August 26, 2015
New Zealand has an opportunity to significantly improve urban development according to leaders across the infrastructure sector.
Stephen Selwood, Chief Executive of the New Zealand Council for Infrastructure Development (NZCID), says we need to lift our vision to be internationally competitive in big city development projects.
We surveyed key decision makers including senior central and local government officials and infrastructure construction, design, finance, professional advisors and service leaders across all sectors at the recent NZCID Building Nations symposium in Christchurch.
Most delegates (49 percent) consider that New Zealand is improving but remains well behind global best practice. Just six percent think New Zealand is at the leading edge while 29 percent feel we are in catch-up mode and 16 percent say we are still at the start line.
Making better use of private capital and integrating transport solutions and urban development are areas of greatest opportunity.
The decision to set up a specialist urban development agency in Auckland, Development Auckland, is seen as a very positive step.
Getting governance right for the $40 billion Canterbury Rebuild is also seen as being key to success. Almost half (49 percent) are fairly confident that governance arrangements to oversee the next phase of the Canterbury Rebuild will work and 12 percent are very confident. But importantly, 43 percent are not confident that governance arrangements will work. Key concerns centre on proposals for two development agencies one run by the Christchurch City Council and another run by central government. Its really hard to integrate development and synchronise decision making and capital programmes when multiple agencies are involved, each with separate budgets to manage.
Seamless delivery necessary for Christchurch CBD
It is critical that the Christchurch central business district (CBD) redevelopment is completed seamlessly across the Crown and council's respective asset holdings.
We favour one fully capitalised urban development agency for Christchurch, jointly owned by central Government and the Christchurch City Council, which can then recruit the very best capability to deliver the next phase of the rebuild. The agency will need to be totally attuned to market needs, have the strongest possible procurement capability and have capacity to effectively manage capital project delivery and whole of life costs of public assets.
An NZCID survey of procurement across principal public agencies rates overall performance as being average. The New Zealand Transport Agency rated highest overall at four out of five. Having a forward works pipeline, a clear focus on the end goal, maximising value for money over least cost tenders, and adopting standard contracts and evaluation methods were seen as the key areas for improvement in procurement across the industry.
Selwood says that feedback on the national infrastructure plan released at the symposium showed a need for central Government and local council growth and investment strategies for Auckland, Christchurch and the regions.
Recycling of assets needed for development
There is significant opportunity to use private capital to accelerate infrastructure delivery and urban development in New Zealand including recycling of assets sale or partial sale of existing assets to build new assets to support growth and development.
Delegates are keen to see positive action on planning law changes beyond the Resource Management Act, the Local Government Act and the Land Transport Management Act, Selwood says.
Consistent direction on long term infrastructure strategy is seen as critical. Two thirds of leaders at the Building Nations symposium saw political risk the risk that elected leaders will change infrastructure strategy and policies as being a significant risk adversely affecting infrastructure investment and decision making.