National's announcement that it intends to spend $212 million upgrading regional roads is not just a naked election bribe, but poor economics, Green Party transport spokesperson Julie Anne Genter said today.
"National plans to pay for upgrading regional roads from the so-called Future Fund - receipts from the sale of state assets. National have essentially sold our profit generating state owned assets to pay for regular upkeep of New Zealand roads. Every householder knows that is disastrous economics," Ms Genter said.
"National has starved the regional transport budget so much that it now needs to push through extra money from the asset sales while spending the actual transport budget on $14 billion of uneconomic Roads of National Significance.
"The fact that National needs to dip into the asset sales fund is purely because of its obsession with the Roads of National Significance (RoNS).
"This makes little economic sense as the dividend returns from the power company assets are far superior to the illusory benefits of the Roads of National Significance (RoNS)."
Transport Minister Gerry Brownlee stated in a written question last month that between 2009 and 2014 National has spent $3.4 billion on the RoNS and of that, $1.5 billion was on projects the New Zealand Transport Agency (NZTA) classified 'low' value with a Benefit Cost Ratio (BCR) of less than 2. Another $1.9 billion of the RoNS spending had a 'medium' value with a BCR of 2 to 4, and none of the spending was 'high' value with a BCR of over 4.
"National has wasted $1.5 billion of public money on transport projects that the Government's own officials class as low value," said Ms Genter.
A study by economic consultancy BERL in May 2012 found that 'a programme of asset sales to finance the construction of new assets leaves the Government accounts permanently worse off (compared with the baseline) in terms of debt, debt ratio and total assets'.
"National's obsession with uneconomic highway spending means it has underfunded regional transport and is actually cutting its roading subsidy for local bodies from 58 percent to 53 percent.
"It appears to be giving with one hand, but has already taken away more with the other.
"Most regions will actually be worse off. National's new transport package channels funding to where it thinks it needs to win votes. It is classic pork barrel politics."
"The Green Party will invest the transport budget where it is needed - maintaining local roads and improving public transport," Ms Genter said.