Government announces ‘time-of-use’ charges for road users to reduce congestion

The Government is introducing “time-of-use” charges to reduce congestion on some of the country’s busiest roads, Transport Minister Simeon Brown has announced.

The scheme would charge road users at certain times of the day or at certain locations, depending on how busy the road was. Brown described congestion as “a tax on time and productivity”.

“It means that we are away from home for longer, sitting in gridlock. It results in fewer jobs being done, fewer goods being moved and delays to services across the city,” Brown said.

“Faster, more reliable travel times will increase productivity and lower costs for businesses and their customers.”

Transport Minister Simeon Brown has announced the Government is introducing “time-of-use” charges. Photo / Mark Mitchell

Brown said money collected through time-of-use charging would need to be invested back into transport infrastructure rather than other council priorities. Local councils would propose schemes in their region and NZ Transport Agency Waka Kotahi (NZTA) would lead the scheme’s design.

“Time-of-use schemes will need to consider the impacts on motorists and businesses that use the roads that fall within the charging areas, as well as the impacts on the wider network,” Brown said.

The Government would prioritise working with Auckland Council, as the country’s largest city was “grappling with pressing productivity challenges”.

“Travel times per kilometre in Auckland are much higher than in comparable cities in Australia. Aucklanders are fed up with the gridlock that is plaguing our roads and making the city less accessible and productive.”

Legislation is expected to pass in 2025.

Auckland Mayor Wayne Brown welcomed the announcement, saying the framework ensures that time-of-use charging won’t be used as a revenue grab.

“I’m also very pleased that the minister has committed NZTA to working in partnership with Auckland Council.

“For time-of-use charging to be successful, Auckland needs to design a policy that works for Auckland. We’ve already proven that the council can work effectively in partnership with central government through Local Water Done Well (that held down water price hikes). That thinking can now be applied to transport and be done quickly,” the mayor said.

Simeon Brown is overseeing a range of large transport projects and reforms. NZTA is looking to deliver on the Government’s promise for a new generation of Roads of National Significance, many of which will be built by public-private partnerships.

The Government is also rolling back changes made by the previous Government that made it easier for councils to reduce speed limits in some parts of the country, particularly around schools.

Brown also holds the energy portfolio, an industry facing an ongoing crisis. Last week, Brown attacked the former Labour Government’s policy decisions for leaving New Zealand with weakened energy markets, which led to higher prices.

Last week, Brown said the Government was seriously considering importing liquefied natural gas to fill an energy shortfall.

A shortage of supply sent gas prices soaring. This, combined with low hydro lake levels, has pushed wholesale electricity prices to sustained record highs, trading above $800 a megawatt hour this week with numerous spikes higher.

Brown blamed Labour’s ban on new oil and gas exploration and other policies for a “dire loss of confidence in the sector”.

Brown also called on Labour to form a bipartisan approach to restore confidence.

“New Zealand now finds itself in an energy crunch, with dry-year conditions being compounded by a low supply of gas, which is critically important at this time, the high electricity prices … are threatening the viability of New Zealand businesses, many of whom export products to the world and the jobs they underpin,” Brown told Parliament.