Transport Minister Simeon Brown has issued a directive to Waka Kotahi and councils around the country to cease blanket speed limit reductions.
This week, the coalition has removed the mandatory requirement and deadline for authorities to submit and then implement speed management plans.
In a statement, Brown said work would begin on a new policy ensuring speed limits took into account travel times and the views of local communities as well as safety.
"Our coalition government wants to see a transport system that boosts productivity and economic growth and allows New Zealanders to get to where they want to go, faster and safer."
Variable speed limits would be allowed on roads approaching schools during pick-up and drop-off times, rather than permanent reductions, Brown said.
"I am writing to Road Controlling Authorities throughout the country to notify them of the changes and to advise them that work has begun on the new [policy].
"This allows them to stop work on current speed management plans until the [policy] is put in place."
Range of factors to consider for safety
Brown later told Checkpoint there were a range of factors that went into making a road safer, including testing for intoxicated drivers or drug testing as well as fixing and building infrastructure.
He claimed the Waikato Expressway, with a limit of 110km/h, was "the safest road" in the country.
Research from Austroads - the Association of Australian and New Zealand Road Transport and Traffic Authorities - shows the risk of death increased from 10 percent if a car was travelling at 30km/h and collided with a human to 80 percent if a car was going at 50km/h.
While variable speed limits would be allowed around schools during drop-off and pick-up times, local authorities would be allowed to apply that to all roads all the time, he said.
The coalition government wanted a "proper and consistent" benefit-cost ratio applied when local road authorities considered speed limits, he said.
"If you look at what Wellington City Council did ... they actually did a full economic analysis of their proposal of 30km/h - the only council in the country which actually did a full economic analysis when they're not required to - actually found that that [reducing the speed to 30km/h] was actually going to have far greater costs than benefits to the city."