Unprecedented spending on roads and railways

The fiscal budget proposed for 2010 brings a new substantial boost in spending on transport and communications. The total budget for this sector for 2010 comes to NOK 27 billion – up 21 per cent compared with the adopted budget for 2009. Spending on roads and railways is at a record-high level.

“This is a new major boost for Norway’s road and railway network. People and businesses will reach to their destination more quickly and easily, the number of fatalities and serious injuries in the transport sector will fall and more people will be able to use public transport,” says Transport and Communications Minister Liv Signe Navarsete.

In its National Transport Plan for the period 2010-2019 the Government presented an offensive strategy for the country’s transport system.

“With this budget the Government continues the steep increase in provision for transport and communications seen since the Government took office in 2005. We have raised the level of spending on roads and railways by a good NOK 9 billion or 46.3 per cent compared with 2005 in the National Transport Plan. The budget proposal has a strong emphasis on climate and the environment, and a clear regional profile. We are setting the stage for an even better offering of road, rail, ferry, public transport, air, postal and telecommunications services for people and businesses throughout the country,” says Ms Navarsete.

Roads: 34 per cent growth in investment

A good NOK 14 billion goes to roads, 23 per cent more than in the adopted budget for 2009. This figure is corrected for the transfer of much of the national road network to county authorities as from 1 January nest year.

NOK 5.6 billion is allocated to national road investments, an increase of 20 per cent compared with the adopted budget for 2009. When NOK 850 million to rockfall/landslide protection is included, investment spending is up 34.3 per cent. NOK 500 million of this figure goes to the county road network.

Railways: more dependable rail services

The Government considers it essential to enhance rail traffic reliability, and has earmarked just over NOK 10 billion to the railways, an increase of some 15 per cent from 2009. A marked focus on operation and maintenance will improve operational stability in Norway’s railway system as early as 2010. The ‘Oslo Project’, bringing together the Norwegian National Rail Administration and rail companies, is an important contributor in this context.

“The budget demonstrates that the Government is continuing to intensify its focus on the railways. Significantly higher levels of new construction and maintenance are imperative over time to secure a reliable, good rail service offering”, says Transport and Communications Minister Liv Signe Navarsete.

The total allocation to railway infrastructure investments comes to NOK 3.9 billion, an increase of 25 per cent.

Traffic safety: targeted funding for traffic safety

The Government is continuing its drive to eliminate fatalities and serious injuries on the roads, and will release NOK 723 million for traffic safety in 2010. About NOK 713 million of this figure is state funding, continuing the high level from 2009.

The Government is giving priority to head-on collisions and run-off-road accidents, to improvement of junctions and curves and to initiatives to make road traffic safer in town centre zones. The drive to reduce speed-related accidents will also continue.

Civil aviation: extra support for airport development

The budget proposal allocates close to NOK 942 million to civil aviation, up 24.5 per cent from 2009. The increase refers to larger grants for regional airports and air transport purchases.

Compared with the adopted budget for 2009, the grants to regional airports are increased more than six fold, from NOK 13.5 million to almost NOK 88 million. NOK 50 million of this figure is a one-time investment grant to the regional airports to meet the substantial investment and funding challenges facing Avinor in the years immediately ahead.

“The Government will also make Avinor’s government loan interest-free in 2010, nor will we be collecting dividends from Avinor in 2010. This – together with the direct grant – will enable Avinor to carry through necessary safety investments”, says the Transport and Communications Minister.

Post and telecommunications: state purchases of unprofitable postal services

Total spending of almost NOK 711 million is proposed for postal services and telecommunications in 2010. The increase from 2009 relates mainly to an appropriation of NOK 497 million for central government purchases of unprofitable postal and banking services to be delivered by Norway Post.

“In recent years no funding has gone to central government purchases of these services since they have been paid for by revenue from other parts of Norway Post’s business. The financial crisis and ensuing economic downturn have affected Norway Post, as have price pressures and a drop in the volume of traditional postal services. Given these economic challenges, funding now needs to be allocated to ensure continued access to reasonably-priced, uniform and good-quality postal services across the entire country,” says Transport and Communications Minister Liv Signe Navarsete.

Geographical fuel price discrepancies to be reduced

The Government will earmark NOK 20 million to a new grant scheme to reduce fuel price discrepancies between central population areas and the regions. The scheme will cover the extra cost of transporting fuel (petrol and auto diesel) to fuel dealers in areas eligible for regional-policy-motivated support.

Public transport and other environmental programmes: broad-based approach

A good NOK 12 billion will be spent on public transport programmes in 2010, an increase of 13.5 per cent compared with 2009. NOK 10 billion of this figure goes to the railways. NOK 629 million will be spent on air route services, NOK 436 million on ferry services that are part of the national road system, and NOK 298 million on coastal transport services (i.e. ‘Hurtigruten’).

“Potential reductions in greenhouse gas emissions from the transport sector are largest in the cities, where vehicle traffic and population growth are heaviest. The programmes in this budget will help to achieve the Government’s environmental goals,” says Transport and Communications Minister Liv Signe Navarsete.

Other proposed allocations:

• An incentive scheme to improve public transport and reduce the use of cars in urban areas: NOK 333 million
• Footpaths and cycle lanes: NOK 250 million – mainly to progress ongoing work on school approach roads
• Initiatives at stations and nodal points in the railway network, inter alia to improve accessibility and information to the public: NOK 278 million, up 142 per cent
• ‘Road funds’ for public transport programmes and universal design: NOK 145 million
• Grant scheme for initiatives to improve accessibility to public transport : NOK 57 million
• Environmental and service initiatives along existing roadways; NOK 62 million
• The Transnova environmental project: close to NOK 52 million
• ‘Public transport in the regions’: NOK 22 million
• Trial project to coordinate travel services for disabled persons (services for those able and those unable to use public transport): NOK 13 million, up 28 per cent
• Further CO2 differentiation of the initial registration tax on new cars, new CO2 differentiation of the initial registration tax on taxi cabs
• Continuation of the favourable 50 per cent tax rate on electric company cars from 2009

Research and development: a boost for green research

Continuing its focus on research and development, the Government proposes raising spending on this segment via the transport and communications budget by almost NOK 263 million, or a good 10 per cent, in 2010.

“We intend to bolster spending on transport research to develop smarter and greener transport solutions,” says Transport and Communications Minister Liv Signe Navarsete. The Government also intends to spend more on research in the areas of transport safety and further development of electronic communication.