ZB

Auckland sitting on $285m fuel tax windfall, with more than half of all fuel tax unspent

Author
Thomas Coughlan, NZ Herald,
Publish Date
Thu, 27 Jan 2022, 7:26am
Auckland City Council is sitting on a $285m mountain of unspent fuel taxes. (Photo / Dean Purcell)
Auckland City Council is sitting on a $285m mountain of unspent fuel taxes. (Photo / Dean Purcell)

Auckland sitting on $285m fuel tax windfall, with more than half of all fuel tax unspent

Author
Thomas Coughlan, NZ Herald,
Publish Date
Thu, 27 Jan 2022, 7:26am

Auckland Council is sitting on a $285 million goldmine, after it failed to spend nearly half the money it raked in thanks to the regional fuel tax. 

In 2018, the Government introduced an additional tax on fuel sold in Auckland of 10c a litre (with GST taking the figure to 11.5c) to help the council fund transport projects in the city. 

But according to data from the council, as of December 2021, less than half of the $515 million raked in by the tax has actually been spent, leaving the council with a $285m tax surplus. 

National's transport spokesman Simeon Brown said the news would likely anger Aucklanders. 

"Aucklanders will be angered to learn that despite paying over half a billion dollars in Regional Fuel Tax, less than half of that money has actually been spent on transport projects in our city. 

He added that it undermined claims made by the Government that the tax was essential for funding projects Aucklanders needed. 

"This just shows what a sham this tax was right from the start. 

"Aucklanders were told by the Government and Mayor Goff that this tax was needed to desperately fund projects which would help ease the congestion Aucklanders battle each and every day. 

"Instead the tax revenue is simply being hoarded for projects which might be delivered sometime in the distant future," he said. 

A spokesman for the council said there were "a number of reasons why the RFT [regional fuel tax] expenditure is currently lower than the money raised". 

They said "spending will ramp up as projects move into the construction phase and all money raised for transport infrastructure will be spent for that purpose," adding that Covid-19 lockdowns and physical distancing on construction sites had also slowed up construction. 

They said the council was constrained the types of projects it could fund. 

"Central government legislation sets out which projects can receive funding from the RFT through an order in council. 

"Any change to the list of projects that can receive RFT funding would need to go through a public consultation process and by way of an order in council by the Government," they said. 

They added that the Government's decision to entirely fund a handful of Auckland transport projects under the NZ Upgrade programme meant they no longer needed fuel tax money. 

An updated list of projects that might be funded with the money was put out for consultation last year. 

It is not the first time the council has come under fire for failing to get projects going. 

In December 2020, the Herald reported $156m from the tax had been unspent, about half the $330m raised at that time.