16 Feb 2017

Govt rules out regional fuel tax for Auckland

5:14 pm on 16 February 2017

The government has ruled out a regional fuel tax for Auckland, leaving the city's mayor, Phil Goff, looking for new ways to fund transport projects.

Auckland motorway with traffic flowing

Photo: RNZ

Minister of Finance Steven Joyce said he has told Mr Goff a new tax is not part of the government's plans and any eventual road charges would only replace existing taxes and charges, not be in addition to them.

Mr Goff had been pushing for a new tax to plug a $400 million gap in funding projects in the city's plans.

He said rates could rise by 16 percent next year, when an interim transport levy was due to lapse.

"And I don't intend to impose that burden on Aucklanders because I think it's unreasonable and unfair.

"And it's not the best way of addressing the problem which needs to have a user pays component to it."

Mr Joyce said there were better ways to improve the transport situation, including getting outside finance - the private sector - to fund more of the transport infrastructure.

"And longer term talking about road pricing to take some of the pressure off to encourage people to travel at off peak times," he said.

Mr Goff said if the government remained adamantly opposed to a regional fuel tax, it would need to come up with another workable solution, that was quick to implement.

"If it can't be implemented for five or six years, what do we do in the interim when every year there is a funding shortfall of $400 million?"

Mr Goff said the onus was now on the government to come to Aucklanders with options for easing the gridlock.

The AA agreed that a plan had to be put in place sooner rather than later.

Spokesperson Barney Irvine said there would not be one quick fix.

"It's going to have to include something in the way of rates, plus some form of road tax or user charges plus some kind of tolls.

"And the very clear message that we've got from our membership is that they're open to the idea of paying a bit more to improve the transport network, but they'd have to see very real benefits in terms travel time savings," he said.

Mr Irvine said there was a still good working relationship between the council and government and that should give Aucklanders stuck in traffic some hope for the future.