Driver licence fee schedule

Changes to driver licensing and driver testing fees

3 Jun 2010 | National Office

Transport Minister Steven Joyce has announced changes to fees for driver licensing and testing services which will come into effect on 1 July 2010. The new fees are closely matched to the cost of providing driver licensing and testing services.

Schedule of fees (new fees apply from 1 July 2010)

New fees

Service	New fee ($)
Licence reinstatement ¹	65.00
Test booking rescheduling fee	16.00
Refund processing fee	16.00

¹ This fee will not apply until 31 January 2011

Application fees

Service	New fee ($)	Current ($)
Learner licence	47.20	39.30
Restricted licence (classes 1 & 6)	47.20	39.30
Full licence (all classes)	48.50	44.30
Overseas licence conversion	51.00	44.30
Renewal 10 yr (or upgrade)	43.00	44.30
Replacement	37.40	31.10
Older driver renewal	18.30	18.30

Renewal (and upgrade) fees: Periods of less than 10 years

Period (Age)	New fee ($)	Current ($)
10 (65)	43.00	44.30
9 (66)	30.00	27.50
8 (67)	30.00	25.00
7 (68)	25.20	23.00
6 (69)	25.20	21.00
5 (70)	19.80	18.50
4 (71)	19.80	16.50
3 (72)	14.40	14.50
2 (73)	14.40	12.00
1 (74)	12.00	10.00

Drivers aged 75 years and over

Service	New fee ($)	Current ($)
Renewal: 75 years old	18.30	18.30
Renewal: 80, 82, etc	18.30	18.30
Driver testing - Older Driver	41.00	41.00

Application fees: Endorsements

Service	New fee ($)	Current ($)
F, R, T, W or D	43.00	37.20
1Yr - P and V, New	63.00	70.10
1Yr - I and O, New	63.00	72.60
1Yr - P and V, Renewal	63.00	63.20
1Yr - I and O, Renewal	63.00	70.65
5Yrs - P and V, New	241.00	272.75
5Yrs - I and O, New	241.00	276.75
5Yrs - P and V, Renewal	241.00	256.90
5Yrs - I and O, Renewal	241.00	273.50

Note: the vetting fee of $28.20 per year is not included in these fee amounts

Fees: Miscellaneous

Service	New fee ($)	Current ($)
Certificate of Particulars	10.90	9.10
Application Fee - ID Card replacement	13.40	11.20
Application Fee - Exemption	26.70	22.20
Application Fee - Limited licence	38.50	46.50
ID card (‘small’ P and V) issued with endorsement	8.50	8.50

Test fees

Service	New fee ($)	Current ($)
Driver testing - Learner	44.70	39.70
Driver testing - Restricted	58.60	48.90
Driver testing - Full Class 1 or 6	84.70	70.80
Driver testing - Full Class 2, 3, 4, or 5	58.60	48.90

Changes to the Driver Licensing and Driver Testing Fees
Questions and Answers
June 2010
1. What are driver licensing and testing fees for?
Depending on the type of licence, fees cover the cost of one or more of the
following:
• Paying agents for processing licence applications on the NZTA’s behalf.
• Paying testing officers for conducting tests on the NZTA’s behalf.
• Manufacturing and postage of each photo licence card.
• Ongoing review and improvement of driver licensing processes, tests and courses.
• Auditing agents, testing officers and course providers to ensure they are complying
with all relevant legislation and NZTA requirements.
• Investigation of complaints into the activities of commercial drivers, agents, testing
officers, driving instructors and course providers.
• Development and maintenance of IT systems required to effectively administer the
driver licensing system.
• Providing customer assistance via a multi-channel helpdesk (0800, email and written
correspondence).
• Recording infringements and convictions imposed by the Police and the Courts.
• Administering the demerit point regime (including mailing warning lettersand
personally serving suspension documents).
2. Why are fees being changed?
New Zealand driver licensing and driver testing systems are based on the principle of
self-funding (commonly known as ‘user-pays’). This means the costs of processing
transactions, issuing licences, and managing the information technology (IT) and
operational systems must be met by the fees charged to users.
The current fees no longer cover the costs of delivering driver licensing and driver
testing services and maintaining the information systems. The fee changes are intended
to address this.
3. When are the fees changing?
The new fee for processing a refund, the test rescheduling fee and the changes to
existing fees will come into effect on 1 July 2010. These fees must be brought into effect
by amendments made to the Land Transport (Driver Licensing and Driver Testing Fees)
Regulations 1999. The licence reinstatement fee will come into force on 31 January
2011.
4. What are the three new fees for?
 Test booking rescheduling fee
Test applicants are able to cancel and reschedule a booked test by phoning the
NZTA’s toll-free help desk or by visiting a driver licensing agent. Both options incur
additional costs for the NZTA. The new $16 fee is a regulated fee to cover the time
taken and additional costs incurred when a test is cancelled or rescheduled.
 Refund processing fee
Where a person gives two or more complete working days’ notice (excluding
weekends and public holidays) of an intention to withdraw from a driving test, they
are currently entitled to a refund of the test fee, minus the cost of arranging that
test. If less than two day’s notice is given, a refund will only be available if that test
slot has been filled by another applicant.
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The new fee of $16 will allow the NZTA to recover the costs already incurred for
processing the application and/or arranging the original test.
 Licence reinstatement fee
Parliament has authorised the introduction of a new fee of $65 for ‘licence
reinstatement’ for repeat traffic offenders who have had their licence suspended due
to accumulating over 100 demerit points within a two-year period, or people who
have been disqualified from driving as part of a Court-ordered penalty. (This fee will
be introduced in 2011).
Previously no fee has been charged to recoup the costs incurred by the NZTA to
administer and maintain the licence records of suspended and disqualified drivers.
The new fee will enable the NZTA to recover such costs as:
 Recording offences and demerit points.
 Mailing warning letters to drivers accumulating demerit points.
 Personally serving demerit suspension documents.
 Manufacturing and mailing photo licence cards after a demerit suspension
or a disqualification has ended.
 Providing a temporary licence while the photo licence is being arranged.
 Answering related enquires via the toll-free helpdesk.
5. Why are the three new fees needed?
It is appropriate that the people who incur a cost should be the ones who pay for it,
rather than passing it on to all other drivers. The new fees are for services that involve a
significant cost (such as the costs involved in suspending or disqualifying a licence
holder), or the frequent, but lower, administrative costs involved with processing a
refund or rescheduling a test.
The new fees mean that the costs of these services will no longer be borne by the
general driver licensing fees. They will be met by the people whose actions cause those
costs to be incurred.
These services have not previously been charged for as the NZTA cannot charge a fee
unless it is stated in the Fee Regulations.
6. What are the changes to existing fees?
Please see Appendix 1 for a list of the fee changes.
Sometimes both a licensing and a testing fee is required in the same transaction. This
includes new applications for a learner, restricted, and full licence.
If any subsequent re-sits of the test are required, then only the test fee is required to be
paid again.
The total new fees payable (both current and new) when a person first applies for a
learner, restricted or full licence are set out in the table below.
Service Current total
fees
New total fees Cost of
providing the
service
Learner (application fee and test fee)
$79.00 $91.90 $93.10
Restricted (application feeand test fee)
$88.20 $105.80 $107.05
Full (application fee and est fee)
$115.10 $133.20 $133.17
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7. What principles are behind the new fees?
The fee review and subsequent changes have taken account of the following principles:
• The Driver Licensing and Driver Testing system should be self funding.
• Where practicable and reasonable, a person who uses the service or who is
responsible for the activity should pay for the costs incurred in doing so.
• Law changes that improve the driver licensing system be funded from driver
licensing revenue/fees.
• The costs of ensuring the integrity of the Driver Licensing System should be built
into the fees.
• The level of fees should be sufficient to maintain services and quality.
• Fees should be simple and uniformly applied.
• Fees should conform to the relevant guidelines for the setting of fees in the public
sector issued by the Treasury, the Office of the Controller and Auditor-General and
Audit NZ.
8. Why have some licensing costs gone up?
Before the review in 2009, the fees were last reviewed in 2001. Licensing costs have
since been going up due to:
• Legislative changes. Since the fees were last set, there have been a number of
legislative changes which have required changes to processes and IT systems. The
costs associated with these changes are not able to be recovered through the current
fee structure. Some changes (such as removing compulsory on-road tests for drivers
aged 80 years and over) have also resulted in reduced revenue.
Most changes in legislation require us to change our computer systems in some way.
IT changes can often involve substantial costs. The NZTA also incurs costs to change
content in forms, pamphlets and other communication material.
If a requirement is removed, fewer people will be paying the fee; an example is when
people converting an overseas licence ceased to sit the theory test if they held a
licence from an “exempt country” – such as the UK. Changes in transaction volumes
do reduce some costs – the costs incurred only when the service is provided – but
other costs, such as power and IT maintenance, remain the same. Reduced volumes
mean reduced revenue and only partially reduced costs.
• Transactions that have no set fee. There are currently some driver licensing
services that don’t have a fee set in the Fee Regulations. For example, no fee applies
to someone who reinstates a licence following the end of a demerit licence
suspension or a disqualification of less than 12 months. Transactions with no set fee
also include processing refund applications and test rescheduling. These three
transactions will have fees introduced as part of this review.
• General cost increases. Over the period since the fees were set, the cost of
providing driver licensing and testing services has risen.
9. Why have some licensing costs gone down?
The review looked at the total cost of running the system, money coming in and how it
was distributed. Some of the core transactions have less of the total cost now, because
of the introduction of new fees. So it’s appropriate to hold or reduce those fees.
10. What is the NZTA doing to ensure ongoing efficiency?
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The NZTA is exploring changes which will allow it more to be more flexible in delivering
services and reduce costs for users. Government expects the NZTA to regularly review its
service delivery strategy. The driver licensing and driver testing fees will be reviewed on
at least a three-yearly basis in the future, in line with recommendations from the Office
of the Controller and Auditor-General.
11. How do we know the changed fees accurately reflect costs?
The NZTA reviewed the full cost of delivering each of the driver licensing and testing
services in January and October 2009 and found that the cost of providing a number of
services is higher than the current fees. The introduction of a new fee for licence
reinstatement means the allocation of costs across all driver licensing and driver testing
services has changed. The reallocation of costs means that some fees will be reduced
and still meet costs.
The changed fees are set as follows:
• New fees are linked to the cost recovery for that transaction
• 18 fees are reduced
• 23 fees are increased (with a maximum increase of 20 percent), and
• 4 fees remain unchanged.
The methodology used in the costing and setting of fees has been independently
assessed by Audit NZ which found that it is reasonable and in compliance with good
practice standards.
Fees cannot be used for activities other than for what they were collected. Therefore the
fees will only be used for costs associated with providing driver licensing and driver
testing services. The combination of the introduction of new fees, and adjusting fees for
existing transactions, is designed to bring revenue into line with costs.
The total income from the changed fees will not meet all the identified costs; the NZTA
will be making savings to bring these activities into balance.
12. Will the increase in cost deter people from getting their licence?
In most cases, people who choose not to have a driver licence do so for reasons other
than cost. Also, not all of the fees are increasing.
There are a number of benefits associated with having a valid licence (both for driving as
well as other purposes, such as identification), the NZTA does not believe the changes to
fees will lead to an increase in unlicensed driving.
Driving without an appropriate current driver licence is an offence. An instant
infringement fee of $400 applies, or a fine of up to $1,000 if summonsed to appear in
court and convicted of the offence.
13. Will the 10 year licence renewal fee change?
The new fee is a slight decrease – from $44.30 to $43.00.
14. How will the changes affect older drivers?
There will be no change to the fees paid by older drivers. The government provides a
subsidy to keep the licensing fees for drivers aged 75 years and older as low as possible.
As older drivers have more frequent licensing requirements this ensures that the cost of
licensing does not reduce the mobility of older driver. This subsidy will remain.
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15. What do the changes mean for commercial drivers?
Fees for commercial driver endorsements except for the Dangerous Goods endorsement
are being reduced. In addition, these fees are being standardised. Current fees for
commercial driver endorsements vary considerably and standardising these will make
the system clearer and easier for customers to use.
16. With so many people being fined for driver licence offences, why isn’t that cash
covering these costs?
The NZTA does not receive any money from the collection of fines, even from those
related to driver licensing offences.
17. How has the NZTA paid for driver licensing and testing when revenue has been
less than costs?
The NZTA has used prior year surpluses to cover the shortfall. Doing so has enabled the
driver licensing and testing businesses to continue to operate even though they are
running deficits.
18. Will the proposed fees be used to pay back the deficit accumulated in past
years?
No, the proposed fees will not be used to pay back any part of the historical deficit. The
proposed changes are designed to ensure the fees charged will better match the current
costs of providing each service. The NZTA will have to absorb all of the deficit
accumulated from prior years.
19. Are there going to be more changes in the future?
It is proposed to review licence fees on a three-yearly basis. This may lead to smaller,
but more frequent, changes in fees. This is in line with guidelines issued by the Office of
the Controller and Auditor-General.
Also, Safer Journeys: New Zealand’s road safety strategy 2010-2020, outlined initiatives
for improving road safety. The actions in the strategy may lead to changes in the way we
license drivers.
20. Were the public consulted on the Driver Licensing and Driver Testing Fee
review?
Although there is no legal requirement for the NZTA to consult on the fee changes,
because fees affect a large number of people, the practice has been to give prior advice
of proposed changes and to give affected parties an opportunity to comment. The
consultation period ran from 28 January to 26 February 2010.
21. What did the submissions say?
Most submitters though that the way the fees were being set was reasonably fair and
thought a 20% cap was good. Businesses commented that keeping costs reasonable was
important for them to stay in business.
Some submitters asked if the NZTA could balance fees to advantage people coming into
the system. However, the Guidelines for changing fees for public sector goods and
services from the Office of the Auditor General does not allow the NZTA to overcharge
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some customers for the benefit of other customers. The fees are set on a user-pays
basis, which ensures customers do not pay for the costs incurred by others.
Appendix 1 - Schedule of fees (new fees apply from 1 July 2010)
New fees
Service New fee ($)
Licence reinstatement1 65.00
Test booking rescheduling fee 16.00
Refund processing fee 16.00
Application fees
Service New fee ($) Current ($)
Learner licence 47.20 39.30
Restricted licence (classes 1
& 6)
47.20 39.30
Full licence (all classes) 48.50 44.30
Overseas licence conversion 51.00 44.30
Renewal 10 yr (or upgrade) 43.00 44.30
Replacement 37.40 31.10
Older driver renewal 18.30 18.30
Renewal (and upgrade) fees: Periods of less than 10 years
Period (Age) New fee ($) Current ($)
10 (65) 43.00 44.30
9 (66) 30.00 27.50
8 (67) 30.00 25.00
7 (68) 25.20 23.00
6 (69) 25.20 21.00
5 (70) 19.80 18.50
4 (71) 19.80 16.50
3 (72) 14.40 14.50
2 (73) 14.40 12.00
1 (74) 12.00 10.00
Drivers aged 75 years and over
1 This fee will not apply until 31 January 2011
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Service New fee ($) Current
($)
Renewal: 75 years old 18.30 18.30
Renewal: 80, 82, etc 18.30 18.30
Driver testing - Older Driver 41.00 41.00
Application fees: Endorsements
Service New fee ($) Current ($)
F, R, T, W or D 43.00 37.20
1Yr - P and V, New 63.00 70.10
1Yr - I and O, New 63.00 72.60
1Yr - P and V, Renewal 63.00 63.20
1Yr - I and O, Renewal 63.00 70.65
5Yrs - P and V, New 241.00 272.75
5Yrs - I and O, New 241.00 276.75
5Yrs - P and V, Renewal 241.00 256.90
5Yrs - I and O, Renewal 241.00 273.50
Note: the vetting fee of $28.20 per year is not included in these fee amounts
Fees: Miscellaneous
Service New fee ($) Current ($)
Certificate of Particulars 10.90 9.10
Application Fee - ID
Card replacement
13.40 11.20
Application Fee -
Exemption
26.70 22.20
Application Fee -
Limited licence
38.50 46.50
ID card (‘small’ P and V)
issued with
endorsement
8.50 8.50
Test fees
Service New fee ($) Current ($)
Driver testing - Learner 44.70 39.70
Driver testing -
Restricted
58.60 48.90
Driver testing - Full
Class 1 or 6
84.70 70.80
Driver testing - Full
Class 2, 3, 4, or 5
58.60 48.90