Letter in response to concerns about allocating funding to Transport Choices projects

A member of Parliament wrote to us with concerns about the way funding allocations were determined for the Transport Choices Package. This is our letter in response.

3 May 2023

Simeon Brown MP
Parliament Buildings
Wellington

Tēnā koe Mr Brown

TRANSPORT CHOICES PACKAGE

Thank you for your letter dated 8 December 2022 about the Minister of Transport’s statement on 4 December 2022, announcing the indicative approval of projects under the Transport Choices Package.

Your concerns

In your letter, you expressed concerns about the way funding allocations were determined and asked me to investigate. You noted that:

  • The Minister of Transport wrote to Members of Parliament (MPs) in the Labour Party on 27 June 2022 about the Transport Choices Package (the Package) and said “If you have any queries about the Transport Choices Package or would like to bring potential projects in your area to my attention, please contact my office”.
  • That letter was only sent to Labour Party MPs and not to other MPs (including not to National Party MPs).
  • This invitation was more than a month before the application process for the Package opened.
  • Final decisions about which projects would be funded would be made by the Ministers of Transport and Finance, which you say is unusual for transport funding decisions (these are usually made by Waka Kotahi).
  • A majority of the 46 councils that received funding are in electorates held by the Labour Party.

Because of those points, you were concerned that:

  • the process had not been transparent and was potentially politicised to benefit Labour Party MPs; and
  • the Ministers of Transport and Finance might have given political considerations more weight than the actual merits of the proposals put forward for funding.

Our work

In light of your letter and public reporting on this matter, my Office inquired into the process for allocating this funding. We sought information from Waka Kotahi (as the responsible agency for the initiative), including:

  • correspondence between MPs and Waka Kotahi;
  • briefings provided by Waka Kotahi to the Ministers of Transport and Finance;
  • copies of applications received from local authorities (and supporting documentation); and
  • communications to the Minister of Transport and his office.

What we have seen

The process

The Package is part of the Climate Emergency Recovery Fund. It makes $350 million funding available for:

  • upgrading/building new cycleways to build more connected networks;
  • creating safer pedestrian areas;
  • supporting safer, greener, and healthier travel to school; and
  • making public transport easier to use.

The Package was announced in May 2022 as part of the Budget. Waka Kotahi is managing a process where councils can apply for funding against the criteria for the Package published by Waka Kotahi. The process for selecting the final projects involves two stages; the initial selection of indicative projects, and further refinements and agreement of final funding arrangements. The specific steps are set out in more detail in the table attached to this letter.

Our comments about the funding process

From the work my Office has done, we have seen that:

  • All councils were contacted by Waka Kotahi in August 2022 and provided with a copy of the initial expression of interest form.
  • All the projects that are being considered for funding were included in applications from councils. We have not seen any evidence that projects were received by Waka Kotahi directly from any MPs or outside the application process. We have seen examples of correspondence from MPs discussing particular projects. In all instances they were advised by Waka Kotahi to engage with the relevant council about projects the MP was interested in.
  • Waka Kotahi assessed applications and projects put forward by councils against the criteria for the Package. We did not carry out an independent analysis of Waka Kotahi’s assessment. However, it is clear from the information we have seen that proposals which were not sufficiently detailed, or did not meet enough of the expected criteria, did not progress.
  • The analysis about which projects should receive funding was done by officials at Waka Kotahi. Ministers have agreed the indicative list of projects (one of three options put to them by Waka Kotahi) and will be asked to endorse the final list of projects and amounts. However, there is no indication in the material we have seen that Ministers are making substantive decisions about funding or altering Waka Kotahi’s recommendations. The final decisions (by Waka Kotahi) about how funding will be allocated and the endorsement by Ministers are expected soon.

Our findings

Based on the work that we have done, and in respect of your specific concerns, we have not seen anything to suggest that the process has been politicised to the benefit of one particular political party, or that other considerations have outweighed the merits of proposals for funding. Although Ministers have agreed to the in-principle list of projects, and are expected to endorse the final list of projects and funding, the analysis of which proposals will be funded has been done by Waka Kotahi.

We have also not seen any evidence to suggest that funding has been directed to particular electorates. All councils were made aware of the funding and given an opportunity to put forward projects and work with Waka Kotahi to see whether those projects qualified for funding. We remain interested in the outcome of the final assessment of projects and confirmation of which projects will receive funding.

General comments

It is not for me to comment on whether the Minister should write to MPs to make them aware of particular funding that might be available through an application process, or to comment on which MPs should be written to. However, I note the language in the Minister’s letter of 22 June 2022, which invited MPs to contact the Minister’s office directly about potential projects.

In my view, that language risked a perception that projects might be considered outside of the published application process, or that the application process might not be fair or transparent and could be open to influence. As outlined, we have not seen any evidence of that in relation to this scheme. However, I encourage all ministers in a similar situation to act cautiously and in a manner that promotes the public’s trust in the integrity of New Zealand’s systems of government.

Thank you for raising this matter with my Office. Because of the public interest in the matters covered in this letter, I intend to publish the letter on our website.

Nāku noa, nā

John Ryan
Controller and Auditor-General