Driver licensing and driver testing fees review

Poor financial oversight by the previous government has resulted in a $20 million shortfall in the driver licensing and testing area.

The NZ Transport Agency, which is responsible for managing driver licensing and driver testing systems, is proposing changes to fees to meet the shortfall and rebalance charges.

The fees have not been reviewed since 2001 and, since then, the cost of providing licensing and testing services has become greater than the fees collected.

Cost increases add up to a total projected deficit of $21.78 million in the driver licensing account by June this year (2010).

The NZ Transport Agency is looking at ways to improve its systems and reduce costs. The agency will have to absorb much of the current deficit but we can’t allow it to keep growing. The deficit is increasing at a rate of about $650,000 a month.

The agency is now consulting on fee changes that will better match the actual costs of providing each service. Submissions close at 5pm on 26 February and changes will be introduced in July 2010.

While an increase in some fees is necessary, the Government recognises the impact of increased costs on New Zealanders and all fee rises have been kept as low as possible.

Fees for 18 services would be reduced. The 10-year licensing renewal fee would drop 3 per cent to $43. Renewals are the most common transaction with more than 21,000 in May 2009, a typical month.

Fees for 23 services would be increased.

Four fees, including those for drivers aged 75 years and older, would remain unchanged.

Three new fees are proposed:

One for license reinstatement after disqualification (which has been agreed to by Parliament).

Two administration fees for withdrawing from and/or rescheduling a driving test.

The license reinstatement fee is important.

It’s simply not acceptable that responsible, law-abiding drivers have for so long carried the costs of people whose licenses have been suspended and then reinstated.