Media statement Thursday, April 17th, 2003

Public transport review hitch hikes on local rates

Government's review of its contribution to local public transport announced yesterday will keep local council rates spiraling rapidly upwards according to the Employers & Manufacturers Association (Northern).

"Transport Minister Paul Swain's review of public transport is rich in irony," said Alasdair Thompson, EMA's chief executive.

"Not only is the review intended to load more responsibility onto property owners for public transport costs, it comes at a time when rates in the Auckland region this year are set to skyrocket already to pay for public transport.

"We need to straighten out some of the skewed thinking behind this ill considered review.

"First, Government does not "subsidise" the cost of local bus and ferry transport - it collects about $1.4 billion from petrol tax and other road user charges and Transfund re-distributes five per cent ($70 million) of it to regional councils to encourage people's use of public transport.

"Second, by assuming that ratepayers rather than public transport passengers will have to pick up a greater share of the extra costs, the review ignores the fact that Auckland Regional Council rates are going up this year by 34 per cent. Virtually all the increase ($27 million) is earmarked for public transport development.

"The review will also ensure increases in local council rates keep going up for years to come.

"In conjunction with the 'power of general competence' given to local councils recently so they can compete with Government in the delivery of social services, spiraling rates bills are assured.

"Third, business welcomes the strong growth in public transport. But if the re-distribution from Transfund to local public transport on a per passenger basis is becoming an excessive burden on the state purse, how does Government expect it to be more affordable by taxing ratepayers on a narrower, property owner, basis?

"It makes no sense. More people using public transport should make public transport more efficient and less costly with full buses and ferries. This increased efficiency and user charges should meet increasing costs.

"The public transport review is plainly another step towards shifting central government costs onto local ratepayers.

"Government is hitch hiking on ratepayers through their local councils thereby raising taxes by stealth.

"It's not what we understand 'open and transparent' Government to mean."

Comments: Alasdair Thompson tel 09 367 0911 (b)

09 303 3951 (h)

0274 982 024

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