Budget 2022 will be delivered on Thursday, 19 May.
Minister of Finance Hon Grant Robertson has said this year’s Budget will include a focus on the Government’s health reforms and investing to meet climate change goals.
The Government is set to publish New Zealand’s first Emissions Reduction Plan on 31 May, with the Plan’s financial implications set to be a Budget highlight.
Minister Robertson has also signalled the Budget will include a one-off increase of $6 billion to the operating allowance to invest in major programmes such as health reforms. The allowances will reduce to $4 billion at Budget 2023, and then to $3 billion in Budgets 2024 and 2025.
Addressing the fallout from Covid-19 on the economy and advancing the Government’s other priorities – some of which are election promises – means Minister Robertson has the hard task of managing the split between operational and capital expenditure. What Budget 2022 does for the infrastructure sector will have substantial flow-on effects given infrastructure is a foundation for our economic, social, environmental and cultural wellbeing.
Feasibility work on pumped hydro underway at Lake Onslow
The New Zealand Battery Project has begun geotechnical investigation of the feasibility of pumped hydro at Lake Onslow. Additionally, MBIE has confirmed that work is underway looking at ownership model options.
Early estimates indicate a cost of about $4b for the project, though the feasibility study will provide a better indication of the costs. Critics say the actual costs could be much higher.
The Department of Conservation has also commissioned a study looking at the environmental, recreational and conservation values of pumped hydro at the site.
A Cabinet decision on whether, and how, to progress on feasibility work is expected in May.
A boost to Auckland’s water supply
Watercare Services Ltd has been granted a 20-year resource consent by the independent Board of Inquiry appointed by the Minister for the Environment. The decision allows for an additional 150 million litres per day to be taken from the Waikato River, doubling the total water take to 300 million litres a day.
Watercare originally sought a 35-year consent, but opposition from the Hamilton City Council, Waikato River iwi and the Waikato River Authority led to the changes.
In its decision, the Board of Inquiry allowed for review by the Waikato Regional Council every five years and imposed conditions including greater involvement of Tangata Whenua in river governance decisions, an annual payment of $2 million to the Waikato River Authority for river restoration initiatives, and for Watercare to demonstrate progress toward finding new water sources.
Work is already underway to reduce Auckland’s reliance on the river, with initiatives including the use of residential water meters, encouraging greater use of rainwater, and renewing water infrastructure to plug leaks already being pursued. Longer-term options including desalination and the potential use of recycled wastewater are being explored.
The consent will allow supply to Auckland as well as to Pokeno and Tuakau and will see the organisation develop a new permanent treatment plant. Work is underway to develop this in stages to meet population growth estimates, and in time, a second pipeline into Auckland city is anticipated.
A programmatic approach to decarbonising cities
Jacobs, an INZ member organisation, has released a thought leadership paper Beyond Carbon: A holistic approach to net zero cities. It asks the question: What if city stakeholders used a programmatic approach, looking beyond traditional project and asset boundaries, to co-develop solutions that reduce carbon AND address the most urgent and aspirational needs of the community?
The paper outlines how embracing a more holistic, programmatic approach to decarbonisation and investing in local carbon reduction and removal projects could help cities accelerate their transition to net zero, deliver co-benefits that address other challenges, and provides a roadmap for cities to implement this approach.
Access the full paper here.
The World Economic Forum and Marsh McLennan release Global Risks Report
The World Economic Forum in collaboration with Marsh McLennan have released the 2022 version of the Global Risks Report. This 17th edition of the report examines how global divergence across multiple domains in the post-Covid -19 recovery threatens to widen disparities and aggravate societal fractures.
Drawing upon insights from over 950 experts and decision-makers worldwide, the report unpacks some of the critical global tensions that risk worsening the pandemic’s cascading impacts and complicating the coordination needed to tackle common challenges that include strengthening climate action, enhancing digital safety, restoring livelihoods and societal cohesion, and managing competition in space. It concludes with reflections on enhancing national and organisational resilience, informed by lessons from year two of the pandemic.