Fundamental Flaws in Road Funding not Addressed

The Government has once again failed to get serious about comprehensively addressing all the roading issues in New Zealand, says Federated Farmers Vice President Charlie Pedersen.

"The package announced yesterday by Transport Minister Paul Swain is only half a package, said Mr Pedersen.

"This Government appears to be more concerned about congestion in Auckland and lining the pockets of Tranz Rail's overseas owners than ensuring the productive sector of New Zealand has an efficient land transport system.

"A major inequity of the current road funding system is the use of local government rates, based on property values, to fund approximately 50% of the cost of local roads.

"To achieve the Government's goal of lifting New Zealand back into the top half of the OCED rates must be taken out of the funding of roads. The current system places an unjustified burden on the New Zealand farming sector, and is distorting market signals by subsidising forestry and tourism.

"A serious threat faces rural New Zealand if its District Councils cannot adequately fund the roading infrastructure of the hinterland. The situation will reach breaking point when the forestry expansion comes on line. A good roading network will be required - those who think rail will provide the answers need to think again.

"Greater investment is required in New Zealand's roading network. The Government's plans to divert more road users funds into less efficient alternatives will have the opposite effect to that which they seek to achieve. As New Zealand learnt in the late 1970s and early 1980's Governments are not good at picking winners.

"Federated Farmers urges the Government to establish an environment in which our exporters can compete on the world stage. For this to occur an efficient cost effective and response system of land transport is required.

"Continuing with the current model and using road users funds and property rates to subsidise less economic alternatives is economic suicide and will ultimately ensure New Zealand remains in the bottom half of the OECD."

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