The Government has announced it will spend over $20 billion to “get transport back on track”, with funding for 15 Roads of National Significance, as well as public transport and potholes.

To secure the transport budget, the Government is proposing to increase fuel taxes from 2027 and the Motor Vehicle Licensing Fee by $50 total by January 2026.

Transport Minister Simeon Brown said over the next three years the Government would invest $7b per year on projects that prioritised economic growth and productivity, increased maintenance and resilience, safety and “value for money”.

Brown said it balanced the need for investing in new projects while ensuring the transport system was maintained to a high standard.

The plan comes from the draft Government Policy Statement (GPS) on Land Transport, which, when finalised, will lay out the direction of travel in the portfolio for the next 10 years.

Roads of National Significance

It included 15 new “Roads of National Significance” projects, revived from the Key and English-led National governments.

During the election campaign, National estimated the cost of the projects would total around $17 billion, but the costs of the planned highway projects remain uncertain.

Brown said every one of the 15 new roads will be four lanes, fully separated from other traffic, and could be delivered in stages.

The plan also included a commitment of up to $2.3b for public transport services and $2.1b for public transport infrastructure over the next three years.

Brown said delivering reliable, effective and efficient public transport was a priority, particularly in Auckland and Wellington.

For Auckland, the focus was on completing the City Rail Link and Eastern Busway, he said. Planning would also be done for the delivery of the Northwest Rapid Transit Corridor and the Airport to Botany busway.

For Wellington, it would be delivering the Lower North Island Rail Integrated Mobility project, upgrading rail network substations and replacing rolling stock for the Wairarapa and Manawat┼ź lines. It would also support the acceleration of the North-South, East-West and Harbour Quay’s bus corridors, he said.

Pothole plan

The plan also included increasing maintenance levels and improving roading resilience, and the draft GPS included an increase to road maintenance funding of $640 million.

Brown said potholes had become increasingly apparent on New Zealand roads in the last five years and the Government had arranged for between $3.1b and $4.8b to be funnelled towards addressing them on state highways and local roads.

Brown said there would also be a stronger focus on road policing and enforcement, as well as investing in new and safe roading infrastructure and targeting the leading contributors of fatal crashes.

That meant the Government would introduce “workable legislation” to enable roadside drug testing, review fines for traffic offences as well as the vehicle regulatory system.

The latter was aimed at better managing the safety performance of New Zealand vehicles, he said.

The Government would not continue with a “blanket approach” to speed limits, he said.

“Investment in infrastructure to reverse recent speed limit reductions will be prioritised, where safe to do so. This includes the New Zealand Transport Agency increasing speed limits to 110 km/h on roads engineered to that safety standard.”

Rego to go up by $50

Brown said as well as increasing the Motor Vehicle Licensing Fee by $25 in January next year and a further $25 in 2026, the Government would also give a Crown grant of $3.1b and a Crown load of $3.1b.

“And a 12 cent, 6 cent, and annual ongoing 4 cent per litre increase in Fuel Excise Duty, and RUC equivalent in January 2027, 2028, and 2029 respectively.”

He said the Government would not raise FED nor RUC this term.

“I expect the NZTA to consider different ways of funding and delivering major transport investments, ensuring they make efficient use of every dollar spent.

“This will likely include Public Private Partnerships (PPPs), increased use of tolling, ‘Build, Own, Operate, Transfer’ equity finance schemes, and value capture, to generate additional revenue and deliver infrastructure in a more efficient manner.”

The draft GPS is now open for consultation, concluding on April 2.

Additional reporting by Justin Hu and James Ball

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