Infrastructure new Zealand MEDIA & RELEASES

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

  • 27 Jul 2018 3:30 PM | Anonymous

    MEDIA RELEASE

    “The importance and value of arm’s length infrastructure advice to Government to assist infrastructure decision-making will be the keynote topic at this year’s Building Nations Symposium,” says Stephen Selwood CEO of Infrastructure New Zealand.

    “Katie Black from the National Infrastructure Commission in the UK, Jim Betts from Infrastructure NSW, Michael Masson from Infrastructure Victoria, Allan Garcia from Infrastructure Tasmania and Anna Chau from Infrastructure Australia will all be discussing national infrastructure leadership and strategy on Day 2 of the conference.

    “McKinsey Global Institute has found that up to 40 per cent of infrastructure spending globally is not spent effectively because of issues with infrastructure strategy, governance and capability.

    “The potential gains for New Zealand are significant.

    “Even just a five percent improvement achieved through good project selection, streamlined delivery and optimising assets could generate $5 billion in added value on the $100 billion infrastructure investment that is planned over the next ten years.  

    “With such large demands on transport, water and social infrastructure up and down the country, putting in place the measures to support improved strategic capability and procurement must be a priority.

    “Each of the political systems closest to ours – Australia, the UK and Canada – have achieved significant improvements in infrastructure efficiency with arm’s length centralised infrastructure agencies.

    “Entities like Infrastructure Australia and the UK National Infrastructure Commission provide strategic advice to Government decision makers and help build public consensus and bi-partisan political support on long-term infrastructure needs and challenges.

    “Organisations like the Scottish Futures Trust, Infrastructure Ontario and the “I-bodies” in Australia support central and local infrastructure providers to deliver complex projects efficiently, helping to reduce the chance of cost blowouts and improving joined-up thinking with other public providers.

    “These bodies bring together the best expertise from the public and private sectors to support multiple projects at any one time up and down the country.

    “The combination of hands-on infrastructure delivery expertise with long-term strategic planning consolidated in a single independent infrastructure body can help New Zealand meet its growth challenge.

    “Giving the body arm’s length independence from a defined Ministry frees up officials from reporting and administration and allows them to focus on making operational improvements.

    “Decision making always remains with responsible Ministers, Mayors and other infrastructure leaders, but they all can benefit from improved advice and support from career professionals who understand infrastructure,” Selwood says.

    Building Nations is New Zealand’s largest annual infrastructure industry conference and will take place at the Viaduct Events Centre in Auckland on August 16-17.

    ENDS

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

  • 24 Jul 2018 3:20 PM | Anonymous

    MEDIA RELEASE

    “The Productivity Commission’s inquiry into local government funding and financing is welcome, but it is concerning to see the Terms of Reference will constrain an objective assessment of all options,” says Stephen Selwood, CEO of Infrastructure New Zealand.

    “It is particularly disappointing that ‘asset recycling’ – the process of selling down public shareholding in one public asset in order to invest in another more valuable asset – has been precluded from the terms of reference.

    “Asset recycling is enabling Australia to respond faster and much more effectively to their growth challenge than New Zealand.

    “New South Wales alone will spend AU$14.7 billion on transport improvements this year compared to around $3 billion across New Zealand – twice what we are on a per capita basis. It has been able to do this by selling down nearly $50 billion of underperforming assets in the last five years and using the proceeds to deliver heavy rail, light rail and roading, as well as urban redevelopment, schools and health investment.  

    “With better services and fewer public funding constraints on development, the Aussies are addressing homelessness and deprivation whilst investing tens of billions in road and rail transport infrastructure.  

    “Research has shown the asset recycling programme in New South Wales has very high public support - 61 per cent, with only 9 per cent opposed - when people understand why the programme is in place and where the money is going.

    “High growth councils around New Zealand would provide a much better public service by selling down shareholdings in ports, airports or low performing assets and “recycling” the proceeds to invest in core transport and water.

    “In Auckland, partial or full sale of Watercare would enable the Council to release billions in capital to invest in storm water, floodwater and transport infrastructure and would allow the company to leverage its balance sheet to invest in water infrastructure to support growth.

    “The opportunity cost of having public money tied up in non-essential services is worse congestion and a prolonged housing crisis.

    “If, for some reason, New Zealand is different than Australia and if advice from the OECD, World Economic Forum and others on good capital management is misplaced, the Productivity Commission is best placed to make that call.

    “The same can be said for the rating of Crown and Maori land. It is extraordinary that the Crown considers councils to be core infrastructure providers, but will not pay them to deliver services to Government assets like schools nor even take advice on the issue.

    “It is encouraging that the Government has launched this Inquiry, but given the constrained terms of reference that the Productivity Commission has been given, the potential outcomes of the study have been compromised at the outset,” Selwood says.

    ENDS

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


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