Auckland’s traffic congestion is more than a daily frustration. It is a multi-billion-dollar drain on productivity, wellbeing, and infrastructure [1]. Congestion occurs because drivers are not confronted with the cost of taking up space on the road during peak times [2]. As well as economic productivity, this congestion adversely impacts access to work, education, health services and social activities, and quality of life. 

This article explores some of the lessons learned from international experience can be applied to the Government’s proposed solutions to maximise the likelihood these solutions are successful. 

The Government’s proposed solutions

As urban growth accelerates, policymakers are turning to smarter pricing tools: road tolls and time of use charging [3] - to reshape how we use our roads. 

Road tolling

Tolling directly links road use to payment, ensuring those who benefit also contribute. It reflects a user-pays approach, offers choice, and helps gauge public willingness to invest in better infrastructure [4].   

Currently a road tolling scheme may be established if [5]:

• the relevant public road controlling authority or authorities have carried out adequate consultation on the proposed tolling scheme;
• there is satisfactory community support for the proposed tolling scheme in the relevant region or regions; 
• a feasible, untolled, alternative route is available to road users; and
• the proposed tolling scheme is efficient and effective.

There are protections in the Land Transport Management Act 2023 relating to the use of personal information collected for the purposes of the road tolling scheme. 

The Government Policy Statement on land transport [6] recommends that tolling should be considered to construct and maintain all new roads, and that opportunities for toll roads should be explored where they are likely to meet the requirements set out in the Act, and toll revenues, net of the costs of the tolling scheme itself, will make a positive contribution to the costs of the project. 

In December 2024, the Government announced key policy changes to enable tolling of roading infrastructure with the then-Transport Minister Simeon Brown stating “The Government is taking a user pays approach which optimises toll revenues to build the modern roading infrastructure which will improve economic productivity by helping Kiwis get to where they want to go quickly and safely.” [7] The changes, when implemented, “will enable the New Zealand Transport Agency (NZTA) to consider tolling in circumstances beyond what is currently possible” [8].  

The potential benefits of such changes are clear: tolling could help New Zealand build future-focused roading infrastructure, improve connectivity and support economic productivity.

Time of use charging

Charging drivers to use certain roads at peak times encourages smarter travel choices. These include altering travel times, routes, destinations, or modes of transport. Even a small drop in peak traffic can dramatically improve flow, cut travel times, and boost economic productivity [9]. The Government says “Modelling shows that successful time of use charging – charging motorists to travel on certain roads at peak times – will encourage people to change the time or mode of travel, and could reduce congestion by up to 8-12 per cent at peak times.[10]”

Earlier this year the Land Transport Management (Time of Use Charging) Amendment Bill was introduced and passed its first reading in Parliament on 4 March 2025. The Bill will enable the NZ Transport Agency (NZTA) and local authorities to develop charging schemes for our most congested roads [11].  

The Bill [12]: 

• enables local authorities to propose road charging schemes, which require public consultation and an impact assessment, to the Minister of Transport;
• allows the Minister of Transport, if traffic flow would be improved, to recommend the authorisation of the scheme and conditions applicable to it;
• establishes a partnership governance model between local authorities and NZTA; and
• requires that revenues collected from schemes will be reinvested in land transport activities within the scheme region, guided by a framework that ensures alignment with the investment principles of a scheme.

Public submissions have closed, and Bill is currently sitting with the Transport and Infrastructure Committee. The Government intends to pass the legislation before the end of 2025. Local authorities have already commenced technical work and assessing scheme options and have indicated they will seek public input as legislation develops [13]. 

Lessons domestically and from abroad [14] 

Improving New Zealand’s roading infrastructure and economic productivity will require bold leadership from the relevant authorities, and a willingness to confront public concerns about tolling and time-of-use charging. International experience shows that success is possible, but only when schemes are designed with care, communicated with clarity, and implemented well.

Edinburgh: The cost of poor engagement

Edinburgh’s 2005 congestion charge proposal failed due to strong public opposition. Engagement was lacking, there was no well-crafted communications strategy, and community concerns were not addressed. The proposal was rejected overwhelmingly in a referendum.

Germany: A cautionary tale in technology

Germany’s 2005 truck tolling rollout was championed as a smart solution to solve traffic congestion, but it was plagued by technical problems and delays. The technology used was relatively untested, and the challenges of integrating it was underestimated. This led to inaccurate toll calculations as the technology was deployed without sufficient time for thorough testing and troubleshooting.

London: Early gains, long-term challenges

London’s congestion charge was hailed as a pioneering move to combat gridlock. It initially reduced traffic by 30%, but exemptions and increased taxi use later offset those gains. The experience underscores the need for careful policy design and ongoing monitoring to sustain long-term benefits.

New Zealand

After deducting administration costs, our three current road tolling schemes generate $24 million annually. This revenue is insufficient to pay for the costs of the roads, and a top-up from the National Land Transport Fund is required. This modest revenue potential may also indicate the level to which users value the benefits of the toll road relative to the existing route. High administrative costs and a lack of public acceptance have to date hindered the widespread use of tolling.

Singapore: Prioritising flow over revenue

Singapore’s Electronic Road Pricing system prioritises traffic flow over revenue. By using dynamic pricing and regular, transparent reviews, it effectively manages congestion in one of the world’s densest cities. Privacy and data protection has also been a core principle from the outset. Public support has grown through clear communication and technology that adjusts charges based on real-time conditions.

Stockholm: Trial, trust, and transformation

Stockholm’s successful implementation of a congestion charge underscores the pivotal role of an effective communication strategy in garnering public support. When congestion charging was first proposed, it faced fierce public and political backlash. After extensive communications to highlight goals, Stockholm launched a trial period to demonstrate benefits, followed by a referendum to decide whether the scheme should be made permanent. After implementation, public approval was maintained through positive reiteration of the benefits. Transparent communication and visible benefits helped build trust and secure lasting support, demonstrating the value of trial-based implementation.

United States: Choice with caution

In the USA many states offer dynamically priced express lanes alongside free alternatives. While effective in managing congestion, these schemes have faced criticism for creating inequities. Success depends on thoughtful design and clear public messaging to balance the benefits with fairness.

These experiences highlight what works, and what doesn’t. They also reveal the common pitfalls that can undermine well-intentioned schemes. So how can New Zealand get it right?

How leaders can set up road pricing schemes that work

Public concerns about road pricing typically centre on several key issues: equity and potentially disproportionate impact, trust and scepticism regarding the motives (particularly as road users pay fuel taxes and other user charges), the availability of viable alternatives, questions around the collection, use, and protection of personal data, and fears that the system may be difficult to understand or prone to technical errors.

Setting up for success: Getting the foundations right

These concerns are signals to the areas to which relevant authorities must respond. Road pricing is not just a technical or financial challenge. To be effective, road pricing schemes require robust governance, consistent messaging, and operational discipline, and success depends on how well leaders listen, engage, and adapt. Ministers, road controlling authorities and local authorities must:

• Focus on purpose: Clearly communicate that the goal is better traffic management and well-maintained infrastructure, not revenue collection, and that data protection is a core principle. Ministers, mayors, and agency heads must advocate consistently for a scheme’s purpose, benefits, and protections. With clear champions and transparent purpose, public trust follows.
• Engage early and often, and adapt: Build legitimacy through consultation, clear, evidence-based communication, targeted engagement and pilot schemes, and data sharing. Even if a road pricing scheme originates from central government, success depends on buy in from local government and the community A clear framework for local authority involvement, including consultation, co-design, and shared governance (as proposed in the Land Transport Management (Time of Use Charging) Amendment Bill), is essential to ensure schemes reflect regional needs and priorities. Additionally, authorities must adapt to changing circumstances and public feedback. Trust must be maintained as a loss of confidence can be difficult to recover from and may jeopardise the long-term success of road pricing initiatives.
• Design for equity: Fuel tax is a blunt tool for assessing road usage and impact. It does not account for the wear and tear of the user’s vehicle on the road. Equity demands that those who use the roads more and impose the greatest costs on the network should pay more, while those who drive less should pay less. This is not only fairer, but also more efficient, as it sends clear price signals about the true cost of driving. The Government and local authorities can enhance social equity by designing pricing models to protect vulnerable groups, for example by allowing discounts for low-income drivers, exemptions for essential workers, and transparently reinvesting revenue to create a better transport network and ensuring alternative options are accessible and affordable.
• Use technology wisely: The rapid advancement of technologies such as affordable, onboard devices that collect and process vehicle movement data, satellite navigation systems, automatic number plate recognition and 5G connectivity heralds a new era for road pricing. Dynamic pricing can improve fairness and efficiency, but only if the technology is reliable. Rigorous pilot testing of the technology is essential before any nationwide rollout of a complex road pricing scheme. Once implemented, schemes must be monitored and maintained. This includes ensuring system reliability, resolving disputes, and adapting to changing traffic patterns. Strong operational governance and performance metrics are key to long-term success.
• Communicate clearly: Communications must be coordinated across agencies and levels of government, with a unified narrative about why road pricing is needed, how it works, and how it supports broader transport goals. Edinburgh’s failure and Stockholm’s success both underscore the power of strategic, transparent communication.

With the right approach, New Zealand can move beyond congestion and build a system that’s not only efficient, but fair, future-ready, and publicly supported.

Footnotes:

[1] Time of use charging Bill passes first reading | Beehive.govt.nz
[2] 876
[3] Proactive-Release-Cab-Revenue-Action-Plan-for-web.pdf  
[4] Proactive-Release-Cab-Revenue-Action-Plan-for-web.pdf 
[5] Land Transport Management Act 2023, s 48 
[6] Government-Policy-Statement-on-land-transport-2024-FINAL.pdf 
[7] https://www.beehive.govt.nz/release/government-enable-tolling-accelerate-investment-roads
[8] https://www.beehive.govt.nz/release/government-enable-tolling-accelerate-investment-roads. Legislation will be required to give effect to any changes.  
[9] TheCongestionQuestionMainFindings.pdf and 876
[10] https://www.transport.govt.nz/about-us/news/time-of-use-charging-bill-passes-first-reading; https://www.transport.govt.nz/about-us/news/time-of-use-charging-bill-passes-first-reading 
[11] https://www.transport.govt.nz/about-us/news/time-of-use-charging-bill-passes-first-reading; https://www.transport.govt.nz/about-us/news/time-of-use-charging-bill-passes-first-reading  
[12] Land Transport Management (Time of Use Charging) Amendment Bill 113-1 (2024), Government Bill – New Zealand Legislation
[13] For example Auckland Transport and Auckland Council: Time-of-use charging
[14] 847