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AAP
AAP
Ben McKay

Car rego jump adds to cost of living pain in NZ

New Zealand's government has diverted funding bound for public transport, rail, and walking and cycling projects into road-building and highway maintenance in a "back to basics" transport package.

But to fund it, the coalition is planning higher fines and to raise rego costs from $NZ106 ($A99) to $NZ156 ($A146) inside two years.

Transport Minister Simeon Brown announced 15 new "roads of national significance" to be built as four-lane highways, with the government aiming for private funds to help overcome an infrastructure deficit.

"All funding, financing, and delivery options should be considered to deliver them in stages as quickly as possible," he said.

"We've chosen to prioritise new roading infrastructure, maintaining services in targeted investment of public transport, while also ensuring our road network is maintained.

"Investments in these essential corridors will make it easier for New Zealanders to get where they need to go, create a more productive and resilient transport network, drive economic growth, and unlock land for thousands of new houses."

The government has tiptoed around an election commitment not to increase road user charges or the Auckland regional fuel tax during this term, by raising the regional tax by a larger amount next term.

It has also raised car rego charges by 50 per cent, causing outcry from the opposition.

"They said during the election they were going to make cost of living their number one priority," Labour leader Chris Hipkins said.

"The government have got their priorities wrong when they're doing things like hiking fares for public transport users, cutting public transport, increasing vehicle registration fees and increase in fuel taxes."

Greens transport spokeswoman Julie Anne Genter called the new transport policy "extreme, unbelievable and so backwards".

"It's doubling down on the failed approach of last century and it will lead to more emissions," she said.

A NZ Herald analysis shows more than $NZ500 million ($A468 million) a year less will be spent on public transport, rail and walking and cycling and instead diverted to road spending.

The transport U-turn comes days after Prime Minister Chris Luxon's backdown over claiming a housing allowance.

He was receiving $NZ1000 ($A936) each week to live in his own mortgage-free flat after eschewing the official residence, Premier House.

The conservative leader gave an unapologetic press conference at 3pm on Friday saying he was "entitled to the entitlement".

At 5pm, he went on politically-friendly radio station Newstalk ZB to announce he'd changed his mind and would give the funds back and stop claiming the allowance.

The snafu was front-page and bulletin-leading news over the weekend, but by the time MPs returned to parliament on Tuesday, it had been forgotten.

Of about a dozen National party MPs asked by AAP on Tuesday, none criticised their leader's judgment or said their constituents had raised the issue.

"I saw him make a very quick decision on Friday to stop taking that allowance and to re-pay it and that I think was a good decision," deputy leader Nicola Willis said.

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