Aucklanders will have to pay higher rates or miss out on major road and public transport improvements if the Government
goes ahead with cancelling the Regional Fuel Tax (RFT) this year.
Today, the Minister of Transport, Hon. Simeon Brown, announced that the Government intends to enact legislation to
repeal the Land Transport Management (Regional Fuel Tax) Act, with the RFT scheme ending on 30 June 2024, four years
earlier than planned.
A Curia Market Research Poll[1] commissioned by the Office of the Mayor in November 2023 found that 44 per cent of Aucklanders want to keep the RFT,
while only 26 per cent were in favour of cancelling RFT projects, and just 22 per cent favoured increasing rates to make
up the shortfall in funding.
“While I acknowledge that the National Party campaigned to repeal the RFT, and they are making good on their election
promise, this decision will have unintended consequences unless the Government is prepared to foot the bill for upcoming
transport projects,” Mayor Brown says.
The cancellation of the Regional Fuel Tax will leave a shortfall in transport funding for Auckland of $1.2 billion over
the next four years. Furthermore, the loss in revenue will mean that Auckland Council’s debt-to-revenue ratio will
increase, meaning the council has less ability to borrow when it needs to. *
The Government has been advised that, when the scheme ends on 1 July, there will be around $350 million of unspent money
held in reserve. However, these funds will only be enough to complete the next stage of the Eastern Busway (including
the Reeves Road flyover) and fund the purchase of electric rail units for the City Rail Link.
“The money set aside has been fully allocated to projects that are under construction. It just isn’t spent until
contractual milestones are met. That’s standard practice when you’re building something,” Mayor Brown says.
“Auckland Council will have no choice but to pause any further work on projects funded by the RFT, including those
already contracted, to see how we can fund them in the Long-term Plan.”
RFT-funded projects that could be cancelled include planned improvements to major roads such as Glenvar Road and Lake
Road, as well as the fourth and final stage of the Eastern Busway and work to progress the proposed Airport-Botany
Busway.
“I must be honest with Aucklanders about the financial constraints we are under. As a direct consequence of the
Government’s decision to cancel the RFT, some of these projects may very well be cancelled altogether,” Mayor Brown
says.
“I remain determined to keep rates under control and I’m simply not prepared to pass the cost of these projects on to
struggling Auckland households. I’ve already proposed to cut spending on cycleways by $141.5 million and raised
pedestrian crossings by $80 million. I’m quite happy to talk with the government about what else we can cut.”
“But this is a problem that can’t be solved just by making cuts. Every Aucklander agrees that our transport system is a
mess and it’s going to cost a lot of money to fix. That money must come from somewhere. Unfortunately, the Government
has just made it a lot harder for us,” Mayor Brown says.