“Our government is committed to making using public transport more affordable, easier and more attractive for Kiwis, so it’s crucial we have the drivers in place to keep the system moving forward,” Wood said.

“Improved driver conditions will facilitate workforce recruitment and retention, enabling frequent and reliable bus services.”

Discussions between operators, public transport authorities and trade unions led to the agreement.

Authorities and public transport operators will be able to access a share of budget funding if they help pay for salary increases and continue to index salary rates in the future.

“This will help the industry move to standard terms and conditions for bus drivers, which vary widely across the country,” Wood said.

Funding can also be used to support split-shift pay and penalties for working after 9 p.m., he said.

Greater Wellington Regional Council chairman Daran Ponter said the capital, in particular, was suffering from a shortage of drivers and needed more than 120 drivers.

He welcomed the announcement, saying it provided much-needed support to a sector which was “struggling to deliver on its promises at the moment”.

“In Greater Wellington, we have made it clear that addressing the national driver shortage is our number one priority to help improve the reliability of the Metlink network.”

He said public transport operators and providers such as Metlink should contribute more to driver salaries.

Waka Kotahi will work with authorities and public transport operators to support implementation in each region.