Luxon misleads over cycleways being responsible for rates increases
Back in December 2024 in a social media post on LinkedIn, Prime Minister Christopher Luxon blamed spending on cycleways for driving increases in local government rates. The problem? It turns out he didn’t have any objective data to support this claim.
In response to an Official Information Act request lodged by Local Aotearoa, all Luxon’s office could come up with as evidence to support his statement was a link to a Wellington Chamber of Commerce poll from October 2024 that found people thought Wellington City Council was overspending on cycleways.
Now, it’s all very well for people to oppose spending on cycleways if they want. But that doesn’t automatically make cycleways responsible for local government rate increases.
In fact, Local Government New Zealand commissioned Infometrics to look into the drivers of rates increases and reported the results in March 2024 and, unsurprisingly, cycleways aren’t to blame.
What Infometrics identified as being the primary drivers of rates increases were infrastructure costs - bridges up 38 percent, sewage systems up 30 percent, and roads and water supplies being up 27 percent. It also saw local government labour and interest costs increase too.
Separately, insurance premiums have massively hiked as well. Christchurch City Council’s have risen 72.5 percent since 2021/2022 and councils around the county have faced similar increases too, with Auckland Council’s insurance costs nearly doubling between 2021/2022 to 2023/2024.
While cycleways are part of the broader infrastructure cost inflation that Infometrics saw, they actually noted that “only other paths (carparks, footpaths, walkways, cycleways etc) have seen slower cumulative cost escalation” than roads had.
What this means, as Infometrics points out in their report, is that their “other paths” category saw costs increase by 16 percent, which is less than how much consumer price inflation rose over the same period (a cumulative 19 percent).
This makes it very hard to credibly argue that cycleway spending is in anyway a major, or even minor, driving force of rates increases when compared to any number of other far more influential factors - including just inflation in general!
Despite what Luxon and former Transport and Local Government Minister Simeon Brown might have had you believe, investing in cycleways appears to have bee hugely successful. As a good example, despite vocal and often misinformed opposition, the changes in Newtown have seen bus patronage up 69 percent, cycling trips up 62 percent, and retail spending recovering after unsurprisingly dipping during construction. Now some of this bounce back is accounted for by the recovery out of the pandemic, but some of clearly comes from the improved cycling infrastructure making it safer and quicker to cycle than it ever has been before.
All of this is before we actually get to the economic benefits of cycleways, which Waka Kotahi New Zealand Transport Agency has previously put at an overall benefit of $1.45 per cyclist per kilometre.
From all of this we can say that at best Luxon was misleading people with his social media content. At worse he was outright lying. I generally try to give people the benefit of the doubt, but this isn’t Luxon’s first rodeo for belting out talking points without having the evidence to back them up.
Ultimately, it seems pretty obvious that Luxon was lying here purely for political points.
Despite the demonstrable health, environmental, transport, and economic benefits of investing in cycleways, they are a political lightning rod. In Wellington in particular they’ve become an easy scapegoat for struggling city businesses.
The Spinoff’s Joel MacManus beautifully skewed this fallacy in his “The mystery of the killer bike lane” where he lambasted claims cycleways were killing cafe and retail businesses in the city’s CBD.
Call me old fashioned, but I suspect the combination of government cuts, high inflation, generally depressed economic conditions, and increased working from home have more to do with changing consumer spending patterns - the latter of which has actually benefitted businesses around the Wellington region who are just as deserving of consumer spending as those businesses in the CBD.
Maybe instead of lying to demonise cycleways, Luxon should take a leaf out of his mentor Sir John Key’s book. Key’s Fifth National Government created the $100 million Urban Cycleways Fund, which saw a step change in the amount of investment into cycling infrastructure and has been highlighted as part of Key’s complex legacy.
But that might require some political vision - something which Luxon seems to be inherently allergic to.