The 2008 New Zealand public transport management act: Rationale, key provisions, and parallels with the United Kingdom

Document Type

Journal Article

Publication Date


Subject Area

economics - operating costs, economics - subsidy, mode - bus, organisation - competition, place - australasia


Bus sector regulation, Public transport, legislation, New Zealand, Bus contracting, Market failure, Monopolies, Value for money, Bus procurement


In January 2009, following a lengthy industry review and consultation process, the New Zealand Public Transport Management Act (PTMA) came into force. The Act allows Regional Transport Authorities, as the primary procurers of public transport services, to place either a control or a contracting requirement upon services that are registered as commercial requiring no subsidy. The imposition of either the control or the contracting requirement is designed to facilitate greater system integration, improve service continuity and enhance services to the customer, andallow the Authority to invest in key strategic projects, such as integrated fares and ticketing, so as to grow patronage. The PTMA’s other objective is to ensure improved value for public subsidies. Recent years have seen significant subsidy inflation for seemingly little commensurate benefits. The Act will allow the Regional Transport Authority to achieve greater value for money through improved farebox, a shift to longer, larger contracts to increase competition in the market, a more appropriate allocation of risk, and the removal of the ability of operators to ‘game’ the current system by using strategically placed commercial services as barriers to competition. Similar concerns have also stimulated new legislation in the UK and this paper illustrates the parallels in the environment and proposed response.


Permission to publish abstract given by Elsevier, copyright remains with them.


Research in Transportation Economics Home Page: http://www.sciencedirect.com/science/journal/07398859