Ferry changes and extended fuel tax reduction

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There have been two interesting announcements in recent days


Ferry changes

Friday Auckland Transport announced It struck a deal with ferry operator Fullers on Friday to make changes to trade routes from Devonport and Waiheke Island, but also a major change to the way ferries will operate in Auckland in future. the press release is a bit convoluted so let’s break it down.

Devonport Services

Services from Devonport will be fully AT-controlled, in the same way as all buses, trains and other ferries (except Waiheke) in Auckland.

One of the key elements of the agreements signed today is the full integration of the Devonport to Downtown Auckland route into AT’s ferry network, meaning the service will no longer be a private route. exempt from New Zealand’s regulatory public transport operating model (OCT). Contracts for services operated by Fullers360 between Auckland City Center and Hobsonville Point, Half Moon Bay and Gulf Harbor have also been renewed.

It’s a good result, although it’s unlikely to bring much immediate change for travellers, given that it was already treated as part of the network for things like integrated ferry fares. Services begin today under the new contract.

Waiheke Services

Unlike Devonport, Waiheke will continue to be a trade route (the last in Auckland) but AT says a new deal will bring some improvements via a ‘Quality Partnership Agreement’ (QPA).

Fullers360’s passenger ferry services between Auckland city center and Waiheke Island will continue to be exempt from contract regulations, but subject to new minimum service levels and a withdrawal notice period extended legal minimum service.

As part of the QPA, Waiheke residents will also be able to access a new AT HOP adult monthly pass which includes bus and train connections in the same area at either end of the ferry route. The price of the pass will be the same as existing equivalent monthly passes for the Gulf Harbor and Pine Harbor ferries, offering a savings of 14% to commuters and will be available in the coming months.

AT’s Mark Lambert says that while Waiheke services will remain outside the regulated public transport (OCT) operating model, meaning continued exemption from a contractual status with AT, there will now be much more liability great because these services will be measured against AT’s service standards.

“AT recognizes that the QPA for Waiheke Service does not imply the removal of exempt status. But, as a negotiated outcome, provides immediate interim benefits for service levels, service certainty and fare prices , as we now move through the government-led exemption review process.”

Interestingly, in a separate fact sheet they provided, AT blamed a lack of funding for not being able to change that.

Considerable time was spent by both parties discussing the viability of the Waiheke Island route under OCTs. We appreciate that many members of the Waiheke community have advocated for Fuller360’s exemption status to be lifted. However, the reality is that, under OCTs, the service is not commercially viable without additional funding from Auckland Transport or central government.

Although they also note that the government is currently reviewing the OCT and last month Transport Minister Michael Wood said it had begun the legislative process to remove the exemption.

More new ferries and change of ownership

Perhaps the most interesting part of the announcement is that AT is changing the ownership structure of the ferries, changing them to look more like trains where AT owns the ships and they will be used by the company running the services. I think this is a positive change because in the long run it will be easier for new operators to enter the market and compete with Fullers.

Along with the change in ownership structure, AT is working with Fullers and using funds from the council’s recently introduced Climate Action Targeted Rate to design and build five new plug-in hybrid ferries. These are in addition to the two electric ferries which the government is mainly funding and which were announced in April. They are also buying four existing ferries.

Darek Koper, director of Auckland’s transport group, Metro Services, said the switch to AT for the purchase of the new electric ferries will help accelerate Auckland’s transition to an all-electric and hybrid-electric ferry fleet.

“The plug-in hybrid ferries using design and innovation developed by Fullers360, Incat Crowther and HamiltonJet join the two recently announced EV Maritime all-electric ferries, bringing to seven the Government and Council’s investment in new electric vessels or electric hybrids, which will allow us to significantly reduce our emissions,” says Koper. Q West will build the first of these vessels.

“Passengers traveling on services like the Devonport route will be among the first to travel on the new electric and plug-in hybrid electric ferries, which will be comfortable, quiet and provide a fantastic experience for our passengers. The new partnership builds on the significant investments made to date by Fullers360 in the design and development of new vessels for Auckland.

“The four ferries in the existing fleet are needed to maintain services as we build and transition to the new electric fleet, which requires investment to refurbish and upgrade low-emission engines to ensure we reduce our emissions and improve ship reliability in the immediate term. ”

Fulling in fact announced these in December, so it’s basically AT taking over, although Fullers is still helping on the project. According to AT, the first of five new ferries is expected to arrive in mid-2024, although this may be affected by shortages in the supply chain.


Extension of half-price reductions in TP and fuel tax

Yesterday the government announced they again extended the fuel tax/road charge reduction and half-price public transport fares. It was originally supposed to be a three month change, but the government extended two months at budget time. This time, they’re pushing the changes back another five months until January 31, 2023.

“We know inflation is rising around the world and cost of living pressures are making it difficult for New Zealand at the moment. High fuel prices, particularly due to the impact of the invasion from Ukraine, are a global issue affecting households and businesses in New Zealand,” said Grant Robertson.

“That’s why we decided in March to cut the fuel excise tax by 25 cents a liter and road charges by equivalent levels, as well as cut public transport fares in half.

“At budget time, we extended these reductions, and we are extending them again by more than five months to January 31, because we want Kiwis to have some certainty over the next few months in the face of price volatility. at the pump.

“The Treasury estimate is that the combined impacts of this policy will reduce headline inflation by 0.5 percentage points in the June quarter of 2022. Although many commentators expect inflation to peak in the June quarter of June, it should remain for some time at higher levels than those observed in recent years.

……

“The global fuel price crisis is not leaving many people unscathed, so we are delighted to do what we can to ease the pressure on motorists,” said Megan Woods.

Transport Minister Michael Wood said that since the introduction of half-price fares on April 1, public transport use has increased in the three largest centres, Auckland, Wellington and Christchurch.

“We know this makes a real difference for people who are feeling the pressure of the cost of living, especially low-income households. As half-price public transport will now be available to all New Zealanders until the end of January, the Community Connect scheme will now start on February 1 next year.

“It will also give local authorities more time to put in place the systems needed to effectively administer the Community Connect scheme which will give those with half-price public transport community service cards permanently.

“The extension of fuel excise duty and road charge reductions will also contribute to reducing the fuel burden on the road transport sector and, in doing so, keep the cost of food and essential goods at a lower level,” said Michael Wood.

Extending the fuel excise and RUC cuts until the end of January would cost $589 million. This is money that goes directly to the National Land Transport Fund to pay for road construction and maintenance and fund public transport, walking and cycling initiatives. The cost of expanding public transportation at half price is estimated at $63.1 million.

The extension is not surprising given that the price of fuel is now higher than it was before the 25 cents per liter was removed. Together, this means the total amount of “lost” tax the government has to cover now stands at $1.174 billion. It’s a huge sum they are paying just to maintain the status quo which, according to their own plans, must change.

Although to be fair, for most people the viable alternatives to driving are actually dwindling, because due to the appalling reliability of public transport at the moment with up to 2000 services per day be canceled in Auckland. So while the extension of half-price public transport fares is welcome, it is unlikely to do much to entice more people to use public transport.

There is also a connection between the PT’s half-price fare extension and the ferry news. This is because Devonport and Waiheke were excluded as they were commercial services. AT covered the cost of including Devonport’s services as it would have been difficult for them to be excluded from the integrated ticketing solution. This presumably means that the government will now provide them with financial support at half price. However, as this is still a trade route, it is unlikely that the same will apply to Waiheke services.

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