Ministers Grant Robertson and Michael Wood also said they are stepping up planning for a second Waitematā Harbour crossing with public consultation this year, and an option selected in 2023.
However, there's a gaping political divide opening up over the rail project, which would be mostly government-funded.
The Government says it was the option with the most carrying capacity, was less disruptive and worked best with a rapid transit transport network.
The National Party's transport spokesman Simeon Brown said light rail would be scrapped by the party, adding that: "The number one priority for Aucklanders is a second harbour crossing for both public transport and private vehicles". Act's transport spokesman Simon Court said all New Zealanders would be paying for it. The Public Transport Users Association has attacked its price tag and usefulness.
The Greens preferred street-level light rail but back the need for a link. Auckland Mayor Phil Goff Goff said that without it the city would become gridlocked and unliveable. Infrastructure New Zealand said it would help make Auckland fit for the future.
The chosen light rail line would snake through tunnels from Wynyard Quarter to Mt Roskill, and then move to a surface track alongside State Highway 20. There would be stops at Onehunga and Māngere before it ended at the airport.
In all, the City Centre to Māngere (CC2M), would have about 18 stations, and it is hoped that trains would run every five minutes and ferry 12,000 people an hour.
Going forward the question is whether Auckland can ever get to the point of having a modern, efficient, lower-emission transportation and infrastructure system that works as an integrated whole.
Progress has been made on the city's future with the ongoing 3.4km City Rail Link project, the boom in new suburban home building and development plans for the downtown area. Light rail is seen as part of an overall vision for an Auckland rapid transit network and there are thousands of jobs involved in making it happen.
The challenges are major - hundreds of thousands of people are projected to swell Aucklanders' ranks in the coming decades. More connections to shift people around the city quickly are vital. As the pandemic has shown, Auckland's economic health is crucial to the country as a whole.
On Auckland Anniversary Day we have to ponder: Can it ever be a maturing city that delivers for its overall population and becomes a better place to live or will political dysfunction and interest groups doom that evolution?