Welcome Bay residents rejoice - construction of the new Hairini underpass has been given the green light.

This mornign the NZ Transport Agency confirmed the construction phase of the underpass will start late this year.

Transport Agency highways manager Brett Gliddon said in addition to providing more efficient traffic flows, the underpass will make travel safer and easier for pedestrians and cyclists from all directions.

"The underpass will provide a two lane link underneath the Maungatapu roundabout which will connect directly to Welcome Bay Rd and will provide improved travel for State Highway 29 traffic through the separation of local and state highway traffic," he said.

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"This important decision allows us to proceed with the next phase of selecting a design and construction team. We have received registrations of interests from companies who would like to put in a tender for the contract."

Mr Gliddon said it would take approximately 6-8 months for the contract to be awarded, with an announcement of the successful tender to be made later this year.