
After much debate and discussion, a package of State Highway 1 improvements has hit a funding roadblock, as Jane O’Loughlin reports.
A second Mt Victoria tunnel appears to have hit a funding dead end, despite promises that construction would start during the Government’s current term, which concludes in November this year.
The New Zealand Transport Agency released its ‘major transport projects pipeline’ in July, revealing that SH1 Wellington Improvements project (which includes the tunnel) sits in a ‘future pipeline’ section that has no timeline for construction.


Confirmed work now only includes progressing route protection, and NZTA says on its website that detailed design work that had already started would be put on hold.
Consultation on the design of the SH1 improvements project, expected to cost between $2.9 billion to $3.8b, took place at the end of last year. It includes a second Terrace Tunnel, a second Mount Victoria Tunnel, a major roading upgrade at the Basin Reserve, and changes to the state highway corridor through central Wellington and through Hataitai and Kilbirnie.
Prior to the last election National had promised construction would start within the Government’s first term.
In 2023 Chris Bishop (now Transport Minister) said Wellingtonians were sick of the arguing over the Basin Reserve and a second Mt Victoria tunnel.
“The current tunnel was built in 1931 and services 37,000 vehicles per day. It is long overdue an upgrade and the next National government will deliver where Labour has failed.”
Despite the lack of funding for implementation, the Government says it remains committed to its Roads of National Significance programme.
NZTA said that “current funding and delivery capacity constraints mean projects need to be sequenced over time.”
“The SH1 Wellington Improvements project team remains focused on securing our statutory approvals and route protection, so the project is ready for detailed design, pre-implementation and construction when funding becomes available.”
The roading agency is going ahead with its application for statutory approvals under the Fast-track Approvals Act (FTAA). “We expect to lodge our application in August and complete this work over the next year.”
“Completing the approvals process will protect the route and ensure we are ready to progress when funding becomes available.
“It will also provide greater certainty for residential homeowners, businesses and the community because we will know what the project will look like and where it is going to go.”
The Green Party’s MP for Rongotai, Julie Anne Genter, who is a long-time critic of the project, said it had been a massive waste of money, time and energy.
“National won’t actually come out and admit it in an election year but the tunnels project is not happening. Despite all the promises, Minister Bishop has majorly backed down on the project. It has no implementation date and no funding. It has no realistic chance of getting funding in the future.”
She said people needed to accept it was not going to happen and look at initiatives that would work quickly to alleviate congestion, such as public transport investment, a second public transport spine along the Quays, trialling congestion charging, and making ‘affordable’ changes to existing roads.
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