Infrastructure new Zealand MEDIA & RELEASES

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

  • 28 Jun 2018 4:30 PM | Anonymous

    MEDIA RELEASE

    “The Government’s Policy Statement on Transport confirms record investment over the next decade, but with capital investment levels half what they are in Australia, ongoing congestion, housing unaffordability and constrained economic growth will continue,” says Stephen Selwood CEO of Infrastructure New Zealand.

    “The final GPS for Transport released today locks in record transport spending of $4 billion moving to $4.7 billion per annum over the next decade, supported by new fuel levies.

    “The funding certainty this provides to the New Zealand Transport Agency, councils and transport industry is welcome and it’s clear that the Government is doing as much as it feasibly can with existing transport tools.

    “But it’s not enough. In fact, it’s well short.

    “New South Wales has announced a A$14.7 billion transport capital programme for the 2018/19 financial year.

    “By comparison, just $2 billion - $3 billion of GPS spending this year will be focused on improving transport networks.

    “Even after top-ups from the consolidated account to pay for Auckland’s City Rail Link and council expenditure, New Zealand’s investment in transport improvements will be half what the New South Wales government alone is doing on a per capita basis.

    “This is why New Zealand’s cities are among the most congested for their size in the developed world and it is why we can’t unlock enough land to house our population.

    “It is also why nothing is going to change, in spite of record investment, until we change the way we plan, fund and deliver transport.

    “Asking road users to cover the cost of projects increasingly oriented towards urban development separates those funding improvements from those who will benefit – landowners.

    “Constraining investment to levels road users are prepared to tolerate holds back the economy and urban development.

    “We need to double investment if we are serious about tackling congestion, improving safety and delivering homes.

    “Projects with strong benefit-cost ratios and significant strategic benefits need to be accelerated.

    “Major transport projects need to be debt financed. It is not realistic to fund a long-term investment programme by an annual allocation from road user charges.

    “Debt should be repaid by beneficiaries – road users, property owners and the Government via GST, income and corporate taxes which grow with the economy.

    “A shift to road pricing would not only provide the mechanism to fund needed investment, it would also manage congestion much more effectively.

    “Record transport investment is a step in the right direction, but New Zealand remains a giant leap behind our competitors.

    “If we want to change our transport performance, we need to change our outdated and restrictive transport funding system,” Selwood says. 

    ENDS

    For further information and comment contact Stephen Selwood on 021 791 209
  • 14 Jun 2018 4:00 PM | Anonymous

    MEDIA RELEASE 

    “New Zealand’s urban growth system is broken and must be revised to incentivise cities to grow and city leaders must be given the flexibility and tools they need to succeed,” says Stephen Selwood, CEO of Infrastructure New Zealand.

    “We took 42 public and private sector infrastructure leaders to Portland, Denver, Dallas and Houston – four big, fast-growing cities facing the same challenges as New Zealand cities, but with different economic, social and environmental outcomes.  

    “The US cities may not be able to match New Zealand centres for liveability, but they do know how to grow. Homes are being built, roads and public transport are being delivered and homelessness is down by a third in the last decade.

    “The key to US success is an urban growth system which is incentivised to want growth and has the tools and flexibility to overcome challenges.

    “The metro areas of the US, including the constituents and governments, benefit from growth. Sales and income taxes complement property taxes. More homes, residents and investment means more revenue for local authorities. Federal and state agencies sweeten the deal with grants and funds to encourage performance.

    “America’s thin welfare net doubles the importance of successful urban performance – if cities don’t grow and succeed, homelessness, unemployment and social costs fall much more heavily on local institutions.

    “Cities are not only better incentivised, they have the ability to respond.

    “Different revenue streams provide flexibility of funding. Innovative financing is used to transfer the costs of infrastructure to beneficiaries who repay debt over the long term. Regional governments evolve to meet city-wide challenges, special purpose infrastructure districts fill resourcing gaps.

    “New Zealand’s urban growth system, by comparison, is poorly incentivised. Central government captures the tax benefits of growth, leaving councils reluctant to invest in costly upfront infrastructure.

    “Councils that try to grow have to rely on rates paid by those with homes in order to fund services for those without homes. Debt ceilings constrain finance and hard regulatory instruments become the preferred tool to manage growth.

    “Overdependence on urban boundaries and density restrictions has undermined competitive land markets, preventing affordable housing, and there are no price signals to ratepayers about the consequence of council policies.

    “Overall, the American system is far more collaborative, innovative, aspirational and effective at responding to growth.

    “We simply must revise our governance responsibilities and funding. It is not working having a multiplicity of small councils with limited capability manage limited funds for such an important task.

    “We must re-gear local governance so that local authorities benefit from growth and have the tools to respond. A review of local government funding and responsibilities should be launched as part of the review of planning statute and alongside the Tax Working Group.

    “In the meantime, central government has to intervene with grants and transfers, like the Provincial Growth Fund and city and regional deals which allocate funding to councils who support economic and urban growth.

    “Responsibility for financing costly growth infrastructure needs to shift away from ratepayers. Activities which provide a revenue stream, including water services and toll roads can be used to finance investment without compromising council borrowing costs. Crown Infrastructure Partners needs to have a wider scope to finance infrastructure delivery and rate future property owners.

    “If we combine these measures with emerging urban development authority legislation and get on with delivering attractive new cities and centres, like a satellite city in south Auckland, we can remove planning regulations and allow competitive land markets to deliver housing New Zealanders can afford," Selwood says.

    A full copy of the Infrastructure New Zealand report on findings from a delegation to the USA can be found here.

    ENDS

    For further information and comment contact Stephen Selwood on 021 791 209
  • 17 May 2018 4:43 PM | Anonymous

    MEDIA RELEASE

    “The Ardern-led Government’s first Budget has followed through on well-signalled investments in transport, housing, education and health, but greater use of private investment will be needed to get overall investment to the level required,” says Stephen Selwood, Chief Executive of Infrastructure New Zealand.

    “Additional capital investment of $750 million in hospitals, $400 million in schools and the $300 million Canterbury acceleration programme is in line with pre-Budget commitments and will go some way to addressing immediate needs, such as at Middlemore Hospital in South Auckland and continuing the Christchurch rebuild.

    “Confirmation too that transport spending and the Provincial Growth Fund will be resourced as indicated is welcome. However, just one third of the Provincial Fund is committed to capital projects with a significant part of the balance going to tree planting.

    “Funding has been confirmed for the design of a new Dunedin Hospital, but there is no specific allocation to construction, despite the decision not to proceed with a public private partnership.

    A $200 million commitment has been made to the delivery of rapid-build modular units for prisons but there is no provision for the major new prison at Waikeria that has been in planning.

    “One of the most encouraging Budget announcements is that arms-length government bodies like Housing New Zealand, NZ Transport Agency and Crown Infrastructure Partners are to be given the flexibility to raise debt, beginning the long-overdue shift away from “pay-go” funding for large, lumpy capital projects.   

    “Housing NZ alone will be able to borrow up to $3 billion to get on with delivering safe, warm homes.

    “The initiative should help speed up decision making, give greater certainty to the forward pipeline and facilitate engagement with industry.

    “Much wider use of this type of model is required to deliver Kiwibuild over the next decade, including the billions of dollars of infrastructure needed to support 100,000 homes.

    “No Budget allocation is clear yet regarding a specialised infrastructure agency, but it is just this sort of entity which would facilitate effective use of debt in the delivery of the Government’s large capital programme,” Selwood says.

    ENDS

    For further information and comment contact Stephen Selwood on 021 791 209


  • 10 May 2018 4:42 PM | Anonymous

    MEDIA RELEASE

    “The Government’s announcement that this year’s Budget will allocate $42 billion to capital investment over 5 years will provide a welcome boost for regional and urban development, but speed in establishing a specialised strategic procurement agency is now a priority to ensure projects are sequenced and delivered at best value,” said Stephen Selwood CEO of Infrastructure New Zealand.

    “Details of the exact programme will become clear on Budget day, but with major investment needs in health, education, justice, housing and of course transport, the challenge for the Government will be getting best value out of its programme.

    “There is a risk that costs will inflate if project sequencing stretches the market by location, portfolio or skillset.

    “A carefully-conceived project pipeline, developed with the industry and comprising the full spectrum of central and local government major projects, is essential to delivering a programme this large.

    “Just as important will be the way in which projects are procured.

    “Infrastructure Minister Shane Jones’ procurement agency idea now takes on immediate priority, not only to develop the project pipeline but also to ensure that hospitals, schools, roads, railways and other infrastructure are delivered on time, to specification and to budget.

    “Recent reports that the SuperFund has made an unsolicited bid to deliver light rail in Auckland underline how sophisticated major project procurement has become.

    “It’s great news that investors are looking at national infrastructure as an investment opportunity and we need serious expertise across government to ensure this type of approach will be a success.

    “A specialised procurement agency will consolidate public procurement expertise and enable the 5 year $42 billion pipeline to be delivered in a way which benefits all New Zealanders,” Selwood says.

    ENDS

    For further information and comment contact Stephen Selwood on 021 791 209
  • 17 Apr 2018 12:16 PM | Anonymous

    The New Zealand Government has restated its committed to resolving congestion and other transport issues in Auckland and across the country. It is widely agreed that conventional funding and financing tools are inadequate to address both the backlog of investment and respond to strong growth. 

    Infrastructure New Zealand welcomes news that the Government is actively investigating alternative procurement options, including Public-Private Partnerships, to enable major projects to proceed. 

    More information can be obtained here.  


  • 19 Mar 2018 11:45 AM | Anonymous

    MEDIA RELEASE

    “Cancellation of major projects, delays in new projects coming to market and uncertainty about future transport funding are forcing the contracting sector to release skilled staff just at the point at which the Government wants to increase the speed and scale of construction,” says Stephen Selwood CEO of Infrastructure New Zealand.

    “It is natural for infrastructure priorities to change with new leadership, but the scale of change in recent months combined with high uncertainty over future transport funding is having a particularly heavy effect on a sector under pressure from rising input costs.

    “The Government’s desire to utilise private capital to facilitate infrastructure delivery is commendable, as are commitments to increase Crown capital investment from $32b to $42b over the next four years, but it’s the lack of “shovel-ready” projects which is the problem.

    “Near-term cancellation of projects which the sector had anticipated getting underway shortly include the consented East-West Link, the Tauranga Northern Corridor, the Petone to Granada Link road and SH1 Cambridge to Piarere.

    “Delays to the CRL and north-western busway as well as uncertainty for critical growth projects like the Mill Rd corridor in Auckland and safety projects like Otaki to Levin north of Wellington is compounding the issue.  

    “All up, a conservative figure of the total investment pushed out of the next four to five-year period is over $2 billion. That’s in the order of $400 million per annum taken out of the contracting sector.

    “The industry cannot absorb that level of cost without rationalising staff and equipment – the same staff and equipment which we know are urgently needed today to deliver infrastructure for housing.

    “While it is not the Government’s job to keep the construction industry busy, a committed pipeline of work is fundamental to the productivity of the sector, thereby delivering value for tax-payers.

    “It is vital that near-term gaps in the project pipeline are not allowed to undermine the long term health and capacity of the construction sector.

    “Australian investment in transport is set to double in the next couple of years. The big Aussie contractors will absorb all the available skills we have spent a decade building up, risking a repeat of the 2000s from which we’re still recovering.

    “There are projects with consents ready to go, including Mill Rd and Penlink. These projects have very positive economic benefits and unlock land for housing. We know they are going to be delivered, they must be signed off.

    “These are urgent issues and if left unattended will materially impact our ability to deliver infrastructure and home construction programmes,” Selwood says.

    ENDS

    For further information and comment contact Stephen Selwood on 021 791 209


  • 21 Dec 2017 2:52 PM | Anonymous

    MEDIA RELEASE

    "Waipa District Council’s rejection of a shared water services partnership with neighbouring Hamilton City demonstrates, once again, the need for government intervention in the funding, responsibilities and structure of domestic governance," says Stephen Selwood Chief Executive of Infrastructure New Zealand.

    "No fewer than four independent expert analyses of water services in the Waikato have agreed that it is in the best interests of residents of Waipa District to combine their wastewater, water supply and stormwater services with Hamilton.

    "Yet at the political level, these clear, demonstrable and agreed benefits were insufficient to persuade the majority of Waipa councillors to agree to partner with their neighbours in the provision of water services.

    "Despite the example set by Wellington Water, which has demonstrated significant benefits resulting from a jointly owned management company for its five council owners in the Wellington region, this latest Waipa decision puts another nail in the coffin for shared service arrangements between councils.

    "The case for change in water service delivery at a national level was clearly demonstrated in Havelock North when 5000 people got sick from drinking contaminated water. The subsequent inquiry identified “widespread systemic failure among water suppliers to meet the high standards required for the supply of safe drinking water to the public”.

    "Yet, almost all evidence to date, including rejection of Local Government Commission proposals for consolidation in Northland, Wellington, Hawkes Bay and Wairarapa, shows that significant change will not come from within the local government sector, no matter how beneficial.

    "Local Government New Zealand's Reputation Index gives local government leadership, performance and communication a score of 28/100.

    "Central government is having to constantly put workarounds in place to fix tourism infrastructure funding or growth investment financing. Auckland and other growth cities are 70,000 homes short of the number required for their populations, but they are not being built because there are not enough pipes and roads in the ground.

    "Major change is needed at a national, local and regional level.

    "Nation-wide functions should not be left to local government, including overall responsibility for environmental management and meeting the basic needs of New Zealanders for food, healthy water and shelter.

    "On the other hand the ability of local communities to build the identity and sense of community in their local areas must be strengthened.

    "And in between, there are decisions which need to be made which affect entire cities and their surrounding areas, including water, transport and economic development. These are regional in nature and require empowered regional decision making.

    "Effective institutions with the resources and mandate to deliver services at the level at which they impact communities are required.

    "If the new government is not prepared to lead fundamental reform itself, then a first principles review by an independent and appropriately resourced commission is the least it could do to identify solutions to longstanding deficiencies in New Zealand’s planning, funding and governance system," Selwood says.

    ENDS

    For further information and comment contact Stephen Selwood on 021 791 209


  • 06 Dec 2017 4:14 PM | Anonymous

    MEDIA RELEASE

    "The Havelock North Drinking Water Inquiry’s second report out today demonstrates the immediate need to establish a small number of large dedicated water service providers, funded by metered water and overseen by a competent regulator," says Stephen Selwood CEO of Infrastructure New Zealand.

    "The Inquiry found a serious lack of compliance with drinking water standards across New Zealand, resulting in over 700,000 New Zealanders being exposed to unsafe drinking water.

    "Failures at all levels, from the legislation to governance and weak institutional capability, have contributed to a drinking water system which is dangerous, inefficient and unacceptable.

    "Total reform of the water sector is required and the Inquiry’s recommendations should be implemented in full.

    "Water suppliers across New Zealand are too small, under-resourced and conflicted in their provision of water services. Water regulation has been woefully weak, allowing institutional acceptance of service failure.

    "While this inquiry looked specifically at drinking water, the issues are systemic across the sector including waste and stormwater services.

    "A small number of benchmarked water service providers, delivering both water supply, waste and stormwater services should be established.

    "Larger entities will generate the economies of scale needed to achieve drinking water and environmental standards which are currently being ignored, often because of the cost impact to councils.

    "Funding of acceptable water services should be provided by metering and charging for drinking and wastewater use. Metering typically results in a 15 percent water demand reduction over the long term, with lower water consumption reducing the need for expensive new water sources, treatment and distribution networks.

    "The Ministry of Health needs to urgently implement the Inquiry’s short-term recommendations and an independent water regulator must be established as the first step towards major reform of water service governance and delivery in New Zealand.

    "It is encouraging to see the Government is moving quickly in response to the Inquiry’s hard-hitting findings.

    "It is the duty of every Government to protect the health and welfare of its people and the Inquiry’s sobering report demonstrates a severe failure of governance has been allowed to emerge in the provision of one of the most essential public services," Selwood says.


    ENDS

    For further information and comment contact Stephen Selwood on 021 791 209


  • 24 Nov 2017 2:52 PM | Anonymous

    MEDIA RELEASE

    "The Labour-led Government's five point programme to address New Zealand's urban growth challenges could establish this Government as a change agent to rival the first and fourth Labour governments, but more aggressive reform of planning, governance and funding of urban growth and infrastructure will be needed," says Stephen Selwood CEO of Infrastructure New Zealand.

    Transport and Urban Development Minister Phil Twyford confirmed his plans for change last night at the Infrastructure New Zealand Annual General Meeting in Auckland.

    "The purpose of the urban growth agenda is to achieve competitive urban land markets, where supply meets demand and prices cover the cost of growth. Its five components to address New Zealand's chronic tangle of over-regulation, under-funding and fragmented planning are:

    1. Infrastructure funding and financing
    2. A pro-growth planning system
    3. Road pricing
    4. Spatial planning by central and local government
    5. Legislative reform of the Resource Management Act, Local Government Act and Land Transport Management Act.


    "The urban growth agenda signals a shift, not an end, in the way the Government leverages private capital to promote public policy. 

    "New Zealand's established and highly successful PPP model will still be considered for light rail and other transport projects, but the emphasis of this Government will clearly be on attracting private investment to support housing and wider urban development. 

    "The market will need to adjust, but the Government will also need to be aware that a competitive market cannot be sustained without a visible pipeline of potential projects.

    "It is doubtful that the identified transport programme will be sufficient to retain skills and investment in New Zealand without urgent action to fill the void created by cancellation of the planned $1.5 billion East West project in Auckland and various social housing initiatives.

    "The Government's second point in its programme, to create a pro-growth planning system, will be strongly welcomed by businesses frustrated by red-tape and institutionalised complexity built into our current system. 

    "That's going to require reform of the three key planning Acts, the RMA, LGA and LTMA. This is also on the Government's list of priorities, but Minister Twyford confirmed that the Government still has a preference to retaining the RMA.

    “Our very strong view is that combined effect of planning system failure, complex local government structures, tortuous decision making processes and inadequate funding are at the root of New Zealand’s housing and infrastructure crisis.

    "The desire to build off the past, rather than start afresh, is generally preferable. However, the "effects based" approach at the very heart of the RMA is the root cause of urban growth problems. It hands too much influence to objectors and under-represents the benefits of good planning and investment.

    "A more proactive planning regime, with robust national spatial planning and leadership, needs radically different institutions, processes and funding tools.  

    "We look forward to working with the Government to advance these, but are challenged to see how such transformation can take place within the confines of existing statutes and local government structures and funding. 

    "Finally, it is very encouraging to see the Government has recognised road pricing as a key ingredient to managing urban growth and optimising the transport system.  

    "However, if adding capacity to the road and public transport network is not part of every option to address need, we run the risk of establishing a tax on mobility.  

    "Higher and higher prices will be needed to suppress travel, ultimately delivering less public benefit. The purpose of road charges is to balance revenue with incentives to optimise travel, not suppress it. 

    "Viewed as a package, the Government's urban growth agenda is potentially revolutionary. If successfully implemented, Auckland and other growth cities will for the first time in a generation be able to build enough homes and infrastructure to support their population. 

    "All cities and towns in New Zealand will benefit from more flexibility and a reset in our national attitude to growth. This is long overdue," Selwood says.

    ENDS

    For further information and comment contact Stephen Selwood on 021 791 209


  • 30 Oct 2017 2:43 PM | Anonymous

    MEDIA RELEASE

    “The new Government should target new housing and employment on unzoned land along the rail line through Paerata to meet Auckland’s growth challenge,” says Stephen Selwood CEO of Infrastructure New Zealand.

    “Our latest report released last week examines the cost of growth in different greenfield areas around the city where land is accessible and non-sensitive and finds Paerata to be the best on balance for major new development.

    “It is cheaper to service with water, energy and transport and strategically located near to employment.

    “If the satellite city was supported by a $2 billion upgrade of the rail corridor, we could four-track the southern rail line, allowing non-stop commuter services from the satellite to central Auckland and work places in between.

    “That would put the new city within 30 minutes of the CBD and would allow rail freight to be separated from traditional commuter services. KiwiRail could operate with a much greater degree of freedom, helping to get freight off roads.

    “Being within 30 minutes of the CBD would also allow much greater densities to be achieved at the satellite than would be possible under a traditional expansive urban development approach.

    “Paerata would be a genuine city. It would provide a range of housing choices and with good masterplanning would be much more land efficient and resilient in a changing climate. 

    “The most exciting aspect is that the city could be designed to deliver all of our aspirations for the future enabling sustainable living and leveraging technology to the fullest extent.

    “We can build better, stronger communities, free from the constraints of previous decisions.

    “Developing at scale, we can facilitate the shift to more advanced home construction techniques, common throughout the rest of the world. These are critical to lifting productivity and enabling supply to increase.

    “Scale will also be attractive to domestic and international developers and investors.

    “If the new Government was to prioritise growth in a satellite city near the rail line in the south and tie new zoning to reprioritised transport investment, we could deliver homes at around half the current cost.

    “We estimate that an average new home would cost $430,000 to build. That’s including land, development, infrastructure, GST – everything except a return for risk. How the satellite was delivered, including what risks were accepted by the Government, would determine what price homes could be sold for.

    “This is the full cost – not a subsidy. It’s what houses should cost if we plan well and break through some of the barriers created by our current planning-funding-governance system.

    “Growth can pay for itself if it is well planned.

    “The growth model we have in place at the moment not only allows development in areas which cannot affordably be serviced, it is preventing the delivery of housing at its actual, affordable cost. It is enabling sprawl on productive soil and poor quality infill in established suburbs.

    "Intensification of extremely expensive brownfield land is not delivering housing at the price or speed which is required.

    “Proactively targeting growth around rail is cheaper, consumes less land and will deliver faster housing.

    “The satellite city model can be scaled up to take advantage of new investment and provide for Auckland growth over the long term. It can be aligned with much needed investments in education and health to deliver an exemplar city of the future, providing a better urban lifestyle than can be achieved under existing practice.  

    “The current incremental approach to growth management in Auckland must change. It is too slow, too expensive and is adding to congestion. Integrating urban development and infrastructure “at scale” is the solution,” Selwood says.


    A copy of the Innovation City discussion document can be found here.

    The Innovation City video can be found here.


    ENDS

    For further information and comment contact Stephen Selwood on 021 791 209

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