The Labour Government's $12bn infrastructure announcement includes the Horowhenua Expressway and it will happen sooner than planned and it will have four lanes. Construction of O2NL is expected to start in 2025 with completion planned in 2029.

"The decision to bring forward the construction of the Ōtaki to North of Levin Expressway (O2NL) is welcome news for our region," said Horowhenua District Mayor Bernie Wanden.

Finance minister Grant Robertson announced the plans on Wednesday morning as being the "biggest boost to infrastructure spending in New Zealand in more than a generation. This is a government of infrastructure."

He said there had been significant under investment in critical infrastructure, including schools and hospitals for a decade prior to Labour coming into office.

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"This has put a handbrake on our economy and society and led to lower productivity, ageing schools and hospitals, and congestion in our towns and cities. Quality infrastructure is key to achieving our plans for a more sustainable, productive and more inclusive economy."

Horowhenua Mayor Bernie Wanden said the decision to build the four lane expressway around Levin provides certainty for residents and for many projects including new residential areas such as a proposal for 2500-homes in south-east Levin, and the transformation of the Levin town centre.

"When the Transmission Gully and Ōtaki expressways open, more than 760,000 people will live within an hour's drive of our beach-side communities. We can expect more families to move here in search of our fantastic lifestyle."

Mayor Wanden said the construction of O2NL expressway will provide many challenges and opportunities.

"Horowhenua will bustle with activity and while that will bring excitement it will affect our relaxed lifestyles. However, once O2NL is built, the truck and trailer units and interregional traffic will be off our main streets – our communities will become safer and more relaxed."

Mayor Wanden said in the meantime, he is looking forward to NZTA completing the planned safety improvements on the existing State Highways and discussions about road revocation.

"The additional funds for the Capital Connection are also very welcome, as it is one of the few public transport options available for our residents."

NZTA on its website said the $1.35bn earmarked for the Wellington region will go on four projects, including O2NL and a rail network upgrade. "The new four-lane corridor from Ōtaki to north of Levin (O2NL) will improve safety and access, supporting economic growth, providing greater route resilience, and better access to walking and cycling facilities."

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"This package includes improvements to commuter rail links up the Kāpiti Coast to Palmerston North. Safety is also a priority, with SH58 and SH1 south of Levin both being among the top two per cent of high-risk corridors in New Zealand.

"The new four-lane O2NL corridor and a range of improvements to SH58 will help save lives and reduce serious injuries along these routes. These projects will also build greater resilience into the transport system by reducing the number and severity of crashes and road closures."

NZTA said four-laning State Highway 1 from Ōtaki to north of Levin (Ō2NL) continues the Kāpiti Expressway north of Wellington to support growth in Levin and provide a safer and more resilient route.

The NZ Upgrade Programme will spend $817 million on a new 24-kilometre highway, built to the east of the existing State Highway 1 (SH1) alignment.

This new highway will be four lanes. Investigations will look at opportunities to prioritise freight, public transport and vehicles carrying multiple people. The project includes a separated shared path for walking and cycling running the entire length of the new highway.

It will link into shared path facilities built as part of the Mackays to Peka Peka Expressway and Peka Peka to Ōtaki Expressway, helping extend the region's cycleway.

Three of New Zealand's top 100 dangerous intersections are along this route. In the five years to 2017, there were 49 deaths and serious injuries along the route, making it one of the country's most dangerous sections of road to drive. The new highway will dramatically improve safety.

O2NL is critical for both the Wellington and the Manawatū–Whanganui regions to continue to grow. The new highway will ensure people and freight are able to safely and easily move between the two regions and the rest of the North Island.

The project also ensures better access to the key distribution hubs at Palmerston North, the largest freight connection in the central North Island.

With no current alternative route when SH1 is closed by crashes or weather-related events, the new highway will provide a detour route and build resilience into the state highway network. Safety improvements on the existing SH1 corridor will continue as this road will be an important local road in the future.

The new highway will be built between Taylors Road north of Ōtaki, linking with the expressway, and ending just north of Levin, where the highway branches to head further north and west towards Palmerston North. It will support economic growth, allowing sustainable growth of Levin, meeting current and future transport demands.

Construction is expected to begin in 2025.

Build Our Road campaigner Antony Young said, "We are pleased that the Government has provided clarity on the O2NL expressway. We have been mired in a fog these past 18 months.

"What today's announcement suggests is that we can expect building to take place within the next decade, which was the breakthrough we were looking for.

"This announcement is not just a boost for the Horowhenua's residents and 100s of local business here who rely on the road to access the markets, but a win for Regional New Zealand."