Free public transport the fuel crisis response that makes sense

2026-03-26 - 16:03

Opinion: The Government’s answer to the fuel crisis is a $50 weekly payment to about 143,000 working families with children. The policy is framed as targeted relief. It is not. It is a cash transfer that does nothing to reduce petrol demand and may do the opposite by blunting the price signal discouraging people from driving. There is a better tool – one we have already used – that is cheaper, more equitable, and actually reduces fuel consumption. Make public transport free, for at least three months. We know this works because we have already done it. To address the rising cost-of-living concerns during Covid, the government rolled out half-price fares nationwide. The reduced-fare programme generated an additional 7 percent public transport journeys, with 3 percent of those trips shifting directly from cars and taxis. In Christchurch, a peer-reviewed study found that among public housing residents, 45 percent could make trips they previously couldn’t, and 36 percent of residents were able to spend more on essentials like food. Half-price fares did that. Free fares would do more. Free public transport reduces petrol consumption two ways. Some people leave their cars at home and take the bus or train. Potentially more important, when cars come off congested roads the remaining traffic flows better. New Zealand’s transport cost modelling shows fuel consumption rises from about 7.7 litres per 100km under free-flow conditions to 10.4 litres in stop-start traffic. That is a 35 percent increase in fuel burned just from sitting in queues. In Auckland alone, avoidable congestion costs an estimated $400 million a year – $100 million more than public transportation passenger fare revenue, nationally. This should resonate with people who may never set foot on a bus, ferry or train. Tradespeople, caregivers, freight operators, and rural drivers all burn more fuel when urban roads are clogged. Every car shifted to public transport is one less car slowing everyone else down. Free fares is a policy that benefits drivers, too. The most common objection is that public transport barely exists or is not feasible for anyone living outside our three biggest cities. That is true. It is also one of the strongest arguments for free public transport. In New Zealand, light passenger vehicles consume 95 percent of all petrol, and most of those kilometres are driven in Auckland, Wellington and Christchurch, where public transport is relatively extensive. Reducing urban petrol consumption preserves fuel stocks for the communities and industries that have no alternative. In a crisis, it’s critical to protect supply by cutting waste, especially where substitutes already exist. That’s what we call triage. Transit agencies will point out that higher-income commuters ride public transport more often, and that free travel may disproportionately benefit them. Normally, that’s a fair critique, but during a fuel shock, the standard is different. In this instance, the policy needs to reduce demand and ease the burden broadly. It is also worth looking at who the $50 payment excludes: students, beneficiaries, single adults without children, superannuitants. Free fares would reach all of them. The fiscal case is simple. Pre-Covid, national public transport fare revenue was about $320 million to $350 million a year; currently that figure is closer to $300 million. Three months of fares-free trips would likely cost less than $80 million in forgone revenue, and just over $300 million if extended for a full year. In comparison, the Government’s fuel payment is budgeted at $373 million for a full year, about $93 million per quarter, and it does not reduce a single litre of consumption. For a comparable price tag, free public transport delivers household relief, cuts fuel demand, eases congestion, and stretches our limited reserves. Digging deeper into the numbers favours public transport even more. NZ Ministry of Transport cost analysis puts the full social cost of a car trip at about $0.53 per kilometre, including fuel, wear, capital and congestion, before even more massive crash costs and emissions. A 10km transit trip, fully subsidised, costs the public about $2.80. The same trip by car in peak Auckland traffic costs roughly $5.50. Every trip shifted is a net savings. We already subsidise cars far more generously than buses. We are just less transparent about it. New Zealand has less than 49 days of petrol cover. A 5 percent drop in daily consumption, achievable if even a fraction of commuters in our largest cities leave their cars at home, stretches that to 51 days. A 10 percent drop gets us to 54. When the shipping channel our fuel depends on is closed, every additional day of cover matters. We already have the machinery to implement free public transport: Community Connect concessions, the nationwide half-price fare rollout, and Auckland’s off-peak trials. NZTA and our regional councils have administered rapid fare changes before and can do it again. No new legislation needed. We don’t need new infrastructure. We don’t need additional technology. We generate over 85 percent of our electricity from renewables but import every drop of our transport fuel. We have the tools to reduce that vulnerability, but so far we’re not using them. Free public transport won’t fix decades of car-first planning. But it is the fastest, cheapest, most equitable emergency response available, and unlike the $50 payment, it actually reduces the amount of fuel we burn. The Government should act on it.