National relishes taking flamethrower to Labour’s petrol tax
NOW it is in Opposition, there is nothing National loves more than the smell of napalm in the morning — and this week napalm came in the form of Labour’s proposal to raise fuel taxes.
Labour had blunted National’s attacks on tax policies during the campaign so imagine its delight when Labour released its draft transport plan full of promises for a shiny new light rail to the airport, glistening cycleways, median barriers and roading crews to fix potholes on back roads — along with a 9c to 12c per litre hike in petrol taxes to pay for it all.
In terms of lowhanging fruit, this was at pineapple height and National wasted no time beating it to pulp.
They had some help.
People flocked to object: a Driving Miss Daisy driver, Aucklanders in Rodney and Waiuku, the Road Transport Forum warning freight costs would go up along with the price of goods. Poverty advocacy groups also criticised the move, saying it would have a disproportionate impact on lowincome families.
Labour’s plans should not have come as a surprise to anybody. Light rail in Auckland and plans for more commuter rail in the regions were well flagged in election policies as was its intention to scrap the future Roads of National Significance programme.
It may well have been able to fund its own promises by simply redistributing the money from National’s state highway programmes.
But it had to fit in the desires of the governing partners — NZ First and the Green Party. That means meeting the Green Party’s plans for clean technology, cycleways and public transport.
It meant funding NZ First’s abiding love for all things rail — above and beyond the provincial growth fund. So we have higher fuel taxes.
Few things get more people exercised than taxes and roads — for they affect all.
Much of the debate has centred on the regions versus Auckland.
National has had some success in seeding the perception regional people will be paying for Auckland trams, buses and cycleways while losing the benefits of the funding and jobs that major state highway projects deliver.
Labour claimed the regions would be flooded with money compared with National for roads other than its state highways.
The usual array of smoke and mirrors was hauled on to the stage as each side tried to prove its argument.
Labour deployed the squid ink technique to set out the funding changes.
The obscuring black ink came in the form of presenting the funding changes in percentage terms rather than dollar terms. It also compared its spending plan for the next three years with the last three years of National’s — rather than the figures National had set out for the 2018 to 2021 period.
That showed an 11% drop in funding for state highways while the money going to regional roading was to almost double.
All of this disguised the fact that Labour’s maximum spending allocation for regional roads was a mere $100 million more than National had planned to spend over the next three years, while state highway spending would be $1 billion less than National had set out.
The spending on local roads (in both cities and regions) was $365 million more than National planned. Even in the first three years, that was twice as much leaving the regions than was going in.
Then there was the dramatic drop after that point as the state highway projects National had already started were completed.
Labour also argued that National would have needed a petrol tax increase of 10c to 20c a litre to pay for its $10.5 billion election promise to revamp nine further state highways.
At this stage, National began assembling its smoke and mirrors.
Words are cheap in Opposition and National leader Simon Bridges could simply say while that was the advice, National had not planned to increase petrol tax but to spread the programme out over time and boost the coffers with money for infrastructure spending. Honest, guv’nor.
Labour also pointed to National’s tally of 17c extra per litre in fuel taxes over its nine years in government, and it had a point in terms of hypocrisy.
But for drivers, it is hardly any comfort to know Labour will take National’s increases and add more of its own.
The biggest challenge for Labour is not convincing people of the merits of its plan, but convincing people that paying extra tax is worth it.
Transport Minister Phil Twyford did not help matters by appearing to trivialise the matter, scoffing that the cost was equivalent to a cup of coffee a week and Aucklanders understood the need for it.
Many Aucklanders did not. Those in the north and east certainly saw little benefit in having to pay two whacks of taxes for light rail from the CBD down south and west.
All Twyford’s cups of coffee add up to an extra $600 million a year in petrol taxes — and that will almost all be sucked up by Labour’s $4 billion plus plan for light rail in Auckland.
Twyford has countered National’s arguments about the regions by pointing to the pots for regional and local roads to compensate for stripping back the State Highway programme.
Regional Development Minister Shane Jones has mounted a rather paltry defence of the effect on the regions, saying it means some of the local roads that are bugbears can now be fixed.
That is all well and good if not for the flowon effect. Those pots may not be spent at all if local councils cannot raise their share of the funding.
State Highways are totally Crown funded but councils must chip in up to half the cost for local and regional roads.
Under National’s transport plan, local councils were expected to put in up to $1 billion a year for their share and often fell short.
Under Labour’s new plan that would go up to $1.5 billion.
It will become more tempting for councils beyond Auckland to seek to impose a regional fuel tax.
Yet, perhaps conscious of the electoral consequences, Twyford has barred any council other than Auckland from applying for that until at least 202021.
The side issue to all this has been the debate about the speed limit.
It was unfortunate for Labour that an international report coincided with its transport release and that proposed a drop in the speed limit to 70kmh for roads without a median barrier.
That was conflated with Labour’s plan which does mention the possibility of dropping speed limits for safety reasons.
It is here Prime Minister Jacinda Ardern should deploy the stop side of the stop/go sign.
Middle New Zealand is a valuable commodity for political parties.
She will find Middle New Zealand sitting in cars grinding their teeth as the car in front of them drives at 90kmh only to speed up the moment they hit a passing lane so Middle New Zealand cannot pass them.
Adding a drop in the speed limit on the open road to the petrol tax hikes would indeed be electoral napalm.