More subsidies for public transport

Public Policy / news

The Budget includes subsidies for free or part cost public transport for young people and better wages for bus drivers

18th May 23, 2:02pm by Eric Frykberg

The Government is extending free public transport to young people.

It will give free fares on buses, trains and ferries for children aged 5 to 12 and half price discounts for all passengers aged 13 to 24 from July 1.

This is among a series of measures announced in Budget 23 on Thursday.

The Budget includes new assistance for children’s health and early childhood education, but has few big-ticket items amid an admitted fiscal and economic challenge.

However, getting people about is an exception.

“Transport is a big cost for Kiwi households,” says the Transport Minister Michael Wood.

“It’s why we provided relief at the pump when petrol prices spiked, and it’s why we are now providing ongoing cost reductions for children and young people.

“Making public transport free for children will make it much easier for kids to get to school and provide relief to household budgets.”

Wood says the free fares for the under 13s could save $30 per week for the average household of two children. He adds the whole programme will help over 1.6 million New Zealanders save money.

The whole scheme will cost $327 million over four years, at an average cost of $80 million a year.

A second part of this scheme is a plan to raise wages of bus drivers to overcome staff shortages.

The Budget enables public transport authorities to raise the base wage rate to $30 per hour for urban bus drivers, and $28 for regional bus drivers. It also deals with split shifts and late working hours. The announcement follows last year’s push of wage rates to $28 an hour. It will cost $49.3 million over three years.

Wood says he hopes the combined schemes will take more cars off the roads and reduce emissions.

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28 Comments

by IT GUY | 18th May 23, 2:06pm 1684375580

Good idea, my kids cost 2k a year in bus to school costs.

by Redcastle | 18th May 23, 9:45pm 1684403102

As expensive as that is, You’ll be paying for this long after they leave home

by Redcastle | 18th May 23, 9:55pm 1684403750

There will be conditions for this; it’ll probably only apply to scheduled public transport services, so if you’re paying for a non scheduled service to get your kids to & from school, you might be disappointed.

by solardb | 18th May 23, 2:06pm 1684375581

yup , taking the kids to school in the car is a trip there and back , twice a day . Would help with conjestion and emissions.

by HouseMouse | 18th May 23, 2:14pm 1684376063

Does this mean existing half price fares disappear ( for people older than 24)

by solardb | 18th May 23, 2:47pm 1684378041

if no community card , then yes., it will end june 30th.

by HouseMouse | 18th May 23, 3:27pm 1684380438

Thanks for clarifying.

so, plenty of households like mine will pay significantly more on transport from July, once you also factor in the removal of the fuel tax exemption

Edit - net effect probably not great for inflation

by solardb | 18th May 23, 3:12pm 1684379562

Yes , back to how it was before the subsidy was put in place.

by interesting1234 | 18th May 23, 3:18pm 1684379911

50cc for the win

by IT GUY | 18th May 23, 4:14pm 1684383257

Plenty of adults travelling on kids cards in AKL housemouse, listern to the beeps the taggers make......... drivers do not care

by Hamish | 18th May 23, 3:00pm 1684378821

Better go find some more bus drivers.

by interesting1234 | 18th May 23, 3:19pm 1684379978

The increase in fuel cost alone will drive more to public transport. Good timing to implement this and clearly they know if you get them onto public transport young and regularly then the cultural shift will reinforce itself over time for the following generation.

by morepork | 18th May 23, 3:35pm 1684380952

It worked for me, I commuted to school by public transport, did the same for university, and have never had a job where I've had to drive a car there. I guess it's a bit of a luxury, but I don't think I would accept a job where I couldn't work from home, take public transport, walk or cycle there. Driving in rush hour traffic is too stressful and not worth it at this stage in my life.

by HouseMouse | 18th May 23, 3:47pm 1684381679

I mostly take the train to work. It’s partly a financial decision but it’s first and foremost a saving time and reducing stress decision. Not only is it quicker and less stressful, I can read and do a bit of work etc on the train. And comment on this website :)

by interesting1234 | 18th May 23, 4:04pm 1684382656

It does surprise me when I come up against the views of people looking down at it, as in it is something they had to endure before they could afford to drive. I guess when you go overseas and see at what functioning cities and public transport networks look like, it opens your mind.

by Redcastle | 18th May 23, 10:01pm 1684404062

Recently Wellington commuters experienced how fragile the trains are. Kiwirail has shown how inept it is for maintaining the rail and ferry services. The buses are often Kate or cancelled altogether.

we deserve better.

by interesting1234 | 19th May 23, 11:21am 1684452078

I agree, and have experienced all of this for the last few years prior to leaving Wellington in December last year. Caused by the level of drivers needed after the Metlink overhaul when they added double decker buses and split the routes. Drivers were able to claim covid and simply get a week off for a long time, maybe even now. All of this increases commuter frustration, which gets spilled onto drivers, then they leave due to better prospects financially available. Then there was the lockout from the bus depot. Seems more of a positive culture is needed now they got their pay demands, in order to entice drivers to take up the jobs.

by Pragmatist | 19th May 23, 12:15am 1684412111

The many posts every week on Reddit fuming about continuous cancellations might have something to do with looking down on public transport. It sure sounds like a complete dumpster fire.

by The Person | 19th May 23, 5:01pm 1684472517

whereas the vehicles stuck in gridlock that i pass everyday, that is something to aspire too?

by powerdownkiwi | 18th May 23, 3:36pm 1684380981

Nice thought but we're perhaps looking at a different paradigm by then. Those roads are all made, and serviced, by fossil fuels. As are those cities serviced.

Yes, we have to work out a way to exist in a non-draw-down manner, but I'm not sure by the time we get there, that buses figure.

by kiwi_overseas | 19th May 23, 6:13am 1684433630

It’s unjustified to call them subsidies when anyone under 16 can’t get a driver’s license, and if they bike or walk they are subject to a road network which kills and seriously injures vulnerable road users.

All PT should be free for anyone up to at least the age of 16. If they don’t own a car they should get a full subsidy up until they leave university.

On the flip side we seldom hear about all the subsidies vehicle drivers receive.

by Redcastle | 18th May 23, 10:06pm 1684404364

What are you on?! The only drivers who get subsidies are electric vehicles which get a up-front cash discount and don’t pay RUCs.

drivers are being stung by ever increasing taxes to pay for cycle lanes and public transport while roads are neglected, speed limits reduced and car parks are removed.

Please enlighten us all; what are these subsidies you refer to?

by solardb | 18th May 23, 10:30pm 1684405810

local Roads,parking, cost of accidents. some roading is necessary wether cars use it or not , but most of the cists ratepayers bear are to cater for excessive car use.

by kiwi_overseas | 19th May 23, 6:15am 1684433737

No congestion tolls, parking that is often free, don’t pay the full cost of crashes, don’t pay anything towards vehicle related air pollution, ratepayer subsidies for local roads, taxpayer subsidies for certain SH works. The list goes on and on and on

by Redcastle | 19th May 23, 9:03am 1684443831

Congestion tolls is yet another tax that is designed to avoid investing in essential infrastructure, not a subsidy.

parking? That is not a subsidy. It is provided by landowners for their customers or is simply part of a road. Parking charges are routinely applied in many areas. Not a subsidy, in fact Councils use parking charges to offset rates, so the opposite of what you say.

air pollution, yep road users pay for that

responding to accidents? Most of a vehicle’s registration fee goes to ACC.

road maintenance costs - RUCs on heavy vehicles contribute to that, but rates and taxes also fund road maintenance because weather also contributes to road deterioration.

by interesting1234 | 19th May 23, 11:28am 1684452537

Congestion tolls is yet another tax that is designed to avoid investing in essential infrastructure, not a subsidy.

Congestion tax is simply an incentive for commuters to explore other options in order to reduce demand on the road and reduce traffic which costs businesses as well as the taxpayer in maintaining the roads.

We have already see over the last 50years that building more roads is a band aid that only lasts until the population increases which then causes these roads to hit capacity and have the exact same issue.

Look at any major city in the western world, the key isn't more roads at all, it is to get people out of single occupancy commuter vehicles and into public transport, biking, walking, carpooling even.

Not a subsidy, in fact Councils use parking charges to offset rates, so the opposite of what you say.

This depends on where you are in the country as everywhere has different schemes. for example Nelson has 1hr free parking before you have to pay, this is subsidised by the ratepayers. They all moaned about paying $1 an hour so the council folded and now everyone pays whether they use it or not. Parking should be pricey, as again it dissuades driving and encourages public transport. This extra demand and also extra funding from parking then further encourages greater investment in public transport.

by The Person | 19th May 23, 5:05pm 1684472725

don't forget the constant topping up from the consolidated fund and interest free loans that are used to pay for major roading projects. The fuel tax has not bought in enough revenue to fund our road building for decades now.

by kiwi_overseas | 19th May 23, 5:18pm 1684473535

Congestion tolls are not another tax. They would be offset by a reduction in fuel excise tax.

Parking charges do do cover the full cost of providing, maintaining and operating all on-street parking. Most of its free but should face a fee for its use.

Road users pay nothing towards vehicle related air pollution- the social cost of the air pollution is higher than the social cost of crashes.

Road users only pay a fraction of the health system costs related to crashes and pay nothing towards funeral costs or suffering of crash victims.