The Minister of Transport’s announcement this morning of the new rules that will allow councils to take over and run public transport services themselves rather than contract them to private companies, was another clear example of this government’s appalling disregard for business and the realities of market dynamics, says Ben McFadgen, CEO of the Bus and Coach Association of New Zealand.

“Whilst there are many components of the SPTF that we welcome, the almost singular focus in this announcement on nationalisation of public transport services is staggering. The assumption that it will fix the driver shortage demonstrates a clear lack of understanding of the complexities of the challenge,” says Mr McFadgen. “The driver shortage has come about due to a myriad of influences. Not the least the government’s drive to lower costs through the PTOM tendering process. That and the international events that have occurred, such as COVID and the closing of NZ’s borders, has lead to the instability we see now. Multiple industries are suffering.

“The idea that services will be most effective and efficient under a centralised model is fundamentally unsound. There is a general skills shortage - worldwide. Where will the skills and expertise to run the services for a PTA come from? There is real skill and expertise involved to run the depots, repair buses and maintain infrastructure sustainably. Competition also creates efficiency. This incessant push towards nationalisation does a real disservice to the men and women who have kept and are keeping this country moving through thick and thin.” stated Mr McFadgen.

“Nationalisation is a blunt, ill-considered instrument that basically transfers all the risk to the taxpayer for PT; In short transferring it to everyday Kiwis. The taxpayer and rate payer will be funding this, either directly through taxes and rates or indirectly via crown debt. It will be extremely costly and inefficient – even more so when you add in the inevitable FPA.

“The pendulum has gone too far, we are heading pell-mell back to the 1970’s. What is required is a balance, not this headlong rush to the other side and over a cliff – which is what this Government is doing. This is a touch too far after the instability of the last three years.”

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