Waterfront deaths & cost effectiveness redux🍋
The costs & benefits of fencing Wellington's waterfront
My May 2023 post discussed waterfront drownings in Wellington. I offered a rough cost-benefit analysis of a fencing proposal put forward by Councillor Abdurahman — estimating that fencing would cost $1.5m for the 1km that seemed to be needed, that it would save 0.5 lives per year over the 40-year life of the fencing, and therefore the cost-per-life-saved would be just $75,000. Compared to the New Zealand Transport Agency’s (NZTA) statistical value of a life of $12.5m, spending $1.5m on fencing to save 20 lives seemed very desirable.
Since then, the Wellington City Council has reached the view that fencing etc. (at a cost of $7m) seemed to be warranted, and has erected 850m of temporary fencing. However, the proposal has since ballooned — fencing will extend for 3.5km and lighting will be installed for a cost of $30m. Resistance to proceeding has therefore arisen amongst councillors. Across the extensive Council discussion of this matter, reported in the just referenced media report, the following points are particularly significant.
From poor idea to absolute necessity
The view attributed to Council staff was that the price jump was “the absolute necessity” (sic) to reach a health and safety baseline. However, unlike (say) scaffolding on construction sites, there are no Health and Safety regulations relevant to Wellington’s waterfront fencing (or to the lack of fencing). Furthermore, the danger in question has existed for decades, possibly longer.
When confronted by a death in 2016, Council spokesman Richard McLean stated that “the public would be up in arms if we started putting up barriers everywhere”. Thus, Council’s views on the merits of such action have significantly changed. What is now an “absolute necessity” was not long ago a poor idea and, having been judged now to be desirable, alleged health and safety baselines are seemingly invented. What has not changed is the seemingly arbitrary judgements on what should or should not be done, and resort to whatever emotive argument might best support it.
Without data, decisions are arbitrary
None of the comments attributed to Council staff or councillors on this matter seem to involve any assessment of the number of lives that would be saved, the resulting cost per life saved, and the value of a life. Without such an approach, Council decisions will always be arbitrary.
A $30m fence can be justified
Even at a cost of $30m, the cost per life saved (at 0.5 lives per year over a 40 year life for the fencing for a total of 20 lives saved) would be $30m/20 = $1.5m per life, which is still well below NZTA’s estimate of $12.5m for the value of a life.
But better options should be explored
As with most projects, the issue is not simply yes or no but first identifying the range of possible alternatives. In this spirit, Councillor Brown raised the possibility of motion sensors and lifeguards, and also investigating when fatalities typically occurred. In the same spirit, I note that the latest proposal is for 3.5 km of fencing and lighting, and this is over four times the distance of 850m that has been temporarily fenced. That disparity in distances suggests that the 850m currently fenced is much higher risk than the rest of the 3.5 km that is planned for fencing.
Suppose 95% of the deaths have occurred within that 850m section, and it would account for 25% of the new cost estimate (because it is 25% of the total distance of 3.5 kms). Fencing the 850m would then cost $7.5m, and save 20*0.95 = 19 lives, at a cost per life saved of $400,000 per life. This is well below the NZTA’s value for a life of $12.5m, and therefore seems warranted. By contrast, fencing the rest of the 3.5 km section would cost $22.5m ($30m less the $7.5m above) and save 20*0.05 = 1 life, at a cost per life saved of $22.5m. This is well above the NZTA’s value of a life of $12.5m, and therefore does not seem warranted.
Central allocation could maximise lives saved
Many of the comments attributed to councillors suggest that the cost is not acceptable because of Wellington’s current financial problems. To quote Councillor McNulty: “We do not have the luxury of just magicking up money any more.” Aside from the rather startling admission about Council profligacy in recent times, this highlights the problem in leaving these matters to individual councils, who are responsible for a wide range of other activities. Depending on their financial situations, Council A might spend $20m to save one life whilst Council B might refuse to pay $200,000 to save one.
A far better approach would be for a central government agency to be funded to make these decisions nationwide. Its budget might fluctuate from year to year, and might never be large enough to fund every project that saves lives at a cost less than $12.5m. However, whatever its budget in any particular year, it would at least allocate it across the country to maximise the number of lives saved. Lives are equally valuable, wherever in the country they are saved. If Invercargill has a project that will save two lives for the expenditure of $5m and Napier has a project that will save one life for the same $5m, Invercargill should take priority.
Even better might be for the job (and the extra funding) to go to NZTA, so that the funding would not only be rationally allocated across councils but also the road network that connects them all. The life of a person who drowns in Wellington Harbour for lack of waterfront fencing is no less valuable than that of someone who dies in a road accident on a treacherous section of road for lack of a crash barrier. Sensible allocation isn’t quantum physics.
By Martin Lally
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