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The BulletinJanuary 30, 2025

Is hiking speed limits really going to bolster productivity?

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38 sections of state highway up and down the country are about to have their speed limits increased. The Bulletin’s Stewart Sowman-Lund explains why.

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Speed limits going back up

On Tuesday morning, prime minister Christopher Luxon joined Newstalk ZB’s Mike Hosking for his first weekly interview of 2025. It was a rather combative exchange, somewhat unusual given the cosy rapport the pair seem to have. “You’re too much yak* and not enough do,” Hosking said to Luxon. Later: “My frustration with you is that I think you’re well-intentioned, but you’re running out of time.” And then: “You’re going to run out of runtime if you don’t start kicking some arse and getting this country moving.” Hosking took issue with a number of areas he perceived the government as being sluggish, but he saved his final blow for something close to his heart: speed limit changes. Luxon said he’d “get onto it”, and just shy of 24 hours later, an outcome (though not exactly the one Hosking had been asking for). As we touched on yesterday, the government has confirmed it will reverse speed limit reductions implemented by the former government across 38 sections of state highway up and down the country in a bid to bolster productivity. A further 49 sections of state highway will be put out for public consultation.

*Not the animal.

‘Triumph for common sense’ or a ‘political decision’?

In announcing the decision, newly-minted transport minister Chris Bishop said the government wanted to make it easier for people to get from A to B “which will help drive economic growth and improved productivity.” Act’s leader David Seymour said it was a “triumph for common sense” (the pledge to increase speed limits was included in the National-Act coalition agreement). In Wairarapa, where the announcement was made, the changes could amount to about three minutes of travel time saved. However on shorter stretches of road, calculated Stuff’s Karanama Ruru, it could be as little as 15 seconds. Bishop argued it was worth it. “While these changes may appear small in some cases, collectively when you add up the volume of traffic across all these corridors every day, it makes a big difference,” he said.

The opposition has claimed that it’s a purely political decision and one that will cost lives. As reported by ThreeNews last night, the announcement was made on the corner of a road where someone had previously lost their life. Labour’s Chris Hipkins, speaking to reporters, went so far as to suggest National would be responsible for any increase in road deaths. “If more people die on those roads because of the political decision to increase the speed limits then that’s going to be on National,” he said. The transport minister said drunk and drug drivers were the major cause of road deaths and the government has committed to tackling this problem, as we looked at for The Bulletin last year.

‘Higher speeds often result in increased costs’

The government’s position is that by allowing people to get where they need to be faster – albeit only slightly – it will mean they can achieve more. The Spinoff’s Toby Manhire looked at the debate, and the strong opposition to the government’s moves, in an explainer published last August. Though campaigned on well before Christopher Luxon started talking about economic growth in practically every sentence, the pledge has been rolled out as part of the government’s plan to reinvigorate the economy. In a piece for The Conversation last year, urban planning expert Timothy Welch argued that thinking was flawed. “Higher speeds often result in increased costs rather than improved efficiency,” he wrote. That can be caused by “disproportionate increases in fuel consumption”, but also the heavy financial burden from increased road accidents, explained Welch.

Canterbury university’s Simon Kingham, a former chief science advisor at the Ministry of Transport, made similar arguments in a piece for Newsroom, noting that the government was only pitting time savings against accidents and “ignoring pollution emissions… ignoring mode shift which is a really big one because if you make a speed limit slower, you encourage walking and cycling”.

As RNZ reported, the government will face a legal challenge from a safety advocacy group over its decision.

Local decision making ‘undermined’

Meanwhile, it’s been claimed the government’s decision to take a blanket approach to speed limit adjustments overrides the views of local communities. The Spinoff’s Joel MacManus made a similar point in a piece for The Spinoff last year, arguing that while some local councils had been responsible for reducing speed limits in their towns, the government – that has advocated for local solutions to local issues – had decided to take a wholesale approach. Tina Law, reporting for The Press, said that the Christchurch City Council had been working to reduce speed limits outside schools to 30km/h at all times of the day, but the government will require this only to be in force during pick up and drop off times. Harrison McEvoy from the group Greater Ōtautahi said this ignored community preference and undermined local decision making.

Keep going!
(Toby Morris / The Spinoff)
(Toby Morris / The Spinoff)

The BulletinJanuary 29, 2025

Privatisation fear sees opposition go on the attack

(Toby Morris / The Spinoff)
(Toby Morris / The Spinoff)

The PM didn’t want to talk about it, but he had little choice, writes Stewart Sowman-Lund for The Bulletin.

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Fuel on the privatisation fire

We touched briefly yesterday on the issue of privatisation or asset sales, but with parliament’s return yesterday there has been added attention and scrutiny on the idea. So, this morning we’re going to take a look at what’s actually been said, and what history tells us. While in opposition, Christopher Luxon pledged not to sell off any state owned assets as prime minister – in his first term, anyway. That promise remains, though there have been some signals the government could be exploring possible options for the future. Kiwibank, for example, is set to be bolstered via private investments ahead of a possible part sale, though the finance minister Nicola Willis classed this an “asset capitalisation”. Duncan Greive for The Spinoff looked at the case for selling some of the bank here.

The Herald has done substantial reporting on the seemingly softening stance on privatisation, with Thomas Coughlan reporting last July that “purpose statements” had been drawn up for each state owned enterprises, potentially to determine whether there was a valid reason for owning each asset.

Through all of this, the consistent line from the prime minister has been that nothing will happen before the 2026 election and National would campaign on any changes it wanted to make. Things have been inflamed, however, after Act’s David Seymour said in his state of the nation address last week that the government was “hopeless at owning things”. It’s only an Act-backed position at this stage, but in a coalition, everything gets pulled into the PM’s orbit regardless (Luxon told RNZ’s Morning Report yesterday he hadn’t actually watched or read Seymour’s speech in full).

Word of the day

The opposition has quickly pounced on all of this, arguing the government is softening us up for asset sales. Labour leader Chris Hipkins dedicated a significant chunk of his speech in the House yesterday to privatisation, as did Green co-leader Chlöe Swarbrick. Some variation on the word “privatisation” cropped up more than 40 times across the speeches responding to Christopher Luxon’s first speech in the house for 2025 (Luxon, unsurprisingly, did not mention the word once – though he did say “growth” 18 times). “That is what they’ve done for the last 40 years and that is exactly the playbook that we are seeing now: underfund public services, run them into the ground, cut them and hock them off – that is what this government wants to do,” said Hipkins. Speaking to reporters, he raised the possibility of the government privatising hospitals and bringing in a user-pays model, something National has said won’t happen.

Labour MP Willie Jackson said he wouldn’t be surprised if Māori took legal action against the sale of state assets, reported Maioha Panapa for Te Ao Māori News. “You’ve heard the angst, and we’ve had the terrible experience of what happens in terms of privatisation,” he said.

Coalition fautlines

Despite the political mud-flinging, widespread asset sales are unlikely to be on the agenda come 2026. However, Stuff’s Glenn McConnell has looked at what could be sold off. The most likely contender, and one raised by David Seymour in his speech last week, was QV – the state-owned property valuation entity. “It’s pretty hard to see why the government would want to be in the property valuation business,” Seymour said yesterday. State house numbers could also be adjusted, while the Taxpayers’ Union, in an email yesterday, reiterated its view that TVNZ should be sold.

When Seymour said that New Zealanders were “squeamish” about discussing asset sales, he could very easily have been referring to his coalition partner, National. As the Herald’s Jamie Ensor analysed (paywalled), Seymour has put the subject squarely on the agenda whether the prime minister wants to talk about it or not. “You’re having a conversation that is not happening this term. I don’t know how to be any clearer with you about it,” Luxon told reporters yesterday. It also pits Seymour against Winston Peters, who remains staunchly opposed to asset sales. “I spent my whole career ensuring that our assets stay in our possession,” the NZ First leader told reporters.

Do we know whether it’s popular?

Luxon told reporters yesterday that his party was open to having that conversation in the longer term and, should it decide it wanted to sell any assets, it would campaign on it next year. That has echoes of the last National-led government, wrote The Post’s Thomas Manch, when John Key took asset sales to the 2011 election. Despite a citizens-initiated referendum revealing a resoundingly negative view of the idea, Key argued the election victory had given him a mandate and went about partially privatise the government energy firms, and selling more of Air New Zealand.

It’s hard to know how popular the idea is in 2025. Writing for The Conversation, Massey University politics professor Richard Shaw said that the 2020 New Zealand Election Study showed just under 50% of those surveyed “somewhat” or “strongly” agreed with the proposition that “privatisation has gone too far”. In other words, he wrote, “those who oppose state asset sales comfortably outnumber those who support them”. Whether Luxon, Seymour or Peters can win the debate will be a question for further down the track.

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