Government’s $12.1 billion COVID-19 package will soften the impacts of COVID-19
for individuals and businesses, however these extraordinary times also create
the conditions for our Government to build investment momentum,” says Paul
Blair CEO of Infrastructure NZ.
especially pleased with the reinstatement of depreciation deductions for
commercial and industrial buildings. This will allow around $2.1 billion in tax
to remain with building owners and it is now incumbent upon them to follow the
Government’s lead and inject that money into building upgrades and maintenance.
building owners can take advantage of slack in the employment sector and
taxpayer assistance, New Zealand could emerge from this crisis with
greener, safer and healthier buildings. We’ll be more efficient, more
sustainable and more resilient.
“The big opportunity,
however, is in the third and as yet unannounced component of the Government’s
response – the broader recovery package.
Government gets it right, New Zealand will seize this opportunity to unlock
constraints to our social, economic, cultural and environmental progress which
have built up over many years, allowing our economy and people to bounce back
NZ has developed ten recovery priorities to ensure New Zealand comes out of
this crisis stronger than it went in:
local transport and water projects – many councils have consented, shovel ready
projects across every town in New Zealand that are ready to go today and don’t
need big workforces. Infrastructure New Zealand’s Building Regions proposal
aligns well with the Crown’s unfunded Urban Growth Partnerships – the May
Budget must introduce a new co-funding regime to get these projects done.
mobilise the Infrastructure Commission – some councils don’t even need money to
invest in long overdue water and transport projects, just capability. The
faster we bring the Infrastructure Commission’s project advisory team on board,
the more central and local projects we can unlock.
down on housing growth – Kāinga Ora and the Government’s urban growth agenda
must build on progress to address the housing crisis and support urban land
NZTA borrow – the Transport Agency doesn’t currently have its own borrowing
capacity, but it does have a reliable revenue stream and big asset base. If
NZTA could borrow in the same way as Kāinga Ora, multi-year transport
programmes could be funded. If NZTA has funding certainty it will also enable
councils to spend 100% of their transport capex programmes – today these are
often underspent as NZTA doesn’t have sufficient funding.
in green energy – we’ll never again have the opportunity to tackle emissions
and climate change that we have today. A number of major renewable electricity
projects are consented and awaiting transmission investment, but Transpower is
unable to invest ahead of demand. Bring the energy programme forward to
accelerate the shift away from oil.
and design – not all projects need shovels and there are thousands of skilled
workers who will slip onto welfare if the pipeline stops. We may need
infrastructure spend to be a fiscal lever for us in the months ahead – why not
design, consent and build business cases now to create a ‘shovel ready’
pipeline for the future?
RMA consents and Public Works Act initiatives – the progress New Zealand made
to recover from the devastating Christchurch and Kaikoura earthquakes was
enabled by streamlining RMA processes. Let’s use these extraordinary times to
ensure projects of national significance get consented, or Public Works Act
interventions are made, to cut through excessive delays.
contracting and open-book project delivery partnerships – we can cut down on
the time it takes to tender and procure work by signing longer term and bundled
project contracts. An open book approach can ensure the taxpayer gets value for
money and give employers confidence to keep and take on staff.
– some sectors New Zealand’s workforce will be hit hard. The Government can and
should attach conditions to infrastructure delivery which require training,
upskilling and apprenticeships of those looking for a new career.
– not taking risks in the current environment, is taking risks. The Government
is going to have to move quickly and responsively to a situation moving much
faster than any infrastructure project. Some decisions will turn out to be
wrong, others right. It will be no different for business owners. The
Government must continue to exploit its size, authority and balance sheet to
de-risk private sector investment and back New Zealand.
implement these measures, New Zealand can tackle long standing, costly and
damaging impacts from many years of high growth and weak investment. Never waste
a good crisis,” says Blair.
For further information and
comment contact Paul Blair on 021 902 436