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Filling up - Source: ONE News -
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The government is expected to announce changes to the regional fuel tax early next week.
However, Transport Minister Stephen Joyce says Auckland's plans to electrify rail will not be in danger.
The previous government allowed the tax of up to 10c a litre to help fund transport projects and Auckland Regional Council has started work on rail electrification.
Under the regional and national fuel taxes combined Auckland motorists could have faced 14 cents a litre increases within three years.
Joyce says he will make announcements on the tax and on other transport and infrastructure plans next week.
"The announcements next week will be around funding of transport projects and they will include information in regards to the government policy statement ... and there will also be announcements around the future or otherwise of regional fuel taxes."
The policy statement is how the government prioritises work to be funded by the New Zealand Transport Fund.
Joyce says Auckland is the only region already committed to using the regional fuel tax.
"The primary project there is Auckland rail electrification, which is the biggest one," he says.
"We will put together a funding model for rail electrification in Auckland, yes."
Joyce says he is concerned the regional fuel tax is coming on top of national fuel tax increases of 1.5 cents a year for the next three years.
"In terms of the overall numbers I think what I am signalling is a concern that if you add regional fuel taxes on top of national increases the numbers get pretty high. In Auckland they would be 14 cents a litre higher by three years time."
He approved of national increases if they were reasonable.
Joyce indicated a shift in direction for the national policy statement, saying it has been leading to a 9% decline of funding for state highway construction.
"The size of the fund was continuing to ramp up but the amount to be spent on actual construction of state highways ... was actually declining."
Joyce says it is better for the economy not to add burdens on motorists.
"In tighter economic times you have got to be very careful about how much extra charges you add, you have to make sure it's going into activities that are going to enhance productivity and help grow the economy out of recession."
The Labour Party has reacted to the news, saying important regional projects will be dropped because otherwise they will have to be funded nationally.
Auckland Regional Council chairman Mike Lee is disappointed. He told The New Zealand Herald that the council has already invited tenders for the supply of rolling rail stock.
"It's a carefully crafted model of capital expenditure. If you pull the rope from under it, the whole house of cards can come tumbling down."
Several other regions also have plans for funds raised by the regional fuel tax, Lee says.
In Wellington it may have gone towards the long awaited Transmission Gully route, he says.