WellUrban

Personal reflections on urbanism, urban life and sustainable urban design in Wellington, New Zealand.

Monday, May 21, 2007

Taxing times


I'm not entirely convinced that a regional petrol tax is the way to go: I think a targeted congestion charge for the CBD and major arterials might be a better way of fighting congestion while funding public transport. It also seems fairer to concentrate the charging on places where there are good public transport options.

Whichever way it happens, I'm sure the usual lobby groups will complain that motorists in New Zealand are over-taxed. They should have a look at this chart from the Ministry of Economic Development:

Comparison of OECD petrol prices and taxesOur petrol taxes, and thus prices, are actually the fifth lowest in the OECD. So while New Zealand's dispersed population, supposed "pioneer" culture and "love affair with the car" are often used to explain our high levels of car use, there's another possible explanation: it's so damn cheap! Especially so when our public transport is required to regain a comparatively high proportion of its costs from fares.

An extra 10 cents a litre would actually hardly make a difference by international standards, and it certainly doesn't compare to last year's petrol price rises, which led to a 9% decrease in cars entering the CBD. Now that we're finally making baby steps towards funding a half-decent transit system, perhaps it is time to consider a pricing regime that makes public transport a more attractive option.

27 Comments:

At 12:22 AM, May 22, 2007, Anonymous deepred said...

The stretch between Karori & the Kelburn Viaduct would be a good pilot area for congestion charging. The buses run up to about 40 minutes late due to traffic, and any widening for bus lanes would require the council to exercise eminent domain (one only has to look at the construction of Tokyo-Narita Airport to have an idea of the issues that can arise). It took a while, but I'm glad I've just moved to Mt Vic.

 
At 2:38 AM, May 22, 2007, Anonymous Kevyn Miller said...

The fact that our petrol tax is one of the lowest in the OECD is one of the reasons why our road toll is one of the highest in the OECD. This has been the case since the early 1980s. We had been close to the OECD average for both until the mid 1970s.

There is a graph at
http://www.petroltax.org.nz
which shows how the petrol price increased when the government originally introduced the petrol tax at the request of the roading lobby in 1927. In todays dollar it went from $1.63 to $1.96 per litre.

There is a lot more I would like to say about the use of the petrol tax but I'll leave those comments at my own blog rather than hijack yours:
petroltax.blog.net.nz

 
At 12:33 PM, May 22, 2007, Anonymous che tibby said...

"it is time to consider a pricing regime that makes public transport a more attractive option."

but tom... why do you hate freedom?

 
At 1:36 PM, May 22, 2007, Anonymous LX said...

Feul tax is such a blunt instrument. It would be great to see it replaced completely with some form of road pricing.

Then there would be a very strong price incentive to either live closer to work or use alternative modes at peak travel times.

Roads are a funny last bastion of the socialist command economy.

Most other areas of the economy we have prices for using goods and services that match demand with supply so there is no queing and people make choices between what they want and what they can afford.

We undercharge for peak time road capacity leading to too many trying to drive at peak time with resulting traffic queing and underuse of walking, cycling and PT.

It's a bit like having a pub that's giving a away beer for free and then wondering why the pub is so congested and so few are drinking water.

 
At 2:32 PM, May 22, 2007, Blogger Tom said...

LX: "Fuel tax is such a blunt instrument. It would be great to see it replaced completely with some form of road pricing."

I agree, up to a point. My main concern is from an urban point of view, so I want to discourage excessive car use to prevent roads being widened, the city filling up with carparks, and things like that. From this perspective, road pricing is the most sensible option since it can be targeted at the streets with the greatest problems. On the other hand, fuel use anywhere still has environmental consequences, so some component of fuel tax should remain to prevent those costs being externalised.

"Roads are a funny last bastion of the socialist command economy."

I guess that's partly due to practical issues: it's much easier to tax petrol than to set up cameras, GPS etc to enforce congestion charges. The technology is making it easier though, so we should be able to see more of it in the near future. The strength of the motoring lobby, despite their capitalist/libertarian rhetoric, has ensured continuing support for "free" roads.

 
At 3:27 PM, May 22, 2007, Blogger Baz said...

One side-effect of NZ's low fuel tax is the reduced demand for fuel-efficient vehicles. NZ dealers don't import them (with a few notable exceptions), so we have a much narrower choice of fuel-efficient vehicles than Europe.

And that's without going into the "might makes right" arms race that's occurred partly because of cheap petrol. It's really fun going round a narrow road to meet a line-crossing 4WD head-on.

 
At 9:03 PM, May 22, 2007, Blogger mikeymike said...

che, trolling? your comment suggests that freedom is a pricing regime that makes your motor a more attractive option.

we've been skimming freebies off govt since roads were concieved - you cant deny that. conjestion, pollution, and drag racing costs (etc, etc) are met by the tax payer now. is that freedom?

externalities need to be addressed somehow. the market hasn't done jack.

baz i think there've been a few stories about rising sales for conventional small cars (which for some nz situations actually burn less overall fuel than a hybrid).

there's an awful piece of journalism in the herald on sunday saying that hybrid supply lags demand here. i wont link as its nothing more than unsubstantiated p.r. drivel for a car dealer...

as you were
mike

 
At 9:02 AM, May 23, 2007, Blogger Tom said...

"che, trolling?"

Che, taking the piss, more likely :-)

 
At 9:41 AM, May 23, 2007, Blogger Baz said...

Mike

Yep, small car sales went up with the price of petrol, but again we're constrained on choice -- we have fewer models than Europe (Seicento?) and the smaller-engined versions of what we do have aren't generally available. The latter point applies to larger cars, too.

I guess my point was that higher petrol tax gives a greater incentive to get a fuel-efficient car, something that congestion charge, road tolls etc don't. Of course, these aren't mutually exclusive anyway. Combine them with feebates on new cars and reduced annual rego for efficient vehicles and we could be onto something :)

 
At 11:19 AM, May 23, 2007, Anonymous erentz said...

As a slightly different thought it would be very simple in Wellington to charge all non-resident vehicles as they enter the city, since we only have two points of entry. I guess my thinking behind this idea would be something like:

It would reduce traffic that originates from the satellite cities.

It would be a disincentive to use Transmission Gully (which will add congestion to Wellington City), and if implemented could see Transmission Gully scrapped.

It would provide income to Wellington City to implement its own public transport or road improvement needs.

It gets revenue from all those people who don't live in the city and pay rates but yet use our roads excessively.

Perhaps I'm thinking, we are being forced to pay for Transmission Gully for the 50,000 residents out in Kapiti. It will have negative effects on our city and we as a city don't want it. So lets charge them to enter our city, and they can pay for the things we want/need too.

Of course there is still the need to fix internal congestion, but at least thats a problem the slightly more urbanly-minded people of Wellington can tackle without interference from the ex-urbanites.

 
At 11:37 AM, May 23, 2007, Anonymous Anonymous said...

The stretch between Karori & the Kelburn Viaduct would be a good pilot area for congestion charging. The buses run up to about 40 minutes late due to traffic

I moved to Karori Park in early March and was immediately caught by this traffic as I catch the bus to work.

However the first day of the school holidays, the jams completely vanished. The buses ran on time for two weeks, then were caught again in the jams that resumed when school went back.

As I have lots of time to look out the bus window as it grinds from the mall to Standen St (where the jam vanishes as bus lanes smooth the trip to the viaduct anyway), I have come to the tentative conclusion that the gridlock is caused by parents driving their kids to school, and people driving to the teachers' college in Donald St.

Karori Rd actually seems to have sufficient capacity to cope with the traffic on non-school days.

It also seems to me that it would be easy to put in an inbound bus lane through much of the troubled section, because there is no clearway at the moment, so the lane currently used for parking could become a clearway in the am peak.

On the homeward journey at night, it is very evident that the clearway-bus lane in Glenmore St needs to operate until at least 6.30pm as the jam up to the viaduct traffic island continues most nights until then, and buses are caught in it after 6pm because just one person parks in the bus lane up near under the viaduct each night at 6.01pm.

Come to think of it, bus lanes/clearways city-wide need to operate till 6.30pm.... the days of we workers (teachers excepted) working 9 to 5 have long become a fond memory.

dave (who is not anonymous but there is no provision to give my name)

 
At 12:16 PM, May 23, 2007, Anonymous che tibby said...

hey.... freedom ain't free buddy.

if i want to drive through a tree-lined suburb at 3 in the morning with the subwoofer on 11 the wind in my hair and my hummer flat to the floor... i bloody well will.

mind you.. i'd need a hummer first...

but seriously. tax on petrol is a tax on roads. it only effects road users, after all.

 
At 1:08 PM, May 23, 2007, Blogger Tom said...

"tax on petrol is a tax on roads. it only effects road users, after all."

That's the general idea. I think, though, that when the emphasis is on charging users of particular roads, a petrol tax (even a regional one) is a bit of a blunt instrument.

In a sense, all of us, even those of us without cars, are "road users" if we consume products transported via road. I don't have a problem with theses costs being passed on to consumers, since it's an extra incentive for consumers to buy local products and for producers to switch to rail where possible.

 
At 8:59 PM, May 23, 2007, Anonymous Anonymous said...

Fuel tax is a blunt instrument, but that seems to be the way for so many of New Zealand's financial control methods. Though after seeing how congestion charging has been implemented in London I'm somewhat glad it hasn't entered as an option here.

Perhaps if the govt actually goes through with introducing compulsory third party insurance it'll financially 'encourage' a greater number of road users to take up alternative means of transport.

At the end of the day you've got to make public transport attractive both by making as convenient as possible and comparatively cheaper. Unfortunately using a car for transport at the moment is too easy a choice.

 
At 6:41 PM, May 24, 2007, Anonymous Kevyn Miller said...

The phrase "the principal that the user shall pay" was used liberally during the debate on the resolution to introduce a petrol tax on behalf of the Main Highways Board. And many speakers referred to the fact that as fuel consumption and road damage were closely related the petrol tax was the fairest way to make the user pay. Unfortunately that relationship is only strong on gravel roads, it disappears completely for light vehicles on modern pavements designed for heavy vehicles.
Tom is right, congestion charging is the way of the future as it tackles the roading problems 2007 not the ones of 1927.
It might pay to check if the Wellington Toll Gates Act 1875 has actually been repealed. If not then
the council can levy a toll of 5s. "For every vehicle propelled along a road by steam or other like power." I presume five schillings became 50 cents, but adjusted for inflation since 1875 it would be close to $50.

 
At 4:18 AM, May 25, 2007, Blogger libertyscott said...

"The fact that our petrol tax is one of the lowest in the OECD is one of the reasons why our road toll is one of the highest in the OECD."

Rubbish, it is a reflection of high per capita car usage in a low density country with a highway network almost entirely dominated by single carriageway routes with a high number of bends that cannot be negotiated at anything close to the average speed. Headons and loss of control accidents are, statistically, far more likely.

 
At 2:01 PM, May 25, 2007, Anonymous Kevyn Miller said...

Libertscott, You have described the symptoms. The cause is revealed by the OECD's International Road Traffic and Accident Database. Our death toll per billion vehicle km travelled was never worse than sixth best until the mid 70s. In the decade ended 1973 real spending on highway improvements was never less than $300 million per year, by 1979 it was down to $100 million and never exceeded that amount until 1993. Since the mid 80s we have never been better than 15th safest in the OECD.
The other countries improved their major highways while we did almost nothing.
You have described the physical differences that have arisen because of the financial differences.

 
At 2:27 AM, May 26, 2007, Anonymous Kevyn Miller said...

dave (who is not anonymous but there is no provision to give my name)

I avoid being anonymous by using the "other" option. If you don't have your own web page you can "borrow" mine, if thats ok with Tom.
http://www.petroltax.org.nz
No point paying for your own domain name just to avoid being anonymous.

I have noticed the same disappearance of traffic during the school holidays. It seems Transit has too. Their travel time surveys have repeatedly found 10% less delay in November than in March. Christchurch is not included in the Nov survey so it probably coincides with Canterbury's anniversary day. This means the Nov. survey happens when uni, tech and high school students are prepping for exams.
http://www.transit.govt.nz/
content_files/travel-time/
results-200603.pdf

I think the ultimate solution to peak congestion on both roads and public transport would be a 36 hr week which must be worked either 6hours/6days, 9hrs/4day or 12hrs/3days.

 
At 12:19 PM, May 27, 2007, Blogger David said...

>Perhaps I'm thinking, we are being forced to pay for Transmission Gully for the 50,000 residents out in Kapiti. It will have negative effects on our city and we as a city don't want it. So lets charge them to enter our city, and they can pay for the things we want/need too.

And they can charge vehicles driving through Kapiti on their way to deliver food and other goods to the capital. Or on vehicles leaving it. These vehicles, and trains, have negative effects on the Coast. Especially on a holiday weekend, when half the population of Wellington decide to create a traffic jam in Kapiti, rather than stay at home.

 
At 1:40 PM, May 27, 2007, Anonymous maximus said...

Re Congestion Charging for Tansmission Gully - i presume you realise of course that the only way a Congestion Charge would work there would be to put an equal charge on the Ngauranga / Paekakariki route as well, so people can't escape the charge. In other words, you would have to charge every single motorist entering or leaving the city.

Which i thoroughly approve of. But i imagine others may not be quite so happy...

 
At 5:37 PM, May 27, 2007, Anonymous erentz said...

david, "And they can charge vehicles driving through Kapiti on their way to deliver food and other goods to the capital... Especially on a holiday weekend, when half the population of Wellington decide to create..."

Well, they could charge, but they're getting $1 billion dollars for their Transmission Gully, so logically they'd have to give this up (and then it take them a hundred years to gather that in tolls). Also holiday weekends are quite rare compared to the number of working days in the year, so it'd still work out in Wellington's favour. The point is if these people wish to work in the city, they should live near the city, or if they don't, they shouldn't have their lifestyles subsidized by us working stiffs that do live close to the city, and take the overcrowded buses or congested streets to work.

maximus, "In other words, you would have to charge every single motorist entering or leaving the city."

Oh yeah, why not. Any vehicle not belonging to a resident of Wellington gets charged as it enters Tawa on SH1, or passes Ngauranga on SH2. We could use the funds to make all bus services within Wellington City's borders free, or something fun like that.

(Or for more fun, we raise a private army, annex Petone/Eastbourne, and declare ourselves and independent state.)

 
At 10:25 PM, May 27, 2007, Blogger David said...

>Well, they could charge, but they're getting $1 billion dollars for their Transmission Gully, so logically they'd have to give this up (and then it take them a hundred years to gather that in tolls).

Why "their"? The roads in and out of Wellington are used to bring goods in to Wellington and allow goods and people to leave Wellington. Or are you under the impression that Wellington is self contained and self sufficient and needs no contact with the rest of the country?

>The point is if these people wish to work in the city, they should live near the city, or if they don't, they shouldn't have their lifestyles subsidized by us working stiffs that do live close to the city, and take the overcrowded buses or congested streets to work.

If Wellington people wish to eat food grown in the rest of NZ, they should live somewhere rural. They shouldn't have their food consumption subsidised by Kapiti residents who are forced to queue behind trucks when all they want to do is visit the shops down the road.

 
At 3:21 AM, May 28, 2007, Anonymous Kevyn Miller said...

> "If Wellington people wish to eat food grown in the rest of NZ, they should live somewhere rural. They shouldn't have their food consumption subsidised by Kapiti residents who are forced to queue behind trucks when all they want to do is visit the shops down the road."

Or the food could be brought into Wellington on trains. So charging all vehicles to enter Wellington would solve your problem too Dave.

 
At 8:08 PM, May 29, 2007, Blogger David said...

>Or the food could be brought into Wellington on trains. So charging all vehicles to enter Wellington would solve your problem too Dave.

But why should Kapiti residents have to put up with the noise of passing trains bringing food in to Wellington? And why should their trains have to wait, as they do since it is only a single line in places, for freight trains taking goods in to Wellington to pass?

I don't have a problem. Except with clueless folk who think that Wellington is some how self contained and that development of infrastructure elsewhere in the country is an act of charity.

NZ roads are of third world quality. You won't find a European or North American city of the size of Wellington that is connected to the rest of the continent by a couple of tarsealed goat tracks.

Or a European or North American city the size of Auckland whose only access road is a motorway that drops to a single carriageway just a few kilometers from the edge of the city. Amsterdam is of a similar size and has something like 9 radial motorways linking it to nearby cities, and a couple of ring motorways.

 
At 2:27 PM, May 31, 2007, Anonymous Kevyn Miller said...

David, at least Auckland,Wellington and Dunedin have motorways to complain about. Spare a thought for Hamilton and Christchurch.

Part of the reason for the Netherland's extensive motorway systems is to preserve local roads for local traffic, especially in rural areas, thus retaining cycling as the predominant mode of transport for short journeys.

 
At 5:12 PM, June 01, 2007, Blogger Rich said...

Or a European or North American city the size of Auckland whose only access road is a motorway that drops to a single carriageway just a few kilometers from the edge of the city

The Southern Motorway / Waikato Expressway is dual carriageway from the city centre for about 90km, almost to Te Kauwhata.

In both London and Paris the motorway system stops at least 10km from the city centre. Relatively few large European cities have complete urban motorways as Auckland does - the only one in the UK is Glasgow as far as I know.

 
At 10:40 AM, December 04, 2007, Anonymous Anonymous said...

I lived in Oslo and the geopgraphic similarities to Wellington are striking. They had a toll system for all vehicles entering the city. But unlike London it was not a central congestion charge but instead a outer(not quite to the city limits)ring. The charge was paid on the spot in a booth rather than in a corner dairy. The geogrpahy limited the possible entry points in a similar way to Wellington.

http://en.wikipedia.org/wiki/Oslo#Road
"Access into the city centre requires the payment of a toll at one of 19 entry points around the ring road. It costs 20 NOK to enter the cordoned zone at all times of day, seven days a week, although a season ticket is available. Payment by coins is possible at toll booths although most payment is electronic using the national AutoPASS system.

Initially revenues from the road tolls funded the public road network, but since 2002 it mainly finances new developments for the public transport system in Oslo."

20 NOK is about NZ$6 but is perhaps more like $2 (it's a gold coin)

It is a city built around a harbour and constrained by hills, there is a little uneven urban development along the suburban railway lines. The big difference though is there is nothing like the Kapiti Coast in Oslo.

Where I lived was on the T-Bahn but annoyingly about 2 stops beyond the toll zone, it made it chaeaper to travel by train into the city if travelling alone and about the same price if there are 2 of you travelling in a car.

Norway has amazingly few motorways, but I assume a lot of their transport costs are needed for maintaining roads potholed by winter ice, and the grooves caused by 6 months of winter tyres. They have an amazing and impressive range of tunnels though, and it is sheer rock only about a metre below the top soil so even a road cutting must be quite expensive.

There are a lot of other things 'wrong' with Oslo though, but this one seemed a good idea to me.

 

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