Transport Minister Simeon Brown. Photo: RNZ / Angus Dreaver
National's Transport Minister Simeon Brown is proposing a fuel tax increase of 12 cents to hit all at once in 2027 - the same amount Labour suggested through gradual increases by mid-2026. That would be followed by further increases of 6 cents per litre and 4 cents per litre in subsequent years.
In the meantime, the government plans on hiking vehicle registration fees by a total of $50 - with increases of $25 per year for the next two years - and potential increases in traffic fines.
The government also intends to set up a Road Efficiency Group, which would be focused on "finding efficiencies in road maintenance, standardising maintenance protocols, reducing expenditure on temporary traffic management, and reviewing maintenance contracts".
These changes come alongside the promised $500 million pothole prevention fund, a new approach to road safety including targets for drink and drug testing, and $4.4 billion in public transport spending in the government's overarching plan for land transport, the Government Policy Statement (GPS).
The coalition promised to "begin work on a new GPS reflecting the new Roads of National Significance and new public transport priorities" as part of its 100-day plan - the deadline for which ends on Friday.
"These measures are not about revenue gathering," Prime Minister Christopher Luxon told reporters at the post-Cabinet media briefing on Monday, "this is about sending a clear message to drivers that reckless behaviour and attitudes on our roads will not be tolerated".
The previous Labour government unveiled its own draft of the Transport GPS in August, with then-minister David Parker revealing a spending proposal for $70b through to 2034 - with $60b coming from the National Land Transport Fund (NLTF) paid through fuel and vehicle taxes, and $10b in Crown funding.
The coalition's revised draft also plans to spend $70b - all from the NLTF - in the same time period, with about $20b of that in the next three years.
Labour had prioritised $20b of that for 14 new roads and public transport links, and urged a bigger spending focus on maintenance after the floods and cyclones earlier that year - to help recover and prepare for future disasters. Other priorities included emissions reduction, safety, development and an integrated freight system.
This was to be paid for by returning to a system of gradually increasing fuel excise and road user charges - as had been done in the past by successive governments - but Labour put that on hold along with a 25-cent cut from March 2022 after Russia's invasion of Ukraine caused oil prices to spike.
Parker's proposal would have meant two six-monthly increases of 2c per litre of fuel, increasing to 4c per litre from the second year. All up, fuel taxes and RUCs would have increased by a total of 12c per litre from 2023 to July 2026 - adding $1.4b to the government's coffers over 2024-27.
National campaigned on cancelling those tax increases, while also promising $24.8b of spending over 10 years with 13 new Roads of National Significance (RONS) projects and public transport upgrades.
It suggested increased funding for the policy would come from a mix of sources including more than $9.5b in private funding, toll roading, cost recovery and similar sources. Labour at the time criticised National's proposal as being based on old costings and coming up to $4.8b short.
But now, it looks like National is bringing in a very similar level of tax hikes - coming in six months after Labour's would have.
Brown said the increase to annual registration fees was a "one off fee that people pay when they register their vehicle".
He said the increased fuel excise proposal was also ahead of further work on moving all vehicles to a road user charge instead, which would see vehicles charged based on weight and distance travelled.
"That work needs to be undertaken over the next three months to work out how that's going to be done, and what timeframe and we'll have more to say about that once their work is completed."
Luxon said it was a tradeoff.
"As we look at the choices and the tradeoffs, we have to make for a very foundational piece of work around our transport strategy so that we can have modern, reliable infrastructure in this country. This is the choice and the tradeoff that we've made. We've tried to digest it by actually making it in $25 increments over a two year period and I think we're trying to find the balance of our way through that."
He said by the time the fuel tax increases came in, the New Zealand economy would be in better shape.
"What will have improved is actually inflation will be back in the target range, that'll bring interest rates down, that'll get our economy growing again."
The coalition's new proposal promises 15 new four-lane, grade-separated RONS along the lines of the 13 projects it campaigned on.
In a statement, Brown said legislation was already underway on fast-track consenting approvals to support major transport projects like the RONS, and the government would seek alternative revenue to support their construction.
"This includes Public Private Partnerships, 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," he said.
"We are opening New Zealand up to a range of funding and financing tools ... we need to have all the funding options on the table," Brown told reporters at the post-Cabinet media briefing on Monday.
Asked about National's claims during the campaign its transport plan had been fulled costed, he said the government needed to look at a wide range of revenue options.
"No. What we're doing here is we're ensuring that we can build and maintain our roadway network and we're ensuring we've got the funding, so we can reduce the number of potholes on our road and build the roading infrastructure that New Zealanders expect this government to deliver."
There were "a range of estimates in terms of what has been provided," he said, when asked if the party undercooked its policy costings during the campaign.
The $4.4b for public transport includes $2.3b for services, and $2.1b for infrastructure. This includes funding for the City Rail Link and Eastern Busway, the Northwest Rapid Transit Corridor, and the Airport-to-Botany busway in Auckland.
In Wellington, the Lower North island Rail Integrated Mobility project will continue to be funded, along with "acceleration" of the North-South, East-West and Harbour Quays bus corridors.
Brown's statements signalled the government intended to encourage operators to increase public transport fares as well.
"Ensuring local government pays their fair share, funding should also be supplemented by increased public transport fare-box recovery and third-party revenue," he said.
Brown said the pothole prevention programme would include new State Highway and Local Road Pothole Prevention activity classes, which would help address potholes on state highways and council-managed local roads.
A new approach to road safety would also include new legislation to enable roadside drug testing, consideration of increases for traffic offences, and reviewing the vehicle regulatory system.
Consultation on the draft GPS for Land Transport closes on 2 April, with the final plan expected to be in place by 1 July.
