Government struggles to reliably prioritise projects

16 Jun 2021 4:55 PM | Anonymous

New Zealand Upgrade Programme

The government announced the New Zealand Upgrade Programme (NZUP) in January 2020, a $12 billion programme of 32 investments. 

The majority of expenditure was in public and private transport. There were lesser amounts for a handful of hospitals, a modest injection of capital into schools, and the first of a series of clean-powered public sector projects, mostly aimed at closing coal-fired heating in hosptials. Eighteen months later, and the top 16 projects - mostly in road and rail - were costed at $12.8 billion, roughly double the original estimates for that tranche. That led the Government to a series of adjustments and cutbacks, to get the top 16 projects under $7 billion total capex.

The government has said these projects will result in the reduction of vehicle emissions and decarbonising of our transport system.

The National Party has made its displeasure clear and has accused the government of deliberately downplaying the programme’s costs in an election year and now using the higher, more realistic costs to cancel projects it ideologically opposes.

The government has added a very big project in Auckland, a walking and cycling link between Auckland's City Centre and the North Shore named ‘Northern Pathway’, which is 90% bigger in cost than its predecessor and a very ambitious piece of engineering. Indeed, the revised and much-bigger Northern Pathway in Auckland – effectively a second bridge alongside the existing one – surprised many Aucklanders when the government announced it, partly because of the scale and also because of the proposed capital cost, at near-$700 million, excluding the $100 million for the land section. We support a walking and cycling connection over the Waitematā Harbour, but without seeing the business case,  it’s hard to see how a new bridge would be justified.

Similarly, the $692 million SH1 Whangārei to Port Marsden Highway – an upgraded 22km four- lane corridor – has been canned in favour of safety improvements along the existing highway and the construction of a new rail line from Northport to the North Auckland rail line.

Projects such as the $1.3 billion Mill Road transport corridor in South Auckland – a 21.5km new four-lane corridor with separated walking and cycling facilities that would have served as a new connection from Manukau to Drury South and provided better access for the 120,000-plus people – has been drastically cut back to focus on safety issues and possibly involving an upgrade of two lanes instead of the four between Flat Bush and Alfriston.

The government’s announcements reveal that it continues to struggle with one of the most vexing policy issues New Zealand faces in infrastructure – the reliable prioritisation of projects. The decisions underline how difficult it is for the government to hold to its original priorities and maintain confidence in cities and towns, and with the sector.

One of the purposes of robust prioritisation is to provide certainty – both locally, and to the infrastructure sector regarding the quality and depth of the pipeline of work. 

People who were hoping to see the government’s climate policy tested in court will have to wait for another day. All Aboard Aotearoa had initiated proceedings in the High Court, arguing Mill Road is a breach of the government’s obligations under the Paris Accord and under the Zero Carbon Act 2019. It is hard to see that case proceeding now, given the extent to which Mill Rd has been reduced.

Details of the updated NZUP can be accessed here .

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