Public transport authorities will be able to own and run services themselves without relying on third parties under a new framework announced by the Government.
It's hoped that will mean local authorities will have more control over how services are planned and delivered, creating a more reliable public transport system for users with fewer cancellations due to bus driver shortages.
However the decision is being condemned by National, which says an open tender process ensures transparency of costs, while competition keeps costs down.
Under the current Public Transport Operating Model (PTOM), there's been a focus on the commercial viability of services, which are competitively negotiated with private operators.
But Transport Minister Michael Wood said on Monday the model has "encouraged operators to squeeze worker conditions, pay and opportunities, preventing public transport from living up to its full potential".
"The current model that was meant to lead to better public transport is causing operators to wind back services and timetables, because they can't get drivers. Public transport is too important to our environmental, social and economic goals to allow this to continue."
Wood wants to replace PTOM with a new Sustainable Public Transport Framework, which he says will create a system that is "reliable, an attractive career opportunity and a credible alternative to using cars to get around".
Among the changes the new framework will make is enabling public transport authorities to operate their own services. That means the likes of Auckland Transport or Wellington's Metlink can own their own assets - such as buses or ferries - and employ drivers themselves.
"The new model will also give local authorities more flexibility and control over how public transport is planned and delivered, so they can have a solution that works for their communities," the minister said.
"Public transport authorities will have the option to own assets and operate services, if they feel that’s a better solution for their community than outsourcing to an outside provider. This will make it easier to plan networks and services, to set fares and policies, and encourage innovation in how services are delivered."
Services will also have to be procured, contracted or delivered in a way that ensures transparency of operating costs, service performance, what assets are used to deliver the service, employee terms and conditions and operators' financial performance.
"Improving the conditions of employees will make it easier to recruit and retain the workforce, allowing frequent and reliable services. This will also provide job security by allowing drivers the opportunity to maintain employment if there is a change in operator," Wood said.
Transport decision 'will take NZ backwards'
National's transport spokesperson Simeon Brown said the PTOM was designed to keep costs down through increased competition and a market-based approach to service delivery, and the decision to scrap it will take our public transport system backwards.
"Allowing councils to bring bus, train and ferry services in-house will lead to a less efficient system, with more costs for taxpayers and ratepayers to pick up," he said in a statement.
"Councils can already improve the pay for bus drivers, as we have seen Auckland Council and Auckland Transport undertake in recent months, but this is not an excuse to effectively bring the operating of these services in-house.
"New Zealand's public transport will go backwards because of these changes proposed by a Labour Party who believes Wellington knows best and government should run everything.
"National will ensure that public transport operations continue to be funded in a transparent way with a market-based approach to delivery of public transport operations."
Why public transport matters
Public transport is a critical part of the Government's plan to reduce emissions.
Transport makes up 17 percent of New Zealand's gross emissions or 39 percent of total domestic carbon dioxide emissions.
One of four transport targets included in the Emissions Reduction Plan released in May was to reduce the total kilometres travelled by cars by 20 percent by 2035.
One way the Government wants to do this is by improving the reach, frequency and quality of public transport through a national public transport strategy, infrastructure improvements, and improving bus driver terms and conditions.
