Motorway costs blow-out by $300m

The latest cost blow-out in the Wellington Northern Corridor motorway project raises further questions about why the Government is committing $12 billion of taxpayer money to projects with low or negative returns for the economy, Green Party transport spokesperson Julie Anne Genter said today.

Figures presented by the New Zealand Transport Agency to the Wellington Regional Council on Friday confirm that specific motorway projects within the Wellington Northern Corridor have already increased by $231m, more than 10% since announced by the National Government in 2009.

Answers to parliamentary questions lodged by Ms Genter confirmed that the estimated total cost of the Wellington Levin to airport motorway had increased from $2.1-2.4b to $2.4-2.7b.

“The business case for the Wellington Northern Corridor didn’t stack up before this cost blow-out, and it makes even less sense now,” said Ms Genter.

“$300 million is the entire cost of providing public transport to the region for three years. We could double bus and train services and decrease fares just out of the increase in of the cost of this ridiculous motorway.

“It’s smarter to invest in better buses and trains. They not only move more people around the region at lower cost, they also free up our existing roads for cars and freight. Targeted improvements to the route can address safety and pinch points much more effectively than throwing billions at a new motorway.

“Prior to this cost blow-out, the airport to Levin motorway had a benefit cost ratio (BCR) of 1.2 – that is, for every dollar spent, just $1.20 of benefits would be realised, which is a very low level of return on investment.

“NZTA has failed to update its BCRs since 2009 despite falling traffic volumes, but even assuming the same level of benefits as modelled in 2009, the business cases must now be significantly worse.

“We don’t have to pour billions of dollars of taxpayer money down the drain on unneeded motorways that only lock in our dependence on imported oil.

“There are plenty of smart, green transport projects that make economic and environmental sense that are crying out for funding,” said Ms Genter.

Supporting information:
NZTA report to the Greater Wellington Regional Council on the 2012-2015 Regional Land Transport Programme Gerry Brownlee’s answer to Julie Anne Genter’s parliamentary written question