The New Zealand Transport Agency will be allowed to use borrowed money to pay for roading projects under changes mooted by Minister of Transport Gerry Brownlee.
Currently, roading projects are funded through a pay-as-you-go model as the Agency spends fuel taxes and other registration revenues as they come in.
But the Land Transport Management Amendment Bill, tabled by Brownlee in Parliament yesterday, would "enable borrowing to be used by the New Zealand Transport Agency to fund future land transport projects, subject to the agreement of the Minister of Transport and the Minister of Finance," it says in the Bill's explanatory note.
Labour and the Greens have attacked the move, saying it showed the government was struggling to fund the NZ$8.7 billion required for its 2009-2012 Land Transport Programme, which was dominated by the Roads of National Significance (RoNS) projects.
'Good way to fund intergenerational projects'
Ken Shirley, the CEO of road transport industry group the Land Transport Forum, told National Radio on Wednesday morning that the current model was suitable for minor projects, and for renewal and maintenance of existing road infrastructure.
"But it’s not an ideal funding model for long-term major intergenerational projects," Shirley said.
“One of the consequences of this ambitious programme [RoNS] is that it’s sucking all the available money, and has flat-lined funding for renewal and maintenance. We want the big projects, and we need the big projects, but we have to also maintain what we have.”
See Transport Minister Gerry Brownlee answering questions on the move in the video below: