Auckland light rail - some thoughts UPDATED

The Government's announcement that it has chosen a nearly $15b option to build a single light rail metro line from Wynyard through the Isthmus to Mt Roskill then Mangere and the Airport utterly astonishes me, Although I obtain some schadenfreude from the urbanists upset that it isn't a street tram (in part because they WANT it to take away road space from other traffic), I remain utterly gobsmacked that the amount of money concerned and the hype surrounding what it is mean to do doesn't appear to have much concern at all from The Treasury.

On purely opportunity cost alone the idea that it is worth spending that amount on money on ONE fast tram line ought to be shades of the Think Big debacles of the 1970s and 1980s.  Sure it is easy to question whether some of the motorway projects the National Government advanced were the best use of road users taxes, but this is in another league.   If you were to put all of Kiwirail on the market, and even guarantee ongoing operating subsidies for commuter rail in Auckland and Wellington, I doubt you would get one-tenth of the capital costs of that single line - that ought to put in perspective what this is about.

What gets me the most is that the very basic pure public policy questions surrounding this project haven't been asked, it looks just like a politically driven legacy project, fueled by Phil Goff on the one hand, with Michael Wood and Grant Robertson willing to jump on the boondoggle.

Of course it has an "indicative business case", which like all massive government projects aren't business cases at all, because there is no business here. Auckland Light Rail will never generate a financial surplus of revenue over operating cost, let alone a return on capital.  Of course, large government transport projects rarely do, but the language used is instructive, because some companies will make a fortune from Auckland Light Rail, in construction and technical consultancy.  A common assumption that NZTA historically used for major projects was that 15% of construction costs were consultancy and technical advisory services, and there are multiple companies circling around that trough, after all it's over $2b in fees. NO consultancy has a commercial interest in being critical of this opportunity to obtain serious bonuses for their New Zealand operations. 

Anyway, what about this business case (PDF).

It says:

The following sets out the problems that the proposed investment in rapid transit will address:
• A high reliance on cars is adversely affecting the climate as well as increasing harm from injury and pollution
• Increasing congestion will further disrupt and lengthen travel times, threatening investment and quality of life
• Some communities have worse access to public transport connections, creating inequity and reducing social cohesion

This is frankly pathetic.  So the problems are "too much car use", "congestion" and "poor public transport connections".

Even if you leave to one side the absurdity that high reliance of cars in Auckland is adversely affecting the climate (like a child urinating in Lake Taupo is poisoning it), climate change policy is addressed through the Emissions Trading Scheme, which caps emissions from transport.  The efficient tool to address this is to lower the cap, increasing the price of fuel, so people drive less. If this is about climate change it's a monstrously wasteful way of doing it, and it wont have any meaningful impact.

The claim of "increasing harm from injury and pollution" is questionable.  MoT resources state:

and there is no evidence of increasing pollution, largely because engines are getting cleaner and there is a growing number of low and zero emission vehicles.  However, it doesn't really matter.  If you think a primary reason to build a light rail metro is to address injuries and pollution on the roads then you're a moron.  You can reduce injuries by better enforcing drink driving laws, speed limits, traffic light violations dangerous driving, not build a light metro line.

Then there is congestion.  The reason there is traffic congestion is that demand for roadspace exceeds supply and politicians choose to price that roadspace the same, everywhere in NZ at all times. Price it higher at peak times and locations and congestion will ease. Price the roads properly and there is more space for buses, and buses can run more frequently and reliably, but that's not exciting for politicians.

Building a light rail metro wont ease congestion, although it WILL provide a fast link, given that passengers are forecast to not be willing to pay more than a small fraction of the cost of building and running it, suggests they don't value time THAT much, and more importantly, that congestion isn't bad enough for them to pay a lot more to avoid it. 

"Threatening investment" by whom? If you think Auckland Light Rail will relieve congestion across Auckland you're a moron, in fact you're a moron if you think it will relieve congestion on the corridor it will serve too.

Finally there is the badly worded "Some communities have worse access to public transport connections" worse than what? This is no doubt true in some form, but do you really think $15b is best spent on a single light rail metro line when you could almost certainly spend a tenth of that on frequent cross-city buses and bus priority measures to seriously uplift the city's public transport network? 

After all this connection will be nice for people in Mt Albert and Mt Roskill wanting a quick trip into the CBD (remember only 13% of Auckland jobs are in the CBD), noting that Mt Albert already has a railway station connecting to the City Rail Link underground electric railway under construction.  Who wants to go from Mt Albert and Mt Roskill to Onehunga and Mangere? I doubt many do.  From Onehunga, the light rail metro will probably be slower than the existing train service, and from Mangere it is quite the indirect route to the CBD, but it is good to get to the airport.  Remember that, this will be a slow route from the airport into the city centre, but be marginally useful from Mt Roskill.

Then take this utter drivel from the "business case":

Using public transport to travel from Māngere to the city centre takes more than twice as long than using a private vehicle. As a result, private vehicles account for 85 percent of all journeys to work by Māngere residents

According to the census (using this remarkable visualisation), the number one destination for people from Mangere Central to work or school is Auckland Airport

It's a logical non-sequitur to claim that because it takes twice as long to go by public transport to the city centre than by car that this means that most journeys to work by Mangere residents are by car, because in fact only 5% of them actually work in the city centre.  

So when it estimates that nearly 32m rides will be taken on this line by 2051 you have to take it with a pinch of salt.  In 2019 there were 103m rides across ALL railway, bus and ferry routes in Auckland, so to expect ONE line to carry about a third of that is ludicrous. For that travel it is going to cost $109m a year to operate, so it needs to charge $3.40 per fare to break even on operating costs, but that's not going to happen is it? It is meant to have the capacity of 32,600 people per hou, this is not far short of London's Victoria Line (at 37, 226), does anyone seriously think that EVEN with intensification there is going to be that level of demand on this line?

So given THOSE problems to solve, Auckland Light Rail is an abject failure, it doesn't address any of these effectively.

So I'll make some not-so-bold assertions, that I would happily have refuted:

1. Auckland Light Rail will make next to no impact on traffic congestion (and the business case ADMITS this on pg. 59. 
2. There isn't going to be continuously growing demand for travel on this corridor to and from the CBD.  In fact, Covid19 and changing work trends mean that the norm will be that people wont be in offices five days a week, which completely undermines the case for large scale peak transport capacity in cities
3. For 1% of the cost of this project, there could be some significant improvements in bus reliability and travel times along corridors, with bus rapid transit, bus priority measures at intersections and use of road pricing
4. For 3% of the cost of this project, Auckland could have an interconnected cycle lane network across the whole city
5. For another 6% of the cost of this project Auckland could have a comprehensive network of bus lanes and bus priority measures, higher frequency services AND payment using contactless debit and credit cards which would address all of the social issues, and encourage people to drive less.
   
6. Auckland Light Rail not only wont and cant stop urban sprawl, but also is unnecessary to support housing intensification, primarily because most jobs are still not going to be anywhere along the proposed corridor.  Furthermore, housing intensification along the corridor will have a marginal impact on housing pricing
   

and no, there is even LESS point building the slow tram along the street that the Greens want, because they mainly want it to take away road capacity.  Tradespeople, freight and delivery are unimportant to them, it's just the war on driving, so that rightfully has been dismissed.

Auckland Light Rail is an incredibly expensive folly, it isn't transformative (but the money it costs COULD be transformative in more subtle, more geographically spread and more effective ways that aren't so exciting to politicians) and it is almost certain there wont be anywhere near enough demand to justify it. 

Fares wont pay a cent towards its capital costs, and even property taxes that could be levied to pay for it, wont pay for more than a small fraction of the project. Ratepayers aren't willing to pay for it, and there isn't enough money raised from motoring taxes to pay much towards it either. It needs to be scrapped, and Auckland transport planners (and both Auckland and national politicians) need to focus on how to make existing networks work better, rather than the exciting fetish of a big shiny high capacity boondoggle....

UPDATE:  Of course taxpayer-funded radio (RNZ) discusses light rail with a critical view from.... the Green/left perspective.  The argument Matt Lowrie from the urbanist blog Greater Auckland is partly opportunity cost (it's cheaper to build a slow tram than a fast metro, so there is money to spend on... more slow trams), but then he's quoted as saying it is needed for Wellington, Christchurch, Hamilton and Tauranga? It's economic insanity, but why should anyone be surprised that state radio regards a different perspective to only be from its own tribe of Green Party supporters.

Fifth bailout in twenty years

The announcement by the New Labour National government that it is spending NZ$750 million of your money, to strengthen a company that the Old Labour government bought for NZ$690 million ought to provoke outrage on behalf of those supporting the current government, and should condemn Labour and its cheerleaders the Greens to history for being the most egregious destroyers of taxpayer wealth since Sir Robert Muldoon.

It should be so obvious to a child that buying something that is worth NZ$690 million and having to spend $750 million to save it is lunacy. Labour receives the blame for the former, and now New Labour National does for the latter.

What to know why you're not getting a real tax cut? Ask both of those gangs of reckless spendthrifts. Why their parents didn't spend a couple of hundred bucks to buy them train sets when they were kids so they could indulge in this pastime is beyond me? (mine did by the way).

Will Kiwirail make a profit that will even approach to recovering this (and the other money poured into it in the past year or so)? No. Indeed, the goal is to be "self-sustaining", which presumably means make an operating profit, not recover the long run cost of capital in this very capital intensive business.

The problem is we've been there before. Government is regularly using your money to rescue railways in New Zealand. The first time was understandable, the second time could even be partly excused as due to the legacy of Think Big, but ever since then it has worn a little thin.

The simple truth railway enthusiasts (and I count myself as one of those) have to accept is that the economically viable future for railways in New Zealand is to operate a severely curtailed network carrying moderately high volumes of containers and bulk commodities.

Two years ago I wrote this post, still valid today, where I outlined what looked to be viable and what did not. Railways north of Auckland have little future, as does the line north of Masterton and between Stratford and the main trunk. The Napier-Gisborne line has had a fortune poured into it, so may be best to keep mothballed in the event of traffic.

David Heatley from the NZ Institute for the Study of Competition and Regulation has an excellent presentation called "The Future of Rail in New Zealand". I wrote about it as well.

You see the railways were bailed out in 1982 when transformed from a government department to a commercially oriented corporation (the first "SOE" before the term SOE was coined).

The railways were bailed out again in 1990, in part to pay the full cost of the main trunk electrification approved before corporatisation (and which was found to be a loss making capital investment even if the electricity was supplied for free), and in part to pay for the restructuring following the removal of the monopoly on long haul freight.

Then it was privatised in 1993.

It was bailed out once more when Dr Cullen bought the track from Toll Rail (having earlier paid over the nose for the Auckland rail network), and then refused to enforce the cost recovery track access charges needed to pay to maintain the network.

The fourth time was the renationalisation, by paying well over the market price for the "business" it kept it open, except that it is unprofitable.

Now you're paying more, this time to make it "viable".

Darren Hughes has said the $750 million isn't enough, because $11 billion is being spent on roads. Yes well done Darren, noticed a railway to every business and home? Noticed how many people use roads compared to railways (most lines you can wait hours for a train of any kind to appear)? Might you be better asking why YOU voted for taxpayers to pay over the odds for this dog of an asset? What is he trying to achieve besides looking like he's addicted to spending bad money after bad? Does he want to spend $11 billion on railways??? He says "I think we need to be looking at how we move freight from, say Gisborne on the east coast, to Napier port". Who is this "we"? Because almost all of it goes by road, as it is substantially cheaper. This was looked at when you were in government Mr. Hughes the simple answer is that there is damn all freight from Gisborne to Napier, because Gisborne has a port. The distance is far too short for a viable rail freight operation.

This example shows all too obviously how inane the Greens are on railways (believe in them, believe in them), how blatantly wasteful the Labour was in renationalising it and how the Nats are too damned scared to do what actually needs to be done - get Kiwirail to borrow the money for its renewal itself.

If there are people willing to buy trains and run them on the network paying to use it, then let them. If there aren't then mothball parts of the network and offer to sell it to whoever wants it.

The arguments that the railways save money are clearly ludicrous.

If there is a desire to ensure rail and road are on an equal footing then set up the highways as a profit oriented corporation that borrows and invests in its network paid for by user fees.

Then both networks can be self sustaining, and be privatised. Hopefully then the ongoing political fetish of saving a network that, by and large, has had its day and is now only viable for a few core freight tasks, will be over.

Commuter rail for Christchurch? Cheaper buying them each a Porsche

I'm being a little tongue in cheek here, but the proposal from the Labour Party to spend $100 million to give Christchurch a commuter rail service is so utterly ludicrous that it deserves ridicule.

Anytime a politician says he will "invest" your money, you know that you'd never see it again, and that's exactly what would happen to the $100 million David Cunliffe wants to waste on giving Christchurch a transport service that it neither needs nor is willing to pay for.  In the USA it would be called a boondoggle, a political driven project that has little basis on market demand or economic benefit.

The policy is described here, and then here and here, showing how much effort has gone into something that isn't even important.

I nearly wrote a lengthy post pulling it apart bit by bit, but it's much easier to list what's wrong in a few bullet points.

- Christchurch last had the remnant of a local rail service in 1976 when a once daily, yes once daily, service between Rangiora and Christchurch was scrapped because of lack of patronage.  The last regular service (as in all day service like in Wellington) was between Lyttelton and Christchurch, which ended when the road tunnel was opened in 1972 (the rail service only had an advantage over driving over the Port Hills).  Before that, other services were discontinued during the 1960s as bus services proved more cost effective and car ownership rose.  Christchurch's population grew by over 50% in the period between the end of these services and the earthquake, indicating it was hardly constrained by a lack of passenger rail services.

-  It wont unclog Christchurch's roads.  The Press report says Labour intends the system to accommodate 10% of commuters from the north to central Christchurch.  Phil Twyford says there are 5000 - yes 5000 commuters making this trip (10,000 trips), so it is $100 million for 500 commuters.  That comes to $200,000 per commuter, before any operating subsidies are considered.  In other words, the price of a Porsche 911 for each commuter.  Taking about 400 cars off of Christchurch's roads every morning isn't going to "unclog" them,  it hardly makes a difference, even if it did happen.

- However, what it might do is encourage more people to live further away from the surrounding suburbs closer to the city, because it subsidises living well outside Christchurch.  That's hardly conducive to reducing congestion, nor environmentally sustainable.  It would be far more preferable to focus on finishing renewing the local road network including marking out cycle lanes, than to incentivise living well out of the city.

- A commuter rail service to central Christchurch can't even go there, as the station is 4km from Cathedral Square, in Addington.

- The $100 million is to double track the line to Rangiora, and rebuild some railways stations, but not a new central station (which can't be anymore "central" than the old one on Moorhouse Avenue), nor new trains, although the ex. Auckland ones could be relocated, if a depot could be built, and sidings to put them on were rebuilt as well.

- The rail service would replace commercially viable and some subsidised bus services, but politicians don't find buses sexy.

- The service would lose money, a 1000 trip a day railway service is a joke.  Proper commuter trains in major cities carry that number on one train.  

- If there really is demand for more public transport from the northern suburbs, it could come from commercial bus services.  Clearways could be used for bus lanes and the hard shoulder of the existing and future extended Northern Motorway could be used for peak bus lanes too, if needed.  Trains only make sense if buses are incapable of handling the volumes of demand, and that clearly isn't the case.

- Christchurch was the first major city in NZ to scrap trams, because the grid pattern street network and low density of the city meant there were few major transport corridors to support high density public transport systems, like trams (and commuter rail).  It was also the first of the big four cities to scrap commuter rail altogether (even Dunedin had commuter rail services until 1982 to Mosgiel).   In short, the geography of Christchurch is as poorly suited to commuter rail as it is well suited to cycling.

So when David Cunliffe says "The long delayed recovery of Christchurch hinges on a modern commuter system for the city"  you have to wonder what he's been smoking.

  

Really David? Really?? Not entrepreneurs investing in businesses creating jobs, and so attracting people who want to live there?  

No, David Cunliffe wants a toy, something he can point to and say "I did that", with money taken from motorists (as he wants to divert money collected from motoring taxes from roads to this pet project).  He has no real interest in reviving Christchurch by letting business do business, but to spend up on shiny projects that polish his ego - at your expense.

UPDATE: and the Green Party idea of creating a new bureaucracy called Canterbury Transport is equally ludicrous, because there isn't a governance problem.  Christchurch City Council is responsible for all roads except the State Highways, in the city (and no central government would rightfully surrender national corridors to local politics). It isn't broken up into multiple districts or cities like Auckland was.  Environment Canterbury, like all regional councils, is responsible for contracting subsidised public transport across the region, and planning urban public transport services.  Again, there is no division here.  It's far from clear what such an entity would do that is different from this.

Unless,. of course, you hark back to the "good old days" of council owned bus companies having monopolies and getting endless ratepayer subsidies. A model that saw the near continuous decline in urban bus patronage across NZ for 30 years.  You see at the moment bus services in Christchurch are operated mostly by two companies, one owned by Christchurch City Council, another by a private firm.  They typically compete for contracts for subsidised services, helping keep costs down and providing a check on performance.  The Greens are awfully fond of state owned monopolies, because you can trust politicians and public servants to be incentivised to look after customers and taxpayers' money far better than the private sector competing for both, can't you?

"Smartgrowth" is about trains

I've written extensively on this topic over the years - the crying waste of taxpayers' money being poured into little more than a dream, an ill-informed belief that Auckland's transport woes would be solved by an electric (now underground) railway.  It hooks into the same belief by planners that Auckland has to embrace the so-called "smartgrowth" or "new urbanism" philosophy, which is little more than a form of Soviet-style central planning and control upon the city - which has itself failed miserably in every New World city that has embraced it (and not delivered wonders for the old world ones either).

Not PC has been rightfully pointing out the fallacies behind this dogma, which at its essence is a belief that more people should fit into the same space, and that human aspirations for bigger homes, bigger gardens and more living space should be restricted ever increasingly, by stopping cities growing out, but encouraging them to grow up.  

I heard much propaganda around this when I was dealing with Ministry for the Environment and several planners in Auckland councils a few years ago.  They wanted in-fill development, they wanted high rise, they basically wanted less bedrooms and more people in residences.  Is that what you want?  It doesn't matter, because it is "good for the environment".  Why?  It almost entirely comes down to transport.

Planners in "new world cities" (cities outside Europe) have long bemoaned the predominance of the private car for most trips in cities and in particular most commuting trips.  Cars, you see, are bad because they clog up roads, emit nasty fumes and it is "unsustainable" to keep building new roads to meet demand (or new car parks).  (They ignore that cars today have the cleanest emissions than ever, but that is a diversion).   So do they ask questions as to why there is traffic congestion?  The simple fact that road use is priced the same regardless of demand, the fact that taxes collected from road users are frequently not allocated based on demand, but on politically driven imperatives?  No.  The planners are uninterested in economics, for they largely do not understand them.   They don't think that maybe peak time commuting would change if it cost more to drive then (and a lot less to drive at other times), they don't think that there could be innovative ways adopted by commercial road owners to get more capacity out of networks (e.g. intelligent systems for cars to operate in convoys in close formation).  No, they have a pet love affair with one thing only - mode shift - and it isn't to walking or cycling or even buses, it is trains.

You can see it in the Auckland Transport Blog, which has permeating throughout it this philosophy, a glorification of urban railways, a less interested concern in buses and a sneering hatred for the car and almost absent interest in roads at all or serious economics.   You see the blog administrator is a planner and he carries the philosophy he has been taught.

The main problem the railevangelists have is that one of the main reasons the car dominates is because with lots of people living in fully detached houses on sections, there aren't enough people within walking catchments to justify their pet dream - railways.   Railways need lots of people wanting to go to and from the same places at the same time.   New world cities don't have that, they have a lot of people heading in the same direction, but at both ends there are widely differing origins and destinations.   Urban rail projects in new world cities inevitably are not financially viable, because demand, especially off peak, isn't remotely enough to cover the costs of operating the services.

The planners want to change this.  They want you living on top of a railway station, or near it, or within walking distance at least.  With others.  So you might be in an apartment block, or in an adjoining block.  You see you need to live near lots of people doing that to make it "work" (not for you, the planners).   Want to build a new home outside urban limits? No.  That would be immoral, you might drive, you wont be supporting "your railway", and you never know where it might end, cities might sprawl forever!!

Of course it is nonsense.  The "smartgrowth" planners want you to have less living space, and consequently more noise, more shared spaces and to be near a railway so you drive less, then there will be less traffic, less pollution, less congestion and all will be better - except you wont be living where you want, because you can't afford the remaining low density homes (which are priced out of reach because supply is constrained), and traffic patterns wont have changed because you can't force businesses to locate where you want them.  They locate where it is best suited or they leave altogether or never start up.  Congestion wont have changed because the real issue is the price and supply of road space, which the planners have no interest in (other than a more recent interest in using road pricing to fund their rail fetish and penalise the bad cars). 

So yes, it is all about justifying the rail project.  It isn't about your needs at all.  If you want to see how effective it is in addressing transport needs you need look no further than Portland, the pin up city of the Smartgrowth evangelists, where public transport mode shares dropped.

So if it is about trains, wont they deliver wondrous dramatic improvements to travel around Auckland?

Well as I've said before:

- Only 12% of employment in Auckland is downtown.  The railway only exists on two main (plus one secondary and one small branch) corridors, more than half of those commuters wont be served.  On top of that the assumption is 28% of Aucklanders will live within 800m of a station by 2016, so maybe at best 4% of Auckland commuters will be served by the railway.  What about the other 96%?

- The average difference in travel time on roads will be less than 1km/h.  Whilst some rail users will transfer from cars, the effect will be hardly perceived by other road users. As a congestion busting strategy it will be an abject failure.  Largely because most people don't live near railway stations or work near them, which of course is why planners want to price you out of living away from them.

- Most of the trains will lie idle most of the time.  Over one billion in "assets" will be grossly under-utilised most of the day, and all weekends.  Only for two hours every rush hour will they all be used, mostly in one direction, for maybe three trips each, before being stabled to do nothing until a repeat performance in the evenings.

- Majority of rail users wont be motorists.  They will be existing rail users, existing bus users, people who rode with others in cars or people who wouldn't have travelled in the first place.  Maybe around a quarter would have driven, so it is a big subsidy to pay for people who would have used public transport anyway.

- Rail pushes out commercially viable buses.  Until the massive expenditure in rail, maybe half of bus  services in Auckland were unsubsidised and commercial.  Meeting the needs of those paying for them.  With heavily subsidised trains, these have been put out of business and the passengers ride trains without having to pay for more than a third of their operating costs.

- The money poured into the infrastructure can never be realised.  The Auckland rail network was valued by Treasury at a maximum of around NZ$20 million in 2001. It is having around NZ$1 billion poured into it.  Even if by some miracle it doubled in value, it is still a monumental destruction of wealth.  Even those who benefit directly from it are unwilling to pay fares to operate the trains, let alone contribute towards those mammoth fixed (and now sunk) costs.  

Right now, the railevangelists are demanding action on an underground rail loop because they believe Britomart will be congested after electrification, which hasn't even been completed yet.  They want planning for a North Shore railway when even the busway isn't remotely close to capacity.  

Electrification will happen, but it will prove to be a disappointment.  Yes rail patronage will go up, but so what?  Until rail passengers fully pay the operating costs of this dud, it will be a net economic drain on Auckland.  Parking, fuel and congestion charges shouldn't be used to prop it up.

However, roads do need to be treated differently.  The motorway network should be commercialised and sold, and the new owners allowed to charge whatever they like.  Then roads would not be so congested, money would be available to fix bottlenecks and maybe, just maybe, the rail network might prove some value.   Don't bet on the planners even considering this - for they are blinded by the lights of trains being good, not by achieving objectively determined results.

Bloggers vs journalists

Not PC mentioned about David Cohen's amusing dig at bloggers in the NBR. David Cohen is one of the few NZ journalists I rate, because he can write well, and he thinks. Indeed, as I have said before there is a difference between journalists and reporters, and sadly far too many in the mainstream media (and TV is significantly worse) are reporters. Their idea of a story is:

- The government announced it would do X today. It said that doing X would solve a long standing problem of Y and Z. The cost of doing X is $A, which Minister B said would be great value. Lobby group C supported the move cautiously saying while a step forward, it wasn't enough. National spokesperson D said it was too little too late.

Cohen put forward a 20 point test that is meant to mean you've moved from being a "mere blogger" to being a journalist. How destroyed is my ego that I haven't passed, (well I got 10) though I'll live as I am lot happier actually doing stuff than just writing about it, and my bank balance is happier too.

After all I am paid for my writing, I think my formal qualifications in law and public policy don't make me cry about having not done journalism, my writing is typically peer reviewed, I know the difference between practice and practise, I've used the OIA (and see how poorly a few journalists use it as they don't know enough to ask the right questions), I've often met deadlines, I've had my work read by Cabinet Ministers and Chief Executives of public and private sector organisations. So on and so on.

Keith Ng has a good set of questions too in response. My favourites from his are:

Do you ever write stories where more than half the content comes from one press release?

Do you ever write a story about a report solely from the press release accompanying the report, without having read the report itself?

Both are far too common, and infantile. Why should people pay to read such drivel when they can go to Scoop and read the press releases as they are?

I have a better set of questions for journalists, to see how smart and honest they are:

Do you make your political and religious affiliations transparent to your readers? Do you declare any political parties you have been a member of or donated to?Do you questions assumptions made in government reports and press releases, as well as opposition ones?

Have you ever asked a politician whether the answer to a problem is for the government to do nothing? Have you ever written an article where you analyse what might happen if the government did less not more in a particular policy area?

Do you ever make an Official Information Act (or LGOIMA) request knowing exactly what it is you need to know to determine what has gone on?

Have you ever written about H2's control on the areas of government policy she has the greatest interest in and which the PM trusts her in? Do you even know what she does?

Could you get a similar level job writing for The Times, Daily Telegraph, Financial Times, The Guardian or The Independent (UK not NZ!)? (or even the Economist?)

Do you understand that the value of money declines over time so quoting financial statistics without adjusting for this is not comparing like with like?

Can you accurately name under which Prime Ministers and Finance Ministers the NZ government privatised NZ Rail, privatised Telecom NZ, corporatised the Railways Department and privatised NZ Post? (trick question)

Do you know what onanism is (without going and Googling it now) and have you never had anyone describe your work as such?

Oh and while I'm at it here are some examples of journalism missing a point:

1. This article doesn't mention that Telstra Clear didn't install its own network, it is using Telecom's, so it is competition on unequal terms.

2. This article, didn't include any interviews with any school principals, even though it is about schools.

3. This article, quotes Chris Turver, ignoring that he was once a Wellington Regional Councillor until last year. It also doesn't even note that funding has been approved to extend the electrification of the rail network to Waikanae, so it looks like another problem ignored.

and that's just today.

"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. 

More fuel tax thanks to Labour

and the Greens, and NZ First, and United Future and Jim Anderton.

2c a litre next year, rising to 9.5c a litre by 2011. Yes, you needed that didn't you?

7c of it is to electrify the Auckland passenger rail network, which shows you how much of a great saving that will be, because fares can't recover that cost.
1c is for further upgrades to Auckland's rail network.
1c to help build the Penlink highway in Rodney District
0.5c to upgrade ferry terminals and a new ticketing system

Well it IS a Labour government.

National opposed it, but big surprise what did John Key say in response? *baaaahh meeeeee toooo* Getting used to National opposing policies it just never changes when it is in government? Getting used to wondering what the hell the point is in voting National yet?

The NZ Herald reported he "acknowledged a fuel tax as a "legitimate way" of raising money for electrification, but was concerned at the speed with which it would go up to 9.5c"

Meanwhile, according to the NZ Herald the rail worshipping Greens are unhappy that a small part of the new Auckland regional fuel tax, which largely comes from motorists is to be spent on - a road!! Yes, outrageous really - motorists paying for a road, when they should be happy to be paying for transport modes they don't use, and which aren't even within 10kms of them (rail). Given motorists on the North Shore will pay this new fuel tax and wont get a railway, maybe the Greens might ask why they should be paying this tax at all?

The Greens think the proposed Penlink road/bridge, to link Whangaparaoa Peninsula with the Northern Motorway, is inconsistent with the Auckland Regional Land Transport Strategy - a document that before Labour was barely relevant to transport planning (fortunately). It calls the Penlink project "pork-barrelling of the worst kind". Not that the Greens believe in special subsidies for projects no - I mean the Wellington trolley buses for example...

Unbelievable. So pillaging the pockets of road users, car users, taxi companies, bus and truck companies to pay the costs of building an electric rail network isn't pork- no, because those who use it wont be paying for it, but those who don't use it will.

Now the Penlink project was once meant to be a toll road, but its costs have blown well out and it is no longer viable - which tells you that it shouldn't be getting built at all as not enough revenue can be gained from tolls to pay for it - but for the Greens to feel blasphemed against because a new petrol tax may have less than 15% of its revenue spent on a road, tells you how disconnected from user pays they are.

Just think if car usage dropped 20% there wouldn't be enough money to waste on subsidising railways hmmm.

Kiwirail's illiterate and foolish fanatics

The NZ Herald report that the government expects Kiwirail to be financially self sustaining is a relief rather than a joy. It's the bare minimum I should hope for.

Meanwhile, the Labour Party, which destroyed $330 million of taxpayers wealth by buying this ailing business, after already letting it off the hook for not paying all track access charges that were owed, is desperately wanting you to pay more of your money to subsidise the freight movements of businesses. Labour can't give a single good reason why the users of rail freight deserve privileged treatment, and besides which, farmers are NOT dependent on Kiwirail. Fertiliser can go by road, and the milk that goes by rail is for Fonterra.

The economically illiterate lobby group "Campaign for Better Transport", which is largely aligned to the Green Party in terms of policies, goes further.

It is a relentless assault on the English language, that combines illiteracy of the language and punctuation with economic illiteracy and a strong hint of paranoid conspiracy theories. It is so damned ignorant that it is no surprise it isn't taken seriously by transport policy makers. I know, since I used to be one.

For starters, who can take seriously the following failures at English:

"Steven Joyce has come out swinging today against Kiwirail, as he says it will loose $1 million per day." Loose what??

"the Campaign For Better Transport (CBT) is questioning the Ministers figures" How many Ministers?

"Recently Joyce said KiwiRail was worth around $360 million dollars which we all know is unbelieveable" Unbelieveable? No, this preteen English standard is unbelievable.

"If I was a business owner I certainly would not put Steven Joyce incharge of quotations, Reeves said." incharge? Another new word. Comma missing too.

"In recent months is has become clear" is what?

"some unusal right wing groups have been producing reports with unusal facts and figures against Kiwirail" unusal? How creative, another new unusual word.

"yet it moves over 15% of the countries freight" What are all the countries?

"the nations rail network" Again, what are the other nations?

"The Campaign For Better Transport would like the Minister of Transport like" Like, whatever?

Poor Jon Reeves, he obviously did so badly at English at school (and CBT doesn't do spell checking) but wait, there's more. He can't even get his facts right.

He claims it is "ridiculous" to value Kiwirail at $360 million. Why? Because he puts forward the ludicrous implication that it be valued at replacement cost. As if anyone would pay replacement cost for it. As if Telecom, or any power lines company could be sold at replacement cost. Jon, it is called a "sunk cost". Money has been put into Kiwirail's assets that can never be recovered. You're no market analyst or businessman. By implication, Toll Rail was stupid to sell it at such a low cost and the sharemarket so badly wrong at undervaluing it, except for one point. It is worth $360 million because that's the value it might generate either in net revenues over time, and by implication, if sold on the open market.

Oh the Kaimai Tunnel? It is 8.879 km long, not 9.5 km long. Doesn't take much to check that fact, but then you're as good with facts as you are with spelling and grammar.

You wouldn't put Steven Joyce in charge of quotations if you were a business owner? Well he was a business owner, he was a millionaire at age 38 thanks to a business he set up at age 21. I don't think he really could give a damn what you think about his business acumen. Do you?

You claim that unusal (sic) right wing groups have been producing unusal (sic) facts and figures against Kiwirail. Who are these? What evidence do you have that the trucking lobby has been "working hard" on him, when he rejected their call to abolish road user charges?

You say "The Minister is throwing $8.8 billion dollars at roads so trucks can take away rail freight business", which is a complete non sequitur. The money for roads came from road users, who pay for road maintenance and capital expenditure, and besides, most roads don't compete with railways. Besides it isn't $8.8 billion a year yet you then say "giving Kiwirail only $90 million per year yet it moves over 15% of the countries freight"(sic). The money Kiwirail gets does NOT come from rail users, but from taxpayers. The link is illogical. Coastal shipping moves a fair proportion of freight but gets no subsidy, so what?

I might suggest that besides getting some literate spokespeople, the CBT might start having even a paucity of knowledge about economics and how the transport system is funded and financed, and throw away the paranoid conspiracy theories.

A better approach would be to read this article by Luke Malpass from the Centre for Independent Studies where he says:

"the present Government has only one policy option - the reform, rationalisation and resale of KiwiRail. The difficult reality is that many of the unprofitable lines must be closed while the Government prepares to sell off separate parts of rail to interested parties in the private sector. The rail system needs to shrink substantially to become viable in the long term. Only then will taxpayers be insulated from further political expediency and foolishness.

Without such bold action, rail is going to continue to be a drag on the economy and a constant cost for taxpayers, who have already spent a billion dollars on the business in the past year."

Len's boondoggle

If you want an example of why politics should be taken out of the sphere of transport then Len Brown’s policies provide some pretty clear guidance.  A lot of attention has been paid to his policies focused on building expensive electric rail lines to the North Shore, Auckland Airport and an underground CBD rail loop. These lines that would cost billions of dollars, would lose money year after year to operate and hence couldn’t be sold for even one twentieth of what it will cost to build them.  However, Len Brown is a politician – he has visions, visions of how to spend other people’s money and he doesn’t care whether this spending is worth it financially, economically or environmentally.  No, he’s joined one of the religions of recent times - Railevangelism – driven by faith, passion and a belief that trains are good, and a little thing like money shouldn’t get in the way of Auckland having more.

The cost of his plans approach NZ$5 billion.  To put that in context that is around two years total spending on land transport by government on roads and public transport, across the country.  It is double the total annual national take of fuel tax, road user charges and motor vehicle licensing fees.   So if you like Think Big, you’ll love Lenin’s Think Biggest. 

Ahh, but wont people use it?  Well sure they will, but you wont be charging fares that even cover the costs of running the trains (which need to be bought too, the $5 billion doesn’t include those).   You see the whole urban rail strategy is based on the trains not making a financial return.   So not only will the capital expenditure be a deadweight loss, but it will bleed money continuously unless the fares are increased to change that.  Funnily enough if the fares were increased the trains would be empty, which tells you exactly how much those who would ride the trains truly value them.

Ahh, but wont their be economic benefits from reduced traffic congestion?  You’d hope so for that sort of money, and a year on year subsidy, but this is where things break down a little.  Yes, the NZTA estimates that removing one car from peak time roads in Auckland and shifting the users to rail is a $17 benefit in reduced congestion.   However, will everyone on those trains have been people who would have driven cars?  Hardly.   Many will be existing bus users,  for the CBD loop some will have otherwise walked, some will have been car passengers (so the car is still being driven but the train offers a convenient option for the passenger) and yes some will be drivers of cars.  On top of that some will be new trips, trips that otherwise wouldn’t have been done,  but which you will have been forced to pay for.   Funnily enough the railevangelists treat everyone on a train as if it is someone who is doing good for everyone else by not driving a car, ignoring that many of them would not have driven in the first place.

Oh but wont congestion be reduced?  Really?  What new world city has made any impression on traffic congestion by building a new electric rail network?  Los Angeles? No.  Portland?  No.  Atlanta?  No.  In all cases the impact on traffic has been minuscule, and is more than made up by the continued growth in road traffic.  A large amount of money spent for next to no gain.   In Auckland only 12% of commuters terminate their trips in the CBD because most jobs are not downtown.  Len Brown wants to build a railway focused on servicing downtown Auckland where over 30% of commuter trips are already by public transport (mostly buses, which get ignored by many railevangelists because they aren’t politically sexy).  The simple truth is that his ideas will benefit a tiny percentage of commuters at a cost of thousands of dollars for every Aucklander.

Surely a rail line to the airport is a good idea and will take lots of people out of their cars?  Well it might take some businesspeople (they always need a subsidy) from taking taxis to the CBD, but the catchment area for airport trips is across all of Auckland.  Who will take the train to west Auckland or Penrose or Pakuranga or Long Bay or Point Chevalier?   Auckland does not and will never have the kind of high frequency metro service seen in London, Paris or New York,  so it will remain highly inferior to take any connecting trips by rail.   An airport line wont ever stack up.

Let’s be clear, the last and the current government have committed to wasting your money on a heinously expensive rail electrification scheme that is already costing a fortune.  Before that has even been built or proven by any measure, Len Brown wants to build the next few stages at around 3x the cost of what is committed already.   He isn’t even saying “let’s wait and see how it goes” in case it proves to be a financial failure or simply doesn’t reduce congestion, he’s calling for more money to be poured down this tunnel of faith.

The economically rational response to the rail programme is to treat it as a sunk cost, let the current contracts be concluded and eventually sell the whole thing off to whoever wants to run it.  The economically rational response to Auckland’s traffic congestion is to commercialise and privatise the road network so it can be priced and invested in according to demand, rather than political whim, and finally for Len Brown to get his pilfering hands out of the wallets and purses of ratepayers.   He is no better at planning how Aucklanders should move than he would be if he wanted to plan how Aucklanders should eat, dress or be housed!

Clark and Bolger - political whores

Chris Trotter’s curious comment in his latest column that Helen Clark and Jim Bolger are more similar than either is to Don Brash is not far from the truth. After all, both Clark and Bolger are political whores par excellence. If we look at both their political careers they have actively been a part of some of the most authoritarian and liberalising governments in recent history.
*
Helen Clark was Minister of Health in the late 1980s – when hospitals were being closed because of the archaic duplication of facilities across the country, and the health system was starting to face up to a structure reminiscent of the worst local authorities. Mental health was the poor cousin, as nobody got elected to hospital boards promising to increase funding for it. Clark was part of the beginning of the Rogernomics revolution on health care that meant that hospital boards couldn’t keep asking for more money without accountability for what was being bought. Clark was also in Cabinet when Telecom, PostBank and Air New Zealand were privatised, and also when it agreed to implement a flat tax. No doubt she held personal reservations about much of this, but in agreeing to be in Cabinet and a Minister, she wasn’t just a backbencher loyally supporting her party – she was in a position of power, part of the Rogernomics revolution and was widely loathed as small hospitals saw their range of services reduced. She succeeded Mike Moore as leader in 1993 with what has been described as a “Maoist” type of coup, and then worked hard to win the 1996 election.
*
Jim Bolger was Minister of Labour in the latter days of the Muldoon government. To his credit he supported voluntary unionism (repealed by Labour, reinstated in the Employment Contracts Act and not repealed by Labour), but he was also in Cabinet while Think Big was being progressed, wage/price freezes, interest rate regulations and continued growth in subsidies. Bolger supported one of the most leftwing interventionist governments in recent history, he was a part of it. After his election as PM in 1990 he led a government that continued Rogernomics, with further privatisations (NZ Rail, BNZ, Radio NZ commercial networks), reductions in state spending, structural reform of the health sector, reductions in welfare. The liberalising policies also saw Bolger fall out with Winston Peters, and start the process of electoral reform with referenda on change options and ultimately MMP itself.
*
The 1996 election showed the country what Bolger and Clark are all about. With National roughly maintaining its share of the vote at 33%, Labour’s vote collapsed to 28%, as the “talkback idiot” factor saw NZ First and the Alliance pull in as strong third and fourth parties. National needed NZ First to govern, ACT and United would not be enough. Labour needed NZ First to govern too, as the Alliance was not enough. So after the election, Winston looked like the cat who got the cream, and Bolger and Clark – both whom loathed Winston and his pandering to anti-Asian racism, started strutting their stuff in meetings with him like common K-Road whores.
*
Ultimately it was Bolger who Winston screwed, one reason being that while he could have screwed Clark, he also needed Anderton there watching, and that was less than appealing.
*
Indeed, Clark and Bolger have a lot in common – they were both desperate for power at any cost. Bolger could have walked away from it all and said – no – the National Party supports immigration and does not pander to populist nationalist politics (or some monosyllabic grunt that the talkback demeritocracy understands). So could have Clark. No.
*
Of course, as we all know, Bolger’s marriage with Winston didn’t last and the Nats paid the price in 1999, with Clark storming in with Anderton (and the Greens) to govern.
*
In 2005 it was different. National not only could not govern with a ragtag mob of United Future, NZ First, ACT and the Maori Party, but Don Brash had campaigned on NOT entering into government with Winston Peters. He was never tested as to whether he actually would have. Clark, by contrast, could have governed without Winston Peters, and had a choice of support from the Greens and/or the Maori Party instead, but she actively sought out Winston Peters – the man who continues to get support for either playing the “foreigners are dangerous” card or being Maori, and formed a confidence and supply agreement with him.
*
This all makes a mockery of the sort of drivel that says that National wants power at any price – Labour is at least as bad and has been willing to sell out immigrant New Zealanders by giving Winston his baubles of power and appointing him Minister of Foreign Affairs, even when it didn't need to.

Reaction to rail nationalisation

Predictably, the soothsayers and faith based activists for rail are bowing their heads in deference to the mountain of taxpayers' money thrown into buying the ferries and railway rolling stock. Don't forget this is $150 of your money taken to be used on this - you might have preferred that be spent on food, health insurance or some books for your kids - no you've been forced to buy a business that will cost you more again, each year, so that a handful of companies can move their freight more cheaply.

.

According to Stuff:

Mainfreight is cheering it on, after all, it will be a key beneficiary of subsidised rail freight.

Jim Anderton and NZ First's Peter Brown, both experts of regulatory economics (ha!), are wetting themselves with excitement. Peter Brown claims it "will result in improved service, innovation" though I wonder what he was drinking when railways were last government owned to think that state ownership means innovation and quality service. It was a national joke. Jim Anderton of course simply worships state ownership - remember that he will be deciding, along with other Ministers what trains you'll be forced to buy for the railways. Yes - the $665 million is only the start. It's worth noting that Air New Zealand, being publicly listed and partially privately owned doesn't have any such political interference (or subsidies) in its investment programme. However, you might wonder whether Peter Brown, whose personal policy fetish is coastal shipping - has realised the government is about to own one of the biggest competitors of the coastal shipping sector!

.

Richard Prebble claims the buyback may cost as much as $3 million a day in subsidies. He may not be far wrong. He also asks if different companies will be allowed to run train services on the tracks (as is the case in much of Europe and Australia) or whether the government will run a monopoly? It's a good point. Why shouldn't someone wishing to buy their own trains run a service on the publicly owned tracks, especially now the government has bought Toll's monopoly access rights?

.

The trucking industry, in the form of Tony Friedlander (ex. Muldoon era Minister of Works) of the Road Transport Forum said it was too early to comment. After all government owned rail is likely to compete with many trucking operations.

.

The Greens are of course thrilled that taxpayers have been forced to buy their idol - the railway rolling stock and locomotives. It would be nice if they actually used it more though. Nevertheless Jeanette Fitzsimons is already calling for you to be forced to pay for the slowest motorised long distance transport in the country - passenger trains! It takes six hours to go by rail from Christchurch to Dunedin (without speed restrictions) four hours to drive, less than an hour to fly. It takes five hours from Wellington to Napier by rail, 3.5 to 4 hours to drive and an hour to fly. Auckland to Wellington by rail can, at best, be done in 10.5 hours, seven hours to drive and one hour to fly. Few things excite the Greens more than rail transport - it truly is a faith based initiative.

.

National of course is opposing it, but wont reverse it. See that's what being in Opposition is all about - oppose a policy at the time, but go along with it when you get elected. It's called Ratchet Socialism - Labour advances socialist policies, and National can't move the ratchet back, (and has policy worthy of rat shit as a result). The claim the Nats make that it wouldn't get a good price for the sale. However, here's an idea. Don't sell it, hand out the shares to the general public. Give everyone a stake in the railways and hand over the shares. Publicly float them, see if the value is retained, and then people can bail out if they like. It wouldn't be "flogging off the assets to foreigners" it would be handing them to New Zealanders - true public ownership, though not one socialists agree with because it doesn't mean Cabinet is in control. However, David Farrar thinks there is a case for the state to own core infrastructure assets - so he wont think the Alliance is mad in seeking renationalisation of Contact Energy, Auckland and Wellington airports. Meanwhile Maurice Williamson has said National is committed to buying electric trains for Auckland. Why, except for votes?

.

I'll expect ACT will advocate privatisation of it again, as it should.

George Wood urges caution on Auckland rail

While the outgoing Chair of the ARC, Mike Lee, plays politics (he is an Alliance member from way back) in demanding the government cough up money for lavish rail plans that haven't even had any serious investigation done, George Wood talks some commonsense in the NZ Herald. The basic questions that rail enthusiasts, like the ARC, evade and avoid, because they have a grand vision of changing Auckland.

Wood is concerned about accurate costings and whether all these projects are good value for money, he notes "The Northern Busway Project was a good case in point. The final costs were considerably greater (nearly double) than the initial early estimations.". The record of rail project in the US shows on average public transport projects finish 20% above budget.

"A few decades ago the majority of employment was in the Auckland Central Business District. People now find their place of work is in the outer suburbs where they live, or they travel to other parts of the region.

In the case of North Shore City, in excess of 60 per cent of workers do not have to leave that city to find work. These days the majority of the Auckland region's workers never have to travel into the Auckland CBD."

He's right, but the planners still think of Auckland in the 1950s or want to go back to it. Only 11.7% of jobs in Auckland are in the CBD. So you might ask why spending over a billion dollars to service those jobs is worthwhile, particularly when half the people in those jobs don't live anywhere near a railway station or line. Half as many jobs are in Mt Wellington and Penrose, but the planners have no interest in commuters going there.

"In the next three years the operational subsidies provided by ratepayers will amount to $43.3 million. The remaining 60 per cent of this three-year operational cost, which amounts to $108.2 million, comes from petrol taxes and road user charges paid by Auckland's motorists."

So $36 million a year in subsidies, for around 8 million trips a year. So that means every trip carries a $4 subsidy. You might think it would be better if fare payers could pay that, but even if they did, it wouldn't start to cover the capital costs.

"Once the new rolling stock is purchased someone, and again it will probably be the ratepayers and motorists, will then have to pay for the depreciation of this equipment. This will amount to around $12 million a year" Oh and you're forced to pay for the rolling stock new as well of course.

"In 2001 ... we were told that 25 million passengers would be using the metro rail network by 2015. We are still a long way off this figure. The Auckland Regional Transport Authority has now revised its target down to 17 million passenger trips by 2016. This is still a huge increase when last year's annual figure was 7.9 million."

In other words, the massively inflated targets for patronage aren't being met, so the targets get revised and history is rewritten. What does that remind you of?

"Buses operating in the region carry six times the number of passengers carried by our trains. Buses are a far more cost-effective means of providing transport services to all our communities."

Indeed he is right. Buses carry around 43 million trips a year, (2007/2008) compared to around 8 million on rail. Some bus services are unsubsidised, but the annual subsidy total in Auckland for buses is around $93 million, so around $2.16 per trip. Cheaper than rail certainly, and it would be cheaper still if the ARC hadn't poured so much into contracting over commercial routes, and decimating profitable bus routes with the competing rail services. Subsidies were only $45 million in 2005, with similar levels of patronage, so the ARC geniuses have more than doubled subsidies with no net increase in patronage. Given the big increases to and from the North Shore with the new busway, this means significant declines on the Isthmus. This was before the recession.

So while George Wood is largely right, I wouldn't take the ARC or the new Supercity as the great model in fiscal prudence in looking after public transport in Auckland. I most certainly wouldn't think Mike Lee has any good record in knowing how to spend ratepayers' money. It's about time Auckland and central government took stock before pouring more money into Auckland's public transport networks.

Auckland rail money gone - like that!

How do you wipe out the value of hundreds of millions of dollars in an instant? Easy - spend it on a railway in New Zealand.

The government is going to spend $540-$600 million of your money on upgrading Auckland’s commuter rail network (which it bought from Tranz Rail for $81 million in 2001), which means finishing the double tracking of the Western line, a branch line to Manukau city and some resignalling and other improvements. Divided by Auckland households, that is around $1800 a household - would you rather have that money in your pocket, spent on healthcare, your kid's local school or on some railway tracks (before the trains have even run on them)?

So an asset that had a book value of $81 million (I’m being generous in not considering market value) is going to have at least $540 million poured into it, and after that? It will still have a book value of $81 million. Fabulous investment isn’t it? Could the private sector take money by force and eliminate its value so quickly and get away with it?

Ah, there are profits to be made from that investment that aren't realised in capital. Um no. No profits, in fact you can't even cover your day to day operating costs.

Ah, the rail advocates say, you forget the social and environmental benefits of being able to run more passenger trains because of reduced car traffic and traffic congestion. No I haven’t. They are just too infinitesimal to measure. The passenger train operational costs are 80% subsidised and the majority of users were former bus patrons. Many of those buses were not subsidised – so there is no net gain at all there in terms of congestion, just increased cost (a few buses off the road will make virtually no difference). The shift from car to rail is also very low – and makes virtually no impact on congestion - work done by the ARC a few years ago indicated that road traffic speeds would be improved by less than 0.5km/h. This taxpayer funding is around 50% more than the cost of building the Mt Roskill and Manukau extensions of SH20 (both of which will make a noticeable difference to congestion) - and those are funded from petrol tax, so are paid for by road users.

Remember the $540 million for rail does NOT include money for running the trains, or upgrading stations or new trains.

So should Auckland ratepayers be thrilled? Well being saved from funding the rail track infrastructure upgrade is one thing – but the quid pro quo is that capital expenditure on stations and trains will be entirely funded by ARTA, which means ARC rates and Auckland Regional Holdings dividends and cash assets. Operating costs continue to be subsidised 60% by Land Transport NZ (your petrol tax) and 40% from ARC rates. That will cost ratepayers a packet, and you wont see congestion reduce. The marginal difference to congestion made by these projects is tiny – because rail is very expensive, and most trains don’t go near where most Aucklanders work. Buses do better, they carry around 30% of commuters into downtown Auckland, but they are not sexy – and some of them are not subsidised. It costs little to put in bus lanes, or other measures to speed up bus journeys.

Ah but the trains provide Aucklanders with an option to bypass congestion. Well, if you can walk or bike or bus quickly to a station and there is another station on your line that is close to where you want to go -yes, if the train stopping at every station is faster than driving continuously. However only 13% of Auckland employment is downtown where most of the trains terminate. Look at a map of Auckland and where most people live, it isn't near the railway stations.

Of course the Greens want to spend even more money, electrifying the network (when that has not been proven to be worth the additional cost) and building lines all over the place, with little care for where the money comes from to pay for it - you see it is ok to make unnecessary journeys, wasting electricity and other people's money, as long as you are on an electric train.

So where IS rail viable?

Now despite all the doom and gloom about the rail network, the truth is that SOME of it is commercially viable. To show this I wanted to link to a map of the network on Ontrack's website - Ontrack being the state owned enterprise responsible for the railway network, but it doesn't have one.

Wikipedia does though here >>>>

Now of that network, you can split rail into five main businesses: Coal, logs/wood products, containers, milk and commuter passenger rail. The long distance passenger rail services by themselves could never sustain any of the lines. There is other freight, but it also is of a far smaller scale than any of the others, worthwhile on a marginal basis but not on its own in most cases.

Coal is predominantly West Coast to Lyttelton, but also some from Southland to Timaru and within Waikato (Rotowaro to Mission Bush). The West Coast line is viable for coal and that's it. The other services rely on other freight to bear the cost of the lines.

Logs/timber traffic is carried predominantly Murupara-Kawerau-Mt Maunganui or Auckland. Also Kinleith to Auckland/Mt Maunganui. There is some activity in Northland and Wairarapa to Wellington. However, it is the Bay of Plenty timber traffic that matters. Despite popular misconceptions, logs are not important freight on the Gisborne line (nothing really is, despite some forecasts in recent years). There is certainly insufficient log traffic for any of the Northland lines to be viable, with only the Murupara-Kawerau-Mt Maunganui/Auckland, and Kinleith lines really retaining enough traffic to be viable.

Container traffic is essentially movements between main centres and ports. The viable routes here are the North Island Main Trunk line, and the main southern line from Picton to Christchurch/Lyttelton and down to Dunedin/Bluff, with worthwhile flows between Waikato and Mt Maunganui. Beyond that, there really isn't enough freight to Taranaki or Napier to sustain those lines for this traffic.

Milk traffic forms the last major freight traffic on the lines. These movements are mainly southern Hawke's Bay - Manawatu - South Taranaki, Southland-South Canterbury. Again, these largely use routes carrying other freight, but do help sustain them.

As far as commuter rail is concerned, in Wellington it has a future, although the Johnsonville and Melling lines are not at all viable, money is being poured into it all so is really a sunk cost. In Auckland it is a major waste of money, but again partly a sunk cost.

So what is left? Well surprisingly quite a lot of the network is probably commercially viable, but frankly there are quite a lot of lines that have no economically viable future, unless some major freight customer wants them:
- All lines north of Waitakere in Auckland (expensive to maintain, low capacity)
- Rotorua and Taneatua branches (simply no viable freight)
- Napier-Gisborne (with big questions to be asked about Napier south to Oringi).
- All lines in Taranaki except south of Hawera (some expensive to maintain)
- Masterton to Woodville (mainly useful as a diversion for the main trunk line!)

The reason others are worthwhile comes down to either a single major customer, or having enough general freight. The latter is really just the north-south main trunks in both islands. Now if the government could only swallow those closures (or simply opening lines Toll doesn't want to operate to others if they wish), then there might be a viable railway for the trunks and the few bulk commodities that rail can handle well.

What does THAT network look like? Well this:

Not so bad really, with dotted lines where lines probably should close in the next few years (Napier, Southland and New Plymouth). Beyond that if Solid Energy, Fonterra and the forestry sector want rail, they should buy it - since all of the lines outside the main trunk are almost entirely about them. There is no reasons for the state to subsidise their freight movements.

Certainly the track is not worth the nonsense "replacement value" capital worth on the Crown's books of NZ$10.648 billion as listed in Ontrack's annual report. Now this DOES include some prime real estate, like Wellington railway station. That is where there certainly is some value, but $5.4 billion book value for railway infrastructure is simple accounting sorcery. No one would pay that for it, not in scrap and certainly not to charge someone to use it. If the government offered it for sale, that is not what it would go for, nothing close. The $4.9 billion for the land is similarly so, given that most of the land is a sliver of a corridor.

Oh yes I did forget one thing, the ferries. They ARE worth a good bit of money - the only consistently profitable part of the railway system for decades.