1. THE PUBLIC FINANCE DEBATES: “It’s time…New Zealand extended charging for public infrastructure” Commentator: Chris Money

2. Three Questions The VUW-GEN Public Finance Debates November 12, 2013 1.What does “It’s time….” mean? 2.What are we actually charging for? 3.Is directly charging the best response?

3. Now or Never or At Some Stage? The VUW-GEN Public Finance Debates November 12, 2013 4 major concerns with the current system: – Increasing reliance charging to achieve multiple policy objectives – Intergenerational funding inequities – Net revenue efficiencies now, but technology is moving fast – Do sustainable networks need demand management?

4. Net Investors Now or Never or At Some Stage? The VUW-GEN Public Finance Debates November 12, 2013 Palm Springs Portland Detroit

5. Direct charging for cities is already happening Proposed and implemented schemes Singapore Stockholm Milan Edinburgh, Manchester West Midlands, Bristol Cambridge, Telford Auckland Netherlands New York Serious proposals not progressed and unlikely to come back soon Recidivists London

6. The pipeline of potential schemes Potential schemes USA Copenhagen France & Germany Tel Aviv Toronto Guangzhou & Hong Kong Sydney

7. What are we charging for? ConstructionMaintenanceConsumption RoadsRoad users/ratepayers No one Public transportRoad users/ratepayers Users (40-60%) 3 WatersUsers No one PowerUsers TelecommunicationsUsers The VUW-GEN Public Finance Debates November 12, 2013

8. The arguments summarised ProponentOpponent Efficiency 1.Critical to managing long-term service levels 2.Fairly apportions costs where they lie 3.A more sustainable funding path 1.Pricing will reduce mobility and therefore economic activity 2.Restricting access at point of use is sub-optimal from a revenue perspective 3.High transaction costs Equity 1.Sub-optimal outcomes for those with higher values of time. 2.Those that don’t create the externality costs “overpay” 1.We’ve already paid 2.Alternatives are critical – disconnect between viability of alternatives, incomes and origins/destinations. Other points 1.Proof is there for all to see. 2.Not an answer on its own.  Scheme Design is critical to outcomes The VUW-GEN Public Finance Debates November 12, 2013

9. So is it time to charge? Direct charging doesn’t wholly replace current funding and pricing systems The shift in emphasis has to be demonstrably better than the alternatives The VUW-GEN Public Finance Debates November 12, 2013