June 12, 2026 7:00am by David Farrar

Labour gets a triple fisking over its dodgy fare numbers

Labour’s $65 million costing for its $20 cap on public transport fares is looking beyond dodgy. We have three seperate scrutinies which all say it doesn’t add up. First Macroeconomics Professor Robert MacCulloch:

The Labour Party’s announcement that its newly proposed $20 weekly public transport fare cap will cost $65 million is out by a factor of at least three times. The Opposition Leader’s Transport Press Conference and Labour’s webpage (https://www.labour.org.nz/farecap) state, “On average, people will save around $25 a week” from the cap, some more, some less, and “hundreds of thousands of people would benefit”.

Census data from 2023 says 135,000 people use public buses, trains or ferries as their “main means of travel to work” (https://figure.nz/chart/x72mUPCCIJtePP5B). A weekly average saving of $25 per person for 52 weeks would cost the government $175 million. Should prices be slashed, demand for trips rises, increasing the subsidy to nearly $200 million. This estimate is conservative, since many people use public transport not associated with a commute to work.

Declaring that “hundreds of thousands of people” benefit and the saving is “on average $25 a week” does not add up to $65 million. It adds to at least three times that figure.

So MacCulloch says by Labour’s own claims, the cost would be at least triple what they say.

Then the TU breaks it down by region:

Using publicly available 2024/25 data from New Zealand’s three largest public transport-using regions, the Taxpayers’ Union estimates the annual cost to be: 

  • Auckland: $118,061,733 to $141,051,370
  • Wellington: $23,249,363 to $38,094,684
  • Canterbury: $394,877 to $3,383,523

That puts the cost for just these three regions at $141,705,972 to $182,529,576 a year, potentially up to nearly three times higher than Labour claims for the entire country.

Unlike Labour, the TU has provided their workings.

And finally Simeon Brown points out:

Labour claims its fare cap policy will:

  • Cost $65 million per year
  • Save the average person more than $1,200 per year
  • Benefit around 1.36 million New Zealanders who use public transport every year. 

“These three claims cannot all be true. 

“If 1.36 million people are each saving more than $1,200 a year, the cost of delivering those savings would exceed $1.6 billion annually – not $65 million.

Labour must release their own detailed costings and assumptions, for their budgeted cost estimate to have any credibility.