Infrastructure new Zealand MEDIA RELEASES

MEDIA RELEASE

“We fully support the Resource Management Review Panel’s recommendation to replace the RMA with two new Acts, which reflects growing consensus of the way forward but, if changes are not also made to local government responsibilities and rewards, then it is difficult to see how plans will be implemented or who will be accountable,” says Infrastructure NZ CEO Paul Blair.

“The Tony Randerson-led Review Panel has recommended replacing the Resource Management Act 1991 (RMA) with two new pieces of legislation, a Natural and Built Environments Act and a Strategic Planning Act.

“The Natural and Built Environments Act would strengthen the current system by not only seeking to protect the environment, but improve it.

“The Strategic Planning Act would give statutory weight to strategic spatial plans and, critically, force reconciliation and alignment across central and local government to ensure implementation.

“Ultimately, we’ll see something closer to 14 integrated resource management and strategic plans instead of the 100 plus we currently have.

“What is really positive about this proposal is that it will move New Zealand away from the negative and short-sighted ‘effects-based’ planning approach which has dominated the last 30 years and which has seen severe deterioration in housing affordability, infrastructure and environmental performance.

“We’ll again focus on outcomes and the value created from planning and investment, not just the costs. 

“However, a question remains as to how strategic spatial plans will be implemented.

“For plans to be implemented successfully, the organisations overseeing those plans must want them to succeed. The only way to do that is to ensure local councils and other institutions receive a portion of the value they create.

“What is the revenue stream available to councils which will enable them to invest in long term growth infrastructure ahead of the businesses and homes which will eventually pay rates? What reward will councils receive from investment decisions which lead to stronger economies, communities and environments?

“When considered in parallel with the COVID response and water reform programme, the Panel’s recommendations provide the opportunity for central government to formalise its investment relationship with local government.

“If central and local government can agree the resourcing central government will commit to spatial plans and councils can agree to support those plans with local services, then we will have an accountable framework for funding and implementation.

“The problem is that signing 78 separate agreements with each local authority for 14 or so regional strategic spatial plans is not going to be efficient nor feasible. 

“Responsibility for development, funding and delivery of strategic spatial plans needs to be vested in 14 or so strengthened regional authorities to leverage scale, capability and ensure accountability.

“Local democratic decision making and identity needs to be the focus of truly local councils who can effectively represent their individual communities of interest.

“Infrastructure New Zealand has set out a pathway to achieving strengthened local representation, decision making and delivery in its Building Regions report, accessible here.

“The next Government should provide financial incentives for local councils to collaborate, with a view to concentrating major planning and investment decisions at a regional level where scale and capability can be leveraged and focusing local councils on local needs, democratic decision making and identity,” said Blair.

A copy of the Resource Management Review Panel’s report can be found here.

The Review Panel process was catalysed by the Resource Reform New Zealand group, consisting of Property Council New Zealand, Environmental Defence Society, Employers and Manufacturers, Business New Zealand and Infrastructure New Zealand.

ENDS

For further information and comment contact Paul Blair on 021 902 436 

JOINT MEDIA RELEASE

Construction and infrastructure industry leaders are calling for urgency around the release of the government’s full list of ‘shovel-ready projects’ as increasing numbers of workers face redundancy and business confidence amongst construction and infrastructure companies nose-dives.

Early this month the Government announced it had selected 150 projects worth NZD$2.6b that would create or retain 20,000 jobs. But four weeks later, only 30 projects worth about NZD$500m (approximately 25 per cent of the total allocated) had been released. A package including NZD$761m of three waters funding had also been announced, but without any timelines.

Civil Contractors New Zealand Chief Executive Peter Silcock said while the civil construction industry welcomed funding announcements and wanted to take the lead in driving post COVID-19 employment and economic recovery, details were urgently needed, or people would lose their jobs.

There was a big difference between making announcements and providing meaningful employment opportunities through economic activity, Mr Silcock said.

“The current situation is incredibly frustrating. We know the work is out there, but unless we know where, what and most importantly when projects will start, contractors are left totally in the dark. They will have no choice but to put workers off or face the risk of companies going under.”

He said employers had been waiting months for shovel-ready jobs and needed certainty to invest in people. Every week’s delay meant more would lose their jobs. A joint letter from industry leaders was sent to ministers in mid-June stating the urgent need. Ministers responded that answers were ‘imminent’, but the actual project details were still trickling out slowly, he said.

Infrastructure New Zealand Chief Executive Paul Blair said companies were running out of options.

“The drop off in well-signalled work across local councils and the private sector means industry is disproportionately dependent upon central government. All those small but steady jobs in local areas across the country help sustain employment in between big jobs that make front pages. They’re very important. That’s why industry was so pleased with the shovel-ready announcements.”

Mr Blair said timing was everything. Projects starting construction today had planners, designers and architects at work last year. Contractors began allocating resources, scaling up or down based on predictions of work. The problem now was that no one could see six to 12 months ahead, so they were taking risks retaining staff on assumptions work would appear or having to cut back hours.

“It’s very stressful, it’s increasing costs and it’s completely avoidable. The full list and timing of shovel ready projects needs to be released now with a clear commitment to project timeframes.”

Association of Consulting and Engineering Chief Executive Paul Evans said the situation was looking dire as local government cut spending on infrastructure projects, and unless urgent action was taken, the infrastructure and construction industries stood to lose a huge amount of skilled workers.

“We've seen this happen before. From 1987 into the early 90s, thousands of jobs were shed, creating a capability crisis lasting a decade, whose ripples remain today. The loss of skill and capacity in engineering and construction meant under-investment in critical infrastructure.”

Mr Evans said right now the industry could not create employment opportunities, and was instead adding people to the unemployment list. A June ACE New Zealand survey indicated 46 per cent of engineering consulting firms were experiencing cashflow and financial issues.

He said forty-five per cent had been considering cutting staff – the average loss was estimated at 15 per cent of the workforce. This was likely to have increased since June, with flow-on effects across the whole of the economy.

ENDS

To arrange an interview, contact:
Fraser May, Communications Advisor, Civil Contractors New Zealand
Fraser@civilcontractors.co.nz | 027 8222 107 | www.civilcontractors.co.nz

Paul Blair, Chief Executive, Infrastructure New Zealand
Paul.blair@cinfrastructure.org.nz | 021 902 436 | www.infrastructure.org.nz  

Paul Evans, Chief Executive, Association of Consulting and Engineering New Zealand
Paul@acenz.org.nz | 021 340 317 | www.acenz.org.nz

ABOUT CIVIL CONTRACTORS NEW ZEALAND
Civil Contractors New Zealand is an incorporated society that represents the interests and aspirations of more than 600 organisations – including large, medium-sized and small businesses in civil engineering, construction and general contracting. It also has associate members who provide valuable products, support and services to contractor members.

ABOUT INFRASTRUCTURE NEW ZEALAND
Infrastructure New Zealand promotes best practice in national infrastructure development through research, advocacy and public and private sector collaboration. Members come from diverse sectors across New Zealand, equity owners, service providers, public sector agencies, and major infrastructure users.

ABOUT THE ASSOCIATION OF CONSULTING AND ENGINEERING NEW ZEALAND
ACE New Zealand provides leadership, support and advocacy for the consulting and engineering sectors in Aotearoa. ACE represents over 200 consulting and engineering firms employing more than 13,000 staff. Our members are on the front lines of delivering critical construction and infrastructure and represent the essential expertise that Aotearoa will need as we look to the future.

MEDIA RELEASE

“National’s commitment to reforming planning and transport investment is welcome and, if supported by effective and timely delivery, could be transformational for New Zealand,” says Infrastructure New Zealand CEO Paul Blair.

“New National Party leader Judith Collins today announced a $17 billion transport investment programme for the Upper North Island and signalled a future allocation of $14 billion across the rest of New Zealand.  

“The $31 billion transport programme, covering both strategic roading and public transport, would be principally enabled by a $7 billion allocation from the $20 billion COVID response fund and the long awaited allowance of NZTA borrowing against National Land Transport Fund revenues.

“Not only would this borrowing lift NZTA’s spending capability, it would also mean that future generations pay fairly for the benefits they get from today’s investments.

“National have signalled that the new investment-led approach to growth management will be supported by the repeal of the Resource Management Act.

“The replacement of the RMA with separate environmental protection and strategic planning Acts is necessary to pivot New Zealand away from decades of effects-based planning which has failed to support growth and productivity.

“The commitment by National to repeal and replace the RMA dovetails with the ongoing review by the Randerson Panel. 

“Wider resource management system reform which aligns planning and investment across central and local government is needed to achieve the kind of economic, social, cultural and environmental outcomes everyone wants.

“Delivery will be the key.

“RMA reform and transformational investment has been talked about for many years, but successive Governments have been challenged to overcome barriers within each three-year cycle.

“The next Government will need to rapidly move to reform key statutes like the RMA, Local Government Act and Land Transport Management Act, without losing momentum on projects needed to implement Government direction.

“A comprehensive project pipeline is a critical first deliverable for the next Government to ensure industry is ready and capable to meet future work demands.

“National’s announcements today are encouraging and we look forward to a healthy debate between all parties on the best way to fix the way we plan, fund and deliver infrastructure for a more successful New Zealand,” says Blair.

ENDS

For further information and comment contact Paul Blair on 021 902 436 

Infrastructure NZ is delighted to acknowledge the growing number of member organisations nominated as finalists for the 2020 Diversity Awards NZ™, demonstrating the increasing importance the infrastructure sector is placing on diversity and inclusion to help build a future focused industry.

“Entering the Diversity Awards is a bold move and demonstrates a public commitment to driving change in workplace cultures; which research demonstrates, is rewarded by enhanced business performance and employee engagement” says Paul Blair, CO Infrastructure NZ.

The awards, run by Diversity Works New Zealand, are in their 23rd year and celebrate best practice in workplace diversity and inclusion. Judging convenor Kirstin Te Wao says the judging panel was impressed to see a number of entries that demonstrated a clear link between the organisation’s diversity and inclusion initiatives and the overall business strategy.

“The judges saw some very well-designed programmes that evidence businesses are making a significant investment in the future sustainability of their workforce,” she says.

Another theme was the increase in organisations drawing on external expertise or partners to design and deliver initiatives, contributing to the uplifting of economic outcomes for broader Aotearoa.

“It was also wonderful to see organisations demonstrating inter-generational and collective thinking through initiatives that benefit an entire industry, not just one organisation, and have a broader impact on the wider community. These are all positive signs as Aotearoa reimagines what the future holds in a post-Covid-19 environment.”

This year, Infrastructure NZ members Jasmax were nominated as finalists in the Cultural Celebration Category, where they were commended for their responses to cultural and ethnic engagement in the workplace;

Deloitte was nominated as finalists in the Empowerment Category which celebrates innovative responses to empowering women in the workplace;

The Ministry of Education was nominated as a finalist in the Rainbow Inclusion Category, for their innovative response to inclusivity of the LGBTQI community in the workforce;

HEB Construction was nominated as a finalist in the Skills Highway Award Category, honouring organisations which recognise the importance of numeracy and literacy.

Citycare Ltd, Fletcher Building and Girl Boss NZ, The Ministry for Business, Innovation and Employment and Watercare Services Limited were nominated as finalists in the Tomorrow's Workforce Award category which celebrates innovative responses to a changing workforce demographic.

Aurecon was nominated as a finalist in the Work Life Balance Award which celebrates organisations that recognise that work is part of a rich and challenging life.

As a member of DiversityWorks, Infrastructure NZ is a strong advocate for member organisations developing diverse and inclusive workplaces by publicising clear targets and metrics on diversity, prioritising action and reporting externally to stakeholders. “We want the infrastructure sector to be the industry of choice”, says Blair “welcoming to everyone, and the home of the best and brightest minds.”

Infrastructure NZ congratulates all finalists and wishes them well for the Gala Dinner at the Skycity in Auckland on Wednesday, 16 September, where the winners will be announced.

MEDIA RELEASE

“The Government’s long-awaited funding boost and water reform agenda is New Zealand’s best chance to create a high performing water sector for New Zealanders,” says Infrastructure NZ CEO Paul Blair.

“The Government has today announced it will provide $761 million of investment to local councils who opt-in to the Government’s wider reform programme.

“The reforms are required because over one million Kiwis do not have access to clean drinking water today, our wastewater systems are degrading the environment and our inability to deliver water services ahead of demand has been a critical handbrake on the release of land for housing.

“We are pleased to see that central government is using financial incentives to effect this change, and believe that funding, accountability and risk-sharing mechanisms that reward local government for alignment with central government goals will be far more effective than the ‘stick’ of additional regulation on already stretched local resources.

“Where we all really need to get to is a small number of publicly-owned specialised water service providers with the scale and capacity to plan, fund, finance and operate increasingly complex water systems.

“Establishing these new regional public water providers as independent entities off individual council balance sheets, will unlock major new water investment needed to meet basic drinking, waste and stormwater standards.

“Debt limits on similar international water companies are around six times revenue, compared to current council restraints equivalent to three times revenue.

“That’s an additional $4.5 billion of investment in new treatment plants, pipes and other critical infrastructure to add to the Government’s $761 million injection, if the Government’s reform process can be realised.

“If reforms can be accelerated, this investment will provide a major economic boost across all parts of New Zealand at the same time as improving public and environmental health.

“As we continue progress towards a modern world class water system, economic regulation will be needed in addition to the Government’s new water quality regulator Taumata Arowai.

“Economic regulation will monitor water charges to compare performance across the country and ensure water entities meet standards, affordably and without gold plating services.

“The form of economic regulation of water will need to be broadened to explicitly address the social, cultural and environmental importance of water to New Zealanders.

“The twin guardians of economic regulation, on one hand, and environmental and drinking water quality regulation, on the other, will provide Kiwis with clear benchmarking of quality outcomes from these water companies, enabling consumers to understand the value they gain from their payments to water companies.

“When it underwent its reform process two decades ago, Scottish Water was able to double its capital expenditure and its customer satisfaction, while lowering water rates by 40% over a decade and a half of reform.

“This is what we can achieve in New Zealand.

“The Government’s announcement today is a very important step to creating a complete water system covering urban and rural, fresh and grey water resources, helping to sustain and improve one of our most important assets,” says Blair.

ENDS

For further information and comment contact Paul Blair on 021 902 436 

MEDIA RELEASE

“Today’s announcement that the bulk of the $3 billion shovel ready infrastructure fund has been finalised is welcome, but to avoid major lay-offs in the engineering, design, consulting and construction sectors, projects must be urgently brought to market,” says Infrastructure New Zealand CEO Paul Blair.

“Ministers Robertson and Jones announced today that $2.6 billion of the $3 billion shovel ready fund has been allocated to 150 projects, with $400m still to be allocated.

“The spend is grouped into four main sectors, comprising $708m spent on transport, $670m on community and social development, $464m on housing and urban development, and $460m on environmental projects.

“Infrastructure market participants up and down the country will be pleased that the Government has announced this next step.

“However, for employers hurt by the sudden drop-off in local government and private sector investment, today’s announcement may not give them the certainty needed to retain underutilised staff.

“In the 6 weeks since the Infrastructure Reference Group provided their list of 800 projects, a significant gap has emerged in the infrastructure forward works programme.

“Civil Contractors NZ and the Association of Consulting Engineers NZ have estimated that engineering and construction job losses could hit 10,000 without money rapidly flowing into projects and programmes of deliverable work.

“The fundamental challenge still facing the industry is the lack of clearly defined projects and a timeline for when they will be brought to market.

“Just 12 projects were signalled today and details of when they would be tendered or how have not been released.

“A survey conducted by Infrastructure NZ in March showed that few employers can afford to wait 12 months on the basis of future spending promises.

“Will we use accelerated delivery models to rapidly move from announcements to money flowing into actual projects which put people to work?

 “The industry strongly supports government infrastructure stimulus efforts, but urgently needs more detail on the projects and to proceed at pace,” says Blair.

 

ENDS

For further information and comment contact Paul Blair on 021 902 436 

MEDIA RELEASE

“The Government’s decision to end the twin track light rail process provides some clarity, but questions still remain about process, problem definition, outcomes and how now Auckland will meet its transport and housing needs,” says Infrastructure NZ CEO Paul Blair.

“The Government has been running a process to determine whether a consortium, which includes the NZ Super Fund, or the New Zealand Transport Agency should procure light rail between the Auckland CBD and airport.

“Confirmation that coalition partners have been unable to agree a way forward means that officials and the market can now move forward with the next stage of preparation.

“However, many questions remain unanswered, including, if two proposals were received which both achieved the objectives of the project, why was neither able to proceed? Will the next iteration suffer the same fate?

“A risk emerges that international infrastructure expertise views New Zealand as unattractive and expensive, an issue which could undermine the country’s COVID recovery.

“It will now be very important for government to learn from the process, including how best to managed unsolicited bids, engage the sector on complex projects and manage intellectual property concerns.

“Light rail was proposed to address access, congestion, housing and urban regeneration objectives that now are left without a clear response.

“Design, construction and other infrastructure sub-sectors were also anticipating major work related to the project in the short-medium term.

“A significant transport and housing investment programme is now required to fill the gap left by light rail and by Auckland Council funding pressures.

“An immediate priority must be to confirm the infrastructure pipeline, not just to protect employment but also to address historic underinvestment and accommodate rapid population growth from returning Kiwis,” says Blair.

ENDS

For further information and comment contact Paul Blair on 021 902 436 

MEDIA RELEASE

“The Simpson Review’s proposal to restructure the healthcare system should be aligned with other reforms to enable a coordinated approach to public service governance, planning, funding and delivery,” says Infrastructure New Zealand CEO Paul Blair. 

“The Health and Disability System Review chaired by Heather Simpson found that while New Zealand continues to have a good public health system internationally, it was now under serious stress. 

“This finding is supported by analysis released last week that found an average of $1.4 billion per annum of capital investment in healthcare would be required over the next decade. This is around three times what DHBs spent in the past decade and illustrates just how large the backlog is in one aspect of health service delivery. 

“It is not clear from this report how additional health operating and capital expenditure needs will be met. True innovation in service delivery will be required to bring in partners, adopt tele-health, and leverage iwi and third sector providers. 

“The Simpson Review comes at the same time as the Government is reviewing water services and the planning system, as well as investigating electricity prices, port infrastructure and is considering support to local government through the COVID-19 crisis. 

“Throw in known and severe issues in transport and housing, plus $136 billion worth of demand for ‘shovel-ready’ projects, and it is very clear that the public purse is highly stretched and a major rethink of domestic public service provision is required.  

“Who should deliver public services, who should fund them and how do we get the range of public service providers working together collaboratively and coherently? 
 
“Demand for health services often sits at the end of a very long chain of public policy decisions in transport, water, housing, education, welfare, justice and other sectors.  

“We need alignment in the way decisions across these sectors are made, certainty of investment and the ability for both national and local priorities to be represented.  

“There is no such alignment currently and it is undermining our ability to plan spatially, invest to meet growth and recognise when things are going wrong.

“There are over twelve different interpretations of what constitutes a region in New Zealand for the purposes of administering public services, in addition to the existing 20 DHB areas. (Click here to see a map from the McGuinness Institute). Each has its own boundaries, decision making processes and funding streams.  

“More important than a reduction in the number of DHB areas, as per the Simpson report, is regions with agreed governance, investment, funding, partnership and planning arrangements across transport, health, education and other public services.  

“That would enable delivery of regional spatial plans. We could then align health investments with those in transport and other sectors based around improving public outcomes, rather than minimising the fiscal cost of each service within each silo.  

“That is what we need to get on top of simultaneous crises across almost all of our key public services.  

“But it can’t happen if the Simpson report’s findings are progressed independent of wider reform initiatives underway.  

“New Zealand needs a much more fundamental discussion around who makes decisions for public services, where the money comes from and who is held to account if things go wrong,” Blair says.  

A copy of Infrastructure New Zealand’s Building Regions Report can be found here.

ENDS

For further information and comment contact Paul Blair on 021 902 436 

MEDIA RELEASE

“Today’s national assessment of our health assets shows that our health infrastructure is on life support and points to systemic weaknesses in the ways we plan, fund, and deliver our social infrastructure,” says Infrastructure New Zealand CEO Paul Blair.

“Today, the Ministry of Health released its report of the National Asset Management Programme for district health boards (DHBs).

“We commend the Government and the Ministry of Health for commissioning and publishing this vital and confronting work. For far too long, there has been poor transparency on the true condition of New Zealand hospitals.

“The report found that our hospitals are old, with significant infrastructure deficiencies, and are technologically behind the times.

“DHBs estimate that, though our hospitals have a total replacement value of $24 billion, they will need $14 billion in capital investment to bring them up to standard over the next decade, showing just how much work is needed. 

“The $14 billion of investment required is a major increase from the $5.5 billion estimated a decade ago and will likely rise further the longer we delay.

“Pleasingly, $750 million in capital investment was committed in Budget 2020. This is a significant step forward but it only represents half of what is required every year for the next ten years.

“A ten-year funding commitment from Budget 2021 will be required.

“This will not only demonstrate to the public that the Government is committed to resolving severe health infrastructure issues, but will give the infrastructure sector time and confidence to scale up for the largest health capital investment in decades.

“It couldn’t have come at a better time. The vertical construction sector will soften markedly through 2021 as existing projects are completed and private investment remains muted.

“Government now has an opportunity to build through the dip, utilising available resources and improving the quality of life-saving infrastructure.

“If the Government is unable to commit funding directly, there is significant private capital (including quasi-public entities like NZ Super and ACC) looking for opportunities and a range of models are available to help Government manage cashflow and meet essential service demand.

“Reform of our health sector should also be investigated.

“Evidence that New Zealand’s provision of ICU beds is far below comparable countries  and ongoing DHB financial pressures suggest our model may no longer be fit for purpose.  

“Health spending should not be ‘the ambulance at the bottom of the cliff’.

“Integrated  planning and funding of high-quality housing, water, transport and social infrastructure can provide highly effective ‘primary care’ intervention, and this should be prioritised as well to improve holistic health outcomes for Kiwis.

“Our Government should be setting ambitious outcomes for the health of kiwis  – we look forward to transformational reform such as that recommended by the Health & Disability System Review,” says Blair.

ENDS

For further information and comment contact Paul Blair on 021 902 436 

MEDIA RELEASE

“New Zealand's move to Alert Level 1 means the infrastructure industry’s largest annual event, the Building Nations Symposium, is now confirmed for 14-15 October at Trusts Arena, West Auckland,” says Paul Blair, CEO of Infrastructure New Zealand.

“With the $12 billion upgrade programme, $3 billion shovel-ready stimulus and another $20 billion of public investment available, this will be one of the most highly-anticipated Building Nations events ever.

“Closely following the election, the Government’s investment agenda, water, transport, housing and the transition to a more productive, sustainable and inclusive economy will be among the priority topics for discussion.

“Last year’s Symposium in Rotorua hosted over 720 attendees and generated over $2 million dollars for the local economy.

“Building Nations is the premier infrastructure event where infrastructure leaders and experts go to hear the best and latest thinking from Ministers, global experts, and public and private sector decision-makers.

“Buildings Nations has been recognised for its approach to sustainability and is a finalist for 4 NZEA 2019 Event Awards this year, including Best Corporate Event, Best Established Event Professional, Best Local Government Event and Best International Event.

“Registrations will open shortly and we look forward to safely bringing a positive impact to the West Auckland community and the infrastructure industry,” says Blair.

ENDS

For further information and comment contact Paul Blair on 021 902 436