Hodgson Pete: Financial Review Debate — In Committee 
Hodgson Pete: Financial Review Debate — In Committee 
[Volume:630;Page:2450] 
Hon PETE HODGSON (Acting Minister of Transport) 
: 
 The last few remarks of Maurice Williamson were not as well put together as his earlier remarks which I thought were very helpful and contributed very usefully to the debate. The member said he wanted to talk about funding for roads. Land Transport is about a lot more than roads but I will respond on the topic he has raised because that is the fair thing to do. Although the national land transport strategy is about much more than roads we can talk about roads for a while. I thought the member made a pretty good point. He has witnessed when he was Minister and subsequently—during the course of this Government—lots of changes of plans delays advancements things coming on and off the schedule money being put in by Governments though it needs to be said that that has happened more since the change of Government than before. As he pointed out there has been a bunch of regional joint official group projects—in Auckland initially then in Wellington a couple of times in the Bay of Plenty and soon to be announced in Waikato. All of those things are true. The Government has continued to put more money into the National Land Transport Fund by capital injection. Maurice Williamson has argued that we simply need to shift all of the money that is nominally put across to the consolidated account to the National Land Transport Fund in order to give certainty. 
It is not a bad argument. I say to the member that the Government is currently looking not at doing what he suggests—I say straight up—but at ensuring that we can get a higher level of certainty especially in the next few years. Certainty in years 9 and 10 will always be a challenge. Certainty in the first several years is certainly a possibility. 
I need to point out to the member that because oil is experiencing a very significant increase in demand and because it will soon at some stage—in some year some decade—show a maxing out of supply we will see the price of petrol go up. In the event of us not being able to shift adequately or quickly enough to for example biofuels or other forms of motive power we will see the use of motor cars drop. Indeed technology already allows for the use of motor car revenue to drop so he does not have a panacea. If members can imagine in 3 years from now the importation of second-hand hybrids into this country or the very significant increase in the sale of new hybrids they will begin to see that the certainty that the member is seeking is actually quite elusive. He is a smart enough guy and he has been— 
Hon Maurice Williamson 
: We need to go to direct charter. 
Hon PETE HODGSON 
: He has already got an answer to that. I am just saying that the position that was put up by the member does not provide all of the certainty that he and I would wish it to. 
I want to take issue with the member on the great thing of the benefit-cost ratio. I say to him that if a person wipes himself or herself out as he or she approaches a bridge in Southland—as a relative of mine tragically did—or if that happens twice then there will be a new approach to that bridge. It may be—not in the case that I mentioned—that both of those people had been drinking. It would still count and that bridge would still be realigned because of those two lost lives when a word in the publican’s ear might have done the job. That is where a benefit-cost ratio falls down. One cannot get killed on an Auckland motorway when traffic is snarled up. It is not going fast enough. That is why during the 1990s when the National Government paid undue attention to a benefit-cost ratio it ended up putting its investment in the wrong place—I say that assertively. 
I quote an email I received not so long ago from a board member of Transit. This board member extolled the virtues of the “new” approach which is more holistic where more factors have to be taken into account and where a bit of lateral thinking has to take place. Transit had made a very good decision by its standards and decided that it had done a very good job. The board member’s email said that in the days of the benefit-cost ratio he would roll up for a meeting have a look at the page of projects for that month work his way down the page because it is ranked from the highest benefit-cost ratio to the lowest draw a line when Transit ran out of money for that month—which he said was never far enough down the page—and pick up his brain at the door on the way out. That is not good decision-making. I say to the member that I understand his attachment to benefit-cost ratios. We still use them to an extent. It is a good methodology but like all methodologies it is a good servant and a bad master. 
Report noted.