Big changes allow councils and Auckland Transport to lift bus and ferry drivers' wages, and accelerate decarbonisation of their fleets will be discussed by Cabinet in the "next month or two", Transport Minister Michael Wood said.

The Public Transport Operating Model, better known by its acronym, PTOM, sets out the way councils and Auckland Transport contract out public transport from the private bus and ferry companies that run public transport services.

Since it was rolled out in 2013, it has been criticised for driving down the wages of workers like bus drivers, which has made it difficult to recruit new staff.

This led to complaints bus services would be cancelled because companies were struggling to find staff to operate services they had promised.

Bus drivers recently struck a deal with councils and Waka Kotahi NZTA which would see the Government ''top up'' wages to ensure all drivers are paid at least the living wage. However, this was only a stopgap measure.

Last year Wood announced a wholesale review of the PTOM system as a whole.

"I've had final advice from officials on the future direction of the Public Transport Operating Model and I will be looking to consult with Cabinet colleagues in the next month or two on that," Wood said.

He said a previous review of PTOM had found it had a "downward impact" on driver wages and conditions - "part of that race to the bottom we're also trying to resolve with Fair Pay Agreements".

He said the Government would "certainly ... want to move on" issues around low wages for drivers and other staff.

One issue for implementing any changes to PTOM is that each council will have different agreements with the companies running its transport services, and those companies will have different agreements with staff and unions.

This could make unpicking PTOM rules in their current iteration slow going.

Wood said there would be a "range of options" for implementing any changes.

"There are a range of options about how that might be done - the current situation of course is regional councils do hold the particular relationship with operators," Wood said.

"In terms of any changes we make - that will have to be worked through at the time."

Options included waiting for the next round of public transport contracts to be negotiated before implementing the changes, or taking action to sever the existing contracts so a new system could be rolled out sooner.

The two goals of the current PTOM system are that "competitors should have access to regional public transport markets to increase confidence that public transport services are priced efficiently" and that "incentives should exist to reduce reliance on public subsidies to cover the cost of providing public transport services".

The Government wants to alter this by giving weight to improving wages and conditions of drivers, and ensuring the public transport system works to reduce emissions.