New Zealand has an export-led economy but we are remote from the
best markets for much of our produce - Europe, Asia, North America or, across
the Tasman Sea. The same places are the sources of many of the products we
need, and of much of the equipment that is necessary to sustain our
economy and the way we live. In addition, international tourism is a
significant and growing aspect of the economy, and creates new jobs.
Without good transport systems our businesses and economy would crumble. Transport is equally important to us as individuals. We need to travel to visit our families, play our sport, go to work - in essence to live. We are all immigrants, or descendants of immigrants, and a common strand in the two main cultures is the importance of discovery, travel and meeting the challenges presented by the new and unfamiliar.
However, New Zealand has a number of features that make providing good transport a challenge, especially within its borders.
New Zealand is geologically young; it consists of two main islands and scores of smaller ones. Erosion processes have not had time to round and smooth much of the landscape. Slopes tend to be steep and surface materials are generally unstable and variable. What's more, rivers are swift and prone to flooding. New Zealand's population at 3.7 million is not large when compared with many other countries. The population density of Japan is 24 times that of New Zealand.
The corresponding ratio for the United Kingdom is 18 times. The Auckland area is the most populous in New Zealand with nearly 30 percent of the population. However, significant numbers live elsewhere; the five main urban centres are strung out along the two main islands.
The location of New Zealand in the world and the distribution of its population mean transport is highly important. However, it is also more expensive to provide than in most countries. The length of New Zealand and the rugged physical landscape conspire against low cost transport, particularly low cost land transport. This emphasises the need to focus on the efficiency of our transport system. We must continually seek out ways and means to improve transport and its management.
It is not surprising, therefore, that the development of transport has been an integral part of New Zealand's economic and social history. In recent years, many aspects of the transport sector have undergone significant change to meet the changing needs of our society and economy. To illustrate:
- Entry to the domestic airline industry was freed up in the 1980s. Ansett entered the market and smaller commuter airlines were established. The quality and frequency of services improved for most passengers, and the real costs of airfares fell sharply;
- Port reform began in 1988. The functions formerly performed by locally elected Harbour Boards were split between commercial port companies, regional councils and local authorities. A year later, the Government introduced competition in stevedoring. The real cost of using the waterfront has declined significantly, with considerable benefit to the New Zealand economy. The regulatory and recreational roles taken over by elected councils have received a sharper focus because they are now undertaken by bodies that specialise in such functions and have accumulated considerable expertise;
- Licensing in the taxi industry moved from being 'quantitative' to being 'qualitative'. The availability of taxis has greatly improved and, after an initial period of adjustment, taxi charges have been largely static for several years; and
- The restrictions on the carriage of goods by road in competition with the former New Zealand Railways were removed between 1980 and 1986. New Zealand Railways was corporatised in 1990 and privatised in 1993. There have been large improvements in the efficiency of both road and rail transport as a result.
RECENT ROAD MANAGEMENT AND FUNDING CHANGES
While change has been occurring in the broader transport sector, we have
also been improving the way we manage and fund our roads.
Major steps have been:
- The introduction of Road User Charges on a distance/weight basis in 1977 to ensure that heavy vehicles and light vehicles using diesel fuel pay for the wear and tear they impose on the roads;
- The creation of Transit New Zealand in 1989 to replace the National Roads Board. Transit became responsible for managing the state highways and the Land Transport Fund. Transit was required to make funding and other management decisions on the merits of particular cases, without direct political intervention;
- The requirement from the early 1990s that Transit tender out all road works and maintenance on a competitive basis to ensure efficiency of costs. Similar requirements were introduced for all local authority road expenditure in 1992. Transit estimates that its savings from the changes it has made have been 17 percent for road construction and maintenance and 30 percent for professional services;
- The establishment of the Land Transport Safety Authority in 1993 to undertake activities to promote land transport safety at reasonable cost; and
- The creation of Transfund New Zealand in 1996 to take over the funding allocation role from Transit and to manage the new dedicated National Roads Fund.Transit continues to manage the state highways. The change clarified the separation of the funding from the provision of roads.
