During the year, the Ministry delivered over 90 percent of its Output Plan as agreed with the Minister of Transport (the Minister). This is a very good result. In addition to work agreed at the beginning of the year, the Ministry responded to events as they arose (for example, the Rena grounding) and took on a range of assignments not originally programmed.

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The Ministry has also contributed to other whole-of-government work programmes over the year.

The key achievements for the 2011/12 year are set out below under the government’s drivers for transport:

Investment in infrastructure

Clifford Bay

Building a new ferry terminal at Clifford Bay has the potential to significantly increase transport efficiency and productivity. Its benefits needed to be considered in terms of its potential impact on an efficient national transport system. Since September 2011, the Ministry has led a detailed evaluation of the potential for the proposed ferry terminal at Clifford Bay and developed a full business case on its possible development for the government to consider. Key stakeholders including rail and other potential users of the service have contributed to this process.

Wellington and Auckland metro rail infrastructure funding

In October 2011, Auckland Transport signed a purchase agreement for 57 three-car railway units from Spain. This action effectively completed the funding, ownership and procurement activities that made up the Ministry’s contribution to the modernisation of the rail transport services for Auckland. Similar arrangements were made with Wellington earlier in 2011. Investment in making rail public transport accessible and efficient will reduce congestion in Wellington and Auckland and contribute to transport productivity.

Connecting New Zealand

The Ministry finalised and published Connecting New Zealand in August 2011. Connecting New Zealand provided stakeholders with a summary of the government’s policy direction for transport over the coming decade. In setting out the government’s long-term outcomes for transport, it assists stakeholders to better understand how the government wants the transport system to develop over time and helps to ensure investment decisions will contribute to transport effectiveness and economic productivity.

Freight Information Gathering System (FIGS)

The new Freight Information Gathering System was fully implemented over the past year. As a consequence of improved freight data collection systems and regular reporting, freight owners are able to access consistent, accurate and timely data from all 10 ports that participate. The data relates to container freight movements, including the balance of exports to imports, freight volumes and the mode of transportation used to carry cargo into and out of ports. By understanding the freight supply chain, the Ministry can provide better informed policy advice and contribute to growing the economy.

By publishing quarterly reports on its website, the Ministry is also impacting on efficient freight transport. It appears the freight sector is finding the data very useful as there are often enquiries for when the latest information will be available.

Auckland transport infrastructure investment

The Ministry has engaged with Auckland Council and Auckland Transport to support integrated decision making and long-term planning in line with government priorities and funding commitments for transport. These actions will contribute to a high quality transport system for Auckland.

The Ministry contributed to the analysis of drafts of the Auckland Spatial Plan. It also wrote the transport component of the central government submission on the Spatial Plan when it was put out for consultation.

Together with the Treasury and NZ Transport Agency, the Ministry also coordinated central government input into, and assessment of, the responses to the Government Review of the 2011 business case on the Auckland City Centre Rail Link.

Land Transport Management Bill

The Ministry, in consultation with Local Government NZ, the Automobile Association and the Land Transport Forum and regional councils developed a more effective, efficient decision making process for land transport expenditure decisions that will reduce compliance costs for the sector and advance economic growth. These changes are incorporated in the Land Transport Management Bill. The Bill, that was introduced to Parliament on 13 August 2012, also introduces legislation that simplifies the process of approving tolling and public private partnerships while maintaining robust approval processes. It also introduces changes to the public transport operating model.

National Airspace Policy released

A National Airspace Policy Statement was completed in collaboration with the Civil Aviation Authority and members of the aviation sector including major airlines and Airways Corporation of New Zealand. The updated policy is in response to worldwide changes in technology that impact on how aircraft navigate between airports and how air traffic will be managed. The statement provides a policy environment that will allow New Zealand to gain the maximum benefits from new technologies. It will future proof the airspace and air navigation system and ensure the safety and efficiency of air traffic services and the resilience of the airspace system.

Government Policy Statement on Land Transport Funding 2012 (GPS 2012)

The Government Policy Statement 2012 was approved by Cabinet and published in July 2011. It sets outcomes and priorities for the investment of the National Land Transport Fund from 1 July 2012. Government investment in the National Land Transport Fund over the next 10 years will focus on projects supporting economic growth, value for money and road safety. The publication of the GPS 2012 will allow the transport decisions taken by NZ Transport Agency and local authorities and other organisations to be aligned with the government’s outcomes and priorities.

Rena recovery

The Ministry was able to give significant support to Maritime NZ during the early stages of the Rena container ship grounding. It provided specialist policy advice and legal, financial and communications support and regular updates to the then Minister of Transport. It also took the initiative to set up and lead a cross government Rena Coordination Group, including key government agencies and the Bay of Plenty Regional Council.

The Ministry also contributed to the commercial negotiations with the owners and insurers of the Rena.

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Better quality regulation

Agricultural vehicle reform

During the year, the Ministry undertook a review of the licensing requirements for agricultural vehicles. Currently agricultural vehicles must meet many of the regulatory requirements that are designed for on-road commercial vehicles, creating regulatory barriers to economic productivity. The review looked at developing simplified and reformed licensing regulations, while reducing compliance costs where possible and maintaining safety. Consultation by the Ministry included the release of a position paper in April and the holding of six workshops. The Ministry developed options for reform and the government took decisions in August 2012.

A new road user charges system

The Ministry developed a modernised and simpler road user charges system that reduces compliance costs and ensures regulations are effective and meet government priorities. The new system will increase transport effectiveness by encouraging operators to make efficient choices, in terms of the vehicles they purchase and the way they use them, and by limiting opportunities for charges evasion.

This is the first major refresh of the road user charges regulatory process since the 1970s. In recognition of the importance of the review for transport productivity, the Ministry undertook wide ranging consultation with the sector over the several years it took for the policy to be developed.

The new system is intended to be cost neutral and will contribute to a sustainable funding basis for transport infrastructure investment and use.

The Road User Charges Act 2012 that provides the legislative framework for the new system was passed in February and new road user charges regulations came into force on 1 August 2012.

Vehicle Licensing Reform

The Ministry developed options for reform of vehicle licensing that have the potential to save households and businesses time and money, and reduce the volume of infringements in the criminal justice system, while maintaining road safety. Change will impose some implementation costs on the government and could have financial impacts on businesses that do inspections. A discussion document is being developed that is expected to be released for public consultation in September 2012.

The project has been trialling a collaborative approach, jointly with the NZ Transport Agency. It involves the Ministry working closely with other government departments such as ACC, the Ministry of Business, Innovation and Employment and the Ministry of Justice, as well as early and ongoing engagement with key industry stakeholders.

Improving safety in transport related adventure tourism activities

The Ministry oversaw the introduction of two transport rules that address some of the recent concerns about the safety of adventure tourism activities. Aviation Rule Part 115: Adventure Aviation sets standards for all adventure aviation operators for their management systems, staff training and qualification, and equipment. Amendments to Maritime Rule Part 82 ensure river jet boat drivers have completed appropriate training and can demonstrate competency. These changes will provide greater certainty to people taking part in these activities that they will retain their excitement while remaining as safe as possible.

Transport rules redesign project

The transport sector is highly regulated and there are opportunities to improve processes for regulatory intervention. Part of the Ministry’s response to the government’s “Better Regulation Less Regulation” initiative has been to develop a new Regulatory Policy Statement that ensures the regulatory development process is simpler and more streamlined, and effective regulation is delivered with minimal delay and reduced compliance costs. To help implement the policy statement, the Ministry produced the 2012 edition of the Rules Development Handbook that is available to rules developers as a booklet and on an interactive website.

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Opening markets

International air transport policy

By ensuring New Zealand’s international aviation arrangements are fit-for-purpose, we will improve competition and support increased passenger and freight movements to and from New Zealand. Over the past year, the Ministry has made a significant contribution to this outcome by completing a review of New Zealand’s international air transport policy that provides the framework within which air services agreements with our key trading partners and transport markets are negotiated and implemented. The review was undertaken in response to changes in international air transport arising from a number of recent shocks including regional financial crises, terrorism threats and fluctuating oil prices, as well as ongoing change in tourism markets.

A discussion document outlining proposals for a new international air transport policy was released in May 2012. The government agreed to the finalised policy statement in August 2012.

International air services

The Ministry also contributed to New Zealand’s access to and choice of international air services by successfully negotiating new air services arrangements with Japan and China.

As a consequence, Japan removed a number of existing restrictions on the airline services of both countries.

For New Zealand airlines, this means the removal of limits on operations to and through airports in Japan outside of the Tokyo region. The limits on operations to Tokyo’s Narita airport will be removed in 2013. The agreement makes reciprocal rights available to Japanese airlines and understandings have been reached on possible future access to Tokyo’s Haneda airport. The outcomes of this negotiation constituted a significant step forward in our air services relationship with Japan. The new arrangements will provide the airlines of both sides with greater flexibility to react to changing market conditions, and the opportunity to commence new services or additional frequencies.

The results of a successful negotiation of a new air services agreement with China saw a tripling of the capacity available to the airlines of both countries to 21 return services per week. The new arrangements support the rapidly growing market for travel between China and New Zealand, and are expected to provide sufficient capacity to meet the medium-term needs of New Zealand and Chinese airlines. Understanding was also reached on technical cooperation between the respective civil aviation authorities, an increase in the number of intermediate or beyond points (airports in third countries) available for own operation or code-sharing services, and more flexible tariff filing provisions.

Public Transport Operating Model

The Ministry worked to implement the agreement it had reached with stakeholders in 2010/11 on a new and innovative model for partnerships between regional authorities and private sector transport operators. The aim of the model is to grow patronage for public transport services while reducing reliance on public subsidy. The Ministry has worked with the NZ Transport Agency and Parliamentary Counsel Office to repeal the Public Transport Management Act and incorporate a major amendment into the Land Transport Management Act. The impact will be a more accessible public transport system that will contribute to the nation’s social and economic welfare and economic productivity.

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Safer transport systems

Safer Journeys Action Plan

The Ministry implemented a range of actions arising from the first Safer Journeys Action Plan. In doing so, it has coordinated the actions of other agencies that have road safety responsibilities, that is ACC, NZ Police and the NZ Transport Agency. These actions will help to further lower the road toll (New Zealand’s road toll in 2011 was the lowest since the 1950s) and reduce injuries, and in doing so reduce the costs to the economy generated by these personal tragedies. While the safety of all New Zealanders will be increased by these actions, young drivers will be particularly impacted by raising the minimum driving age and implementing the requirement for zero blood alcohol content for young drivers. Other completed actions that will increase road safety include the alcohol interlock programme and introducing tougher penalties for dangerous driving.

The Ministry has also been working to develop and evaluate options for a range of new proposals. These include lowering fines for speeding infringements while increasing demerit points, extending child restraint requirements and developing a national policy for the use of red light cameras after a pilot project in Auckland indicated this policy could have safety benefits.

The Ministry worked with its road safety partners to develop many other initiatives such as the Centre of Road Safety Intelligence and the development of a Safer Journeys Communications Strategy to embed the Safe System Approach.

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Better public services

The governance and monitoring of Crown agencies

The Ministry continued to deliver on the Minister’s priorities with regard to Crown agencies by undertaking a range of actions that have contributed to value for money from improved decisions, better government services and reduced costs to the transport sector.

The Ministry advised the government on the appointment of several deputy chairs and board members for the transport Crown agencies.

The Ministry also continued to engage strategically with agency chief executives and boards, which led to better information flows and to agencies’ better understanding of the government’s priorities and the Minister’s needs. These actions, coupled with the Ministry’s continued involvement with agency work on value for money and the development of business models, has enhanced our understanding of the strategic direction and challenges for the agencies. In turn, this has informed our governance and accountability advice to Ministers.

The Ministry prepared Ministerial letters of expectations for the boards and advised on agencies’ final draft Statements of Intent, which led to further improvements from the previous documents.

Work continued, with the Civil Aviation Authority and the Office of the Auditor-General, on initiatives for the Authority to complete recommendations arising from the latter’s report on the Authority’s progress with improving its certification and surveillance functions. Nine out of 13 recommendations have now been closed.

Civil Aviation Authority funding review

The Ministry worked with the Civil Aviation Authority as it developed its business case to ensure funding arrangements recover costs from those who benefit and for additional funding from civil aviation fees, charges, and levies. This funding will sustain a range of performance improvements that the Civil Aviation Authority achieved over 2011/12 and further enhance the entity’s capability and services so that it is a durable and effective regulator and organisation.

Maritime NZ funding review

Working with stakeholders, the Ministry and Maritime NZ have together completed a draft discussion document for consultation. The goal of the review is to ensure Maritime NZ has in place robust and sustainable funding arrangements that balance the range of interests in the maritime community while supporting business operations within the maritime regulatory environment and Maritime NZ.

Rugby World Cup (RWC) 2011

During the RWC, the Ministry provided daily transport sector reports to the RWC 2011 office, attended daily whole-of-government operations group meetings and coordinated weekly transport agency RWC 2011 meetings. The Ministry also provided advice on the steps taken by Auckland Transport to bolster transport arrangements following capacity issues on the opening night of the tournament.

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Further information on the Ministry's work in 2011/12

This is a sample of the wide and varied work of the Ministry in 2011/12. Further information on the work done is reflected in the section of the report on our non-financial performance.

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