Petrol Tax Increases - Where Is The Money Going?

"Since 1999 the Government has increased its annual petrol excise and RUC take by $240 million dollars from road users but the difference in road construction spending between then and now is only $7.4 million per year", AA Public Affairs director George Fairbairn revealed today.

Mr Fairbairn was commenting on analysis by the Get Real on Roads Campaign. The rest of the money has either gone to the increased payments to maintenance contractors, administration or subsidising public transport or rail.

Last year, under the Government's "Moving Forward" package, the total petrol excise and RUC income increased by $170 million a year, and yet new road construction, so essential for growth in the economy, has remained starved of investment.

"When it announced Moving Forward the Government told road users that petrol taxes and RUC's would be used to make progress on crucial roading projects. This has simply not happened. Of the 4.7 cents per litre the Government added to petrol tax last year, claiming it was needed for Auckland's roading congestion, less than one cent has been spent to meet the roading need, which growth in the Auckland region has created",he said.

This year $6 million less has been allocated for Auckland's roading needs in Transfund's current budget while it is widely acknowledged that the city needs a minimum of $120m a year in additional funding to build and complete the road network it requires to reduce congestion.

Mr Fairbairn said this is but one region where the Government is short-changing road users.

"Our analysis has found that the government is simply shifting road funding around the various regions with many seeing enormous drops in local road spending."

New Zealand's nationwide expenditure on roading as a proportion of GDP (0.95%) is less than half that of Australia's (2.35%). While New Zealand has adopted Australia's approaches to road safety in all other respects Mr Fairbairn said it had failed to follow through on building safer roads.

"To date this year the road toll is not decreasing to match the gains achieved last year. Fines and advertising can save so many lives but ultimately the only permanent safety solution is a constructed one", he said.

Reference National Land Transport Programme Total NLTP Spending By Output 1999/00 2002/03 Difference % change Road Construction $368m $375m $7m 2% Road Maintenance $479m $553m $74m 16% Non-Akl NLTP Spending By Output 1999/00 2002/03 Difference % change Road Construction $251m $253m $2m 1% Road Maintenance $390m $458m $68m 17% Auckland 1999/00 2002/03 Difference % change

Road Construction $117m $122m $5m 5% Road Maintenance $89m $96m $6m 7%

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