Baldock offers solution to funding local roads
United Future MP, Larry Baldock, has offered a radical solution to the growing problem of funding the construction and
maintenance of local roads throughout the country.
The party’s transport spokesman says “One of the concerns expressed by opponents of the Local Government Bill, now
before Parliament, is that when local councils are given powers of general competence, they will begin to engage in new
activities that can only be funded by increases in rates.
“In effect, central Government is devolving responsibility to local Government without passing on any funding. The
citizens will therefore be faced with an increase in rates and no reduction in income tax.
“But if we change Government policy so all revenue from roading-related taxes is used on road-related expenditure, we
could offer a solution that addresses both the needs in roading and the concerns with the Local Government Bill.”
Mr Baldock says the Government road funding agency Transfund currently pays local councils approx 40-45% of the costs of
local road construction and maintenance, about $322 million in the 2002/2003 financial year . “If the Government,” he
says, “adjusted this percentage by 5-10% each year over the next 5 years, local councils would have additional income
(or at least a greater percentage reimbursement from their local road costs) that should enable them to keep rate
increases to zero or at least level with inflation.
Mr Baldock says this would be particularly helpful in rural territorial authorities as a great deal of their expenditure
is on country roads.
“We would be assisting farmers who are major contributors of rates to rural local authorities and assisting local
bodies, who always have tight budgets.
“In addition, the public will see that Government is making some progress on addressing the issue of skimming off funds
from the national roading funds,” he concluded.