A selfless editorial

A very selfless editorial from the NZ Herald:

In the wake of the Christchurch earthquake a debate is developing about the merits of depriving other regions, notably Auckland, of development for the sake of Christchurch’s recovery.

In fact, there is no choice. Christchurch is one of the hubs of the national economy and the disruption of its normal activity will reduce economic activity nationwide. Its recovery is imperative and quite properly it will have first call on public investment for a good year or more.

The idea that boosting Auckland’s activity might enable the national economy to grow despite the earthquake is fanciful. Auckland’s infrastructure programmes are not gold discoveries; at best they are of incremental value to the economy.

They note:

In the wake of the earthquake, it seems clear the Auckland Council will have to forget about an inner-city rail loop if it wants this Government to fund it. That $2 billion proposition was already struggling to convince Transport Minister Steven Joyce that its business case was soundly based.

Members of the Auckland Council may be aggrieved that the centrepiece of their public transport plans may be sacrificed to the needs of Christchurch. …

If the Auckland Council dared to levy its own ratepayers for the bulk of the capital cost, its chances might be better still. But if the council continues to plead for national finance, it will find the Government more deaf than ever for a good while. The needs of Christchurch will take precedence over Auckland schemes, and properly so.

There will be two constraints on infrastructure spending outside Christchurch, which I agree must be the priority. One is fiscal – how much can one afford in any one year. But the more important constraint might be capacity – the construction industry is so big and can only handle so much work without leading to huge cost inflation. So some prioritisation in terms of timing may have to occur, and again Christchurch should win out.