Road Torque News

Bits of Bollocks: The National Land Transport Fund
Posted: 21-Apr-2018 |


This week in bollocks we look at the political landscape and discourse surrounding the Land Transport Fund.

1. Political Independence

The NLTF initiative was set up 20 odd years ago as a way for roading projects to continue adequately, void of ideology, through successive governments. The idea is that because roading is a contentious issue depending on which side of the political line you fall there is a chance that a new government may neglect old projects that the previous government had begun, bringing the whole thing to a halt.

The NLTF also provides a way for non-biased, independent, cost-benefit analyses and budgeting to be done void of pork-barrel politics. This is crucial in deciding what is in the country's best interest as a whole based on expert analysis, not what is best in the eyes of a group of potential voters.

2. Modality

The NLTF was set up as a user pays the way of funding roading projects. People who use the roads both recreationally and commercially pay excise on their fuel. This tax goes into the NLTF and in turn, goes towards improving the road network that those people use.

Currently, the coalition government wishes to diversify the NLTF into other modes of transport, using the fund to pay for light and heavy rail, mostly in Auckland.

3. It's all going to rail

The argument that in principle the NLTF should not be paid by road users and go towards rail is justified. However, much of the debate surrounding this issue is that a huge amount is going towards alternative modes of transport.

While the sum is a great deal upon what has previously been spent on the rail the vast majority of the NLTF will continue to be spent on roading projects. However, this may lead to delays (even cancellations) in some important infrastructure projects. Delays are certainly expected but anything else beyond that is speculation until it is announced.

4. Trains can take on the freight task

The debate surrounding the use of the NLTF can be broken into two areas, principle and pragmatics. Ultimately, it is fair to say that those who have suggested that trains could take the entirety of the freight task have their head in the clouds. However, it would be unfair to outright dismiss a more moderate view.

Some have suggested that trains can take more of the entire freight task than they currently do. This would take some trucks off the roads, thus making road freight less congested and more efficient. Thus, because rail benefits road transport, they should be allowed to dip into the NLTF. This may be the case, but it entirely depends on how much more of the freight task they take, this is vague at best.

The next suggestion is that having more public trains takes the strain off of metro freight through reduced congestion on city roads. While a nice idea, there is no way of knowing how much these projects will realistically reduce congestion compared to large-scale roading projects.

Finally, one other suggestion is that rail is better placed for long-distance freight, while trucks are better suited for 'the last mile' of the freight task. This argument is true but misses a crucial piece of the puzzle, rail is suited to long-distance freight, yes, but freight that is not time sensitive. Ultimately, expansion of rail freight could definitely be beneficial to the overall efficiency of New Zealand transport, however, this limited to one kind of freight. More analysis needs to be done into the exact level of impact an expansion of long-distance rail freight would have before dipping into the NLTF (if at all necessary).

Overall, the debate surrounding the National Land Transport Fund is full of bollocks and political rhetoric. In the end, the argument from principle seems to make sense if you are already in favour of having the NLTF exclusively fund roads. However, the argument from pragmatics clearly concludes that for the time being the NLTF should be used for road projects until a definitive case for more rail is made.


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