Drivers to pay for oil shock

Motorists should pay more to drive cars - including more expensive car parks, and fees to use the roads - if New Zealand is to survive rising oil prices, a comprehensive new report says.

The increased costs would be coupled with investment in public transport, tax breaks for fuel-efficient vehicles, laws requiring new developments to provide showers and lockers for walkers and bikers, improved urban design, and encouraging businesses to swap company cars for cash or bus subsidies.

The independent report, Managing Transport Challenges When Oil Prices Rise, was commissioned by the Government's New Zealand Transport Agency as a response to rising petrol prices.

Petrol peaked at $2.19 a litre in July for 91 octane and has since fallen, but the report, by transport consultants from McCormick Rankin Cagney and academics, says high oil prices are a serious and urgent risk and predicts petrol will rise to $2.80 by 2014.

New Zealanders would be particularly stung by rising prices because of their over-reliance on cars. Currently 80 per cent of the population travel by private car and only 4 per cent by bus. Fourteen per cent is commercial.

The report calls for a fundamental shift in the Government's transport solutions - away from building more roads toward investing in alternative transport and maintaining existing roads.

It says most of the recommendations are low-cost and can be afforded within current land-transport budgets. Charging motorists the true cost of parking and using roads will raise funds to invest in alternative transport.

Drivers will be further discouraged by reallocating road space and slowing traffic to make roadways more pedestrian-friendly. Rather than widening roads, it says one existing lane should be for buses or car-pooling, leaving less room for private cars and making efficient options even more attractive.

The authors acknowledge that the recommendations may be unpopular with the public but say they will reduce dependence on oil so the average consumer will spend almost the same on oil-based transport in 20 years as they do now, despite escalating fuel prices.

They also calculate the recommendations will save $15 billion over 20 years in fuel and vehicle expenses as well as the welfare benefits of reduced congestion, air pollution and greenhouse gases.

This report will be published on the NZTA website and distributed to policymakers and local authorities to be considered in their planning.

Green Party co-leader Jeanette Fitzsimons welcomed the report and hoped it would "inject a bit of reality" into transport planning. She said the Government had previously ignored rising oil prices in its cost-benefit analysis of building more roads. This report acknowledged "for the first time" the reality of long-term oil-price rises.