Immigration sector agreements a helpful start

The Construction and Infrastructure Sector Agreement as part of the Immigration Rebalance is a helpful start and will allow the recruitment of much-needed lower skilled workers in the sector. However, work to residency pathway certainty and global competitiveness improvements will need to follow to ensure New Zealand’s construction labour shortages begin to ease.

Under the sector agreement, the construction and infrastructure sector is provided limited exceptions to the median wage requirement in exchange for ongoing improvements to productivity and wage growth.

The agreement comes in part as recognition of the great work our sector is doing to recruit and upskill New Zealanders and as an acknowledgement of the continuing pressure that an ageing workforce, the size of the infrastructure deficit and Covid-related pressures have placed on the sector’s capacity to transition in line with the Government’s vision of a high-wage economy.

The construction and infrastructure sector agreement will allow employers to hire migrants at 90 per cent of the median wage, or $25/hour. This will be updated annually in line with the 90 per cent threshold.

Migrant workers will be able to be paid at that rate for two years. Then, a stand down period of 12 months will apply before they are able to be paid at below the median wage again. A range of roles are eligible across the sector and the agreement will come into effect in October this year, before being reviewed in 2024.

While helpful, we are not alone in facing a tight labour market. Ability to attract workers for these below median wage positions during the transition period will be affected by New Zealand’s global competitiveness at cost of living and policy setting levels.

In Australia, Prime Minister Albanese has added an extra 35,000 permanent visas and has announced a review to streamline immigration processes.

Without clear work-to-residency pathways and streamlined processes in New Zealand, it’s hard to see how the beckoning call of faster processing and greater residency certainty across the ditch would fall on deaf ears. With employers globally crying out for workers, clear and expedited processes and a focus on our global competitiveness will be crucial to easing pressures onshore.

Auckland Council adopts ambitious transport emissions plan

In August, Auckland Council adopted the Transport Emissions Reduction Pathway which gives effect to te Tāruke-ā-Tāwhiri Auckland’s Climate Plan’s required 64 per cent reduction in transport emissions by 2030.

The pathway lays out what will need to happen for Auckland to meet that goal. It includes:

  • Making the majority of Auckland’s local trips (under 6km) by sustainable modes
  • Converting 30 per cent of the city’s vehicles to electric, especially commercial vehicles
  • A ten-fold increase in active travel
  • A five-fold increase in the number of public transport trips taken – aided by a three-fold increase in the number of services on offer.

Forty per cent of Auckland’s emissions come from transport, with 86 percent from road transport. Reducing private vehicle use and designing our cities to enable active transport will be crucial to meeting emissions reduction obligations and creating better outcomes for our biggest city – and by extension, New Zealand.

At present, 17 percent of trips around Auckland are made by walking, cycling or on public transport. To reduce transport emissions by 64 per cent, this will need to increase to at least 62 per cent of trips by 2030.

The Transport Emissions Reduction Pathway is ambitious, but bold action will be required if we are to avoid the worst of the possible climate scenarios. The onus is now on the Council, and government, to invest in public and active transport as well as electric vehicle infrastructure, and to create the regulatory environment that we will need to effectively and equitably reduce Auckland’s transport emission at the pace and scale demanded by the plan.

Rating tool to be more widely available  

The Infrastructure Sustainability Council’s (ISC) Infrastructure Sustainability (IS) Rating Scheme is already delivering improved environmental and social outcomes across some of New Zealand’s biggest projects. New funding will make the scheme’s IS Essentials tool available to a wider range of projects with a capital value of under $100 million.

The scheme is currently used by Waka Kotahi and on major projects like City Rail Link (CRL) and Watercare’s Central Interceptor. Use of the IS Rating Scheme during work at CRL’s Waitematā (Britomart) Station, the country’s highest IS rated project, is expected to result in a 17.8 per cent reduction in peak operational energy use, and a 23 per cent reduction in operational carbon emissions over the project’s 100-year life span. The scheme also focuses on embedding cultural values and engagement with mana whenua into each project, providing a tool to drive and reward proper inclusion and engagement with Māori insights and knowledge.

Funding under the Westpac NZ Government Innovation Fund, awarded in late August, will allow ISC to scale decarbonisation and sustainability outcomes through its online IS Essentials tool. With an estimated 80 per cent of New Zealand’s publicly funded infrastructure projects having a capital value of under $100 million, this investment is welcomed as public and private infrastructure developers alike seek to drive meaningful improvements to projects’ environmental, social and cultural outcomes in the face of the pressing decarbonisation challenge.

Opportunity to engage on updates to the National Waste Data Framework

WasteMINZ, in collaboration with the Ministry for the Environment, is updating the National Waste Data Framework to accommodate new mandatory data reporting requirements.

To date, there have been few standards for waste data recording, reporting and compiling in New Zealand. Lack of standardisation has meant it can be time-consuming and difficult to meaningfully collate and share waste data, or to accurately monitor the impacts of interventions on waste flows.

The project involves drafting new protocols and standard reporting indicators which will then be consulted on to gain feedback on potential issues, opportunities, and gaps within the draft documents and to ensure they are clear and easy to use.

We encourage INZ members affected by the proposed changes to engage with WasteMINZ and the Ministry to provide feedback on the draft protocols and standard reporting indicators.

You can register your interest to provide feedback on the draft documents here.

Public Transport Framework changes

Transport Minister Michael Wood announced in August that the new Sustainable Public Transport Framework will replace the Public Transport Operating Model (PTOM) which has been in place since 2013. It will make changes to the Land Transport Management Act 2003, alongside the development of operational policy to support its implementation.

The framework gives councils the opportunity to own and operate public transport and seeks to improve workers’ pay and incentivise decarbonisation.

The introduction of the framework follows a 2020 evaluation report, commissioned by the Minister, which highlighted that lower-paying commercial providers had a competitive advantage in tendering processes. This comes as skills shortages are placing pressure on bus service provision in particular.

The reforms will also enable use of on-demand public transport like AT local in South Auckland or MyWay in Timaru, in an attempt to bridge gaps in the network.

By bringing ownership of public transport and its infrastructure in-house, the Government also hopes that the electrification infrastructure resulting from its $50 million investment to support fleet decarbonisation will remain in public ownership, so the full benefits of the investment are realised regardless of service contract changes.

Opposition parties have been quick to express their view that bringing operations in-house may place greater strain on already stretched council workforces and suggested that public ownership is likely to make services less efficient as a lack of competition and transparency drives costs up. The Government has noted that it will be up to councils as to whether bringing bus and ferry service provision in-house is the right thing for their communities.

Blueprint for better: WSP advances decarbonisation commitment

Since pledging last November to halve the carbon footprint of infrastructure designs and advice by 2030, WSP in New Zealand has passed another milestone in moving its strategic commitment forward.

The first and most critical step has been involving staff. Staff workshops have been run to capture ideas for meeting the commitment. More than 400 ideas were tabled and about 45 are being progressed. An equal number are still being assessed for next year.

One of the big ideas being advanced is Carb0nise – a WSP developed calculator that compares the embodied carbon of construction materials for vertical infrastructure – for example, different types of concrete, steel, and timber.

Carb0nise offers enormous potential in making informed material choices more quickly. It is in beta-testing and will soon be ready for live projects, having been updated with the latest New Zealand environmental product declarations (EPDs).

Similar tools are being investigated for design of horizontal infrastructure such as bridges and roads.

WSP’s decarbonisation programme has a strong emphasis on people, process, skills, capability and training. It’s about encouraging staff to design with lower carbon alternatives front of mind. A key aim is to make decarbonisation information and tools easy for staff to find and efficient to use.

WSP is aiming to fill and organise its decarbonisation toolbox with reference guides, calculators, design and measurement tools. These will all be geared at making more informed low-carbon decisions earlier in their design and advisory engagements.

Google Cloud Region investment a welcome addition

In a previous edition of InfraRead we outlined the significance of digital investment in New Zealand as a productivity enabler. INZ welcomes Google Cloud’s recent announcement that it will invest in a cloud region here in New Zealand.

Alongside Amazon Web Services’ Asia Pacific Cloud Region, the continued interest in New Zealand’s digital infrastructure and economy post-Covid represents a real vote of confidence and, hopefully, impetus to invest in building the skills we will need for our digital future.

The cloud region will give businesses the ability to keep their data onshore and drive their digital transformation efforts. A recent report, commissioned by Google Cloud, outlines that if this digital transformation is fully leveraged it could create up to $46.6 billion in economic value by 2030. The largest projected beneficiaries of this gain are expected to be the government services, healthcare and manufacturing sectors.

Further investment is a step in the right direction for the country, but it needs to be met with a focus on building digital skills onshore and a regulatory environment that is agile enough to support the digital improvements necessary to supercharge our productivity.

As canvassed earlier in this edition, the implementation of the Digital Strategy for Aotearoa will go some way to enabling a supportive environment for these investments.

Dunedin Hospital’s fast-track consent granted

Resource consent has been granted for Dunedin Hospital’s new outpatient building. The building’s foundation and groundwork consent had already been approved under the Covid-19 Recovery (Fast-track Consenting) Act 2020. The latest decision gave the go-ahead to build the outpatient facility – albeit subject to a range of transport and works-related conditions. This building is expected to open mid-2025.

Progress towards addressing our $20 billion health infrastructure deficit is welcome. The hospital building is expected to contribute $429 million to Dunedin’s GDP and will help prepare the region for the range of intersecting challenges affecting the health sector now and into the future. We welcome this news as addressing the Infrastructure funding deficit across the board is one of Infrastructure New Zealand’s key policies.

The building will incorporate innovative digital health technologies and learn from overseas best practice from hospitals in places such as the United States and South Korea.

The project team is also considering the use of digital twin technology from both asset management and healthcare service maintenance perspectives. With most of a hospital’s costs in maintenance, this has the potential to create significant cost savings for the new facility over the long term and provide an important case study in the application of digital twin technology in a healthcare setting.

Te Waihanga begins work to develop adaptation guidance

Aotearoa New Zealand’s first National Adaptation Plan (NAP) contains a range of actions relevant to infrastructure and the built environment.

Released in early August, The NAP’s infrastructure and built environment chapters lay out actions to support the creation of resilience and adaptive capacity in the built environment. One of such actions relates to the development of guidance to support asset owners to evaluate, understand and manage the impacts and risks of climate change on their physical assets and the services they provide.

Te Waihanga / The New Zealand Infrastructure Commission has begun work to develop that guidance. In August, the Commission held an interactive webinar to begin engagement with the sector.

Opportunities to engage on the draft guidance are expected towards the end of 2023.