Infrastructure new Zealand News & MEDIA RELEASES

Keep up to date with the latest infrastructure developments in New Zealand.

  • 22 Jan 2016 12:00 PM | Anonymous

    Media Statement 
    August 26, 2015

    New Zealand has an opportunity to significantly improve urban development according to leaders across the infrastructure sector.

    Stephen Selwood, Chief Executive of the New Zealand Council for Infrastructure Development (NZCID), says we need to lift our vision to be internationally competitive in big city development projects.

    We surveyed key decision makers including senior central and local government officials and infrastructure construction, design, finance, professional advisors and service leaders across all sectors at the recent NZCID Building Nations symposium in Christchurch.

    Most delegates (49 percent) consider that New Zealand is improving but remains well behind global best practice. Just six percent think New Zealand is at the leading edge while 29 percent feel we are in catch-up mode and 16 percent say we are still at the start line.

    Making better use of private capital and integrating transport solutions and urban development are areas of greatest opportunity.

    The decision to set up a specialist urban development agency in Auckland, Development Auckland, is seen as a very positive step.

    Getting governance right for the $40 billion Canterbury Rebuild is also seen as being key to success. Almost half (49 percent) are fairly confident that governance arrangements to oversee the next phase of the Canterbury Rebuild will work and 12 percent are very confident. But importantly, 43 percent are not confident that governance arrangements will work. Key concerns centre on proposals for two development agencies one run by the Christchurch City Council and another run by central government. Its really hard to integrate development and synchronise decision making and capital programmes when multiple agencies are involved, each with separate budgets to manage.

    Seamless delivery necessary for Christchurch CBD

    It is critical that the Christchurch central business district (CBD) redevelopment is completed seamlessly across the Crown and council's respective asset holdings.

    We favour one fully capitalised urban development agency for Christchurch, jointly owned by central Government and the Christchurch City Council, which can then recruit the very best capability to deliver the next phase of the rebuild. The agency will need to be totally attuned to market needs, have the strongest possible procurement capability and have capacity to effectively manage capital project delivery and whole of life costs of public assets.

    An NZCID survey of procurement across principal public agencies rates overall performance as being average. The New Zealand Transport Agency rated highest overall at four out of five. Having a forward works pipeline, a clear focus on the end goal, maximising value for money over least cost tenders, and adopting standard contracts and evaluation methods were seen as the key areas for improvement in procurement across the industry.

    Selwood says that feedback on the national infrastructure plan released at the symposium showed a need for central Government and local council growth and investment strategies for Auckland, Christchurch and the regions.

    Recycling of assets needed for development

    There is significant opportunity to use private capital to accelerate infrastructure delivery and urban development in New Zealand including recycling of assets sale or partial sale of existing assets to build new assets to support growth and development.

    Delegates are keen to see positive action on planning law changes beyond the Resource Management Act, the Local Government Act and the Land Transport Management Act, Selwood says.

    Consistent direction on long term infrastructure strategy is seen as critical. Two thirds of leaders at the Building Nations symposium saw political risk the risk that elected leaders will change infrastructure strategy and policies as being a significant risk adversely affecting infrastructure investment and decision making.

  • 22 Jan 2016 12:00 PM | Anonymous

    Media Statement 
    2 July 2015

    The Prime Ministers announcement that an urban development-type agency will be established to oversee the Christchurch central city rebuild is positive, but a jointly owned Crown and Council agency will be key to success and will better facilitate transition to local ownership, says Stephen Selwood of the New Zealand Council for Infrastructure Development.

    It is critical that the CBD redevelopment is completed with urgency and delivered seamlessly across the Crown and Councils respective asset holdings.

    It is also crucial that the development agency is totally attuned to market needs, has the strongest possible procurement capability and can effectively manage capital project delivery and whole of life costs of public assets.

    We are pleased to see decisions have not yet been made on the form of governance between the Crown and Council for a redevelopment authority, as agreement across the two parties is critical to the long term success of the initiative.

    A single Crown-owned agency that is solely tasked with delivering Crown projects risks excessive focus on minimising upfront capital costs to the Crown while transferring risk for whole of life operational costs to the Council without adequate Council input and oversight in the initial project delivery.

    Separate Crown and Council development agencies would be even less desirable.They would compete to recruit and retain the highest calibre expertise, would face difficulties in sequencing projects to market and would risk duplication of resources.

    A jointly owned development agency governed by an independent professional board therefore seems a logical step. This would require the Crown and Christchurch City Council to agree the outcomes to meet tax and ratepayer expectations, set the budget and empower the development agency to get on with the job.

    Separating the operational aspects of the rebuild from political processes will be essential given the proposed five year time horizon of legislation. Christchurch residents could potentially see one change of Government and two changes of council within that time.

    A further critical issue will be resourcing the agency sufficiently to avoid regular cap in hand trips back to authorities. Funding and revenue allocations must be identified and agreed as part of the establishment of Regeneration Christchurch.

    "A jointly owned independent delivery agency is typical across equivalently sized redevelopment initiatives and is consistent with global best practice, Selwood says.

  • 22 Jan 2016 11:59 AM | Anonymous

    Media Statement 
    30 June 2015

    A no surprises National Land Transport Programme maintains the Governments momentum in the transport sector for the next three years, but its time to set out a clear long term investment strategy for the state highway system to meet future inter-regional and intra-regional travel demand, says Stephen Selwood of the New Zealand Council for Infrastructure Development.

    Three years for any major state highway project is a blink of an eye. The East-West Connection in Auckland was identified as a regional priority over three years ago, but a preferred option has only just been released for public feedback. It will be another three years before the first spade hits the ground on the main component.

    Currently we have little visibility of what pressures the state highway system should expect beyond three years, where and what the pipeline is to address emerging demand.

    The problem is now acute in Auckland where all available evidence demonstrates future state highway planning is inadequate to meet growth.

    Multi-billion dollar investment in the Western Ring Route and elsewhere across the Auckland network gets the region to where it should have been some time last decade. It wont meet the needs of another Wellington and another Christchurch moving into Auckland over the next three decades.

    What is the plan for Aucklands motorway network beyond Waterview and the East-West Connection?

    The current picture is bleak with todays speeds and performance dropping significantly across the network and congestion moving into the inter-peak.

    Network performance is also challenged for those regions and territories not supported by the Roads of National Significance programme.

    How is the state highway programme going to promote growth and productivity in New Zealands agricultural engine room and what is the sequence of priorities?

    Its time NZTA came up with a long term national state highway strategy that meets the needs of regions across New Zealand and supports economic and population growth of another one million people in Auckland," Selwood says.

  • 22 Jan 2016 11:58 AM | Anonymous

    Scale, vision and an overhaul of planning legislation needed to address housing problem 

    Media Statement 
    19 June 2015

    The Productivity Commissions comprehensive report into land for housing underlines the need for a major revision of New Zealands overall planning framework. In the meantime, Aucklands housing shortfall could be addressed with a new compact greenfield satellite city aligned to the rail network, funded off land value improvement and financed with private capital, says Stephen Selwood CEO of the New Zealand Council for Infrastructure Development.

    The Commissions report demonstrates just how imbedded the many challenges are which over two decades have seen New Zealands housing affordability plummet.

    The common thread tying together each of the major issues identified by the Commission regulation, infrastructure funding and delivery, spatial planning, public engagement and central and local government coordination is New Zealands dysfunctional planning and governance framework as set out in the Resource Management Act, Local Government Act and the Land Transport Management Act.

    The Acts were conceived separately and never designed to work together. As a result, transport decisions are made which inhibit urban development. Land use decisions are made which add to congestion. We have local government objectives which conflict with central government policies and central government directives which heap costs onto financially constrained local bodies.

    The three Acts the RMA, LGA and LTMA must be subject to a first principles review with the objective of harmonising planning and decision making across New Zealands two levels of government.

    Getting the incentives and objectives across government right will help councils and the Crown align their objectives, ensuring above all that sufficient land is available and ready for development.

    Thats going to take some time, which is why the Commissions call for an urban development agency is so important.

    As we design more effective governance, planning and legal frameworks to meet the needs of future generations at the national level, an urban redevelopment agency can seek out a nearer term response for the urgent housing need in Auckland.

    A public agency that is market focused and geared to engage private capital, innovation and expertise is critical to bridging the gap between public resource management activities and property market needs.

    Acting on behalf of both the Crown and Auckland Council, an urban development agency must be empowered to, at the very least, aggregate land to enable development at scale.

    The agency could engage the development community to target a major new city on greenfield land, proximate to rail where land value appreciation can be leveraged.

    A very successful initiative like this is underway in Springfield, just outside Brisbane.

    There, a city the size of Pukekohe but with a population equivalent to Hamilton is under construction. Because it has been masterplanned to accommodate that level of density, rather than retrofitted around an existing incompatible urban form, much better transport, environment and social outcomes are being targeted.

    Committing to tens of thousands of new homes over the next two or three decades, built to modern tastes and consistent with expectations for quality public transport, urban living and sustainable design, and urban development agency working in partnership with major private developers can deliver the types of outcomes both the Government and Auckland Council, as well as residents, demand, Selwood says.

  • 22 Jan 2016 11:57 AM | Anonymous

    Media Release 
    10 June 2015

    The Local Government Commissions announcement that it would move to strengthen local government in the Hawkes Bay at the same time as backing down on recommendations for Wellington and Northland demonstrates the need for a first principles rethink of what local government does, why and how, something a Royal Commission is best placed to investigate and which must include stalled discussions on the role of the Resource Management Act and other planning laws, says Stephen Selwood CEO of the NZ Council for Infrastructure Development.

    The Commissions decisions are set to entrench different governance structures, roles and activities in different regions with net costs to New Zealand as a whole.

    The Local Government Commission was at risk of having its decisions reversed by local referenda driven by local politicians. Had the Commission been in a position to recommend strengthened governance for Wellington and Northland, New Zealand could have begun the transition to a consistent national and regional spatial planning and implementation framework supported by local boards at the grass roots level.

    This would be consistent with international best practice and would help align central and local government on major planning and investment decision making.

    It would also facilitate private activity and investment while enhancing community participation and decision making through local boards.

    It would have delivered a superior outcome for NZ Inc. Instead, much more narrow interests have been allowed to prevail.

    The result is an unfolding piecemeal governance scenario with large regional councils like Auckland providing clear direction and a single voice on major issues, whilst small councils like Kaipara next door struggle to sustain the expertise necessary to provide modern public services.

    A Royal Commission is now required into local government in New Zealand.

    Only a Royal Commission can access the resources and maintains the mana necessary to complete a full first principles review of local government across New Zealand.

    Such a review would align well with another stalled reform process, that of the Resource Management Act 1991.

    Currently, we have councils making plans under the Local Government Act, large aspects of which are actually implemented under the RMA and transport Act. We have rules under the RMA which impede the plans of councils developed under the LGA and proposals under the RMA which are not funded because council spending falls under the jurisdiction of the LGA.

    The whole thing is a complete mess.

    Until we achieve alignment over what it is we want local government to deliver and how, it will be very difficult for the Local Government Commission to make sound recommendations which mobilise the support of communities.

    That process cannot happen without the LGA, RMA and Land Transport Management Act being part of the same discussion, Selwood says.

  • 22 Jan 2016 11:56 AM | Anonymous

    Leveraging private capital and design innovation on Puhoi-Warkworth will make the budget go further

    Media Statement 
    27 May 2015

    A safer, more reliable and resilient road connecting Northland to the world is a step closer following the Minister of Transports announcement today that the Puhoi to Warkworth Road of National Significance will proceed as a public private partnership if the market can provide as good value for money as Transmission Gully, says Stephen Selwood CEO of the NZ Council for Infrastructure Development.

    For a privately financed bid to succeed, the Transport Agency is going to have to be sure the design and construction of this vital road connection delivers a superior level of service to what can be achieved under a more conventional model it will have to be safer, stronger, faster and better.

    Thats what is being delivered through the countrys first transport PPP along Transmission Gully, a project that last weeks flooding shows cant come soon enough.

    The potential for a PPP to get better value for the tax payer is not limited to the requirement that Puhoi-Warkworth be superior to a conventionally procured project.

    Financing major capital procurement through debt smoothes the funding pathway, promotes intergenerational equity and avoids boom-bust cycles in the construction sector which has been a significant handbrake on productivity in recent decades.

    Use of debt funding means there will be more capital available in the National Land Transport Fund in the near term to resource other transport priorities across the country.

    If Puhoi to Warkworth was totally funded out of pay-go annual revenue streams, then this priority billion dollar project would not only starve regions across the country of much needed transport investment in the medium term, it would take at least two years longer to deliver forgoing substantial economic growth opportunities in Northland in the meantime.

    There has been strong market interest both locally and globally in this project following the success of Transmission Gully. Robust competition will help drive the efficiencies needed to generate whole of life cost savings which in turn are required to demonstrate better value for taxpayer money.

    Critics of PPPs incorrectly compare the whole of life cost of PPPs to conventional costs to build an asset. This ignores long term maintenance and repair charges and mistakenly attributes the value of a dollar today to a dollar twenty years from now.

    The process transport authorities will now undertake will be to challenge the PPP market to deliver a 30 year road solution at better value than 30 years of conventional contracts.

    Without some combination of improved service delivery and cost savings, a PPP will not proceed and thats exactly the right process, Selwood says.

  • 22 Jan 2016 11:55 AM | Anonymous

    Media Statement 
    20 May 2015

    Local governments representative body LGNZ should be commended for taking proactive steps to lift the performance of the sector, following the release of concerning national survey results which rated councils just 3 out of 10 for overall performance, says Stephen Selwood CEO of the New Zealand Council for Infrastructure Development.

    The 2014 Colmar Brunton survey of 2400 residents and 600 businesses found that a strong majority of New Zealanders believe that local government is important, but also revealed a poor reputation for local government overall. Residents and businesses rated councils just 3.2 out of 10 for communication and interaction, 2.8 out of 10 for performance and 2.6 out of 10 for leadership.

    The results should serve as a wakeup call to our 78 councils.

    All councils are struggling to balance service costs with expectation pressures, a tension which is going to increase as growth pressures require the need for investment in some areas while demographic change limits capacity to pay for core services in others.

    This survey suggests councils need to radically rethink the way they deliver services, engage with residents and lead their communities forward.

    It is therefore encouraging to see local governments peak body outlining a priority programme to improve public understanding of local governments critical role and performance of the sector.

    NZCID supports the six priorities proposed:

    1. governance, leadership and strategy; 
    2. financial decision-making and transparency; 
    3. asset management and infrastructure; 
    4. engaging with business; 
    5. communicating and engaging with public; and 
    6. building a stronger relationship with central government.

    However, the one aspect LGNZ has not identified is whether the current size and number of councils is appropriate to address the issues and future challenges.

    Local government has a potentially significant role to play in leading the social, economic and environmental development of our regions, but in order to perform this role adequately it requires fit for purpose structures, resourcing capability and the confidence of its constituents.

    The results of this survey demonstrate the need for councils to dramatically up their game and suggest a need for transformational change to meet current and future challenges across the local government sector, Selwood says.

  • 22 Jan 2016 11:54 AM | Anonymous

    Media Release
    12 May 2015

    The Hamilton City and Waipa and Waikato district councils should be commended for looking at innovative ways to improve services to ratepayers at lower costs, says Stephen Selwood of the New Zealand Council for Infrastructure Development. 

    The three councils agreed to co-fund the independent study into different wastewater, water supply and stormwater management options in 2014. 

    The Cranleigh authored report released yesterday identifies close to half a billion dollars of savings over the next thirty years and $107 million over the next decade, if the three councils were to transfer water assets and management to a council controlled organisation. 

    These three councils are planning to spend $764 million on water services over the next ten years, so a saving of $107 million or 14 per cent is very significant. 

    Savings would come on top of better water services for residents. The report found that the CCO model would contribute to: 

    - a stronger and much more resilient waters network across the sub-region; 
    - improved compliance with environmental and drinking water standards; 
    - a greater likelihood of attracting and retaining key waters staff; 
    - the creation of a regional water centre of excellence; and 
    - the ability to better harness and maximise the economic potential of the region. 

    The findings are consistent with experience elsewhere, including in Scotland, Tasmania and Auckland. 

    In Scotland, a publicly owned special purpose water company has achieved 40 per cent savings in operating costs whilst dramatically increasing capital investment in water infrastructure to provide better services to users. 

    Closer to home, Watercare has realised $104 million in savings per annum following its consolidation of water services in Auckland, at the same time as scale has enabled upgrades to Rodney and Franklins infrastructure that was not affordable under the former council structure. 

    Its encouraging to see Waikato councils front-footing emerging challenges and seeking out new opportunities, Selwood says.

  • 22 Jan 2016 11:53 AM | Anonymous

    Media Statement 
    30 April 2015

    The transfer of 2800 state houses to the joint Auckland Council-Government owned special purpose body, the Tamaki Redevelopment Company, will result in the biggest investment in the Tamaki community since the 1950s and presents the opportunity to revitalise the communities of Glen Innes, Panmure and Pt England, says Stephen Selwood of the New Zealand Council for Infrastructure Development.

    Decades of underinvestment by successive Governments managing state housing through a single national provider has failed to deliver safe, warm and healthy housing, let alone a vibrant local economy, secure neighbourhoods and a bright future for residents.

    The transfer of assets to the Tamaki Redevelopment Company (TRC) together with access to a $200 million loan initiates a process to achieve each of these outcomes.

    As an independent redevelopment company, TRC will be less fettered by public policy processes and departmental silos which slow down decision making and impede engagement with communities, investors and the development sector.

    TRC will be able to get things done.

    And it will be able to do this more efficiently than in the past. In owning all the stock and having capital at the ready, the Company will be able to implement a master plan for Tamaki, aggregate public and, where possible, private properties, redevelop at scale and maximise land value in what is a very desirable part of the city.

    Even using conservative estimates of 7500 new properties in Tamaki over the next 20 years, the Company will be able to sell or lease two new houses for every new social house it develops, thereby significantly increasing housing supply and retaining the same number or more homes for people in need.

    Thats not just good news for tenants and home buyers, who will be the direct beneficiaries of new housing, but also for the taxpayer, as less public money will be required to deliver new warm, dry homes.

    But it remains unclear how the Government will deliver on all of its objectives through this policy.

    If community revitalisation is to be front and centre of this initiative, which everybody agrees it should, there must be a pathway and provision of funding to support social housing tenants to transition from dependence to independence.

    How will the Government integrate its policies, programmes and funding to achieve this?

    In order to maximise the value of land, reduce risk and attract private capital to the area, the Government must provide confidence that the neighbourhoods of Tamaki will be attractive places to both live and invest in.

    That requires strong commitment up front, in the terms of reference for the redevelopment, and accountability and funding to deliver on those objectives.

    The transfer of responsibility to TRC is a good first step. What is now required is for TRC to proactively engage with investors, lenders, developers and social support service providers in a clear and transparent manner and seek innovative and integrated proposals for the redevelopment of Tamaki.

    "A public private partnership focussed on delivering community uplift, and integrating private capital, innovation and expertise with social support services provided by community housing organisations and/or commercial providers, would be a logical solution.

    "That is the strategy employed by Government in the Wiri prison PPP which targets reduced recidivism rather than just building another jail.

    The business case process now underway must take a broad social and economic approach which values wrap around service provision, including the impact of good social support on land values and community wellbeing.

    If the Government, council and Tamaki Redevelopment Company work together with the community and in partnership with the private and third sector to deliver a great place to live, the value of land and the potential of the community can both be fully realised," Selwood says.

  • 22 Jan 2016 11:52 AM | Anonymous

    Survey findings demonstrate Aucklanders are willing to pay for better transport services and reduced congestion

    Media Statement 
    17 April 2015

    Colmar Bruntons survey of Auckland views on transport investment demonstrates a strong willingness to pay for better outcomes. The onus now is on the Auckland Council and Government to agree on objectives and deliver an aligned transport investment, land use, pricing and funding strategy that reduces congestion and supports the shift to public transport, says Stephen Selwood CEO of the New Zealand Council for Infrastructure Development.

    Almost 60 per cent of Aucklanders say they are prepared to pay more to improve Aucklands transport system, compared to less than a third who are happy to continue business as usual. A similar number, 57 per cent, prefer that new transport funding is levied through a $2 average motorway charge, while just 31 per cent support new investment through increases to rates and fuel taxes. The survey questioned over 5000 respondents through February and March this year and has a margin of error of +/- 1.4%.

    These are compelling numbers derived through a rigorous independent survey.

    The Auckland Council has successfully brought Aucklanders over the line on the need to invest more in transport and even identified a mechanism to fund that investment.

    However, there remains substantial work to do to ensure that additional investment meets the expectations of residents and the Government.

    An earlier Colmar Brunton survey indicated that the top two priorities to achieving the worlds most liveable city was to improve public transport and reduce traffic congestion.

    Yet even with the Councils preferred Auckland Plan investment programme in place, several key transport outcomes worsen noticeably in the future. Of particular concern is that congestion is not projected to improve beyond delivery of the Waterview Connection and in fact will deteriorate significantly beyond 2025.

    Thats not what residents are thinking when they agree to open their wallets.

    The only way of delivering on the strong message conveyed to decision makers through the Colmar Brunton survey is for the Auckland Council and Government to get round the table and agree an optimum demand management, land use and investment strategy.

    The Council must be willing to review its Auckland Plan programme, including the release of brown and greenfield land for housing supply and transport priorities, as a means to persuading the Government to pass necessary legislation.

    If the Government and Council can reach an accord on transport and urban development supported by a road pricing regime which optimises the transport network, we have a very good chance of delivering the worlds most liveable city, Selwood says.

    Opportunities to deliver better outcomes for Aucklanders include:

    • Project reprioritisation the sharp projected increase in congestion post 2025 and improvement post 2035 demonstrates resequencing is necessary,
    • Project optimisation more needs to be achieved from the key investments,
    • Road pricing variable pricing delivers a more efficient network and stronger economy,
    • Development control and prioritisation brownfield development must be concentrated around rail and busway stations and staged to align with transport investment,
    • Value capture property value improvements due to infrastructure and zoning decisions must be retained to fund services,
    • Leveraging technology - the plan must fully exploit opportunities, from remote working and intelligent transport networks to electric and fully automated vehicles .

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