Our budget challenge
COVID-19 has impacted the use of our transport network.
More people are working from home and concerns about COVID-19 will see fewer people using public transport, but it is important that we maintain this essential service.
In June 2020 public transport patronage was down 37 per cent compared to June 2019.
There is a noticeable drop in capital investment over the next year compared to current plans, with work focusing on projects that are already in progress.
What we are doing differently
Revenue
Public transport revenue
The impact of COVID-19 restrictions, more people working from home and the resulting economic slow-down will have significant impacts on transport revenue compared to previous years.
In 2020/2021, we expect that public transport farebox revenues will be $74 million lower than planned, offset in part with $55 million higher Waka Kotahi NZ Transport Agency operating subsidy (assuming top up of the revenue shortfall to 31 December 2020 and then 51 per cent for the balance of the year).
Parking and enforcement revenue
Parking and enforcement revenue is expected to be down by $35 million, even with greater levels of enforcement to keep bus and transit lanes clear so that the network flows as efficiently as possible.
We expect a reduction in fuel usage meaning that the Regional Fuel Tax revenue will drop by $8 million. This is additional to a $22 million drop in other Auckland Transport revenue lines.
Savings we need to make
A number of operational investment and capital investment savings will be made in the transport activities in 2020/2021.
Planned operational savings include:
- reduced staff costs, professional services costs and contract staff costs - an $18 million saving
- setting an additional savings target for Auckland Transport - a further $7 million saving
- some reductions in the number and frequency of public transport services - a net $4 million saving.
Capital investment deferred
$1.142 billion of capital investment will be delivered in 2020/2021 (this includes $395 million for City Rail Link). Auckland Transport will deliver $747 million, compared with $1.3 billion previously planned.
This level of investment will not allow us to support capital programmes undertaken by other agencies or developments in Auckland.
In addition, around $100 million of capital investment that did not proceed in 2019/2020 will now fall into 2020/2021 further reducing the level of investment in new projects.
The reductions in capital investment in 2020/2021 include:
