIA, with its de facto oversight of the water sector (i.e. next to none) did little until the Ardern Government saw it as a way to bail out local government and start to implement the principles of He Puapua (which remains on ice). 

On the second point, the idea that a key reason to merge agencies is to dilute the culture of the one you don’t like, or which is corrosive to government policy is not a good way of diluting the poison, because it spreads the poison across a wider field. The answer for the Ministry for the Environment is not to merge it, but to cull its responsibilities and split what remains among other agencies.

The Partnerships, Investment and Enablement business group should be abolished because Government should not be seeking to “tangibly shift mindsets and change behaviours in New Zealand through effective partnering and engagement within the public and private sectors”. The culture of MfE is anti-development, anti-growth and it the behaviours that need changing are those ones.  

At best the Environmental Management and Adaptation business group should be placed within the Department of Internal Affairs to work with local government, specifically regional councils on their statutory function, and the Climate Change Mitigation and Resource Efficiency business group should be part of MBIE, which has oversight of economic regulation of natural resources.  

It is so obvious that the next time a Labour-led Government takes power, almost certainly with the Greens, that a Ministry of Housing, Infrastructure and the Environment would be rebranded into a Ministry of Sustainable Development or the like. The culture that would be dominant will be the one inherited from MfE and will seek to decimate private provision of housing, as well as turn transport policy into one big behavioural change programme that treats active travel and public transport as being good, at any cost, while treating private motoring and the movement of freight by road as being malignant. 

One of the legacies of Labour Governments is that they implement structural reform of Government that National Governments rarely reverse.  Don’t forget the optics of splitting MfE (“integrating environment across policy”) may not be great and of course the Opposition will cry that it is about decimating the environment, but the public largely will not care (other than the ones who vote Green anyway). Splitting MfE into Internal Affairs and MBIE will dilute MfE’s culture because it divides it. Merging it with MHUD and MoT keeps it intact, despite pleas from some that it will dilute the priority of the environment, it will place it in the centre of two agencies seeking to resolve issues that are, in part because of the prioritisation of the environment through the RMA that stops stuff being built.

The MHUD is essentially an oversight agency for Kainga Ora, as well as the regulator of rental housing and other accommodation. The synergies with the MoT are weak, especially given MoT’s functions range from monitoring the land transport funding and regulatory sector, through to the economic functions of all transport modes. There is little that MHUD can bring to aviation policy, and indeed most of the transport policy issues affecting MHUD are undertaken by local government. 

If there is a case for a merge, then MBIE makes more sense for MoT than MHUD, because MBIE does look after network industries in infrastructure, such as energy and communications, but that was tried before in the late 1990s and ultimately abandoned. 

So the idea of merging agencies should be put in the bin. There is a better case for reviewing their functions and determining whether some should exist at all, and if so, who is better placed to manage them.  Putting climate change policy in the DIA or MBIE is likely to be preferable than having it dominating housing and transport.

Merging MfE, MHUD and MoT smells of something that the Greens or TOP (remember them?) would advocate. MfE is by far the agency with the most dominant culture, and it is one that is philosophically antagonistic to the Government it is meant to be serving.  It should not poison housing and transport policy with that culture. 

The Government should run a mile from it.

A poor critique of National's transport policy

It’s entirely in keeping with their philosophical bent, for taxpayer funded RNZ to publish as a lead article on its website, a piece by Timothy Welch, senior lecturer in Urban Planning at University of Auckland. It’s also hardly surprising that the taxpayer funded Spinoff has published the same article, as they share a common view of the world, which is predominantly sympathetic to the objectives and ideology behind transport policy in NZ since 2017. 

I am sure Mr Welch is a smart man, so it is pity that it seems to have been written in a rush because it is such a poor critique of the National Party’s transport policy. The views he expresses exemplify why I’m sceptical of urban planners. The very problems they seek to fix are in some considerable part because their predecessors had an overly simplistic view of the complexities of cities, economies and the wants and needs and preferences of human beings.  However, even more important is to understand that the philosophy of transport policy expounded by the Government, which also comes from some academia and is essentially the ideology promoted by the Green Party, which is to treat transport modal choices as a hierarchy that essentially devalues the personal preferences of the public relative to what the planners think is “good for society and the planet”. It devalues people’s time (by wanting people to travel more slowly), money (by wanting to tax them more for infrastructure and services they don’t use) and comfort (by wanting people to use less comfortable modes), in favour of choices that whilst certainly having merits in many circumstances, are for many users inferior to their own preferences (and do not reflect people’s willingness to pay).  What is worst is that much of the argument is based on overly simplistic rhetoric and claims that some of people’s choices are either morally wrong or based on them being “addicted” to driving.

So what about Welch’s article?

It was clearly written as a hit-job on National’s recently released transport policy, which itself has strong hints of central planning, command and control in picking projects it wants to advance, although these are mostly projects to facilitate faster and safer travel of motor vehicles, whether cars, buses or commercial vehicles.  Let’s be clear National is hardly advancing a free-market libertarian vision of transport, but it is a contrast from the view of the Greens and the Labour Government, which want to cut kilometres driven by cars and light commercial vehicles by 20% on average across the country (which in cities means much more than that, given the scope to cut driving in rural areas is much lower).  Just consider that, Labour wants you to drive 20% less, regardless of whether or not you have an EV.  Labour hasn’t quite swallowed the Green approach completely, as the Greens treat any road building as at best a waste of money, and at worst a crime against the planet which fuels people’s “addiction” to their cars (which they would only break away from if they were instead forced to pay for billions in subsidies for other modes of transport). 

Welch starts by claiming there is an old joke about “just one more lane” to relieve congestion, even though the main part of this proposal is actually about building intercity 4-lane highways between major centres, in the manner of countries like Finland, Switzerland, the Netherlands, Denmark, the UK and Ireland. Sure there are a few proposals that expand urban road capacity, but in none of these cases does it involve adding lanes to roads recently expanded. For example, New Zealand's first motorway - Johnsonville to Tawa, has the same number of lanes today as it did when it opened in 1950.  Maybe the old trope of the Greens that lanes just keep having to be added isn't universal after all?

He claims that National wants to build a four-lane highway from Whangarei to Tauranga for $6b when the $6b claim is only for four projects that cover only a fraction of the route (noting 205km of the route is already motorway/expressway with 177km remaining). He ties himself up in a rough calculation to say it couldn’t cost $6b, when he could have simply read the policy document in the first place.  It literally proposes $6b to four-laning Whangarei to Port Marsden, Warkworth to Wellsford, Cambridge to Piarere and Tauriko West SH29. 

He then claims that “The opportunity cost of these projects also needs to account for those who don’t – or don’t want to – drive a car”.  That begs two questions, why? And how don’t they? None of these projects hinders people who don’t want to drive, indeed building new highways offers opportunities to improve cycling on existing routes, and can support faster and more efficient bus services, and improves the amenity of towns bypassed for walking and cycling.

Furthermore, what is the opportunity cost of using funds collected from motor vehicle users (fuel excise and road user charges) to pay for roads? He would have a point if Crown (general taxpayers’) funds are being used to pay for them, but it is the opportunity cost of using ANY taxpayers’ funds? It takes money away from people spending on their home, their kids’ education, books, food, investing for their retirement. It doesn’t need to account for those who don’t want to drive, anymore than it needs to account for those who don’t want to consign freight by road. If people don’t want to drive they can catch scheduled bus services between Whangarei-Auckland-Hamilton and Tauranga, they can fly and if they are keen they could bike, but there is a curious blindspot among some planners about intercity bus services. They simply pretend they don’t exist because they see rail as the holy grail of virtuous, environmentally friendly transport, but it’s a shame they actually don’t want to pay for it out of their own funds.

He critiques National wanting to scrap light rail proposals for Auckland and Wellington, but then gets it wrong saying “National argues that additional motorways and tunnelling in Wellington would be more cost-effective”. National is proposing no new motorways in Wellington at all, but rather a second Mt Victoria Tunnel (which is not a motorway) and improved approach roads to it. 

The policy says “National supports bus rapid transit and bus priority lanes for Wellington to make it easier to get into and around the city. A duplicate Mt Victoria Tunnel will allow for greater bus access to the east, bus priority lanes on the roads leading to the tunnels, and much more free-flowing traffic through the tunnels, including for buses”. So did he just blank-out that National actually thinks bus rapid transit is better in favour of agitprop that it’s all about motorways, when literally no motorway is proposed?  Furthermore, the current LGWM Mt Victoria Tunnel proposal doesn’t include light rail anyway, but bus rapid transit.

Welch continues by claiming that light rail is “fast, efficient and equitable”, yet the LGWM proposal for light rail to Island Bay would still be slower than driving and slower than the current express bus service from Island Bay, because it would stop frequently.  It wouldn’t be efficient because it could never recover its capital costs, and it would be much worse in recovering the costs of operation compared with bus services. It wouldn’t be equitable because its eye-watering cost would be paid by ratepayers and road users throughout Wellington even though most would never use it (and it would, if LGWM is to be believed, significantly uplift land value along the corridor thanks to that subsidy).  He compares it to Sydney’s Randwick and Kingsford lines recently opened, even though the NSW Auditor Office notes that the project, originally costed at $2.1b ended up at $3.1b and that the project benefits have had to be revised downwards. Of course Sydney does have a population greater than New Zealand

Welch continues by claiming buses and trains produce about 80% less carbon emissions per passenger kilometre than cars, which is entirely dependent on patronage. Trains and buses with few people on them are not exactly environmentally friendly, and it is highly dependent on type of vehicle.  A plug-in hybrid has lower emissions per passenger km than a diesel bus. Bear in mind the ETS internalises the costs of climate change by putting a levy on the price of fuel, so motorists are already paying for the emissions they produce, and that price will be rising over time. In short, policies to reduce emissions are incentivising people to change behaviour, it’s just that it’s not enough for Welch.

Welch makes the claim that “Given the observable realities of the climate crisis, many have questioned the logic of leaning into road expansion as a policy, especially at the expense of efficient public transport”.  I’ll let you speculate on who the “many” are (and let’s leave aside the abuse of the term “efficient” again), but the whole basis of this is a widely cliché’d claim that “More roads encourage more traffic and more driving, often leading to even worse congestion”. Bear in mind that the bulk of the National proposal is for intercity highways to be upgraded and be faster and safer and have more capacity, and is not about congestion.  However, the “build more roads, watch them fill up” claim is neither universally applicable, nor takes into account a key element – price.

Most roads in New Zealand carry traffic volumes at a tiny fraction of their capacity, because the mere presence of a road doesn’t generate demand beyond what origins and destinations generate for personal or freight transport. Sure, expansion of an urban highway, especially one parallel to a public transport route, without any price signals to reflect cost and capacity, can encourage more demand and relocation of housing and businesses to reflect the lower generalised cost of travel.  Auckland has witnessed this as its population has increased and motorways improved, this has reduced travel times and encouraged more use of them. However, this is not a problem if the roads are paid for by those using them and price signals are set to manage demand.  This is where Welch is being wilfully blind because

“National will also introduce congestion charging as a new tool to help reduce travel times in our congested cities”

Congestion charging can mean new roads can be built and not get congested, it can mean motorists pay more to use roads as a scarce resource at times of peak demand and less when there is plenty of capacity.  Congestion charging is supported by the Greens (albeit as a tool to punish motorists), but it would do more to reduce emissions than building boondoggles. LGWM estimates congestion charging could reduce car trips into central Wellington by 8%, but you can speculate for yourself as to why Welch doesn’t celebrate this and rethink his narrative. Bear in mind also that the Labour Government received reports on Auckland congestion pricing in late 2019 and has essentially sat on it for three years, and Phil Twyford actively opposed Wellington congestion pricing when he was Minister. 

Welch then rightfully points out that EVs are a small proportion of the fleet, yet ignores the significant growth in hybrids and plug-in hybrid vehicles as well, which cut emissions by between 55% and 85% respectively on average. In short, the light vehicle fleet profile is one of lowering emissions, and this is likely to continue as such vehicles get cheaper, and the secondhand import market’s share of hybrids grows so much.

Then we get Welch’s weirdest comment:

“EVs require the same amount of road space and, due to their increased weight, potentially cause more road damage. But EV owners don’t buy petrol, which means they don’t pay excise tax – the same tax that pays for expanding roads”

The differences between EVs and petrol and diesel powered cars in terms of weight are insignificant in terms of road damage, this is why there is one rate for road user charges (RUC) for vehicles under 3.5 tonnes.  Around half of road damage costs are due to the effects of weather, and most of the rest are due to heavy vehicles, a few hundred kilogrammes of additional weight in a car are not important in terms of road wear. The bigger error is ignoring road user charges RUC by weirdly saying EVs don't pay excise tax (on petrol), but then neither do diesel vehicles.  EVs used to be liable for RUC, but have an exemption until 1 April 2024. Assuming the exemption is not extended, EVs will start to pay on a per kilometre basis then. This comment of his is fairly pointless.

Finally Welch claims the policies are akin to those from the 1950s and 1960s, which is perhaps an overly simplistic view of the time. In the 1950s Wellington had its biggest expansion of electric passenger rail in the country’s history to date, with construction of the line through the middle of the Hutt Valley and electrification to Upper Hutt, along with the development of Tawa that followed EMU service introduction to Paekakariki from 1949.  Yes governments did embark on gradual motorway building, but did so in a haphazard manner (Auckland’s North-Western Motorway didn’t even extend all the way to the city until 1983), largely responding to a public that preferred driving to the monopoly local authority owned and operated bus services, which suffered from regular strikes, lack of capital spending on new vehicles and poor quality of service (e.g. exact fare requirement in Auckland for many years).  It was also hardly car-centric when central government for decades taxed the importation of new cars by up to 60% or simply restricted the numbers permitted. This saw the price of cars inflated above market prices, and the fleet remain much older and less safe than it would have been otherwise. This didn’t completely end until 1998.  

There is nothing behind the claim that the road building of the past made transport “less efficient and less equitable”. Indeed the 1950s and 1960s were also dominated by a law that prohibited freight being moved more than 30-40 miles in competition with railways, because Welch’s predecessors in the world of planning thought they knew best how freight should be moved about in NZ.  The shackles of regulation on freight and passenger transport, and tariffs and import restrictions on vehicles were thrown off in the 1980s and 1990s making transport significantly more efficient. The idea it would be more efficient for motor vehicles to be using the Great South Road to travel between the Port of Auckland and Waikato, than the Southern Motorway is just ludicrous.  There are sound arguments to be made that the highly invasive motorway building through central Auckland did not take into the opportunity costs of the land used, which could have encouraged an alternative approach such as tunnelling or redirecting through traffic towards the west, but the simple point is that the past saw enormous inefficiencies and costs to safety and the environmental because one set of planners decided they knew what was best.

There are reasons to criticise the National transport policy. Who knows what the net economic benefits are of the proposals? Why isn't there a bypass of Te Aro for Wellington? Is Waka Kotahi the right structure for undertaking so many operational and regulatory activities? What should be the future of road user charges and fuel duty?  Should Kiwirail be split to encourage more rail operators to come to the market? What are the barriers to competition in various transport markets?  It's unclear how road safety will be addressed, and are there too many road controlling authorities? Is Auckland Transport performing efficiently and responsive to the needs of transport users? What about the public transport funding framework implemented by the Government.

Unfortunately Welch’s rant seems like an ill-focused take that could have just come from the Green Party press office. I expect he can do better than just ‘cars and roads bad, trains and trams good’.

Inter-regional passenger rail - a dearth of serious analysis

I LOVE travelling by train, I caught long-distance passenger trains as a child. My father took me on the Northerner in a sleeper to Auckland and back on the Silverfern, I rode the Southerner from Christchurch to Dunedin, I rode the Picton-Christchurch Express and the Christchurch-Greymouth Expresses, and my first long-distance trip by myself was on the Wellington-Gisborne express.  I took the last Bay Express from Napier to Wellington.  I rode the Indian Pacific on my honeymoon, I've ridden Amtrak, I rode umpteen trains in the UK when I lived there, including the sleeper from Paddington to Penzance, I was a frequent traveller on Eurostar. I rode by rail from Pyongyang to London, on five different trains across China, Russia, Belarus, Poland, Germany and France. 

So nobody can accuse me of not liking trains. I had a model railway as a kid, and yes I have a transport nerd's knowledge of a lot of trains, and I wished the Silverstar had returned to service and I even wrote to the Minister of Railways at the time pleading the case (who was Richard Prebble!).

I would be thrilled if there could be more, viable, long-distance passenger rail services in New Zealand, but I am not thrilled by the idea that they are, somehow, special and deserve to get taxpayer subsidy over air and coach services, let alone private motoring. 

The Transport and Infrastructure Committee of Parliament has wasted time and taxpayers' money investigating whether taxpayers should pour money into subsidising long-distance passenger rail services (called inter-regional by the Committee), and has produced a report that largely consists of "reckons" by activists with a complete paucity of evidence and analysis as to the costs and benefits of doing so.

The fact that the Committee has produced such a poor quality report reflects both on the understanding of the majority of its Members (from Labour and the Greens), and the staff supporting the Committee, who seemed to be incapable of undertaking some fairly basic research or analysis (or perhaps were directed not to bother too much).  You would think they could at least have gotten some information from this book.

It made six recommendations, of which my favourite (for the wrong reasons) is "We recommend that funding arrangements for future inter-regional passenger rail services reflect the level of national benefit of such services to New Zealand". At best that would be nil, at worst it means the Committee thinks subsidies should equal benefit, so each dollar of taxpayers' money spent should return a dollar, which displays the level of economic ignorance of the Committee.

It's worth a read, as it exemplifies the standards of critical analysis that are deemed acceptable by many MPs today, and it shows how far there is a dearth of economic and policy analytical depth today.  Noting this Committee was supported by the Ministry of Transport, the Infrastructure Commission and an economist. 

Take the introduction which mentions how lots of people used to catch trains then:

"However, as private car and air travel became more popular and accessible, many passenger rail services were cancelled. The national railway network then experienced decades of underinvestment."

Hang on, so WHY did private car and air travel become more popular?  The first because of flexibility, you didn't need to wait hours or a whole day till it was time to travel, and it didn't necessary go from where you live to where you wanted to go.  Plus trains were simply slower. Air travel is obvious, it is fast and it became a lot cheaper over time, as did car ownership.  Modes that were faster, more convenient and more flexible and ultimately cheaper saw people abandon passenger rail.

However. the "decades of underinvestment" claim is quite something. For a start, there was underinvestment from the 1920s onwards, NZ Railways didn't bother reintroducing dining cars after World War 1, and the last remaining one operating in 1930.  There was no on-board catering (beyond tea and coffee) until 1970, so the "underinvestment" was par for the course by the Railways, as it treated its peak passenger demand like many monopolies do, it took them for granted.

To claim there was underinvestment as demand tailed off implies there should have been more "investment" poured into passenger rail, in the 1960s, 70s, 80s, but why, and for what ends?  In reality the major problem was that the NZ Railways Department operated as a heavily-unionised government department with monopolies on much of the market to move people and goods. It was simply a lazy, non-customer focused organisation, it was focused on political and industrial relations imperatives.  Business travellers moved to airlines and leisure travellers to cars, and it wasn't until the Lange Labour Government stop subsidising long-distance passenger rail that it became much more responsive to passenger demand and was business oriented.  That Government gave the Railways Corporation its final subsidies as a lump sum to upgrade services and make them viable, which it did at the time. It's just that over the subsequent 20 years demand changed, airline competition saw fares drop substantially in real terms and the removal of protectionism for local car assembly saw new and used car prices drop as well. People's mobility improved and demand for long-distance rail travel eroded. The routes with growing overseas tourism demand thrived, like the Tranz-Alpine and Coastal-Pacific services between Christchurch and Greymouth and Picton respectively are scenic trips, and are viable in their own right. The Auckland-Wellington Northern Explorer has hung on marginally, but the largely locally used Southerner and Bay Express had insufficient patronage. Rotorua's Geyserland Express suffered because the cost of the service had to bear the full cost of the track as freight traffic was not viable from Rotorua to Waikato/Auckland, and the Kaimai Express to Tauranga had insufficient patronage on a regular basis (also not a route significant in scenery or as an overseas tourism destination).

However, the Committee didn't get told that. 

In the Background (p6), another enormous error is published:

"Over time, and particularly in the early 2000s, focus shifted away from passenger rail services towards providing rail freight services."

This is complete nonsense, railways in New Zealand have been focused on freight for literally decades. In the 1970s the Railways Department noted that the proportion of its business that is passenger traffic was less than 20%.  Unlike railways in Europe and Japan, passenger traffic has not been the focus for railways in New Zealand perhaps since the 1920s.  It is the same in Australia and the United States.

The report summarises Te Huia without really shedding any light on whether it actually contributes to what the report says is the point of the inquiry, which is whether there are any net benefits in expanding inter-regional passenger rail.  There is NO data on how many Te Huia passengers previously drove a car to take the same trip compared to how many are new trips (and whether it enabled people to take jobs they didn't have before, or if they are simply leisure trips). There is no data on the effects on competing, unsubsidised bus services, in other words the analysis is just how many passengers ride it, how happy they are and how taxpayers/ratepayers are paying more than 85% of the costs of RUNNING the train, let alone the capital costs of purchasing and refurbishing the rolling stock and upgrading the stations.  Where's the economic analysis?

It summarises the Capital Connection service (Palmerston North-Wellington) without noting it was set up and operated on a fully commercial basis for many years, without subsidy.  There is no data on daily patronage (just annual) and none on farebox recovery, but there is this odd insertion of a generic definition in the report:

"The Capital Connection service uses older rolling stock that is nearing the end of its life. Rolling stock refers to railway vehicles, such as locomotives, carriages, wagons, or other vehicles used on a railway."

The authors forgot to write a definitions section, and also forgot to mention how much money was spent to acquire rolling stock for Te Huia and build a new station (and upgrade another) (it was $49 million).

The report continues with a completely odd section about historical services, which it could have largely left, or it could have focused on those that operated until 2001.  However it is just full of mistakes (p7-8).  Without nitpicking...  Auckland-Tauranga and Auckland-Rotorua were reinstatements of services that were cancelled in 1967, because of poor patronage. The Waikato Connection seems odd to include as it was a trial of less than a year, especially since Te Huia is essentially the same route. The Northerner did start in 1975, but was a successor of the first Main Trunk overnight service started in 1908.  Why mention that and not the Silverstar? 

However there was no Endeavor (sic) between Gisborne and Napier, Gisborne hasn't had passenger rail service since Cyclone Bola in 1988, and the Endeavour ceased operating in 1981 and never returned to Hawke's Bay (it was used as a substitute train from Wellington to Auckland, and the rolling stock later refurbished (with higher density seating) returned to use as a pool for several unnamed services).  It is also odd to talk of the "New Plymouth express" starting in 1955, when it finished in 1955 and was replaced by a railcar service, until 1977.  There are umpteen books about this, and it wouldn't have taken long for the Committee to get an actual rail enthusiast or two to confirm all of this.  

I could point out minor errors in the descriptions of the roles of agencies, such as "The NLTF is made up of revenue from fuel excise duty, road user charges and road tolls, vehicle and driver registration and licensing".  No, driver licensing fees do NOT go into the National Land Transport Fund.  Seriously, how hard is it for the Ministry of Transport to not fact-check such basic stuff?

The bulk of the report is a summary of what submitters said with little analysis as to its merits. For example, on p13:

"Submitters highlighted that inter-regional passenger rail would also benefit users of other transport modes. For example, if more travellers used inter-regional passenger rail there would be fewer cars on the road. This would reduce congestion, thereby shortening journey times and reducing costs for road users. Some submitters suggested that investing in rail and alternative transport modes would reduce wear on roads and save on expensive road upgrades."

This assumes the extra demand comes from car drivers, it assumes that congestion arises from inter-regional car driving (which outside peak holiday times is simply not true) and the marginal cost of car use on road wear is so tiny (most road wear is caused by heavy vehicle axle loads and the effects of sunlight, rain and temperature changes), so it simply wouldn't reduce road wear in any meaningful way.  

This utter nonsense is repeated lower on the page:

"Passenger rail could also enable more efficient use of existing transport infrastructure. This is because a reduction of vehicles on the roads would be likely to improve the longevity of road infrastructure, reducing maintenance costs and the volume of emissions-intensive resources needed to support maintenance and renewal programmes for roads."

No it wouldn't, this is just ridiculous. Fewer cars has next to no impact on the maintenance of state highways, and to talk about "emissions-intensive resources" to maintain roads, without noting that railways need resources to be maintained as well, and are a duplicate network to roads is completely lunatic thinking, and it's shocking that such claims are giving the credibility to be in a summary.

Further nonsense appears below:

"Submitters noted that passenger rail could improve New Zealand’s resilience to the effects of climate change, natural hazards, and other events. For example, if natural hazards or extreme weather events prevented access to roads or air travel, rail could provide an alternative method for moving people and goods."

Those submitters are morons. Unless you happen to live near a railway station (walking distance) the idea you will get there or that consumer goods would get to you by rail if a road is closed is largely fanciful. Most parts of the rail network are much more vulnerable to closure than the road network, and there has never been any case of a natural disaster which left the railway intact to perform access functions that the road could not (in fact very much the opposite). 

The absurd claims continue, until on pg 14 there is this:

"Some submitters also suggested that inter-regional passenger rail would offer an alternative to domestic air travel, thereby reducing aviation emissions"

Yes if you have a lot of time to spare.

Claims on emissions don't include key caveats, such as patronage or whether or not a car driver is driving an electric car.  

"While a diesel train is generally a lower-emissions form of transport than petrol car or air travel, an electric train can produce around three times less emissions than diesel train"

Besides the pointless reverse mathematic of "three times less", this is entirely dependent on how many people travel on the train compared to the car or aircraft.  Before many services were stopped in 2001 and 2002, the average patronage of those services was much less than a busload.  There is absolutely no analysis about what levels of patronage or modal shift would make sense from an emissions point of view (and of course the fact the Emissions Trading Scheme caps emissions from domestic transport is blanked out, officials and politicians so often just pretend that cutting emissions has no cost, or that they aren't replaced by emissions from others, unless the cap is reduced).

The Committee's response is rather entertaining...

"We think that inter-regional public transport could bring demonstrable public value to New Zealand."

..."While it is evident that there are wide societal benefits associated with passenger rail, it is difficult to measure or quantify these benefits."

Here's a clue, the people who benefit from passenger rail can quantify the benefit according to ... whether they are willing to pay the costs of providing the service!  It isn't "evident" because there was literally no evidence published from submitters in this report, just "reckons".  No evidence whatsoever!

The report isn't without some glimmers of sense though.. on pg.16:

"Increasing inter-regional passenger rail will likely require a high level of investment in the national rail network. On the other hand, historical trends suggest that inter-regional passenger rail services are unlikely to result in a high commercial return without services experiencing patronage growth. Careful assessment will be needed of whether inter-regional passenger rail services are the public transport option that best benefits the public."

Maybe if they had a high commercial return you wouldn't get involved? The last sentence is perhaps generously stating that there is unlikely to be any reason why inter-regional passenger rail services are the best option.

Then there is this claim, throwing the bus sector.. under the bus:

"We note that several commercial bus or coach services operate inter-regionally. While these options do not provide the same level of public benefit as passenger rail, particularly in terms of accessibility and environmental benefits, they remain a viable option for many people."

That's right, buses are MORE environmentally friendly than trains, and their accessibility is likely to be higher because they can stop just about anywhere.  Then the committee of politicians and bureaucrats make this empty claim:

"If passenger rail services are designed efficiently, accessibly, and in a manner that meets people’s needs, there is real potential for large-scale uptake."

In short, if you design a service that people want to use, they might use it.  However, what does any of this actually mean?  What demand IS there on the key routes submitters discuss? Couldn't the Committee have obtained data on intercity bus service demand and long distance car traffic, and if not, why not?  How many people drive between Auckland and Tauranga each day, surely you need to know this if there is likely to be some assessment of potential for a rail service?

Fortunately the Committee isn't completely mad as it decides to be focused on... more evaluation:

"At this stage, we think what will be most useful is identifying specific inter-regional services that should be investigated further. We need to better understand the costs and benefits of specific services before we can properly evaluate their potential."

No, you can't evaluate any of this.  You don't decide what routes Air New Zealand and other airlines fly, or routes Intercity operates, so you shouldn't be doing this.

Then Te Waihanga, the Infrastructure Commission, weighs in on pg.18, without thinking more widely about the point:

"Te Waihanga told us that KiwiRail’s commercial mandate means that investment decisions are often made based on the economic viability of services, rather than consideration of any wider societal costs and benefits. This means that, even if a rail service would be worthwhile from a public-value perspective, investment is still unlikely to occur."

Well it doesn't happen for air or bus services, or inter-regional freight services, so why is rail special? Indeed, regional councils ARE mandated with thinking about public transport subsidies and "public-value", so they actually can work together on this.  What matters more is that Kiwirail has a monopoly on managing access to the rail network, so no other business can readily obtain access to that network without Kiwirail approving it. This looks likely to be provide one option for enabling at least other commercial operators to have a chance at providing more services.

Te Waihanga can't identify the "public-value" of these services, but maybe it thinks this should be its job?

Ultimately the report seeks a growth in bureaucratic involvement in transport by saying"We recommend that the Government identify an agency to act as system lead for interregional public transport.".

Why? Because it can't identify whether inter-regional passenger rail is worthwhile, or specify how it might be. So it calls for a new role for government to "lead" not just rail, but bus and even ferry (maybe even airline) services.

This is absurd, because unless there is a clear case for this, it would set up an agency with responsibilities that it would, no doubt, decide, needed to be expanded. You can see a return to the days of 1970s when transport licensing was undertaken based on demand, with intercity bus services regulated (can't have them "undermining" inter-regional passenger rail), and the heavy hand of central planning seeking to respond to the demands of whoever the Minister of the day is.

The remainder of the report is the Committee's "reckons" as to routes worth further investigating.  Tauranga-Auckland is suggested with zero analysis of potential demand, Auckland-Wellington suggested whilst dismissing the fact there is already a service, it is geared towards tourists people who are willing to pay the costs of using the service.  The claim for Auckland-Wellington is that it should be "affordable" which is code for "paid for by someone else". The case for why one mode of travel between Auckland and Wellington should be subsidised when none of the others are is not made.  It then suggests Napier-Wellington. Why? Who knows, because literally nothing the report backs that route as an option over say Christchurch-Dunedin (it also falsely claims there is no station in Napier, when the old station remains very much intact). Likewise, extending the Capital Connection to Feilding is presented with zero evidence as to why.  This is literally just bureaucratic and political reckons based on nothing, although the report claims "The case studies we have identified in this chapter are what we consider “low-hanging fruit”."

However, this is based on virtually nothing, except the wild claims of rail enthusiasts. 

The only saving grace of this report is that the National and ACT members dissented, presumably they could see how ridiculous this all this. 

It's all quite simple.

Inter-regional passenger transport is, by and large, commercially viable or privately funded.

Air New Zealand, Jetstar, Air Chathams, Soundsair, Originair and other domestic airlines operate such services fully funded from users, paying airports to use the infrastructure and including the cost of the Emissions Trading Scheme in their fares. 

Intercity operates commercial coach services, again fully funded from users, paying road user charges and also paying for emissions through the ETS.

Private car owners and renters of cars pay for their own cars, paying for fuel including fuel tax and the ETS, again paying for the road.

Kiwirail runs commercially viable inter-regional rail services between Auckland and Wellington, Picton and Christchurch and Christchurch and Greymouth. If it sees business opportunity in starting new services it should do so. Likewise if any other business wants to start up such services on the rail network, Kiwirail should not get in its way.

However, there is no serious public policy reason to spend taxpayers' money to set up new passenger rail services. The state highways are generally not congested outside a handful of holiday periods, and will not be relieved by a few daily passenger rail services.  Almost all rail routes are significantly slower than the parallel state highways (and one train a day will not justify pouring hundreds of millions of dollar in speeding up rail lines).  The dream of an overnight sleeper train service between Wellington and Auckland may seem nice, but realistically most business travellers would rather fly, and the density of sleeping accommodation to be competitive would be akin to couchettes because more standard sleepers would just be too expensive compared with flying (and beyond Friday and Sunday nights, patronage is unlikely to be high).   However, of course, the advocates for this, don't want to pay the full cost of providing the service - even though the passengers on Airbus A320s pay for theirs.

There are merits in ensuring Kiwirail doesn't unreasonably block the entrepreneurship of other rail operators in establishing passenger (or indeed freight) services using the infrastructure taxpayers now own - but to spend much time or money investigating the merits of long-distance passenger rail is wasteful.  Meanwhile advocates might want to use existing services much more frequently and demonstrate they are willing to spend more time travelling than other modes, before they call to force everyone else to pay for new services.

What's wrong with Kiwirail?

Kiwirail has been in the news a lot recently, many due to disappointed about it failing.  It includes the breakdown of the single track evaluation car in Wellington (and scheduling of track inspections as well), the programmed closure of Auckland's rail network to enable significant reconstruction, and the simple answer given to this is that it is a failure either of rail privatisation (which was reversed partly in 2001, 2003 and ultimately 2008.

In 2001, the Clark Government bought the Auckland rail network for $81 million, in 2003 it bought the rest of the rail network for $1, but with a $44 million investment in TranzRail (and the buy back of the network then included a monopoly being retained by TranzRail). Finally in 2008 the entire business was bought for $690 million, which was well above the market price at the time.

So there have been 15 years of state owned enterprise Kiwirail, which is exactly how long the privatised NZ Rail/TranzRail existed for, but some pundits still claim that all of the problems stem from privatisation. Surely government ownership is meant to fix everything, after all the country had government owned railways for well over a century beforehand, weren't they wonderful?

To some extent there is some bad luck with a few incidents regarding Kiwirail, but it is pretty clear the incentives around the company are very mixed indeed.  

For example, Auckland the commuter trains are owned by Auckland Transport, although they are operated by Auckland One Rail, a train operating company contracted by Auckland Transport to operate the trains for eight years (starting 2022).  The rail infrastructure is owned by the Crown through Kiwirail, but the stations are owned either by Auckland Transport (Waitemata, Newmarket and New Lynn), or a mix of Auckland Transport (for the buildings) and Kiwirail (for the platforms). Of course the train services themselves are subsidised by Auckland Transport as the contractor, which gets 40% of its funding from Auckland ratepayers with the remainder from Waka Kotahi (i.e. taxes paid by road users).  Fare revenue only recovers around 30% of the costs of operation in normal times (whereas at present taxpayers are halving that to 15%).

In Wellington, it is similar, with the commuter trains owned by Greater Wellington Regional Council, operated by TransDev, with infrastructure owned by a mix of the Crown through Kiwirail and the regional council (Kiwirail owns the track and the main railway station, the regional council owns the other stations). 

The railfreight system is all owned by the Crown through Kiwirail, as is the long distance passenger rail system.

However, what isn't widely known is that whether it is Kiwirail's freight trains, or the commuter trains operated in Auckland and Wellington, that the Track User Charges paid for trains to operate on the tracks don't go to Kiwirail, they go to Waka Kotahi.  This bizarre situation is the brainchild of the current Labour Government.

Instead of Kiwirail getting its day-to-day operating revenue, for maintaining the track and related infrastructure from the trains operating on the network (whether its own trains, or in Auckland and Wellington the commuter trains contracted by the relevant authorities), the Track User Charges, set by politicians, go to a central government bureaucracy - Waka Kotahi - which then gives Kiwirail money to maintain the tracks, based on the Rail Network Investment Programme.

So Kiwirail's infrastructure business is not paid based on trains operating, but paid on whether it can convince a bureaucracy, guided by Ministers, to give it the money it requests for its network. Michael Wood and Grant Robertson have broken the link between use of the track and being paid for the track.

Of course this replicates the road network, but road funding has always had that separation and the separation is an artifact of how motor vehicles are charged to use the road network. Because all petrol-powered light vehicles pay petrol tax, it is impossible to reliably link your car to what roads you drive on, so the revenue from petrol tax is all collected by Customs, and handed over to Waka Kotahi to fund road maintenance and improvements.  Road controlling authorities (Waka Kotahi for the State Highways and territorial authorities for local roads) have to bid for funding from Waka Kotahi (yes you noticed that?) for road maintenance.

However Kiwirail's network isn't like that.  It is effectively a controlled private network as Kiwirail knows exactly what railway vehicles are on its tracks at any time, and charges them Track User Charges, which could be based on whatever it needs to charge to maintain and develop its network. Indeed if the track infrastructure was run as a separate business, setting its own Track User Charges, then it would expect to not get paid if it didn't enable trains to operate.

That's not what the Government has done, it has disconnected payment to use the tracks from the provider of the tracks, which is a retrograde step.  Every other piece of effective infrastructure operates with user pays. Airlines pay airports fees for landing, taking off and parking aircraft at terminals and on their tarmac. Shipping companies pay port companies fees for docking and other services. Indeed if structured appropriately, as in some other countries like Austria, Czechia, Japan and Slovenia, there is no reason why trucking companies and motorists couldn't be paying to use the roads directly to road companies.

However, the Ardern and Hipkins Government has chosen to weaken the link between providing rail infrastructure and getting paid for doing so by customers, by Kiwirail getting paid by Waka Kotahi instead.  $1.2 billion is being spent by Waka Kotahi to Kiwirail to maintain and develop the rail  freight infrastructure, of which $834.4 million comes from general taxpayers (the remainder from the National Land Transport Fund, which Track User Charges are paid into).  Not only that, unlike the National Land Transport Programme (which outlines the road and public transport projects funded from the National Land Transport Fund), the Minister has to approve the Rail Network Investment Programme.  It's a highly politicised funding system. Kiwirail has to respond to what the Minister wants, not what its customers want, in relation to the infrastructure.

It's worse than that of course. Because Kiwirail runs two businesses, an "above rail" business (hauling freight, carrying long-distance passengers and running rail ferries), and a "rail infrastructure" business (providing the tracks, signals, etc so trains can operate on them), it will prefer the "above rail" business which it directly gets revenue from. Consigners of containers on freight trains pay Kiwirail directly, which it then includes its accounts (even if it has to pay Track User Charges to Waka Kotahi).  Whereas the train operating companies running Auckland and Wellington commuter trains don't pay Kiwirail directly at all for the tracks, but pay Waka Kotahi.

Bear in mind also that Kiwirail, as track provider, has a literal iron grip on access to its network for competitors. Now there may be a low chance of a rail freight competitor emerging, because of the high cost of acquiring rolling stock, but likewise if another business wanted to operate say a passenger train from Christchurch to Dunedin, then Kiwirail could effectively decide whether it would let it do it.  Kiwirail's "rail infrastructure" business is not incentivised to try to find a way to let a new customer use its network because it wont get paid for it, but it's incentivised to do what works for its staff and contractors, and for its own trains.

One can argue about whether enough taxpayers' money was put into the rail network since it was renationalised, or whether it is good value for money at all. After all, why should the rail freight network not pay its own way, given trucking companies pay road user charges, which fully fund the state highway network?  However, if the government is going to keep owning the railways then maybe it should follow a model seen in some European countries.

Split it up.

Have a Kiwirail holding company for oversight of the assets (including the land held by NZ Railways Corporation), but have three separate companies underneath it:

1. A railway infrastructure company. Have it receive Track User Charge revenue directly and let it charge what it needs to do to maintain its network.  If the government wants to upgrade tracks, then it can put taxpayers' money into it transparently and have arguments in the public sphere about whether new cancer treatments are better to pay for than a faster railway line somewhere.  Ensure that company has open access, and seeks to encourage new entrants into the rail industry.  It may also include stations and freight terminals not held by local government, but also be willing to enable competing operators with access to those facilities.
2. A freight company.  Have it own the locomotives and rolling stock Kiwirail currently has to run and operate freight trains.  Arguably it should also have the Interislander as it is core to that operation, and it makes more sense than it being in the railway infrastructure company or the next company.
3. A passenger company.  It may only be four passenger trains at present, but let it be willing to expand on a commercial basis. It might even run the commuter trains in Wellington and/or Auckland if it  wins contracts to do so.  It should own the locomotives and rolling stock for passenger rail, or it might seek to lease locomotives from the freight company. 

There is an argument that there isn't really enough business for rail to have competition in New Zealand, and it may be right, but given the government owns the network, it ought to at least enable the possibility of competition. 

A hard-nosed look at railways in New Zealand would confirm that the rail freight business is the core, followed by commuter rail services (which require subsidy as long as pricing of roads at peak times in Auckland and Wellington does not target congestion).  Rail freight is about containers, logs, milk and coal, and a handful of other commodities.  

It should have nothing to do with Waka Kotahi (except its role as safety regulator), nor should Michael Wood or any other Transport Minister be deciding how much money the railways get to maintain their tracks (after all, what would they know?). If more money is going to be poured down the black hole of railways in New Zealand, it should at least be incentivised to operate trains reliably.  At present it has poor incentives, is costing taxpayers a fortune in money that will never be recovered, and has been set up into a bizarre funding structure that has no parallels elsewhere in the world.

Oh and for all of the calls to "restore" intercity passenger rail services, there isn't a business case for it, but at least if the rail business is structurally separated, those who think there is a business case for a lot more long-distance passenger rail can put their money where their mouths are (not their glued hands though). Intercity bus services and airline services are not subsidised in New Zealand, so it is appropriate that intercity passenger rail isn't either.

Bribing voters with their kids' money (and undermining your own policy objectives)

As a libertarian when a government cuts taxes I am pleased, even ones that are purportedly a user fee, because in fact so much of what is collected from those user fees is not directed to services consumed by the users - in this case fuel tax and road user charges.  It would, after all, be much better if the amount collected was what is needed to pay to maintain and upgrade the roads, rather than be directed to pet projects designed to "change behaviour" (subsidise transport modes you aren't willing to pay to use),.

However, it reeks of hypocrisy, as the Ardern/Hipkins Government proceeds to undermine a land transport funding system that once was seen as a shining example in a world where political pork barrelling is so often the order of the day (see Australia and the United States).  It's much more than that though.

Remember the "most transparent government ever"? Remember the commitment to (reducing) child poverty? Remember the belief that New Zealand taking action on climate change is meant to be a demonstrable commitment to values of environmental protection?

It's all bullshit of course.

Remember when Jacinda Ardern said tax cuts would STOP not cut, but stop investment (!) in health and education? This was when National proposed just to raise income tax thresholds, so inflation and wage rises wouldn't result in fiscal creep (when your increases in pay, to offset inflation) putting you into higher tax brackets.  

Remember when National proposed a cut in fuel excise, but Jacinda Ardern said it would mean the roads would fall apart?

"It maintains our roads and it builds our transport projects so if you were to remove excise, which every government has used, you basically remove your ability to maintain roads and build new roading projects," she told AM. 

It's all bullshit of course, because Labour did just that, it cut fuel excise and road user charges, and is paying for it by using "funds set aside for Covid" which are actually borrowings that are unspent.

Prime Minister Chris Hipkins is maintaining these cuts in tax through till the end of June 2023, not because fuel prices are high (they have been dropping for months), but because, he says, it relieves pressure on households.

Well it does, particularly higher income households. Infometrics research indicates that the highest income households save three times as much as lower income households.  That makes sense, as they pay the most fuel tax, because they drive the most and are likely to have the largest vehicles with the highest fuel consumption, but remember this is the Government that decried tax cuts "for the rich". 

Apparently it's ok to cut taxes for those that earn the most.... if Labour does it.

Transport Minister Michael Wood even said on Newstalk ZB that the tax cut was an "investment". Here's a clue, almost every single time a politician says something, that involves your money, is an "investment", it's a lie, because you'll never get anything back from it. In this case, Wood, known as a leftie in the Labour caucus, has helped us all out...

I agree with him, tax cuts are an investment - an investment in believing people know best how to spend their own money.  It was theirs in the first place. 

What's particularly hilarious is the contortion of the tax cut.  Ignore James Shaw bloviating that it is subsidising fossil fuels. 

It's bullshit.

For a start, it is cutting a tax, not subsidising the market price of fuel, secondly it is just one "fuel". Diesel doesn't carry excise tax, as diesel vehicles pay per kilometre to use the roads.  New Zealanders are still pay the market price for fuel, plus (for petrol) some fuel tax and GST.  However, you can rely on the Greens to exaggerate for hysterical effect.

After all fuel tax and road user charges do not raise money for general spending, but for the National Land Transport Fund, so that Waka Kotahi can spend money on roads, subsidising public transport and now Kiwirail and coastal shipping.  They are effectively user charges so there is some user pays, although it's worth noting what this government spends the money on, and how far it has undermined the system that was once deemed best practice by the World Bank.

(From the 2021-2024 National Land Transport Programme)

69% of spending is on roads, the remainder is mostly spent on subsidising public transport and Kiwirail (26%), 4% on upgrading footpaths and cycleways and the remainder on administration and subsidies for coastal shipping.

Setting aside the 20% which actually isn't spent by the government, but comes from local government rates (on average half of spending on local roads and a bit less of public transport is from local government), 56% comes from road use fees in the form of tax on petrol, and road user charges on diesel powered vehicles, plus motor vehicle registration/licensing fees. 24% already comes from general taxes (either current or future).

By cutting fuel tax and RUC, Labour is substantially raising the proportion of money derived from borrowing from future general taxpayers, to around the same as fuel tax and RUC.  

Labour is now subsidising roads more than any government for decades.  Of course it is subsidising public transport like no government ever before, to the point that public transport users are now paying, on average, only around a quarter of the cost of paying for the bus driver and the diesel and maintaining the bus (or train). 

This is the same government that has an explicit target of cutting on average, 30% fewer km every year (50% if you live in a city) because it isn't just about climate change, it wants to mould you into a green citizen, that walks and bikes for most short journeys, rides public transport whenever it is available and just drive less. It's a centrally planned and controlled vision that doesn't respect people making the "wrong" choices, it is also supported by cutting speed limits, because it isn't just about safety, it happens to make driving less attractive compared to slower modes of transport.

However, Labour is now subsidising road use, and that includes road freight (note rail and shipping operators don't get any cut in fuel tax or road user charges, because they don't pay any, but they get subsidised anyway by other means).

So you have a Labour Government that says tax cuts (proposed by National and ACT) will threaten health and education.... but then implements tax cuts, completely blanking out the fact that this either means less money for other spending or it means more borrowing - for tax cuts.  How "sustainable" is that?

It says tax cuts will benefit the rich the most, and then implements tax cuts that do just that.

It says cutting fuel tax will jeopardise spending on transport, and then implements tax cuts on fuel.

Finally, it claims climate change is the great crisis that especially needs New Zealand, the country that emits 0.09% of global CO2 emissions  must radically change how it lives, by constraining private motoring, but then subsidises road use like no government in recent history.

Votes are much more precious that policy objectives though, as is leaving a fiscal bomb for the other side if the election is lost, although if it were up to me, the next government could think long and hard about whether it subsidises public transport and rail from general taxes anyway (assuming it wants to do that), and leaving fuel tax and RUC for roads only.

"Restore Passenger Rail" is a pathetic facsimile of Extinction Rebellion misanthropy

So for several mornings a group calling itself "Restore Passenger Rail" has shut down the southbound lanes of the Wellington Urban Motorway approaching the Terrace Tunnel.  This is completely bizarre stuff.

The disruption caused is enormous, not least because this is State Highway 1/2, the key route bypassing central Wellington, connecting the Hutt, Porirua and Wellington's northern suburbs to the southern and eastern suburbs, including Wellington Hospital and Airport.  Most recently they blocked State Highway 2 near Melling, making it impossible for some people to get to Melling Railway Station by car or bus.

The group is calling for passenger rail services to be returned to the extent they were in 2000, presumably excluding commuter services in Wellington and Auckland, both of which have expanded since then (Auckland has been electrified, with much more frequent services, and Wellington services extended to Waikanae, also with improved frequencies).

When asked on RNZ National, one of the spokespeople called for services to be restored as follows:

• Auckland-Wellington (which is actually operating although the overnight Northerner was cancelled in 2004)
• Auckland-Tauranga
• Auckland-Rotorua
• Wellington-Napier
• Picton-Christchurch (which is also actually operating)
• Christchurch-Dunedin-Invercargill and
• Christchurch-Westport (I think he meant Greymouth, which is also operating)

So they don't actually know what services are running.  They claim this is all about climate change and essential to save the planet.  This is completely unhinged, and if it wasn't a cause close to the heart of the Green Party and many on the left, a rational assessment of them would call their arguments misinformation and call them extremists - but no.

So let's make it clear:

1. Even if all of the intercity passenger train services that existed in 2000 were restored, the idea it would make a difference to emissions that was discernible in terms of climate impacts is absurd. Some people would take a trip they wouldn't have done before, some would have gone by bus, very few would have flown and a few would have driven.
2. Unless the trains carry several bus loads on average, every trip, they will generate more emissions than travel by bus.
3. It's all irrelevant because unlike agriculture, transport emissions are part of the Emissions Trading Scheme, within which a finite amount of emissions are available and sold as part of the price of fuel. Any shift will simply result in more emissions being available for other uses.

However I don't think any of the protestors know much about passenger trains and in fact they are just a NZ version of the Extinction Rebellion misanthropes.  They don't even know the train to the West Coast goes to Greymouth not Westport, any train enthusiast knows what trains used to run.  Of course they don't care that stopping traffic generates a LOT of additional emissions.

For all of their talk about saving the planet and humanity, one of the Extinction Rebellion founders, Roger Hallam, explicitly said he would block a road that had an ambulance with a dying person on board.

This isn't just environmentalism and it isn't really railway enthusiasm (which I have some sympathy for, because I like trains), but is hatred of human beings.  Hatred not only of their freedom of choice, but also their lives. 

What's particularly nuts is that Parliament is calling for submissions on the future of inter-regional passenger rail. (deadline next Friday 21st October).  The claim by the protestors that they have "tried everything" is vacuous empty nonsense.  This is undoubtedly the most rail friendly government for some time, and billions of dollars have been poured into Kiwirail to upgrade tracks and expand services, albeit the passenger focus has been on Auckland and Wellington, not least because most of the demand for intercity services was lost during travel restrictions under the pandemic.  

I'm not a fan of subsidising intercity passenger rail, because there are unsubsidised other modes that exist, and one of them (buses) will take some time to recover after the loss of international travel. However, I like intercity passenger rail, and if Kiwirail can develop a business case for new services, then good for them.  I was involved in reviewing intercity passenger rail viability in 2001, and the figures seen then were poor, but a lot has happened since then. The population has increased, overseas travel increased (although it may take another year or two for numbers to recover) and there may be more interest in travel  by rail, so I think there are merits in Kiwirail assessing opportunities or if it is not interested, in it being required to treat any potential private providers in a non-discriminatory manner.

but these protestors aren't REALLY interested in passenger rail. Do you really think they would stop disruptive protests if five new passenger train services were announced by the government? Of course not.

Of course not, they want attention, they want to promote catastrophism and they don't care for either the trappings of a free society to communicate their views like everyone else, or even a government that is sympathetic to their cause.

It's notable that the Government has said little about them, neither has the Green Party or Wellington's new Green Mayor, Tory Whanau. National's Chris Bishop called them "idiots" and rightly so, but maybe the Labour and Greens politicians LIKE measures that make driving more difficult, and don't want to abuse them?

They wont stop protesting until it becomes too hard for them to do so, they will block more roads and demand "action" from whatever government is in power, regardless of the action being carried out for their cause.  Because what they want is applause and approval from the like-minded, their own little network of misanthropes, and most of all, media attention so they can be interviewed, endlessly.  

This raises their social standing to have disrupted "evil" car "fascists" and drawn attention to a "righteous" cause (diverting taxpayers' money to some train services). They'll feel special and privileged, and hopefully get selected to go on the Green Party's list.

I doubt ANY of them have ridden on the Northern Explorer, Coastal Pacific or TranzAlpine trains, ever! Because it's not about trains.

It is, after all, performative, status-seeking, social misanthropy. 

Free public transport is not an environmentally friendly policy

Auckland's leading leftwing Mayoral candidate, Efeso Collins, has as one of his key platforms making public transport "free" at the point of use, by which he means he'll force everyone else (ratepayers and he's hoping taxpayers, as well as car and truck drivers) to pay for it.

The Greens, who want everything to be free, except your property rights, speech, powers to buy and sell and contract generally, support this.

Given how much publicity has been given to this idea, it's worth giving it a review.  You'll say, quite rightly, that a libertarian could never countenance forcing people to pay for others to get around, and you're right. Philosophically, the idea that if you want to travel somewhere, for whatever reason, that other people should be forced to pay for your choice of travel, is an anathema to individual liberty.  

However, let me put that to one side.  Does the idea that public transport should be fully taxpayer funded, has some merits? Could it actually result in less traffic, less pollution?

Tallinn, Estonia implemented free tram and bus travel for local residents in 2013. The National Audit Office of Estonia reviewed the impacts of the policy and came to the following conclusions:

• It did not reach its goal of reducing car journeys
• Public transport use increased, but not significantly
• Bus network doesn't meet the need of car users

A more detailed study of the impacts was more damning and it was based on a large scale survey in the city.  Note Tallinn previously had a fare-box cost recovery level of around one-third, so one-third of operating costs were recovered from fares, so fares were not high before. 

• Trips by public transport increased by 14%
• Trips by car decreased by 10%
• Trips by walking decreased by 40%
• Average distance travelled by car increased by 13%, resulting in total vehicle kms driven increased by 31%

Much of the public transport trip increase was for 15-19yos, 60-74yos, those on very low incomes, the unemployed/not in education.  However public transport trips for those on higher incomes decreased due to crowding. Higher income people preferred to drive. 

In short, free public transport saw more trips, most of them came from active modes, meanwhile the reduced car trips were more than offset by the remaining car trips being longer distances.  

This shouldn't be a surprise, Hasselt, Belgium (78,000 people) introduced free public transport in 1996.  The experience of that city was mixed:

• Public transport trips went up ten-fold
• 63% of additional public transport trips were existing users travelling more frequently
• 37% of additional public transport trips were new users, but only 16% came from car trips, the remainder were from bicycle and walking.  So the majority of mode shift was from active modes.
• There was also a five-fold increase in the bus fleet, doubling in bus routes and significant increase in frequencies at the same time as abolition of fares
• There was no noticeable impact on car ownership or change in trip mode share
• Free fares were dropped in 2014 because of the cost, with fare concessions applying only to only a small minority of passengers.

In short, free public transport saw people who already used it, used it a lot more often, and the majority of new users switched from walking and cycling to riding public transport.  

Templin, Germany (15,000 people) also introduced free public transport, in 1997.  The result were:

• 12 fold increase in patronage, with the majority being young people and children
• 35-50% of the modal shift came from walking, 30-40% from cycling, with only 10-20% coming from car trips
• Vandalism increased attributed to the higher numbers of younger passengers.

Once again, the main impact of free public transport is to attract people from active modes, so people ride buses instead of walking and cycling.  This costs more for taxpayers, costs more for the environment and so is a negative net impact overall. 

In NONE of the case studies of free public transport was there a meaningful impact on traffic congestion.  

In ALL of the case studies the two main impacts were:

• to encourage people who already use public transport to travel a lot more often
• Reduce walking and cycling (because people who walked and cycled found it quicker and easier to just hop on a bus)

Free public transport has a small impact on driving, but it is hardly worth the cost. It has a big impact on walking and cycling, which is a transfer from zero emissions transport to transport that generates emissions, both directly (fuel and electricity) and indirectly (production of buses/trams/trains, road/rail wear and tear).  

Some may say there is utility in people doing more trips by public transport, but if they were trips that weren't going to happen anyway, then the question is why should taxpayers/ratepayers pay for people to do joyrides, to visit friends, visit places they never thought of going before, just because it's free? Why is that a good use of taxpayer/ratepayer money?  

The simple truth is that free public transport is a political bribe that sounds nice, and gets a lot of support from some on the Green-left despite the evidence being that it is anti-environmental.  It might make a small difference to car trips, but it makes a big difference to reducing walking and cycling - and it generates a lot of arguably unnecessary trips.

So maybe consider that when voting in the local elections.

Emissions Reduction Plan on transport isn't really about cutting emissions

With the NZ Government releasing its draft Emissions Reduction Plan that it intends to present at the COP26 conference in Glasgow, it's worth reviewing what the Government wants to do to us so it can proclaim bountiful levels of virtue signalling, although New Zealand's significance at this is vastly exaggerated by its politicians. This is all about the USA, China, India, the EU, Russia and Brazil after all

I'll leave aside for now whether the target of "net zero" will actually generate any net benefits or not, for now take it as given that the Government wants to reduce greenhouse gas emissions (GHGs). I'll also just focus on the transport policy proposals.

There has been much wailing from radical environmentalists about how weak it is, which you might think means you should be relaxed about it. However, you should not, at least in terms of transport policy.

You see it was some years ago that the only economically rational intervention needed to reduce emissions in transport was introduced – the Emissions Trading Scheme (ETS). The ETS effectively puts a cap on emissions across around 50% of NZ’s emissions, including all domestic transport emissions. 

If you fill your car with petrol or diesel, part of the price includes the cost for fuel distributors of buying emission units that you effectively use when you burn fossil fuels.  There is a fixed supply of these units, and Government policy is to reduce this supply over time (although there was a blip lately), so the price will go up. 

As the price goes up, businesses and consumers respond, which for transport means they might change the vehicle the own or use, drive less, drive differently, change modes of transport, or just pay up and save money elsewhere.  

These changes would mean the vehicle fleet would change, or there would be more use of public transport (putting fare revenue up), or more walking and cycling (increasingly the economic merits of improving those facilities), or there will less demand for more road capacity or carparks, or people will make savings elsewhere. As demand evolves, then so will how existing infrastructure and services evolve, as they always have.

However, nobody joins the Green Party trusting individuals and businesses to simply make the best choices and to be free. You join the Green Party because you believe it is ethical and necessary to use the power of the state to compel people to do what you think is best for them. Banning and taxing what is “bad”, subsidising and making compulsory what is “good”, the Greens are fundamentally illiberal, and this Labour Government has outsourced climate change policy to that ideology. After all, the Nnew Labour Party of Jim Anderton Jacinda Ardern is a party of the big mother state.

The proposals here represent the most radical shift in transport policy and regulation of the transport sector in over forty years, taking it away from the current model, which seeks to reflect user decisions and choice, to one that regulates, taxes and subsidises planners' choices.

So let me start by reminding you throughout all of this, NOTHING the CCC proposes here will reduce emissions without using the ETS to reduce the emissions units available (which would put up the price of petrol and diesel). ALL of these proposals below reflect an ideology of central command and control, all for ZERO net impact. 

You might think the Climate Change Commission (CCC) would be focused primarily on reducing emissions, but its strategy for transport is much more than that (p.54):

Decarbonising transport also offers opportunities to improve the wellbeing of New Zealanders. Air pollution, crashes and congestion from traffic impose a large cost on our health, environment and economy. For many people and communities, transport is not affordable or accessible. The transition could make transport more inclusive, safe, healthy and resilient, and better support economic activity. 

Now if reducing emissions was seen as generating other benefits that may be all well and good, but this rather glib statement is used to justify a level of intervention in transport policy that has been unheard of in New Zealand for over forty years.  

You might see the link between lower GHG and lower air pollution, but fewer crashes?  For example, reducing the number of road crashes by reducing the amount of driving is like reducing the number of workplace accidents by reducing the number of jobs. Less congestion could ONLY come if there were a significant drop in motorised road traffic, which starts to give you a hint about what this is really all about.

The claim that for “many people and communities” transport is not affordable or accessible is equally glib and nonsensical.  Where's the evidence? Are there chronic problems in people accessing work, school or other facilities? If so you'd think they'd be mass unemployment and businesses struggling to access labour. New Zealand per capita car ownership is amongst the highest in the world.  However, I doubt the CCC thinks owning, let alone using a car is “inclusive” or “safe” or “healthy”.

The CCC's plan focuses on three main strategies to reduce emissions:

1. Reducing reliance on cars and supporting people to walk, cycle and use public transport. 

2. Rapidly adopting low-emission vehicles and fuels. 

3. Beginning work now to decarbonise heavy transport and freight. 

SO let's start...