Information Supporting the Supplementary Estimates Vote Transport

MINISTER(S) RESPONSIBLE FOR APPROPRIATIONS: Minister of Transport (M72)

ADMINISTERING DEPARTMENT: Ministry of Transport

MINISTER RESPONSIBLE FOR MINISTRY OF TRANSPORT: Minister of Transport

Part 1 - Summary of the Vote

Part 1.3 - Trends in the Vote

Summary of Financial Activity

Analysis of Significant Trends

Tax Revenue

Vote Transport is responsible for collecting tax revenue from motor vehicle registration fees and road user charges. Revenue is forecast three times a year and increases and decreases reflected in the Crown financial statements. The change above is less than 1 percent. 

Non Tax Revenue

This represents administration fees, road tolling revenue and some infringement fees. The decrease is mainly due to a change in what fees can be charged for some services.

Appropriations

The table above explains the changes in the Vote by recipient for ease of explanation.  

Funding to the NZ Transport Agency for the NLTF - funded from tax revenue

This funding moves in line with road tax revenue. Vote Transport road tax revenue is almost unchanged as noted above, however Customs also collect this revenue.  The decrease of $95 million reflects the net effect of:

• Vote Transport forecast road tax revenue decreased by $3 million during the year
• the forecast road tax revenue collected by Customs decreased by $69 million
• the forecast expenditure decreased by $22 million to reflect the balance in the National Land Transport Fund.

Funding to the NLTF from the Crown

While the main source of funding to the National Land Transport Fund is intended to be road tax revenue, the Crown may provide additional funding. The movement of $286 million is the net of:

• $180 million for a second short-term advance facility for the NZ Transport Agency to borrow up to $90 million from the Crown for 2011/12 only, to assist it to manage seasonal fluctuations in revenue and work programming, and emergency works. The appropriation was set at $180 million to allow funds to be repaid and then redrawn if required
• $102 million for the reinstatement of local roads in Canterbury following the earthquakes, and
• $4 million balance is the recognition of surplus administration fee revenue from 2010/11 and 2011/12.

Funding for Rail

The table above appears to show that rail funding has grown by $94 million in 2011/12. However the increase is mainly due to rephasing between years and a $50.6 million accounting entry, and is not an overall increase. The table below explains the movements that have occurred during the year:

The $500 million loan for the Auckland Electric Multiple Unit package was transferred from KiwiRail to the Auckland Council during the year and the funding rephased. The $80.769 million initially appropriated for 2011/12 increased to $200 million - an increase of $119.231 million, but the loan funding in outyears decreased by this amount.

The accounting entry of $50.600 million represents the cost to the Crown of the below market interest rate of the loan to the Auckland Council.

Funding for Crown Entities

The Transport Crown entities are mainly funded by third party revenue and so receive relatively little Crown funding. The main reasons for the increase of $1.785 million are:

• $1.250 million to Maritime New Zealand to assist them to manage their business as usual activity while also managing the response to the grounding of the MV Rena. This increase was fiscally neutral to the Crown as it was a transfer within the Vote
• $293,000 million to Maritime New Zealand to fund its increased liability to capital charge, and
• $200,000 million to the NZ Transport Agency to fund the introduction of Driver Licence Stop Orders, a new enforcement tool.

Other

Other consists of funding for other activities. The main reasons for the increase of $44.051 million are:

• $35 million for the response to the MV Rena grounding. While this is managed by Maritime NZ, it has been shown separately from the Crown entity funding above, due to its unusual nature
• $7.100 million for the Motor Vehicle Register to cover lower revenue from third parties
• $1 million for an increase in the Bad Debt provision for motor vehicle registration and road user charges based on higher than usual actual costs, and
• $850,000 million for the Motor Vehicle Register running costs and $101,000 million for joint venture airports, carried forward from 2010/11.

Funding for the Ministry of Transport

The small decrease is the net of:

• $1.250 million transferred to Maritime New Zealand to assist them to manage their business as usual activity, while also managing the response to the grounding of the MV Rena
• $1.124 million carried forward from 2010/11
• $193,000 million of additional third party revenue, and 
• $200,000 million returned to the Crown representing efficiency savings.