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Key pulls rug under Goff on CRL, cost concerns remain for ratepayers

Key pulls rug under Goff on CRL, cost concerns remain for ratepayers

Media release – Wednesday, 27 January 2016:

“Most Aucklanders will be pleased the National Government is moving on its commitment to the City Rail Link. However Labour’s mayoral candidate Phil Goff won’t be happy that John Key’s shown the money so soon,” says Auckland Councillor for Orakei Cameron Brewer.

“A big election platform for Phil Goff is working with Wellington to ensure the City Rail Link is delivered sooner. However that’s now going to happen regardless and so effectively the rug’s been pulled on a big part of Goff’s mayoral campaign just two months after he announced his candidacy.  

“Let’s just say now with the City Rail Link locked and loaded, the reason to engage Phil Goff and all his parliamentary service to get the job done is not required. In fact a more National-aligned Mayor would be better placed to ensure this critical partnership stays on track.”

Mr Brewer says while it’s positive for ratepayers the Government is formalising its commitment sooner, it will not be a 50/50 Government/Auckland Council funded project as Mayor Len Brown tries his best to imply.

“The funding split is actually more like 40/60 Government/Auckland Council. The council’s 2015-2025 budget forecasts assume the Government will commit $1.039b and the council will fund $1.490b – taking the total capital expenditure cost to $2.529b. This is largely because the Government will not fund the costly three-year enabling works currently underway.

“Ratepayers need to be fully aware the Government’s renewed commitment is for the main construction works from 2018. The Prime Minister has made that explicitly clear in his speech.

“The cost of the enabling works until then falls entirely on ratepayers simply because Len Brown started the project without the Government. That is a huge failure. Let’s hope the costs for the current enabling works don’t blow out as that tab is for ratepayers to pick up alone.”

Mr Brewer says cost containment will be the biggest challenge for the City Rail Link project with ratepayers not taxpayers most exposed given it remains council-led.

“Let’s not forget that in 2005 the City Rail Link was reported to cost from $500m. By 2010 it hit $2 billion and despite dropping Newton Station it’s now forecast to cost over $2.5 billion. Given the expected cost went up five-fold over the past decade, rest assured there will be more cost escalation over the next decade.”

Mr Brewer says another concern for ratepayers is the fact that council’s operational budget forecasts show the City Rail Link will require an over $100m operational subsidy each and every year – and that’s after receiving NZTA subsidies and passenger farebox revenue.

“It’s a good day for the project but plenty of red flags remain for Auckland’s ratepayers, particularly when you consider there’ll now be a renewed push within council to hit Auckland drivers sooner with the likes of motorway tolls or fuel taxes to help pay for the City Rail Link.” 

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One Response to Key pulls rug under Goff on CRL, cost concerns remain for ratepayers

  1. Just goes to show that if the Government hadn’t been burying its head in the sand for years on the necessity of the project it would have cost us a lot less. But then it has always been the right-leaning councils that have under spent on Auckland’s infrastructure over the past 50 years. False economy and flawed reasoning.

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