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Revenue and expenditure - looking ahead over the next 10 years

The NZTA's 10-year financial forecast (see page 19) spans the years 2009/10 to 2018/19. It details the revenue the NZTA expects to receive and its anticipated allocation to activities through the NLTP.

The figures for the three years between 2009/10 and 2011/12 reflect the NZTA's allocations for expenditure in those years. Revenue and expenditure figures in subsequent years reflect anticipated revenue and expenditure, and as with all forecasts are imprecise. However, they give effect to the GPS by being within the ranges it specifies and targeting its expenditure levels.

The forecast of anticipated revenue and expenditure is shown in Figure 3.

Revenue forecast

The anticipated funding in the 10-year forecast was developed using the GPS proposed levels of revenue, forecasts of revenue and feasible funding from other sources.

The anticipated revenue is principally derived from fuel excise duty, road user charges and motor vehicle registration fees. The forecasts reflect both current fees, duties and charges and changes to these indicated in the GPS.

The NZTA expects to draw down all funds on hand, and to potentially make use of the allowable variation between expenditure incurred and funding available, as described in the GPS. It also expects to investigate funding from other sources to augment the funds available through the National Land Transport Fund (NLTF).

Expenditure forecast

The anticipated expenditure in the 10-year forecast takes into consideration the funding available, the impacts sought from funding and the targeted expenditure in the GPS, and priorities for transport investment in regional land transport programmes.

The anticipated expenditure reflects the GPS's new priorities, with a greater emphasis on new and improved state highway activities, in particular on RoNS. It is based on an activity level similar to that in the 2008/09 NLTP, plus:

• increased expenditure on local road and state highway operation, maintenance and renewal
• increased expenditure on state highway improvements, and in particular on the implementation of RoNS
• increased funding for public transport services and infrastructure.

Figure 3: Anticipated revenue and expenditure, 2009-2018

Notes:

• The anticipated revenue reflects the use of all fuel excise duties, road user charges and motor vehicle registration fees dedicated to transport.
• Expenditure is forecast at a similar activity level to that in the GPS.

Assumptions

When allocating funds to activity classes and forecasting revenue and expenditure, the NZTA has relied on certain sources for information and assumptions. These include:

• forecasts of revenue provided by the Ministry of Transport-led revenue forecasting group, whose membership includes the NZTA and the Treasury
• an assumption that economic circumstances will be as forecast by that group, its advisors and the Treasury
• forecasts of exchange rates and fuel prices provided by the Treasury, and an assumption that while international fuel prices may be volatile over the period of the NLTP, no circumstances will arise that cause a fundamental change in supply and prices from those forecast.

The NZTA has also assumed that:

• the regional land transport programmes developed by local authorities will remain in alignment with their long-term council community plans, including the way in which they interpret and implement their plans
• implementation of a proportion of improvement projects proposed by approved organisations¹ won't proceed as first programmed (as has occurred in recent years), despite their being included in regional land transport programmes
• fuel excise duties, road user charges and motor vehicle registration fees will change in line with the government's intentions outlined in the GPS.

¹ An 'approved organisation' is a public organisation approved under section 23 of the LTMA. It's usually a regional council, a local authority or another public organisation.

Last updated: 6 October 2009