Auckland Council says up to one in three public transport services may be cancelled or fares would have to double to cover the shortfall created by less favourable funding conditions proposed by the Government.
Officials say modelling shows an up to $500 million shortfall in the council’s budgets as a result of the coalition’s proposed transport policy statement.
The “dire” outcome sets up a clash between Transport Minister Simeon Brown and the country’s largest council, which has told the minister the issue is the “single most important change” he needs to make to his agenda-setting transport budget.
Fare rises or service cuts would be applied in “combination”, meaning the individual figures are only illustrative of the worst-case estimates if the shortfall was recouped entirely through one measure. Further rates rises could also be on the table.
It comes as patronage on the city’s bus and ferry services has recovered to around pre-pandemic levels, with train patronage lagging due to repeated disruption.
Without further top-ups, council officials said there would be an operational funding shortfall ranging between $80 million to $500 million, depending on the lower or upper ranges of what the Government had proposed for national public transport subsidies.
The council’s transport committee chairperson John Watson said existing fares were already “too high” and having them rise further would be “counterproductive”.
North Shore councillor Richard Hills said the choice of raising fares or cutting back on bus services would worsen congestion on the roads, leaving “dire consequences” for the city.
With up to 30% fewer services, modelling suggests more than 600,000 fewer trips would be taken every week on public transport, Hills said.
“Over 50% of those travelling across the Harbour Bridge in the morning are in a bus. Can you imagine if half of those bus users switch to their cars?” he said.
“You can bet the 90 people that were on the bus with me this morning — half of them will not be able to afford $10 each way to get to the city — $4.45 is already too expensive, but that’s way cheaper than fares from places like Franklin and Rodney.”
To cover the entire shortfall, council officials warned fares would have to rise between 22% and 136% or existing services would be slashed by up to a third.
If existing fares were to rise by 136%, a peak return trip from Takapuna to the CBD would cost around $21. A similar return trip from Papakura to the city would cost about $34.
Service cuts would “likely result in increased levels of congestion, particularly during the peak periods. Many services providing basic public transport access may also need to be cut, with the prospect of many suburbs losing bus services altogether,” officials wrote.
Auckland Transport would also be unable to fully fund new services to coincide with the completion of the City Rail Link and Eastern Busway, the council warned.
‘Get on with the person with the money’ – mayor
Claims of a substantial public transport funding shortfall emerged during an extraordinary meeting today, called for councillors to discuss their submission to the Transport Minister’s Government Policy Statement (GPS) on transport.
Transport Minister Simeon Brown said the funding ranges proposed in the GPS would be “adequate support for the public transport services that New Zealanders need”.
Every three years, the GPS lays out the broad strokes of how the government of the day wants NZTA Waka Kotahi to spend money across the transport system.
The council’s vote to endorse its submission was carried 16 votes to three.
On raising public transport fares, Auckland Mayor Wayne Brown said the cost of driving was also expected to go up in the same period, and that “we’re no longer a rich country where the government can just print off money to fill everything up”.
He said the council was simply “pointing out bits and pieces that are not there” in the Government’s proposal with its submission.
“There’s no sense throwing a rock at the person who’s got the money,” he said.
“It is the Government and they are entitled to raise the cash and spend it as they wish. One of the things I’ve always taught in business is to always get on with the person with the money.
“So, I think it is just the right approach, and I encourage you all to see it as a document in toto, rather than a collection of 138 sub-clauses — some of which may piss you off or not.”
Meanwhile, Howick councillor Maurice Williamson criticised the council’s “scattergun” approach in its 30-page submission. The former MP was previously the transport minister under Jim Bolger and Jenny Shipley’s National governments.
“I think we do ourselves a great disservice, in supporting a piece of paper like this, which we get almost no time to do any work on,” he said. “There are some really good bits, and there are some really bad bits, that make us look foolish to be supporting it.
“It is not going to achieve the objective that I would like the document to do, and that is to get the Government to listen because they’re wrong in some parts of this GPS — that I’d like them to change and we could have focused on those specifically.”
The Transport Minister said in a statement: “The draft GPS provides significant funding for public transport with up to $2.3 billion for public transport services and up to $2.1 billion available for public transport infrastructure over the next three years.
“Last year, NZTA provided approximately $500 million for their share towards public transport operations in the country.
“The range that the Government has provided in the draft Government Policy Statement is between $400 and $750 million. This range means there is adequate support for the public transport services that New Zealanders need.”
At last year’s Budget, the previous government provided a one-off $140 million top-up to maintain public transport service levels due to rising operating costs and lower usage.
Officials in Auckland say with patronage recovering to near pre-pandemic levels, the proportion of operating costs covered by fares has risen to around 30%.
Speaking to councillors, Auckland Transport chief financial officer Mark Laing reiterated the urgency of the funding issue: “Even in the middle of this activity class means a scenario where you have to put through significant fare increase and cut services.
“We’ve had feedback from Waka Kotahi on the submission and … they were just wondering if we’ve elevated some of these issues highly enough. The one thing that concerns me the most in here is our ability to keep running buses on July 1.”