Transport Minister Phil Twyford says the NZ Transport Agency (NZTA) has "failed" to properly assess all the options for light rail in Auckland, and Prime Minister Jacinda Ardern agrees.
The NZTA was asked by the Government to assess a proposal for light rail from Auckland CBD to Auckland Airport, but it was dismissed, and ministers aren't pleased.
Labour campaigned in 2017 on delivering light rail in Auckland from the CBD to the airport within a decade, and estimated it would cost around $4 billion, and there are concerns it could cost a whole lot more than that.
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One of the two proposals being considered by the Government - a joint venture between the New Zealand Super Fund and Canada's CDPQ Infra group - could cost $10 billion or more.
The project would see a tunnel under Queen St, elevated sections over Mt Eden, and driverless trains. It's being considered by the Government, along with a proposal from the NZTA.
The unsolicited bid from NZ Infra was dismissed by then-interim-chair of the NZTA, Nick Rogers, who reportedly described it as nothing but a six-page PowerPoint presentation.
Twyford said Cabinet asked NZTA to consider both the NZ Infra-Super Fund unsolicited proposal and look at other options, but they didn't, so Cabinet has now given the responsibility to Treasury and the Ministry of Transport.
The Prime Minister said it has been "been widely acknowledged now, they didn't properly assess the second proposal... We owe it to taxpayers to have done that job properly, so we are".
Twyford agreed with Ardern, telling reporters NZTA "failed to do what Cabinet asked them to do," after NZTA board chair Sir Brian Roche acknowledged the agency's failings on Morning Report.
"We the agency, were given a job to do ... and for whatever reason ... we didn't get it done," Sir Brian said. "That's delayed the process, that's frustrated ministers."
He also acknowledged that the delay could affect the price of the project.
Ardern said the two proposals are "substantially different".
"But ultimately, the goal remains the same... We have to progress projects that are going to get congestion reductions in Auckland... We've got to get that city moving and that's what these proposals are all about."
She added, "Do I have an expectation that agencies follow through on Cabinet decisions? Yes, but they didn't, and we're fixing it."
NZTA has appeared to be at odds with the Government's light rail ambitions.
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Last month it announced plans to reallocate $313 million into highways from the more than $400 million it had planned to spend on light rail.
Twyford followed up by announcing on September 19 that five new NZTA board members had been appointed to "bring the right mix of skills to deliver our transformative agenda".
Ardern acknowledged that there had been a change in the management of NZTA, reflecting Sir Brian's comments on Morning Report that NZTA is now "in a good place".
Sir Brian said, "We're really comfortable that under the Ministry of Transport there will be information made available so an informed decision can be made in the next calendar year."
He was appointed NZTA board chair in June following a period in which the agency had no permanent leadership.
Ardern said the environment has changed since Labour proposed its light rail policy in 2017, and said the Government should consider fresh ideas.
"We have a proposal that would use the NZ Super Fund so that every time a passenger used it, it would be a contribution to superannuation."
Twyford agreed, saying people would be "disappointed if we didn't give serious consideration to a proposal that would allow our country's retirement savings to invest in modern transport infrastructure and grow our country's biggest city".