Land Transport Management Amendment Bill — First Reading 
Land Transport Management Amendment Bill — First Reading 
[Volume:643;Page:12755] 
Land Transport Management Amendment Bill 
First Reading 
Hon HARRY DUYNHOVEN (Minister for Transport Safety)  
on behalf of the  
Minister of Transport 
: I move  
That the Land Transport Management Amendment Bill be now read a first time 
. It is my intention to move at the appropriate time that the Land Transport Management Amendment Bill be referred to the Transport and Industrial Relations Committee for consideration that the committee report by 25 March 2008 and that the committee have the authority to meet at any time while the House is sitting except during oral questions and during any evening on a day on which there has been a sitting of the House and on a Friday of a week in which there has been a sitting of the House and outside the Wellington area during a sitting of the House despite Standing Orders 192 194(a) and 195(1)(b) and (c). 
The Land Transport Management Act 2003 fundamentally shifted the way land transport in New Zealand is funded and managed. I am pleased to be introducing this amendment to the Land Transport Management Act and associated legislation on behalf of my colleague the Hon Annette King. This bill arises primarily from a number of reviews into the land transport sector that were aimed at improving value for the massive financial investment that the Government is making into land transport. In particular the Next Steps review of the New Zealand land transport sector identified a number of issues that needed to be addressed. The bill addresses the issues raised in those reviews and provides a mechanism for regions to accelerate capital works through a regional fuel tax if the regions wish to. 
The bill provides for a Government policy statement to provide additional strategic guidance to the land transport sector. The New Zealand Transport Agency replacing the existing Crown entities Land Transport New Zealand and Transit New Zealand will give effect to the Government policy statement when it develops and manages each new 3-yearly National Land Transport Programme. Other land transport stakeholders will need to incorporate the Government policy statement into their decision making. For many years our land transport planning and funding system has been based on an annual cycle. Because the proposed National Land Transport Programme will need to be produced only every 3 years compliance costs will be reduced and certainty will be increased. 
The Government also proposes to change the way that territorial local authorities regional councils and others plan their land transport projects and services. This bill means that land transport projects and services will be consulted on at the regional level by all the agencies responsible for funding and delivering land transport activities. This will facilitate the development of integrated transport packages. 
The new regional land transport programmes will be put together by regional land transport committees. The committees will need to prioritise land transport activities for their regions including those concerning State highways with some exceptions. The Government policy statement will ensure that national priorities such as preserving the State highway network and enhancing public transport services are maintained. Local road maintenance and minor capital activities as well as existing public transport services will be included in regional land transport programmes but will not be prioritised by region. This reflects the need to recognise local government autonomy and accountability. 
I propose giving greater legislative guidance to the membership of the regional land transport committees. Some committees have become large and unwieldy. Each committee will have two representatives from the relevant regional council one from each territorial authority and one from the New Zealand Transport Agency. Reflecting current arrangements there will also be one member to represent each of the five objectives listed in the  
New Zealand Transport Strategy 
 and one member to represent cultural interests. These six members will participate in discussions on regional land transport programmes and will vote on regional land transport strategies. In regions where there are unitary authorities—Gisborne Tasman Nelson and Marlborough—the membership arrangements need to be different but will reflect the general scheme for other regions. 
Transport structures in Auckland will be reflected in the different arrangements for regional land transport programmes there. This means that the Auckland Regional Transport Authority will be responsible for developing Auckland’s regional land transport programme. We are also leaving the regional land transport committee membership requirements in Auckland unchanged while the Auckland governance proposals develop. 
This bill will consolidate all land transport planning provisions into one Act. We are also extending the planning horizon of land transport strategies to 30 years to reflect the long-term nature of transport planning. The strategies will be reviewed every 6 years rather than every 3 years. 
The creation of the New Zealand Transport Agency will integrate decision making and improve accountability. The new entity will be a Crown agent as defined under the Crown Entities Act 2004. It will have all the functions that Land Transport New Zealand and Transit New Zealand currently have except for the power to declare and revoke State highways which will become the responsibility of the chief executive of the Ministry of Transport. The functions of the Director of Land Transport which cover a number of regulatory licensing and law enforcement roles will also be transferred to the board of the new agency. 
Because the new agency will both deliver its own projects and services and fund the activities of others the Government has been mindful in the bill of the need for robust accountability requirements. The new Government policy statement and regional prioritisation will also play a role in ensuring accountability. The Government policy statement will establish the amount of funding available to be allocated to all activity classes including State highways. The agency will not be able to fund projects and services that are not contained in a regional land transport programme with the exception of some nationally led programmes such as road policing and research education and training. 
The Government proposes that all fuel excise duty obtained from motorists will be reserved for land transport purposes. This will ensure that the public will see what they are getting from the petrol excise duty and road-user charges they pay. The bill will also allow the Minister of Transport and the Minister of Finance to allocate fuel excise revenue received from pleasure-boat users to activities such as maritime search and rescue boating safety education and maritime safety services. 
The bill will allow regions to levy regional fuel taxes in order to allow regions to bring forward capital projects should they wish to. Limiting the use of regional fuel taxes to capital assets will ensure that the public understands the purpose of the tax and will provide an end date for the tax. The tax will be limited to up to 10c per litre of petrol or diesel with a limit of 5c per litre to be spent on roading. The Auckland region will be able to identify up to 5c per litre’s worth of projects and the Ministers of Finance and Transport will be able to identify an additional 5c worth of regional land transport projects within the 10c regional limit. 
Regional land transport committees will be required to prepare and consult on proposed regional fuel tax schemes. Once the regional council is satisfied with the proposed scheme it must be lodged with the Minister of Transport and the Minister of Finance. The Ministers may then decide to recommend to the Governor-General the making of an Order in Council to approve the scheme. Once a regional fuel tax has been introduced in a region wholesale distributors will make payment to the New Zealand Transport Agency. The agency will be responsible for refunding commercial non-road fuel users and for distributing the net revenue to the agencies responsible for projects under the relevant scheme. 
The revenue guarantee for the National Land Transport Programme and the funding guaranteed for the State highway construction programme announced in 2006 will no longer be required in the new planning system. That is because a high level of certainty on overall funding levels and activity class levels will be provided through the Government policy statement through a new system for adjusting fuel excise duties and road-user charges and through the ability for the National Land Transport Programme to go into deficit. 
The measures set out in this bill will allow New Zealand’s land transport system to move forward in a fully integrated manner. I am pleased to be presenting this bill on behalf of the Hon Annette King and I urge members to support it. I commend the bill to the House. 
DAVID BENNETT (National—Hamilton East) 
: 
 I thank the Minister for that introduction to the bill which was a synopsis of what has been put into the legislation. I think that before we talk about the bill it is important to look at the background behind it. The land transport sector has been vaunted by this Government as something it has put a lot of money into. Government members have always gone out there and said that they have put a lot of money into land transport and they have given comparative figures on the spending between now and the 1990s. Well some home truths need to come out about that transport funding. 
This bill is the direct result of the inefficient use of funding on a scale that has been demonstrated in a number of reports that have come through to the Minister of Transport. This legislation is a direct result of those reports. It all started with the Ministerial Advisory Group on Roading Costs. Its report was basically a destruction of the Minister her achievements in this area Transit and Land Transport New Zealand. It was scathing in the sense that those organisations involved in land transport were not providing the value for money that people would expect of the sector. It was a huge hit on the Government and on the Minister because transport policy had been a flagship policy in which the Government had said it had been doing so well. The fact that its own people came out and said that it was underperforming that it had no idea of where it was spending its money and that it had no accountability—and what is more no governance over that spending—has resulted in this bill. 
The Ministerial Advisory Group on Roading Costs was set up as an independent panel to look at funding of roading costs in New Zealand. Things have to get pretty bad for a Government to set up an independent panel in the first place but when that independent panel basically slates the Government it tells us that the Government is not doing a very good job. That is the history behind this bill. 
The transport sector has had some money thrown at it but on a percentage basis it is still less than what National put into it. It is a sector that has not delivered. Considering the money that has gone into it it has not delivered. The sector has been plagued by cost overruns and by inefficiencies in planning direction and governance. The ministerial advisory group’s findings led to the Next Steps review. The Minister used this review to say basically: “Well I know there is a problem; let’s do something about it.” Well she should have been doing something about that years ago. These problems did not come up overnight. They have been obvious to people in the sector for a number of years. This Government has sat on those problems year after year and it has not delivered. The Government just says it will do this and that in its Budgets and for pure political convenience it has not actually looked at how it is spending its money. 
The Next Steps review was equally scathing of the Government. It set out some findings. It found that the central regional and local land transport plans are not fully aligned. It found that expenditure pressures are not being addressed strategically. It found that there was inconsistent planning and funding for policies which distorts incentives within the sector; that the roles of Government land transport agencies remain unclear; and that some functions are duplicated. It is another big cross against this Minister and this Government for inefficiencies in this sector. 
Then the Government came up with this legislation. This is supposed to be the answer to those problems. Well this legislation has not been thought through. There are a number of difficulties in it which need to be addressed through this process—through the select committee and by the Government. But the Government will not address the hard issues that need to be sorted out; it will address only some of the minor ones and we will come back to those hard issues that are not being addressed in this legislation. But having said that there are some good things that needed to be done and have been done. 
We need to see some planning in land transport. If members talk to anyone in the land transport sector they will find that their major problem is that they do not have consistency of planning and they do not know what will happen in the next 3 to 6 years the next 10 to 20 years or the next 20 to 30 years. So we welcome the legislation’s provisions in relation to planning. Those achievements in relation to planning are valuable and they are needed in the land transport sector. They are only part of the solution but they are one of the parts that the National Party will support; it is something that has been waiting to be done for a number of years. 
When we look at what we do find problems with we see that one of those things is the issue of regional fuel taxes. The history behind those regional fuel taxes involves State Highway 20 a major road in Auckland. A poll of the Auckland community found that the community did not want to pay a toll. The result of the community not wanting to pay a toll was that the Government decided it could not put a toll on people as it was politically incorrect so it decided that it would have a regional petrol tax. So everybody has to pay a regional petrol tax to pay for the road—a road that somehow goes through the Prime Minister’s electorate no doubt. The rationale behind it—and it is fine if one lives in Auckland—is that the tax would be possibly 10c 5c of which would be for public transport and that partly would to pay for electrification in Auckland. 
That is fine for Auckland but what about other regions around the country that do not have such pressing public transport needs? If members look at the situation in the Waikato they might wonder what the point is of having a regional petrol tax of 10c with 5c of it having to go to public transport. Our big issue in the Waikato is building the Waikato Expressway. That would be where we would want to put the 10c of regional fuel tax. We would not want to put 5c of that into public transport in the Waikato. 
We have Mr Duynhoven here. I would love to see him go to his regional council in Taranaki and ask that council what it wants. I bet the council would tell him that it wants the whole 10c for its own roads. I tell the Minister that it would not want to have to spend 5c on public transport. The Minister should go and ask his constituents this weekend what they want. They will tell him that they do not want that regional fuel tax to be 10c that is broken down to 5c for public transport and 5c for roading. They want the whole 10c put on roading because that is the big issue in Taranaki. If the Minister drove into New Plymouth between 3 and 5 in the afternoon he would realise the congestion problems of getting into the city that he represents. He is not letting the constituents in his city use the regional petrol tax in the manner that they want so there needs to be some degree of amendment to that regional petrol tax to take into account the differing needs around the country. That is something we hope will be addressed through a Supplementary Order Paper during the Committee stage. 
The other part of the legislation that we have great difficulty with is in the merger of the office of the Director of Land Transport and Transit New Zealand. Certainly there is need for reform in this area and nobody is in any doubt about that. However the merger goes back to what was set up a number of years ago. Those organisations were actually divided for a reason. They were divided so that the provider arm and the funder arm were in separate bodies. That is quite a rational division and that is what local government lobbied for. They were joined at one stage and local government went to central government and said: “No we can’t make that work; we want it divided.” So it was divided. Now the Government is bringing that situation back. Well it will get the same problems we had 10 or 20 years ago; it is just dressing them up differently. Those problems will just be in a new vehicle and it will take a couple of years for them to come through. 
This Government needs to take a good hard look at its transport policy. This bill is a quick-fix measure. It has taken a year of reports to identify the problems and suddenly within a couple of months the Government can merge these organisations together and get it sorted out. Well it does not work like that. The Government needs to do some more strategic planning in the reorganisation of the transport sector. It needs to take a good look at what the actual issues are. The actual issues are that the big roads—the big political roads—are not getting built. This change in framework will not solve that problem. This Government is taking a quick-fix solution here and that means that all those organisations that are now having to be merged are actually going through tremendous pressure. Those organisations do not know where they stand and they see great difficulty in the proposals of this legislation. The National Party has great difficult in supporting those parts of the legislation. 
Debate interrupted.