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Ministry of Transport: Aide Memoire
To:
Hon James Shaw, Acting Associate Minister of Transport
CC:
Hon Phil Twyford, Minister of Transport
From:
Richard Cross, Manager Strategic Policy and Innovation
Date:
7 November 2018
Subject:
Green Transport Card Outcomes and Implementation Considerations
OC Number:
OC181048
We are working towards an agreed scope for the Green Transport Card (GTC) budget
initiative. We are seeking further clarity on what you see as the main goals of the GTC, as
this should influence the scope and policy direction.
To enable budget funding, the GTC initiative needs to align with the wellbeing priorities of
Budget 2019/20. Some options are more closely aligned to these priorities than others.
We would also like to discuss with you the implementation challenges of different options, as
these will affect how quickly the GTC could be introduced to meet your expectation for the
GTC to be available in mid-2020.
Potential benefits for inclusiveness, wellbeing, and mode shift
Our preliminary work on the GTC was based on the direction of the Coalition Agreement to
‘reduce the cost of public transport, prioritising people in low-income households and people
on a benefit.’ This implies that the initiative aims to improve inclusive access and social
outcomes.
To align with the wellbeing priorities of Budget 2019/201, we understand that the primary
outcome is to improve the wealth and wellbeing of low-income households, by reducing their
travel costs and improving their access to social and economic opportunities.
Another potential benefit of the GTC is to support the Government’s priorities for mode shift
(towards public transport and active travel modes). Cheaper public transport could support
1 The budget priorities we are aiming to align with are 1: Reducing child poverty and improving child
wellbeing 2: Creating opportunities for productive businesses, regions, iwi and others to transition to a
sustainable and low-emissions economy; and 3: Lifting Māori and Pacific incomes, skil s and
opportunities.
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mode shift, but it may not be the most effective way to encourage greater use of public
transport. For example, the quality, availability, frequency, speed, and reliability of public
transport services need to be considered alongside fare prices.
The current GTC options were based on the priority of reducing public transport costs for
low-income households. If the primary outcome was mode shift, there could be other
options. For example, making public transport free for all students to get to/from school could
have major benefits for mode shift at peak travel times but would cost considerably more,
and would not be targeted at low-income households.
We have summarised the potential benefits for inclusiveness, wellbeing, and mode shift for
the three groups being considered in the following table.
Community Services
Tertiary Students
School Students
Card (CSC) holders
Inclusive access
High. CSC holders are
Low-Medium. Many
Low. Children and
benefits
already identified as
tertiary students
youth currently receive
low-income households.
currently receive a
a 50% discount in
CSC do not currently
discount (e.g. 25% in
most regions.
receive any public
Auckland and
transport (PT)
Wellington, including
discounts. More
at on-peak periods).
affordable PT could
increase their
Students from lowest-
participation in society.
income households
have a CSC
However, CSC holders
(approximately 15% of
in areas without good
tertiary students).
public transport, and
some with disabilities,
would not benefit.
Mode shift benefits
Low-Medium. Some
Low-Medium.
Low. Students are at
CSC holders will use PT Students are already
school in most off-
instead of a car, but
major users of PT.
peak periods.
those travelling for work
Many need to travel at
will often need to travel
peak periods to attend
during peak periods.
classes. Students may
get a ‘taste’ for PT and
There is also a potential
continue using it after
to create/reinforce a
their studies.
social stigma that PT is
just for people who
cannot afford a car.
Alignment with
Medium. Opportunities
Low. Only aligns with
High. Opportunities to
Budget 2019/20
to improve child
priority to create a low-
improve child
priorities
wellbeing, and lifting
emissions economy.
wellbeing.
Māori and Pacific
wealth/opportunities.
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Key implementation challenges that would need to be addressed
As previously discussed, there are a range of implementation issues associated with each
option. Key challenges are highlighted in the following table.
Community Services
Tertiary Students
School Students
Card (CSC) holders
Verification
New CSCs may need to
Most tertiary students
Primary students do
We need to prevent
be issued with photo ID
have a student ID.
not usually have ID.
people giving/selling
(costing ~$16 million, at
Some regional
Some secondary
cards to others.
$20/card). Some costs
councils have existing
students have ID.
could potentially be met
systems to verify
Verification issues will
by CSC holders
student eligibility (full-
be more of an issue
applying for a GTC
time students only) for
for students as they
combo card.
concessions.
become older.
Duplication issues
A new photo GTC-CSC
Existing student IDs
There may need to be
We should avoid
combo card, or a
could be used (e.g.
a mix of students IDs
issuing many
separate photo GTC
with an annual GTC
with stickers and photo
different cards.
would be needed.
Transport sticker).
GTC cards.
Validity of cards
CSCs have an expiry
Many student IDs
Many student IDs
Unlike SuperGold
date.
have an expiry date.
have an expiry date.
cards (that do not
expire after age 65),
GTC would need to
be issued every year.
Dealing with
N/A
In Palmerston North
In most regions
existing
students travel free on
children receive a 50%
concessions
PT. In Wellington and
fare discount. Will
Councils that already
Auckland students
students get free off-
provide concession
receive a 25%
peak travel and
discounts would
discount. Will students
existing discounts on-
need to change their
get free off-peak travel
peak?
fare structures.
and existing discounts
on-peak?
Agencies we would
NZTA, councils, MSD,
NZTA, councils,
NZTA, councils,
need to work
MinHealth
MinEdu, individual
MinEdu
closely with to
tertiary institutes
implement
Integration with
Without a national integrated ticketing system, it will not be possible to
existing smart
have a national GTC. In some regions, people will need to link their existing
cards
smartcard (e.g. HOP card) with the GTC entitlements. This already
People will need to
happens with SuperGold cards.
use smartcards in
some regions (e.g.
Auckland HOP and
Wellington Snapper).
Funding
We could try to set a funding cap (like SuperGold scheme) but councils are
sustainability
likely to resist this (slowing implementation). Without a funding cap, there is
We need to manage
a high risk of exceeding allocated budgets.
the uncertainty of
cost estimates.
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As the scale of GTC coverage increases to cover more groups, implementation will become
slower. Administrative costs will also rise. There may become a point where it would be more
cost-effective to make public transport universally free at off-peak periods, to avoid
administration, monitoring, and enforcement costs. We have not costed this option. Higher
costs could also have implications for potential future funding from the National Land Transport
Fund.
We would like to discuss these scope and implementation issues at your meeting with officials
on Thursday 8 November 2018.
Richard Cross
Manager, Strategic Policy and Innovation
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