10
BRIEFING
Green Transport Card Investigation Findings Cabinet
Paper
Reason for this  To provide you with the draft Green Transport Card Investigation Findings
briefing
Cabinet Paper, and answers to queries you raised at the last official’s meeting
held on 11 July.
Action required
Consider the draft Green Transport Card Investigation Findings Cabinet Paper,
and provide us with initial feedback before 26 July.
Note our advice on the queries you raised at the 11 July meeting.
Deadline
We recommend that you consider this paper before Monday 22 July.
Reason for
This paper will be discussed at the Monday 22 July officials meeting.
deadline
Contact for telephone discussion (if required)
Name
Position
Telephone
First
contact
Richard Cross
Manager, Strategic Policy and Innovation

Senior Adviser
Adviser
MINISTER’S COMMENTS:
Date:
19 July 2019
Briefing number:
OC190676
Attention:
Hon Julie Anne Genter, Security level:
In confidence
Associate Minister of
Transport
CC
Hon
Phil
Twyford,
Minister of Transport
Minister of Transport’s office actions
 Noted
 Seen
 Approved
 Needs change
 Referred to
 Withdrawn
 Not seen by Minister
 Overtaken by events

This briefing accompanies a Cabinet Paper for the Green Transport Card scheme (the
scheme), and addresses questions you raised at our last meeting
1.
With the scheme’s investigation completed, we met with you on 11 July to seek your directions
on next steps (OC190584 refers).
2.
At the  11 July meeting, you decided to proceed with the option of providing Community
Services Card (CSC) holders with a 50 percent concession on public transport fares, for use
at any time. You also made the decision that people with a SuperGold Card/CSC combo card
should have access to the scheme.
3.
You directed us to advise you on the following:
•  Model the fiscal impact of including SuperGold/CSC combo card holders;

•  How the $4.64 million Budget funding earmarked to establish the scheme could be used
by agencies and councils;

•  Advice on the implementation timeframes for the scheme; and

•  Advice on including a visual cue (e.g. a sticker) for the scheme.

4.
This briefing provides you with a copy of a draft Cabinet Paper, timelines for the Cabinet Paper
process going forward, and our advice on your queries from the 11 July meeting. We will
provide you with a copy of the Regulatory Impact Assessment next week, after it has been
through our internal review process.
Cabinet Paper timeline
5.
The table below shows the current timeline to deliver the Cabinet Paper to Cabinet before the
end of August. There  may be some changes to this timeline depending on how long the
consultation process takes. We will communicate any changes with your office.
Date
Action
19 July 2019
Draft Cabinet paper provided to the your office for feedback

Departmental consultation on the scheme.
26 July 2019
Initial feedback received from your office and other agencies

Ministry of Transport to incorporate feedback into the draft Cabinet Paper
7 August 2019
Revised Cabinet paper, addressing your feedback and agencies’
feedback sent to your office for cross-party consultation

22 August 2019
Lodge Cabinet Paper with DEV
28 August 2019
DEV meeting
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Fiscal impact of including SuperGold/CSC combo card holders

6.
At the 11 July officials meeting, you made the decision that SuperGold Card holders, who also
hold a CSC, should be able to access the scheme. These card holders will be able to access
concessions provided by both cards.
7.
The Cabinet Paper notes that you now recommend including SuperGold Card holders, and
also notes the following considerations based on your decision:
•  It is anticipated that most SuperGold Card holders will still choose to travel during off-
peak hours to take advantage of SuperGold’s free concessions. This consideration will
help to control costs; and
•  Including SuperGold Card holders enables the scheme to target low-income
SuperGold Card holders and enable them to access essential services, such as
medical appointments, in a more affordable way. This results in greater equity.
8.
You also directed us to model the fiscal impact of including SuperGold Card holders into the
scheme.
9.
There are currently around 300,000 SuperGold Card holders who also have a CSC. As the
table below shows, our initial calculations show that this would increase direct subsidy costs
by around $1.8 to 2 million per year. In other words, the inclusion of SuperGold Card holders
in the scheme would increase subsidy costs by approximately 10 percent.

Not including SuperGold Card
Including SuperGold Card
holders
holders
Year 1
Year 10
Year 1
Year 10
Direct subsidy costs
$20.1 million
$18.1 million
$22 million
$20.1 million
per year
(+$1.8 million
(+$2.0 million
approx.)
approx.)
Additional
4.5 million
10.9 million
4.8 million
11.5 million
patronage per year
(+ 0.3 million
(+0.6 million
approx.)
approx.)

10.
If possible, we will undertake more detailed modelling before the Cabinet Paper is finalised.
However, this will require us to contact councils for data on their current SuperGold patronage,
and notify councils that we will be including SuperGold Card holders in the scheme. We will
seek your views on timings around communicating this with councils. Note that our calculations
have been made with a significant number of assumptions, and actual costs could be
significantly higher or lower.
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11.
We can provide further advice, if needed, on our assumptions and calculations behind our
modelling work.
Using Budget funding to assist councils in implementing the card
12.
As part of Budget 2019/20, approximately $4.64 million was allocated towards the
establishment of the scheme. You asked whether parts of the $4.64 million could be
transferred to councils to assist them in implementing the card.
13.
Should Cabinet agree to establish the scheme, councils would add CSC concession profiles
to ticketing systems in their respective regions. Councils could then seek reimbursement from
the NZ Transport Agency, drawing from the earmarked $4.64 million.
14.
The Ministry of Social Development (MSD) will also access this funding to transfer CSC holder
eligibility data onto travel cards in each region, and to develop communication materials. We
have sought revised cost estimates from MSD but at this stage it appears likely that the
approved $4.64 million would be sufficient to cover all of the implementation costs that would
be incurred by councils, MSD and the NZ Transport Agency this financial year.
Funding towards additional capacity
15.
In our previous advice we noted that councils may expect the Crown to make a contribution
towards the increased public transport capacity that would be needed to meet increased
demand resulting from the scheme.
16.
The Minister of Transport will shortly be receiving initial advice around funding pressures on
the Government Policy Statement on Land Transport (GPS).
17.
There may be merit in waiting until there is more clarity around the how public transport funding
is likely to be treated in the GPS before deciding whether a separate funding arrangement is
necessary. However, this would depend on the implementation timeframes for the scheme.
We have flagged this point in the Cabinet Paper as well.
Advice on implementation timeframes
18.
We originally suggested mid-2021 as the target date for the launch of the card. In the meeting
on 11 July, you asked whether the card could be implemented by mid-2020.
19.
The feedback from councils showed that, for the Auckland and Wellington regions in particular,
the scheme would be very difficult to implement by mid-2020. Auckland Transport indicated
that implementation would take at least 18 months. Greater Wellington Regional Council
(GWRC) indicated that implementation would take at least 24 months.
20.
The scheme, like the SuperGold Card, is a voluntary scheme, so councils could choose not to
implement the scheme if central government aims to implement it before they are ready.
21.
The Cabinet Paper has noted that a phased approach may be needed. The scheme could be
first implemented in regions where ticketing systems are more advanced. The scheme can be
expanded to pressured regions, such as Wellington and Canterbury at a later date. However,
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members of the governance group for the investigation emphasised that some councils would
not be in favour of a phased approach.
22.
You are meeting with Greg Campbell, the CEO of GWRC on 23 July (Mr. Campbell is also the
Chair of the Regional Government Public Transport Sector Group) to discuss these issues in
more detail.
Advice on giving the card a visual cue
23.
Our advice on verification was to use existing travel cards for each region (e.g. Snapper card
for Wellington), and to link CSCs with the registered travel cards. Given that eligibility
processes are to be automated under this option, this approach is likely to be the most cost-
effective option.
24.
At the meeting on 11 July, you asked whether we were aware of any other ways to provide
some sort of visual cue as part of the scheme. We have not been able to identify any options
other than a sticker or a unique card, both of which would incur additional costs and create a
risk of stigmatising CSC holders by identifying their financial status.
25.
When the card is launched, significant communications and marketing collateral will be
developed. These collateral will help ensure that CSC holders are aware of the scheme.
Recommendations

26.
The recommendations are that you:
(a)
Consider  the draft Green Transport Card Investigation Findings Cabinet  Yes/No
Paper, and provide us with initial feedback before 26 July.
(b)
Note our advice on the queries you raised at the 11 July officials meeting.
Yes/No

Richard Cross
Manager, Strategic Policy & Innovation

MINISTER’S SIGNATURE

DATE:

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Appendix 1: Green Transport Card Investigation Findings draft Cabinet Paper

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Document Outline