Is government grasping the crisis and opportunities?

With the fuel crisis ramping up, all eyes are on the government’s response. Officially there’s a plan, with four phases. There are two relatively similar phases, Watchful and Precautionary – and then a quantum leap to quite serious measures at phases 3 and 4, Managed and Protected, both currently under consultation.

At each stage, there are notes on what individuals “can do”. As quite a few people are noting (with varying degrees of dark humour), the phases seem a little… discontinuous.

BREAKING: Here is more detail on the National Fuel Plan's four "phases". We are in phase one.

— henry cooke (@henrycooke.bsky.social) 2026-03-26T23:05:17.042Z

Of course the first step of confronting a problem is admitting there’s a problem, and this has seemed a bit of a stumbling block for the government so far, with a few exceptions.

Transport Minister Chris Bishop gave a speech last Friday to the annual conference of the New Zealand Automobile Association, which included a number of interesting comments. Here’s a snippet:

When global supply chains are disrupted, as they are now, that exposure becomes very tangible for families and businesses who feel the pain at the pump.

We are already seeing significant shifts in behaviour across the country, and as a government we are closely monitoring these changes so we can respond to their impacts if needed.

Using data from a sample of vehicles across the country, we can start to get a rough idea of how people are responding to this conflict.

Comparing the two weeks pre-conflict in mid-February against 7-day rolling averages for subsequent weeks, we have seen a reduction of approximately 20% in the vehicle kilometres travelled by cars. Not necessarily surprising when petrol prices have gone up 30%.

Also not surprising is that people are responding in a predictable way so far: they are using public transport more, with boardings up by more than 10% in Auckland and Wellington. MOT will be publishing updated data regularly, starting later today.

First, a caveat: it’s too early to say if the sample the Minister refers to is representative of the country as a whole, let alone whether these travel change trends will continue, and at what rate.

That said, a 20% reduction in VKT is massive. It’s particular striking because, in the past, many officials and ‘experts’ have claimed that reductions on this scale simply aren’t possible – or would be extremely hard to achieve.  But if a sudden rise in fuel price alone can reduce driving by up to a fifth, then all previous bets are off.

So on that level, the current and developing crisis – while obviously stressful, inequitable, and still uncertain on many other levels – will be a valuable test of many long-held assumptions that sit at the heart of our transport assessment processes. It will also be incredibly useful for analysis and debate over transport planning in general, and policies like congestion pricing (more on that soon).

That data dashboard Bishop mentions can be found here, and this is how Ministry of Transport describes it:

What it shows

• Kilometres travelled by heavy and light commercial vehicles on a daily basis. We expect to include light vehicle data shortly.
• Passenger numbers on public transport in Auckland (bus, rail and ferry) and Wellington (bus and rail).
• The number of scheduled flight departures for passengers and freight in Auckland, Christchurch, Wellington and Queenstown.
• The number of days of fuel cover, sourced from MBIE, covering petrol, diesel and jet fuel.
• The changes in the prices of petrol, diesel and jet fuel.

And here’s the first iteration of the dashboard, as at 27 March 2026:

In his speech, Bishop continued:

Interestingly, last week saw more than 1,000 electric vehicles registered, close to double the week prior. This makes it the biggest week in EV registrations since the end of 2023. Year-to-date registrations are nearly 2,000 higher than this time last year.

Heavy vehicles are also down around 5% over the last few days, despite an increase of 70% in diesel prices. This is expected – those who rely on heavy vehicles for freight or commercial use have far less ability to respond to these kinds of price shocks with immediate alternatives.

Gliding over “since the end of 2023” (which obviously correlates with the incoming government putting an end to the Clean Car Discount), it’s not surprising there’s been a sudden jump in EV sales. Those who can afford to make that call are taking quick action.

Perhaps the bigger question is how long it will take for dealers to get more stock in, especially as that stock will now be in extremely high demand in other countries.

While not directly related to the fuel crisis, Bishop’s speech also highlighted the scale of public funding subsidies that go into building roads.

The 2018-21 National Land Transport Programme outlined expenditure of $17 billion over 3 years, and was largely funded by road users, who contributed $13 billion.

Fast forward to the 2024-27 NLTP, and the total investment has nearly doubled at $32.9 billion, but road users are still contributing roughly the same amount, $14.3 billion.

The increased investment has come primarily from Crown funding, with around $12.8 billion of direct Crown funding provided over 2024-27.

A reminder: most of the “increased investment” from the Crown is required because road-building itself is aready getting more expensive (on top of which keep an eye on the price of bitumen, and multiply by four lanes), and/or because of the scale of the government’s Roads of National Significance programme.

In terms of helping to pay for transport projects, Bishop notes:

One option is to lift petrol tax and RUC.

Petrol tax has not risen since 2020 and has not kept up with inflation. In 2023, we campaigned on not increasing petrol tax in our first term. This was the right thing to do when there was a cost of living crisis, but we have to be honest about those consequences. It has deferred the issue until later.

Petrol tax is currently due to go up by 12c per litre in 2027, by six cents on 1 January 2028, and 4 cents in each year after that.

I have to be honest with you, the idea that we would put up fuel tax during a fuel crisis seems like a non-starter to me.

If the government is already looking at deferring the fuel tax increase, then it’s very hard to see them being willing to add congestion charges on top. Regardless, as noted earlier, this crisis is certainly going to give some fascinating insight into how effective such a move might be in reducing congestion, aka demand for driving.

Also on Friday, as noted at the top, Finance Minister Nicola Willis announced updates to the National Fuel Plan, including what kinds of restrictions might be used at different phases, should it come to that.

She also said that the Energy Efficiency & Conservation Authority would be running a campaign focusing on helping New Zealanders understand how to stretch every tank of gas as far as possible. By up to 20%, in fact.

From the EECA homepage: “Stretch every tank by up to 20%”. It adds: “Fuel saving tips. Your fuel will go up to 20% further with a few efficient driving habits, and staying on top of routine maintenance.”

The suggestions EECA makes are all the usual kinds of things that come up every time fuel gets expensive.

An EECA infographic laying out six options for saving fuel: keep an eye on your speedo, smooth and steady on the pedals, lighten the load, switch off when waiting, check your tyres, keep on top of maintenance.

What’s notable about these tips is what’s not there, such as:

• Does your trip even need to happen, i.e. is this an “essential journey”?
• Can you bundle together errands (or passengers) for greater efficiency?
• Can you consider when you travel – given idling in traffic at peak times is a waste of fuel?
• Can you consider how you travel – can your trip be made with a different mode?

What happens if you search EECA’s website for alternative modes, like say, the humble bicycle? Full disclosure, if you search for “cycling”, you get a couple of hits, including a 2024 survey that says 38% of New Zealanders would like to cycle more, and when you look at the survey itself you see that half (48%) of those aged 18-34 want to cycle more, one in five (22%) of those who don’t currently cycle would like to start doing so, and that 21% of New Zealanders want to consider active modes for trips to school. Food for thought, and surely policy fodder.

Meanwhile over in Australia, two states are already making public transport free for a given time, to help get people out of their cars in order to reduce fuel use:

Victoria and Tasmania on Sunday unveiled a temporary fare reprieve as motorists continue to face price pain at the petrol pump.

Uncertainty and crimped oil supplies due to the Iran war have driven up costs and led to fuel shortages at hundreds of service stations.

In response, the Victorian government will make public transport free for a month from Tuesday to encourage people to ditch their cars and offset rising fuel costs.

The move is expected to cost Victoria $71 million (NZ$85.4 million) in lost revenue.

Here, I’d settle for even just reduced fares. But the government has repeatedly poured cold water on the very suggestion, noting that there are many people outside of our bigger cities who can’t use public transport.

Which is surely part of the point: the more people in cities who can and do use the available alternatives, the more fuel will remain available for those who can’t. 

Notably, over in Australia the Victorian Farmers Federation is in strong support of free transit, saying:

Victorian farmers welcome today’s announcement by the Premier to make public transport free, following calls from the farming community.

“With fuel still under pressure, free public transport is one of the few practical levers available to help Victorians conserve fuel and save money.”

If Victorians make the switch, it can make a real difference. Every commuter who leaves their car at home frees up fuel for the essential, time-critical work that keeps Victorians fed, whether that’s ensuring livestock are fed and cared for, or getting crops in the ground.

We’re grateful the Premier has listened and acted. This is not a silver bullet and must be one of many levers pulled to navigate this crisis.

Back on our shores, on Sunday’s Q&A programme Jack Tame spoke with Mike Casey, CEO of Rewiring Aotearoa, about the scale of the challenge and the opportunity.

Among other things, Casey notes that our oil consumption is at a five-year high, which he says shows a distinct “lack of strategy” and that the government has unfortunately been “caught with their pants down.”

The “north star” is “New Zealand-made energy”, he says, along with accelerating the shift to rooftop solar and electrified transport. He offers tangible examples from the farming sector he hails from of how that move is already saving people money and increasing resilience.

It’s definitely worth a watch:

If you prefer a quicker and lighter read, Verity Johnson’s column makes some similar points:

Winston Churchill had it right when he said never waste a good crisis. And if there’s one thing we could get out of this mess, it’d be how to not to end up here again in another five years.

What’s your take on the most critical steps the government could or should be taking at the moment?

Today’s header image is the cover photo of this government’s 2024 Government Policy Statement on Land Transport (official document here) 

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