Government announces $1.2b progress on ‘Roads of National Significance’
Monday, 20 October 2025
The Government will spend $1.2 billion advancing its “Roads of National Significance” projects, and has decided to fast-track the Northland Expressway and second Mt Vic and Terrace tunnels in Wellington.
Newly released plans for the roads also show the Wellington tunnels project is expected to cost up to $3.8b, a Petone to Grenada highway $2.6b, two stages of the Northland Corridor up to $18.3b, and the East West link across Penrose $4.1b.
Tolling would be considered on all of the roading projects, including the tunnels and roads which would cross central Wellington, though Transport Minister Chris Bishop said congestion charging may instead be settled on.
Bishop and Prime Minister Christopher Luxon announced the New Zealand Transport Agency had signed off on the investment cases for each of the Government’s “Roads of National Significance” (RoNS), at a press conference on Monday.
The projects would receive a total of $1.2 billion in funding for preliminary works and to purchase properties required to build the roads. More than $675 million would be spend on consenting, designing, site investigations and early work, and $515m was expected to be spent purchasing properties.
Bishop said the investment plans and the funding meant the projects could start in due course, “building that long term transport infrastructure pipeline to build jobs and growth”.
Preliminary work on a second Mt Vic tunnel would commence in 2026, Bishop said, and a new tunnel would contain a 3.6m wide walking and cycling path. The existing path in the existing tunnel would be demolished to widen the tunnel, making it safer.
The overall “Wellington Improvements” project would include a second Terrace Tunnel, three lanes on the southbound Vivian St through the removal of car parks, three lanes on the northbound Karo Dr, upgrades to the Basin Reserve, and widening of Ruahine St on the Hataitai side of the Mt Vic tunnel.
Bishop said it was “ridiculous” drivers could park on Vivian St - the SH1 route through Wellington.
The investment case showed that design of the project and property acquisition was expected to take until at least 2028.
Tolling was also being considered for this main route across central Wellington. Bishop said that could be a “challenging conversation” but if it shaved 15 minutes of people’s drive, commuters from the Hutt Valley or Porirua may pay that.
“The starting point for all the roads is the consideration of tolling. The next step is to look at exactly what the traffic flows will be as part of that,” he said.
“The other thing I would say about Wellington is you've got the other debate around congestion pricing or a cordon charge as well. We're also progressing time-of-use pricing.
“So it may be that those conversations merge together at some point, or it may not be, let's just wait and see where we get to.”
The benefit-to-cost ratio of this project was 1, effectively neutral, if the roads were tolled and the wider economic benefits were tallied, according to Bishop. If the road was not tolled, it would be 1.2 (any figure above 1 indicates benefits greater than cost, less than 1 means costs are greater than benefits).
It could improve travel times by 10 minutes at peak, and reduce the peak traffic along the alternative Harbour Quays by 20%, allowing for greater use of buses along this route.
A route had also been chosen for a Petone to Grenada road, in Wellington, which would require 70% less earthworks than previously designed. A “feasible” route for the adjoining Cross Valley Link across Lower Hutt had also been chosen, Bishop said.
The investment case summary released by NZTA showed the design and approval stage of those roads was expected to extend into 2029, however that was subject to change.
The Petone to Grenada road would save 23 minutes in travel time between Lower Hutt and Porirua, and would support more than 30,000 new houses in Tawa, Porirua, and Hutt City.
Its benefit-to-cost ratio would be 1.7 regardless of whether it was tolled, and the ratio rose to 2.7 when wider economic benefits, such as land use, productivity and employment, were considered. The Cross Valley link would have a 2.0 benefit-to-cost ratio, if the Petone to Grenada road was built first.
Overall, the NZTA estimated a $4.4b to $5.7b economic growth and productivity value from the roads.
The investment plans confirmed the preferred route had been confirmed for the Northland Corridor from Te Hana to Whangārei, made up of two RoNS, and the Te Hana to Port Marsden Highway would be prioritised to provide an alternative to the existing Brynderwyn Hills route.
According to the investment case published, NZTA expected to be ready to start the procurement for the road in 2027. An earlier stage of this corridor, Warkworth to Te Hana, will begin construction in 2027.
Overall the two roads north of Te Hana would reduce travel times by 38 minutes, Bishop said, and were expected to reduce deaths and serious injuries by 66%, and reduce resilience risk - from events such as slips - by 82%.
The road would have a benefit-to-cost ratio of 1.4.
Bishop said full consents would be sought for the Wellington Improvements, Petone and Grenada and Cross Valley Link, and Northland Corridor, though the fast-track regime.
Other investment cases approved by the NZTA included the East West Link in Onehunga and Penrose in Auckland, an area which Bishop said generated 8% of the Auckland region’s GDP.
“That economic hub in Penrose and the surrounding area is a massive freight and logistics hub … the idea that basically, the trucks trundle from State Highway 1 to State Highway 20 along a local road, clogging up the traffic for everyone else who's just living in the area, or trying to get around the place is, frankly, nuts.”
This relatively short roading project was expected to cost up to $4.1b, and the “pre-implementation” stage would run until the end of 2029, according to an indicative timeline.
The benefit-cost ratio was 2.6 regardless of whether it was tolled, and 3.2 when the wider benefits were considered. It would be built in stages.
Which roads would be progressed first would be weighed up over the coming months, Bishop said.