Transport Minister Gerry Brownlee says borrowing to build roads makes a lot of sense.
The Government has been criticised for planning to let the Transport Agency borrow large sums of money to pay for new roads.
The Land Transport Management Amendment Bill tabled in Parliament on Tuesday would allow the agency to borrow for transport projects subject to the agreement of the Transport and Finance ministers.
At present, the agency uses money collected from fuel taxes and registration fees to build roads and can borrow only to manage cash flow.
Mr Brownlee says all the Government is doing is writing into the statute books a practice that is already in place, and the plan makes sense economically.
"There is no doubt about it, better roading, more efficient roading does contribute to economic growth.
"If you look particularly at some of the regions in New Zealand, where there is growth potential but constraints around transport, that's a very evident proposition."
The Road Transport Forum and Council for Infrastructure Development have welcomed the idea.
Green Party co-leader Russel Norman has criticised the Government for intending to borrow for new roads when it argued that it was selling shares in state-owned energy companies to avoid borrowing.
