Public transport hike: Bus and train fares may surge by up to 70% to meet NZTA targets

By Kate Green of RNZ

• Bus and train fares are set to increase, with councils asked to raise private revenue shares.
• Greater Wellington’s transport chairman Thomas Nash warned of a 71% fare increase, worsening the cost-of-living crisis.
• Transport Minister Simeon Brown said rising public transport costs shift the burden to ratepayers and taxpayers.

Bus and train fares are set to increase across the country, with the transport agency asking councils to hit higher revenue targets.

NZ Transport Agency Waka Kotahi (NZTA) has sent letters to local councils and transport authorities asking them to increase their private share – that is, the proportion of the total cost of providing public transport that comes from things other than rates or government funding.

Greater Wellington Regional Council transport chairman Thomas Nash said meeting the targets set for Greater Wellington would require fare increases of 71% next year, “which is the exact opposite of what we need in a cost-of-living crisis”.

That would mean a Wellingtonian spending $10 a day on Metlink fares would have to spend $17 a day under the new rates.

In the past two years, Wellington fares had already increased by 6% and then 10% in order to keep up with rising costs and inflation.

“We know that making public transport less affordable just pushes people into cars, increasing congestion, pollution and emissions and making roads less safe,” Nash said.

Wellington already had the second-highest proportion of public transport costs covered by fares of any public transport authority in the country, behind Auckland, Nash said, and compared well internationally.

NZTA acting group general manager for transport services, Vanessa Browne, said an increase was needed to support the record level of public transport expenditure already being invested by central government in the ever-growing costs of public transport.

She said increasing revenue could be done by other methods, not just raising fares – advertising, sponsorship, rental income and corporate schemes or commercial opportunities.

“By optimising services, reducing costs and raising revenue, [public transport providers] can create a more efficient and financially sustainable public transport system which delivers value for money for all of our communities,” she said – without upping rates.

But Nash said Greater Wellington was already using those levers.

“We just wrapped an entire train in Delivereasy regalia – so we’re doing our best in terms of advertising,” he said.

“The truth is that you don’t even really scratch the surface with that revenue, compared to the amount that you bring in with fares.”

In Auckland, Auckland Transport’s director of public transport and active modes, Stacey van der Putten, said the proposed target set for them by NZTA was 30% for the current year, 34% for 2025-26, and 42% the year after that.

“So far this financial year, Auckland’s farebox recovery rate has been 32.9%. Following our annual fare review in February, we’re expecting Auckland’s farebox recovery rate to increase to just under 35%.”

Environment Canterbury said its targets were 18% for the coming year, 25% from 2025-26, and 28% in 2026-27 – and it was currently at 13.9%.

It is not known what kind of fare adjustments Auckland and Christchurch would have to make in order to reach their targets.

Transport Minister Simeon Brown said public transport costs were rising, shifting more of the burden to ratepayers and taxpayers, who subsidised public transport services. In 2017, public transport users contributed 40% of the operating costs, but by 2023 this had dropped to 10%.

“Our Government expects that councils keep public transport costs under control and ensure that those who use public transport are contributing fairly towards operating the network,” Brown said.

Councils had a wide range of tools available to address rising costs – expanding advertising opportunities, partnering with businesses to fund targeted concessions, maximising retail spaces at transport hubs and introducing commercial charging facilities, he said.

“My expectation is that NZTA will work with councils to help them explore and implement these tools.”

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