The Greens want to build up to $200 million in cycle lanes and walkways around schools if they are in government, and funding would be redirected from "low-value" projects such as the Holiday Highway north of Auckland.
The number of children walking and cycling to primary and intermediate schools has dropped from more than 50 per cent in 1989 to 30 per cent.
The Green Party revealed in a policy paper published this morning that it hoped to reverse this trend by investing $50 million a year over four years into infrastructure such as cycleways. If it was successful, the policy would reduce congestion, carbon emissions and child obesity rates.
Transport spokeswoman Julie-Anne Genter said that the party's total spend of $100 million on cycling and walking projects per year would be a "drop in the bucket" of the transport budget — about 3 per cent.
Labour transport spokeswoman Darien Fenton said her party was likely to support the policy, but would check the costings first.
New Zealand Transport Agency (NZTA) data showed that a third of cars in rush-hour were driven by parents taking their kids to school.
The Greens predicted that if walking and cycling returned to 1989 levels, it would remove 100,000 cars from the road each morning.
Studies had found that the main reason for the fall in cycling rates was the belief that biking to school was dangerous.
Ms Genter said cycle lanes would be completely separated from busy or high-speed roads to ensure children's safety. Trees, traffic islands and raised crossings would also be introduced to make driving safer around schools.
The party would fund the initiatives by reprioritising money from "low-value transport projects". Ms Genter said it would be up to NZTA to decide which projects would have their funding reduced.
The Greens have previously criticised the poor cost-benefit ratios of the $1 billion "Holiday Highway" between Puhoi and Wellsford and the $3.4 billion Transmission Gully project north of Wellington.
There were already some cycling and walking initiatives in place in New Zealand. Travelwise encouraged walking buses and Bikes in Schools allowed children to learn how to cycle safely with school grounds. The rebuild of Christchurch also has a strong focus on cycleways and alternative transport.
But the Greens said there was no national strategy for alternative transport options around schools.
In the 2013/14 budget, 90 per cent of the $3.6 billion in transport money was spent on roads.
Under the Greens' policy, schools would apply to their councils to get a slice of the $50 million each year.