Infrastructure new Zealand MEDIA RELEASES

Our media releases keep you up to date with the latest infrastructure developments in New Zealand.

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  • 22 Jan 2016 10:59 AM | Anonymous

    Auckland productivity dividend must be realised to justify city shaping infrastructure investment

    Media Statement 
    21 February 2014

    An independent review of Aucklands planning framework by international consulting firm SGS Economics and Planning released today identifies a lack of city shaping infrastructure investment as the principal impediment to achieving a quality compact city. The report recommends that the productivity benefit from investment, demand management and urban intensification needs to establish the case for expanded co-investment and policy reform by Central Government.

    We commissioned this study to gain a better understanding of how successfully programmes, policies and investment plans developed over the past three years by the Council are delivering on the Auckland Plan vision to make the city the Worlds Most Liveable, said Stephen Selwood CEO of the New Zealand Council for Infrastructure Development.

    SGS found that governance reforms have equipped Auckland with the most evolved metropolitan governance structure of any city in Australasia.

    Auckland has a united voice on regional issues and has the critical mass to make trajectory shifting decisions in its own right.

    The Auckland Plan sets out a compelling and demonstrably achievable vision for Aucklands spatial development.

    However, SGS found that the Auckland Plan objective of a quality compact city was unlikely to be achieved without increased investment in city shaping infrastructure, identification of the means to fund that investment and policy reform to support road pricing and value capture mechanisms.

    On current plans there simply is not sufficient investment in transport infrastructure to support a transition to an efficient and competitive higher density urban form, Selwood said.

    To reverse many decades of low-density, motor-vehicle oriented growth will take much more than the city rail link and other projects prioritised in the Auckland Plan.

    This finding helps explain why transport modelling of future land use and transport investment completed last year showed Aucklands congestion worsening significantly over the course of the next thirty years, even with all proposed investment committed.

    But rather than retracting the compact city vision, SGS call for analysis of the productivity benefit that is expected from urban transformation. Where the Auckland Plan vision can be shown to boost national productivity, GDP and aggregate tax revenues there is a strong case for co-investment from central government. Increased economic performance more generally also substantiates the case for new funding sources, such as road pricing and value capture, which are key to achieving the Auckland Plan vision.

    Better understanding of these benefits may also help foster community and local board support, which has so far been an impediment to the scale of intensification proposed.

    We hope that this report will stimulate a joint Government and Council work programme to identify the productivity dividend that can be achieved through optimal investment in city shaping infrastructure. In NZCIDs view, this requires vast improvement in integrating transport investment and land use development, including more targeted densification to support major investment in public transport, and implementation of road pricing and value capture mechanisms.

    While the united Auckland Council is making great progress, stronger alignment and unity of purpose between central government and the Council is needed if the productive potential of Auckland is to be truly realised, Selwood says.

    To view the report please contact us.

  • 22 Jan 2016 10:53 AM | Anonymous

    Project information and better procurement essential to raising construction productivity and value

    Media Statement 
    16 December 2013

    The Productivity Partnership-commissioned National Construction Pipeline released recently is an important step to understanding the scale of New Zealands building and infrastructure challenge, but to lift the performance of the sector the future work programme must be project specific, well sequenced and utilise best in class procurement capability, says NZ Council for Infrastructure Development chief executive Stephen Selwood.

    Its encouraging to see well-evidenced information being produced and published on the projected value of the forward work programme in key regions and nationally and across residential and non-residential sectors.

    Knowing, for example, that the Canterbury rebuild will likely peak in 2015 and remain elevated until 2018 will give contractors in the region the confidence to take on or up-skill staff, suppliers to gear upandstudents the option to pick up a trade for a very positive period ahead.

    "But bringing projects to market in a well-sequenced cogent programme, making timely decisions, providing transparent communication of information to suppliers and service providers and conforming with stated bidding processes and timelines is also key to unlocking value.

    "Already, there are several instances where investors and major construction firms have made considered decisions to withdraw from the rebuild having to that time funded business development and taken part in market briefings, bid processes and being otherwise prepared to engage in competitive processes.

    "Given the significance of the forward work programme, adopting best practice procurement is critical if the Government and Council are to extract best value for tax payers and rate payers.

    "The Auditor General recently endorsed procurement practices used by the SCIRT alliance (Stronger Canterbury Infrastructure Rebuild Team), and NZ Transport Agency is generally regarded as a leader in procurement of major projects in New Zealand. Both provide good examples to follow.

    "A dedicated high performance procurement agency acting on behalf of both Government and the Christchurch City Council remains an option worthy of consideration - especially noting that CERA has only two years to run under current statutory arrangements.

    On the national front, large contractors and other corporates will be able to use the National Construction Pipeline information to develop strategies for capital raising, product development, labour specialisation and market positioning.

    But if the businesses involved in meeting New Zealands infrastructure, housing and commercial building needs are to have the capacity available when required, much greater transparency at the project level is required.

    The timing of large projects, such as when requests for proposals will be released and what the intended construction timeframes are, as well as potential procurement options, are all essential to a market which has to deal with lumpy, complex investments requiring long lead-in times.

    The market can operate in an environment where projects are announced with little warning, arrive in clusters followed by periods of relative calm and where expectations for finance requirements or project bundling are frequently thwarted.

    But its a question of, at what cost? Boom-bust project procurement is not only inefficient for the industry it results in much higher costs for clients. Firms invest short term, underinvest in training and incur significantly increased costs of scaling up and scaling down to meet market demands. Inevitably prices rise in the boom and firms go bust when the project pipeline stops.

    Since the public sector has long term certainty over revenue sourced from taxes, rates and charges it is in a unique position to plan and implement asset replacement and renewal on a medium term horizon and be ready to profit from counter cyclical investment.

    The better the planning, the better will be the value for money for tax payers and ratepayers.

    Thats why as much detail as possible is required about not only the aggregate value of work expected across the building and construction sector, but also detail about the type and expected timing of projects and how they will be procured.

    A lot of expectation now hangs over the release of Treasurys much anticipated Ten Year Capital Intentions Plan, due out early next year, and continued improvement to procurement in Christchurch, Selwood says.


  • 22 Jan 2016 10:51 AM | Anonymous

    One Hawke's Bay will strengthen local and regional decision making and service delivery

    Media Release
    2014

    Unifying the Hawkes Bays five councils to create a single Hawkes Bay unitary authority supported by nine councillors and 37 local board representatives across five wards will strengthen local decision making and better meet the long term needs of the regional community, says Stephen Selwood of the NZ Council for Infrastructure Development.

    Under existing governance arrangements, ownership and decision making rights and responsibilities are so fractured that they undermine local democracy.

    All residents of the region, for example, share ownership and shape decision making for the Port of Napier, but only the residents of Napier and Hastings possess the same rights over the Hawkes Bay airport. Napier meanwhile, carries responsibility for managing McLean Park and Hastings has to maintain local roads to and around its major manufacturing plants so that residents outside the district can get to work.

    Yet, one would have to question how less dependent a resident of Wairoa is on the airport or why a Central Hawkes Bay rugby fan should be less responsible for maintaining McLean Park.

    Bringing these interdependent entities under a single regional umbrella and recognising the common facilities and activities of residents will enhance regional decision making for everyone in the Hawkes Bay.

    The Hawkes Bay Council, which will include rural and urban representation in proportionate numbers, will be accountable for services to the whole region not just to the urban centres as has been suggested by some local commentators. That will require councillors to recognise and support the interdependency between town and country.

    Local decisions, meanwhile, can be passed over to community boards, strengthening the ability for residents to influence those decisions which truly are theirs to make.

    Restructuring the region as proposed by the Local Government Commission will not just improve democratic decision making, it will also better reflect the economic relationships binding the area.

    The split between the two more urbanised territorial authorities, Napier and Hastings, and the two more rural districts, Wairoa and Central Hawkes Bay, unfairly reflects the important role that the hinterlands play in supporting urban centres and is unhealthy for the future of the region.

    Manufacturing plays a greater role in the Hawkes Bay than in any other region across New Zealand, but that industry is heavily dependent upon produce sourced from rural areas in and around the urban centres.

    It is not economically sustainable to sit back and watch as the Wairoa district loses a further 17 per cent of its population over the next 20 years while Hastings grows almost 10 per cent.

    A central decision making body with the scale and expertise to identify issues, implement solutions and seize opportunities is much better placed to address the long term challenges of the two rural districts and continue to foster growth in Napier and Hastings.

    The Auckland example shows just how much impact a single voice for a region can have on the investment decisions of central government and the attractiveness of a destination for capital. Separate and sometimes opposing tourism, marketing and economic objectives across the Hawkes Bay are fracturing the message conveyed outside the area and reducing investment opportunities.

    What the region sorely needs is strong, unified leadership, a single plan and the capacity to deliver. Current governance arrangements inhibit progress and it is positive to see the Local Government Commission is taking the bold steps necessary to improve the future for all Hawkes Bay residents, Selwood says.


  • 22 Jan 2016 10:40 AM | Anonymous

    One Northland Council a win-win for local decision making and regional prosperity

    Media Statement 
    12 November 2013

    The Local Government Commissions proposal to unify the four councils of Northland to create a single Northland Council unitary authority achieves the best balance between promoting local decision making and meeting the long term needs of the regional community, says Stephen Selwood of the NZ Council for Infrastructure Development.

    Northland is currently confronted with a number of sizeable challenges and the region often features at or near the bottom of national social-economic indices.

    NZCID research shows that lifting regional productivity requires strong central and local government focus and full participation and engagement with the private sector, iwi and local communities.

    It requires leaders committed to long term vision and planning, unity of purpose, ability to fund, effective regulation and the expertise to implement strategy.

    The option proposed today by the Commission will see the Mayor of Northland and nine councillors deliver that leadership and vision in partnership with seven community boards and a Maori Board.

    Community Boards will reflect the diversity of Northland and be empowered to make decisions on matters directly affecting their respective communities.

    A future transition agency will take on the question of whether major council services, such as transport and water, are best performed in-house or by an independent council controlled organisation.

    A single unitary council for Northland provides the best of all worlds the opportunity for unity of purpose focussed on realising the full potential of the region; the development of one regional plan; a single governing body to work in partnership with government and the private sector, the provision of scale in the delivery of roads, water services and regional infrastructure; and most importantly, the retention of strong local democracy and representation for iwi and communities.

    In short, this is a win-win for local decision making and regional prosperity and is a potential template for regions across the country, Selwood says.

  • 22 Jan 2016 10:39 AM | Anonymous

    Media Statement 
    8 November 2013

    "The Government has made the right decision in commissioning an independent assessment of Chorus financial capability to deliver its contractual obligations under the UFB public private partnership," says Stephen Selwood, chief executive of the New Zealand Council for Infrastructure Development.

    "The essential issue here is whether or not Chorus will be able to absorb a $10 per month reduction in copper wholesale pricing, as required by the Commerce Commission, and still deliver ultra-fast broadband to most New Zealanders.

    "There are two conflicting views on this. On the one hand the Coalition for Fair Internet Pricing say that Chorus can and should absorb the cost. On the other hand, the Governments partner Chorus says that the lost revenue will have a very significant impact on their capacity to deliver ultra-fast broadband to most of New Zealand as they are contracted to do.

    "If Chorus is right, the cost to all New Zealanders of the loss of social and economic benefits that a delay in UFB roll out would inevitably cause needs to be carefully considered.

    "Also to be weighed in the balance is further write off of shareholder value for over 30,000 kiwi investors and consequential loss of investor and financial market confidence.

    "When the impact of the pricing reduction is clear, significant questions over whether the Commerce Commission pricing determination is reasonable still remain, as does Choruss right to require a full cost review.

    "The Government represents all New Zealanders as a partner with Chorus in the roll out of UFB.

    "The independent review provides Government the opportunity to determine the financial impact on Chorus of the Commerce Commission's decision and inform whether or not and how it might intervene in a way that is in the best long term interests of consumers.

    "At the end of the day, the sooner this issue is resolved, the sooner we can focus on the real opportunity how NZ levers the return from this investment in ultra-fast broadband infrastructure - the better it will be for everyone."

  • 22 Jan 2016 10:30 AM | Anonymous

    Northern Corridor Road of National Significance demonstrates major benefits to Wellington and lower North Island

    Media Statement 
    22 October 2013

    Updated project information on Wellingtons Northern Corridor Road of National Significance (RoNS) released today by NZTA indicate that the Wellington Airport to Levin route upgrade will deliver some $3 billion in benefits to the region over 40 years, providing $1.60 back for each dollar invested.

    Its encouraging to see revised data on the project confirming positive economic benefits for this important strategic link, said Stephen Selwood CEO of the New Zealand Council for Infrastructure Development.

    The project summary published today demonstrates exactly why this project is essential for the future growth and development of the Wellington region.

    The morning journey to the CBD from Levin will be 40 minutes faster on completion of the route. Aside from the obvious benefits provided to freight and commercial traffic, a reduction of this scale puts more people within working distance of the capital.

    The direct impact will be an estimated 865 permanent jobs created in the region but, indirectly, a larger labour pool from which to draw employees means employers have a greater chance of finding the right person for the job. We now know that this leads to productivity improvements which are not easily reflected in analysis.

    Interestingly, however, the economic imperative behind the Northern Corridor is as much about resilience and safety benefits as it is about travel time savings and jobs.

    The importance of providing a safe route to access New Zealands severely earthquake-prone political centre and third largest city in the event of natural or man-made disaster cannot be over-estimated. Even a moderate shake today could see State Highway 1 out of commission for up to 6 months.

    Safety too will receive a big boost. The existing road is among the worst accident black spot corridors in New Zealand with one serious injury or fatal crash per year for every five kilometres of road. The new road will be built to modern safety design standards and is expected to save up to 40 lives over a five year period.

    As a long-term strategic investment for the region, the Northern Corridor will be the most significant since the airport was redeveloped in the 1950s. When completed in the 2020s, the high quality road will become a major stimulus to growth and source of resilience for Wellington and the lower North Island, Selwood says.

  • 12 Mar 2015 1:33 AM | Anonymous

    Media Statement 
    17 October 2013

    The National State of Infrastructure 2013 report released today signals good progress has been made over the past 12 months to address New Zealands infrastructure deficit and that, while challenges remain, New Zealand now has the necessary frameworks in place to identify issues and address problems, said NZ Council for Infrastructure Development CEO Stephen Selwood.

    The report records progress across all infrastructure sectors, from direct Government investment in transport and telecommunications, to improved planning and regulation in our major cities, further progress with Public Private Partnerships (PPP) including the first transport PPP (Transmission Gully), and expanding the use of the Better Business Case methodology, among others.

    It is also really encouraging to see the developments underway in the local government sector, especially plans for a Centre of Excellence, a range of new initiatives to deliver a stronger evidence base for Urban Water, and the innovation and improved investment analysis in the management of roads and maintenance.

    However, NZCID agrees with the findings of the National Infrastructure Advisory Board that while good progress is being achieved significant challenges remain.

    In particular, opportunities exist to greatly enhance alignment between the land use proposals of the notified Auckland Unitary Plan, the investments outlined in the Integrated Transport Plan and the strategic vision of the Auckland Plan.

    Finding means to both fund the transport investment programme and manage transport demand in Auckland must be resolved with urgency.

    In Christchurch, interagency coordination still needs to be improved and a well sequenced pipeline of projects remains a critical priority. In contrast, the rebuild of water and road infrastructure is a real highlight in Christchurch, notwithstanding questions over the standard it is being built to and who should pay.

    At the national level, irrigation is progressing, but the industry needs a much broader spectrum of support if the many earmarked projects around the country are to proceed.

    While there are real challenges facing authorities and industry, what must not be ignored is that these issues are now being identified, articulated and the necessary frameworks are in place to address them. Stepping back five years, there was no established, independent authority like the National Infrastructure Advisory Board or the National Infrastructure Unit in Treasury to highlight problems and no mechanism other than political direction to overcome obstacles.

    Later this year, the National Infrastructure Unit will publish the long awaited ten year capital intentions plan, which will go a long way to providing the level of investment certainty required to attract foreign and domestic capital to sectors that are crying out for it.

    Adding together the capital intentions plan, ongoing refinement of Aucklands Unitary Plan and the ramp up in Christchurch, we anticipate that 2014 will be a pivotal year for New Zealand infrastructure," Selwood says.

  • 12 Mar 2015 12:36 AM | Anonymous

    Media Statement 
    28 August 2013

    Changes announced today by Minister for Local Government Hon Chris Tremain will improve linkages between councils long term asset management and strategic planning and should also lead to better quality public engagement. But to maximise the effectiveness of local authority services, development of a 30 year spatial plan to guide and manage growth should be undertaken alongside long term infrastructure investment planning, says Stephen Selwood CEO of the NZ Council for Infrastructure Development.

    While long term asset management across councils is generally good, it is not uncommon to see robust plans being compromised by annual budget processes, causing projects around the country to be deferred, down-sized or cancelled in an effort to limit short term rates increases.

    Consequently, we see good quality asset management practices compromised by electoral cycles, creating a bow wave of investment that future ratepayers have to meet.

    The Local Government Infrastructure Efficiency Expert Advisory Group, in its report to Government released earlier this year, recommended moving to a regional planning scheme with a firm hierarchy of long and short term plans.

    Thirty year spatial plans would set out a long term growth strategy. The infrastructure strategy would ensure that the investment and renewals programme supports planned development backed by good asset management practice. Council long term plans would then provide the ten year budget allocation to allow implementation of the strategy. Annual report processes would monitor progress and provide transparency to ratepayers.

    The planning changes identified today will help address the disjoint between long term community and council aspirations and implementation. Better presentation of data and improved engagement processes should also help communities to participate in planning and strengthen support for investment programmes not only within but across electoral cycles, says Selwood.

  • 11 Mar 2015 11:37 PM | Anonymous


    Media Statement

    22 July 2013

    Speaking at the annual Local Government New Zealand conference today, New Zealand Council for Infrastructure Development CEO Stephen Selwood called for a transition to strengthened regional governance nationwide through local government amalgamations.

    "Regions matter, says Selwood. New Zealand is the sum of its parts and, to quote Minister Joyce, the ability of regions around the country to provide economic opportunities and jobs for people that live in each region add up to the ability of the country as a whole to do the same.

    As a small, isolated nation, we need to realise the full potential of our regions which underpin our national economic performance

    Currently 67 sub-regional city and district councils and 11 regional councils plan, regulate, control, fund and deliver essential infrastructure that supports our economy and local communities

    Most of those councils are very small. Many face challenges of declining and aging populations. Many more struggle to attract and retain the technical, commercial and financial capability needed to realise the full potential of the regions they serve.

    Too often the sole focus of communities is on containing increases in rates and not regional economic growth and development. Too often there is a rural urban divide rather than a true understanding of the dependencies between town and country.

    To compound these issues further, New Zealand's principal planning laws, the Resource Management Act, the Local Government Act and the Land Transport Management Act are complex and contradictory. While linkages exist, the Acts were never designed to work together. Consequently, there is often poor alignment between strategies, long term plans, funding, and regulation needed to deliver infrastructure in a timely way.

    In this context it is hardly surprising that infrastructure investment has so often failed to keep pace with development needs or deliver value for money over time. Nor is it surprising that real economic growth across most regions has been disappointing.

    NZCID commends the initiatives underway to benchmark performance and agree shared service arrangements, including joint ventures and clustering. But, we have strong doubts whether the pace of change is sufficient or that the goodwill and political commitment that is necessary will be sustained over time.

    We favour full council amalgamations using the two tier unitary council model used in Auckland as a template for governance reform across the nation.

    The power of one council united around one vision, one plan, one voice and the size and scale to be able to influence government policy and to implement and deliver are already plainly evident.

    Similar to Auckland, we envisage reform of local government in New Zealand into twelve or so provincial unitary councils based largely on regional council boundaries. These provincial councils would be supported by empowered local boards with delegated authority to levy targeted rates for local amenities and services where there is community support.

    When combined with puplicly owned utilities to deliver water, roads and regional facilities, reforms to planning laws to provide for spatial plans, and enhanced national guidance and leadership, the two tier unitary council model provides a good balance between leadership and local democracy, vision and strategy, scale and specialisation.

    The latest rounds of local government and planning law reform will tweak incremental improvement of our complex planning laws. Increasingly we will see councils start to work together or even amalgamate. Generally speaking that is a good thing. But the pace of change is very slow.

    Wouldnt it be so much better if we could lift our vision beyond the back yard and effect change aimed at fully realising the full potential of our regions, working in partnership with central government, the private sector, iwi and local communities.

    Its time for bold moves in local government and planning law reform and that means addressing the structures which have held back the progress of our regions, says Selwood.


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