Adult cyclists will be required to carry photo identification and fined 350 per cent more for not wearing a helmet under new rules and penalties to be introduced by the NSW government.
Drivers will also be required to leave a 1m buffer when overtaking cyclists, and at least 1.5m when travelling faster than 60km/h, or face losing two demerit points and a $319 fine.
Roads Minister Duncan Gay unveiled the cycling package on Monday. The reforms will start in March 2016.
"We hope this is the right way to do it, but if we need to do more we will, if we need to wind it back we will," Mr Gay said.
Mr Gay stopped short of introducing a licensing system for cyclists, a proposal the minister last year said he was "increasingly persuaded" by.
Instead, it will be compulsory for adult riders to carry photo identification so they can be identified if they break the road rules or in an emergency situation.
"We needed some way of identification and enforcement ... suggestions including licences and registration were rejected by the committee," Mr Gay said.
"In the end we came to a consensus. That is better than being at war when going ahead."
There will be a grace period of 12 months for cyclists caught without photo identifications. However, a penalty of $106 will be introduced from March 2017 – the same as applies to drivers caught without a licence.
Penalties will increase dramatically for cyclists caught breaking road rules. While most offences currently attract a $71 fine, cyclists caught riding without a helmet will be a slugged $319.
Running a red light will incur a $425 fine, riding dangerously a $425 fine, holding onto a moving vehicle a fine of $319 and not stopping at a pedestrian crossing a fine of $425.
The introduction of a compulsory minimum distance of 1m for drivers has already been trialled in Queensland, Canberra and South Australia.
The government is also introducing a "new safety advisory recommendation" for riders to leave a gap of 1m, where practical, when passing pedestrians on a shared path.
Greens transport spokeswoman Dr Mehreen Faruqi supported the new passing distance laws, but said the fines and compulsory identification were "regressive and punitive measures".
Dr Faruqi said it was "ridiculous" that the new $319 fine for not wearing a helmet was almost double the fine for driving in a bike lane and the mandatory identification rule would discourage bike riding.
"What will actually make riders safer is installing good cycling infrastructure. Sadly, but not surprisingly, it doesn't seem the government has any interest in the evidence," Dr Faruqi said.
Bicycle NSW chief executive Ray Rice said he was pleased with the package of changes, particularly the introduction of the minimum passing distance.
The increased fines and requirement for identification, Mr Rice said, would not have a huge effect on cyclists as 90 per cent already carried identification and 70 per cent already wore helmets.
"We don't think it's necessary and therefore why legislate for something that people are already doing ... most riders obey the law already," Mr Rice said.