The announcement that the Auckland Council and the Government have reached an agreement on funding and governance of the $3 billion City Rail Link is a major step forward in the delivery of New Zealand's largest ever public transport project," says Stephen Selwood CEO of the New Zealand Council for Infrastructure Development.
The agreement, which clarifies role responsibilities and cost sharing, will allow the project to progress into construction, ready for operation in 2023.
The partnership reflects the significant benefit of focussed regional leadership and a unified council structure.
It is difficult to see how agreement to progress a project of this scale and tomorrow's scheduled release of the Auckland Transport Alignment Project (ATAP) final report could have been possible without governance reform in Auckland.
A united Auckland has called upon the Government to respond to a regional priority and enabled a single interface to negotiate a comprehensive delivery arrangement.
With funding confirmed, central agencies can work with the council's transport arm, Auckland Transport, to ensure the project is delivered efficiently and effectively.
As the lead client organisation, CRL Limited will now be in a position to undertake proactive market engagement to ensure the right skills can be sourced and project risks allocated optimally.
New Zealand has not delivered a project of this scale and complexity before and there is significant interest from both here and overseas.
Given the risk of operating a construction project of this size in a CBD environment, attracting the best capability will be essential. Transferring too much risk to private partners will result in price increase, while not enough will reduce the incentive to maximise project opportunities.
One major such opportunity regards urban redevelopment around stations to offset some of the capital or longer term operational costs of the project.
Providing the very best governance capability in the Special Purpose Entity overseeing project delivery will be central to ensuring success," Selwood says.
For further comment please contact Stephen Selwood on 021 791 209.