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Aucklanders to pay 11.5 cent fuel tax for 10 years

Auckland Councillors have approved an 11.5 cent a litre regional fuel tax to fund transport projects - but with impassioned criticism from some councillors who say the poorest citizens will be disproportionately affected.

The regional tax will push up fuel prices from July 1, coming ahead of the first of three suggested Government fuel excise increases which when combined over three years will make petrol 25 cents a litre dearer in the Auckland area.

The regional tax is expected to raise $150 million a year, or $1.5 billion over the next decade. Because Auckland Council agreed to apply the regional tax, the central government and contributions from property developers will increase the funds available for transport infrastructure to $4.3 billion by 2028. 

That money is part of $28 billion in the region's transport infrastructure masterplan, which despite all its developments aims to maintain Auckland congestion at 2016 levels for the next decade.

The Mayor Phil Goff acknowledged the regional fuel tax could impact poorer Auckland households but argued the Labour-led Government's families package put more income into those households. "Yes when petrol prices go up it hurts people. Unfortunately, probably three-quarters of the petrol price rises we see have nothing to do with the government or the council. We are only responsible for this 10 cents."

The regional fuel tax was passed by 13 votes to seven.

Councillors from South Auckland were most troubled by the effects of the regional tax. Efeso Collins from Manukau ward said he could not support a tax that would hit his community hardest, Daniel Newman from Manurewa said the tax was a "wholesale redistribution of wealth from some of the poorest people in Auckland with the least choices to those who have the most, the greatest wealth". Sir John Walker, also from Manurewa, voted against the tax. "The people, the local board do not want us to vote for it." He asked what use having a board in a local area was if councillors did not follow its feedback.

"We get people a wage increase [through the Government families package] and we take it back in the fuel tax."

But another Manukau councillor, Alf Filipaina, voted in favour, despite saying he was struggling with the effect on his community. "With the benefits we will be seeing long-term, I will vote for it."

Josephine Bartley of Maungakiekie voted yes after saying her ward supported the tax through the Council's consultation project. She had been on Facebook to research the issue and offered this quote: "A society grows great when old men and women plant trees whose shade they know they will never sit it in."

There was a strong tone of the famous There is No Alternative brand of politics in the debate. Goff said there was no option; if the council had voted against the tax it would have "gutted our budget and ripped the heart out of ATAP [the $28 billion Auckland Transport Alignment Project].

If Auckland did not take these difficult decisions the Government and rest of New Zealand would re-think taxpayer contributions to Auckland's needs.

In a pointed comment against some councillors who had spoken against the tax, Goff said: "It is easy to say 'no' to it if it is going to go through." 

Councillor Mike Lee, who was on the Auckland Regional Council when a short-lived proposal for a five cent regional fuel tax was approved under the last Labour government, opposed this new 10 cent tax."This time I'm not convinced that we have won the essential support of a clear majority of Aucklanders."

While officials, some councillors and the Mayor talked of the $1.5 billion raised by the regional fuel tax becoming $4.3 billion with the Government's input, Lee asked: "Where will that money come from? It is likely to come from another excise tax on top of that. If we are going to 'leverage' it, that means we are doing a double fuel tax."

Projects to be covered by the regional fuel tax money are:

1. Bus Priority Improvements - total cost $266m - fuel tax contribution of $100m

2. City centre bus infrastructure - $163m - fuel tax $62m

3. Improving airport access - $68m - fuel tax $26m

4. AMETI Eastern Busway - $743m - fuel tax $193m

5. Park and rides - $63m - fuel tax $24m

6. Electric trains and stabling - $396m - fuel tax $150m

7. Downtown ferry redevelopment - $73m - fuel tax $28m

8. Road safety - $552m - fuel tax $210m

9. Active Transport - $342m - fuel tax $112m

10. Penlink - $200m - fuel tax $66m

11. Mill Rd Corridor - $508m - fuel tax $102m

12. Road corridor improvements - $302m - fuel tax $87m

13. Network capacity and performance improvements - $296m - fuel tax $99m

14. Growth related transport infrastructure - $300m - fuel tax $126m

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