NZTA Predicts Inaugural Deficit, Risks To Revenue
April 9th, 2009
The NZ Transport Agency hasn’t yet celebrated its first birthday but is already preparing for a policy overhaul to better reflect National’s transport priorities. Its statement of intent released to Parliament last week is out of date with references to the regional fuel tax, efforts to migrate freight from road to rail and shipping, and expansion of public transport.
National has already scrapped Auckland’s fuel tax and isn’t in a rush to promote more public transport and use of rail. The NZTA is forecasting a net loss of $28.99m from operations for its inaugural year. Net assets are listed at $21.1bn, mainly reflecting the $20.7bn value put on the state highway network. In a year which saw crude oil swing from $US145 a barrel last July to around $US50 currently, the NZTA is warning of the risks to its revenue stream, which is based primarily on fuel consumption. NZTA’s board and executives says he swings in the price of crude “create significant revenue and cost uncertainties.”
When oil soared it carried the price of bitumen with it and drove up other costs. Its subsequent decline reflects the global economic downturn, which may also have the effect of reducing revenue. The ability of the NZTA to deliver on its programmes over the next three years “will depend significantly on revenue and cost trends.” NZTA is also weighing up its ability to borrow to help meet spending targets or make up funding shortfalls from other sources.
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