BGA progress report: Building Infrastructure November 2012

Transcription

The Business Growth Agenda
Progress Reports
BUILDING:
EXPORT MARKETS
I N N O VAT I O N
SKILLED AND SAFE WORKPLACES
INFRASTRUCTURE
N AT U R A L R E S O U R C E S
C A P I TA L M A R K E T S
Building
Infrastructure
November 2012
ISBN 978-0-478-40110-3
2
Business Growth Agenda Progress Reports | BUILDING infrastructure
Ministers’ Foreword
We are pleased to present this progress report on
the Government’s work to develop infrastructure
and provide the physical platform for sustained
economic growth for New Zealand.
For businesses to invest in plant and facilities in New Zealand, they need to be
confident that they will have access to the infrastructure that supports their business
– transport, energy, water and telecommunications. This infrastructure needs to be
secure and resilient, located in the right place and accessible at the right time. To
deliver this certainty, the Government has prioritised the development of the National
Infrastructure Plan and committed to a bold vision, that by 2030 New Zealand’s
infrastructure is resilient and coordinated and contributes to economic growth
and increased quality of life. To achieve this vision we need a strategic approach to
infrastructure planning and investment, well coordinated across central and local
government and businesses.
The Government has commenced very significant investments over the past few
years across all infrastructure sectors, delivering a wide range of transport and
communications projects, including the Roads of National Significance and high
speed broadband. We are also progressing the next stage of regulatory reforms,
including the Resource Management Act to reduce the time and uncertainty involved
in future investment.
Resilient and coordinated infrastructure, along with capital, a ready market, a skilled
workforce, innovation, and the necessary resources, are all important for a business
to be successful. Making it easier for firms to access all six key inputs to business is
the focus of the Government’s Business Growth Agenda.
The Government has established six informal portfolio groups of Ministers, specifically
grouped around these work streams, to drive the Business Growth Agenda forward
and focus on what matters to businesses and companies. This progress report tells
you where we are at in the Building Infrastructure stream.
We want your feedback to assist us in focussing our efforts. We encourage you
to engage with the relevant Ministers and officials to give us your views on the
programme.
Nothing creates jobs and boosts incomes better than business growth. For New Zealand
to build a more productive and competitive economy, we need a resilient and enabling
infrastructure platform that supports and attracts businesses.
Infrastructure Group of Ministers
Hon Bill English
Hon Gerry Brownlee
Hon Steven Joyce
Hon Bill English
Hon Steven Joyce
MINISTER OF FINANCE
MINISTER FOR ECONOMIC DEVELOPMENT
Hon David Carter
Hon Phil Heatley
Hon Amy Adams
Hon Maurice Williamson
3
The Business
Growth Agenda
It is businesses that
drive economic growth
and build a more
successful economy.
Growing competitive businesses creates jobs and increases exports to the
world. Nothing creates sustainable high-paying jobs and boosts our standard
of living better than business confidence and growth.
Building a more competitive and productive economy for New Zealand is
one of the key priorities the Prime Minister has laid out for this Government
to achieve. The Business Growth Agenda will drive this by ensuring the
Government stays focused on what matters to business, to encourage
confidence and further investment.
There are six key ingredients that businesses need to succeed and grow.
By focussing on these ingredients we will ensure businesses have the
opportunity to lead economic growth.
The six key areas in
the Business Growth
Agenda are:
Export Markets
Infrastructure
Innovation
Natural
Resources
Skilled and Safe
Workplaces
Capital Markets
This is one of a series of progress reports each focussing on one of the six
elements needed for business growth. These reports give a clear picture
of the advances in each area of work and the projects the Government
is focused on, both to provide transparency to businesses and to obtain
feedback. The Government is holding itself accountable to the business
community and to the public to achieve tangible progress.
The new Ministry of Business, Innovation and Employment is working
alongside other agencies to coordinate the agenda and ensure businesses
can more easily access the advice and support from Government agencies
they need to be successful.
4
Introduction
The future prosperity and
wellbeing of New Zealanders
depends upon improving
economic productivity and
competitiveness.
Infrastructure underpins growth by providing
the supporting networks demanded by a growing
economy, and it catalyses growth by creating new
economic opportunities.
Infrastructure refers to the fixed, long-lived
structures that facilitate the production of goods
and services and underpin many aspects of quality
of life. Infrastructure is made up of physical
networks, principally transport, water, energy,
communications and social assets.
Infrastructure assets are typically costly and can
take many years to plan, commission, build and
bring into service. Projecting the future demand
for infrastructure is critical to ensuring that the
right level of investment is made in the right
infrastructure at the right time.
Building infrastructure will deliver the physical
platform that enables us to successfully compete
in the global economy and enjoy the quality of life
that we aspire to.
5
Building a more productive and
competitive economy and building
infrastructure is integrally linked
to this Government’s three other
strategic priorities:
Building a more
productive and
competitive
economy
Responsibly managing
the Government’s
finances
Rebuilding
Christchurch
Delivering better
public services
within tight financial
constraints
This Government has invested significantly
to both address an infrastructure deficit
and support the country through the
Global Financial Crisis by providing
additional construction jobs. Today, more
than $115 billion of infrastructure assets
are collectively owned by the people of
New Zealand.
The Government has also committed to
keep net debt under 30% of GDP, which
means we must ensure that capital is
used as effectively as possible and can be
reprioritised or spent on infrastructure
where it will deliver highest value for
economic growth – we should not overinvest. This leads to a focus on getting
better use of the existing assets, including
identifying opportunities for better
management or finding better ways of
managing demand.
6
Where the Government invests in or
regulates infrastructure it does so to
enable wider objectives, e.g. to facilitate
transport for people and freight, personal
and business communications, or
deliver education services. Our focus
is on delivering the most productive
infrastructure at the optimal time to support
these goals. This Government is taking a
more strategic approach to infrastructure
planning and investment, with a greater
focus on delivering services and outcomes
rather than just building assets. This will
provide greater certainty and confidence to
businesses about infrastructure provision,
costs and service levels.
The recovery of a vibrant, dynamic
Christchurch is important for the city,
region and nation; and the infrastructure
rebuild is essential to this. While there was
significant damage to underground assets,
the majority of Christchurch’s infrastructure
was either undamaged or repaired quickly
– a testament to the resilience of the
city. The scale of the rebuild provides the
opportunity to meet long term strategic
needs, improve resilience, and incorporate
innovation into the design and planning –
all enabling the infrastructure to maximise
long term outcomes and the delivery of key
services to businesses and communities.
Infrastructure
matters
Infrastructure is an integral part of modern life. Resilient, efficient and
coordinated infrastructure networks are vital to a well-running economy.
They enable the movement of people, goods and information around our
country and around the world. They service housing and households, support
the quality of life within our communities and connect those communities
with each other.
Effective transport networks,
including roads, rail, ports and
airports, enable businesses to get
their goods to markets quickly and
safely while enabling employees to
get to work. Businesses depend on
energy transmission that is reliable
and safe to power machines and
appliances. Quality telecommunication
networks allow for fast and efficient
transmission of data and information,
connecting buyers and sellers and
enabling informed decisions. Water is
critical for our primary industries and
many manufacturing processes as well
as the general health and safety of our
workers and communities.
All infrastructure sectors rely on
energy, to fuel transport, generate
electricity or provide heating.
Infrastructure is important for the
services it provides rather than for
its own sake. At its best, it attracts
businesses, improves productivity and
makes our lives more pleasant. Wellchosen and operated infrastructure
can bring benefits that extend for
many generations. But infrastructure
is expensive to build and maintain, and
the current period of fiscal pressure
makes it more important than ever
that infrastructure investment is based
on quality not quantity.
87%
Average % of New Zealand
exports between 2000 and
2010 shipped by sea
Transmission grid
Grid backbone
High Voltage Direct
Current link
Main generation
sources
Main load
centres
$35.5b
of New Zealand’s
merchandise export
earnings (around 70%) in
the year to 30 June 2011
was generated by the
agriculture, food, forestry
and fishing industries
$200m
Estimated gross cost to the
economy from the Maui
pipeline outage in 2011
Ewing, R. and Battersby, B., 2005. Measuring recent
trends in Australia’s economic remoteness. Economic
Round-up, Summer, pp.21–31.
*
As a small country with a dispersed
population, high quality infrastructure
is especially important for
New Zealand because of:
›› The importance the diverse and
dispersed primary sector plays in
our economy, requiring vast but
efficient transport networks to shift
goods from the farm gate to ports or
airports
›› Our unusually long distance to
markets (New Zealand is the most
remote advanced country in the
world in terms of average distance
from economic activity*)
›› The distance between our main
population centres and where our
electricity is generated, requiring a
long and efficient transmission grid
7
State of the Play
Following a history of inconsistent infrastructure investment, this
Government has made a commitment to ensuring New Zealand has the
infrastructure to underpin a competitive and productive economy. We have
increased investment, established a new Future Investment Fund, made
regulatory change to reduce compliance and provide greater certainty for
businesses, developed alternative procurement mechanisms and taken a
strategic and long-term approach to infrastructure planning and funding with
the development and implementation of the National Infrastructure Plan.
Total government transport expenditure as a % of GDP
Source: NZ Treasury, Ministry of Transport, NZ Transport Agency, Statistics NZ
Investment in the national electricity grid
$m
800
2.2%
2.0%
1.8%
1.6%
1.4%
1.2%
1.0%
0.8%
0.6%
700
Projection
600
500
400
300
200
100
Historically, New Zealand’s investment in our infrastructure
has been inconsistent with periods of significant investment
followed by periods of little. This reflects that in times
of fiscal constraint, it is often easiest to reduce capital
expenditure. For example, in the late 1990s, the amount of
funding available for transport meant that only projects with
benefits four times greater than their costs were funded;
transport investment equated to only 1% of GDP in 1999/2000
(compared to 2% in 2009/2010 and 1.9% in 2010/2011).
0
1
Note: Includes, NLTF, Super Gold Card, KiwiRail Turnaround Plan
expenditure, Metro Rail expenditure and other non-NLTF expenditure.
Excludes costs associated with the purchase of KiwiRail
201
2015
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
2010
8
2005
199
2000
7
1995
199
1990
6
1985
199
1980
199
1975
Capex (net of sales) $m
Beginning in the mid 2000s, New Zealand started a period
of significant catch-up investment in our infrastructure
networks: $1.6b is being invested in high speed broadband
by this Government; Transpower is part way through a $5b
investment programme for the national electricity grid; and
the National Land Transport Programme will invest $12.2b
over 2012–2015 (13% more than the 2009–2012 Programme).
Infrastructure spend: actual and forecast 2009/10 – 2015/16
4500
4000
3500
UFB/RBI
JUSTICE CAPITAL EXPENDITURE
HEALTH CAPITAL EXPENDITURE
PUBLIC TRANSPORT
INFRASTRUCTURE
2500
EDUCATION CAPITAL EXPENDITURE
LOCAL ROADS
2000
STATE HOUSING
1500
METRO RAIL
OTHER STATE HIGHWAY
IMPROVEMENTS
1000
KIWI RAIL (TURN AROUND PLAN)
3000
500
0
2009/102010/11 2011/12 2012/13 2013/142014/20152015/16
8
CHRISTCHURCH INFRASTRUCTURE & ASSETS
ROADS OF NATIONAL SIGNIFICANCE
*Christchurch information from 2012 BEFU; Justice, Health and Education
information based on cashflow sourced from Agency 4 year budget plans; State
Housing from HNZC SOI 2012–15; Metro Rail and KiwiRail provided by MoT, UFB/RBI
from MBIE and 2012 BEFU; Transport data provided by NZTA and from 2012–15 NLTP.
State of the Play
2011 Infrastructure network at a glance
4.8m
Mobile phone
connections
3,400km
77%
High pressure gas
transmission pipes
Electricity
generated from
renewables
$100b
17m
11,000km
State Highway
network
4.9m
tonnes
43,000GWh
Value of local
government
infrastructure
assets
Barrels of oil
produced by NZ
600,000
Coal produced
(over 2.1m
exported)
4,000km
National
Electricity Grid
Hectares of
irrigated land
across NZ
69,000
State Houses
(owned/
leased)
Rail
corridor
Electricity
generated
39
2,474
Two key drivers of demand for infrastructure are population
growth and economic growth. As New Zealand’s population
has grown, its distribution has changed placing pressure
on the type of infrastructure required and where it is
located. Likewise, the growth and the changing makeup of
New Zealand’s economy over the years has placed pressure
on key infrastructure networks and changed the mix of
services required from infrastructure. Whereas New Zealand
had over 100 ports in the 19th Century, there are now only 14
while 99% of our exports (by volume) are shipped.
The relationship between the economy and energy
consumption can be seen in the graph to the right, especially
since 2008 with the impact of the Global Financial Crisis.
New Zealand population increase 1971–2011
146%
Percentage change in New Zealand’s GDP, population
and consumer energy demand since 1990
70
60
50
40
30
20
10
0
-10
1990 1992 19941996 1998200020022004200620082010
TOTAL CONSUMER ENERGY
POPULATION
GDP
New electricity generation consented or under construction
North Island
85%
(4,111 MW)
64%
Sth Island
28%
South Island
374
Police Stations
Hospitals
Schools
12,000km
15%
(732 MW)
North Island
Auckland
9
State of the Play
A key feature of infrastructure is the interdependencies between the different networks:
46% of gas consumption in 2011
was used for electricity generation
Telecommunications are
fundamentally dependent upon the
electricity network to operate
46%
Likewise, water treatment, reticulation
systems and pumping stations also
heavily rely on electricity
Full-time project worker equivalent* resulting from Transpower’s
$5b electricity grid investment programme
TOTAL CONTRACT AND MAJOR PROGRAMME HOURS
Investing in
infrastructure facilitates
jobs, both through the
construction of the
infrastructure and
the opportunities the
infrastructure creates
for economic growth.
1800
1600
1400
1200
1000
800
600
400
200
0
2003/2004
2004/2005 2005/2006
2006/2007
2007/2008 2008/2009
FINANCIAL YEAR
2009/2010
2010/2011
2011/2012
* assumes standard 40 hour week for 52 weeks
2,000
Employees/contractors brought onboard
to support the rollout of the UFB/RBI
69,292
1,000
Cumulative person hours onsite (to
end September 2012) building the new
Hobsonville point primary school
Jobs over the next four years on
building the Waterview Connection
Recognising the importance of infrastructure as a key driver of economic growth, the National Infrastructure Unit was
established in 2009, followed by the release of the National Infrastructure Plan. The Plan identified six key challenges for our
national infrastructure network:
1
4
10
The volatile nature of infrastructure
funding creates a lack of certainty
and continuity for infrastructure
providers. There is insufficient use
of the tools available to generate
revenue and manage demand.
Infrastructure investment is well
analysed at the project level but
there is insufficient consideration
of how assets function as a network
or address potential changes in
demand.
2
5
Poor coordination between
different infrastructure providers
leads to suboptimal outcomes.
Decisions over land use and
infrastructure investment could be
better integrated.
3
New Zealand’s infrastructure is
vulnerable to outages, including
through natural hazards, and
we have insufficient knowledge
of network resilience at a
national level.
The regulatory environment
does not support long term
infrastructure development and
contributes to unnecessary costs
and uncertainty.
6
The performance of
infrastructure assets is not
transparent. It is not always clear
who is accountable for decisions.
Our Vision
To help drive progress in building infrastructure, and measure success,
this Government has committed to the following vision in the National
Infrastructure Plan:
By 2030 New Zealand’s infrastructure is resilient and coordinated
and contributes to economic growth and increased quality of life.
This requires a more strategic approach to infrastructure
planning and investment, setting a clear course for the
future so that infrastructure providers from all sectors have
a common understanding of national level expectations
and policy settings. A key purpose of the Plan is to give
businesses greater certainty and confidence about current
and future infrastructure provision, connecting them at low
cost with each other and to the rest of the world.
The Government’s efforts to build infrastructure are focused
on two key outcomes:
Better use of existing infrastructure
Better allocation of new investment
Getting more from the current stock of infrastructure is about
looking at how assets are used, identifying opportunities for
improved management, finding better ways of managing demand
and ensuring users’ expectations are understood.
New Zealand needs to be smarter about investing in new
infrastructure. The Government will prioritise investment where
there are adequate returns and these are underpinned by robust
analysis through a well understood and transparent process.
Demonstrating this commitment
and looking to provide this
certainty for businesses, this
Government has made or is
planning a large infrastructure
investment programme, including:
UFB/RBI
21st Century Schools
10 YEARS
$1b
Christchurch
Infrastructure and Assets
10 YEARS
$1.7b
$1.6b
6 YEARS
KiwiRail
turnaround plan
Public transport
Metro rail –
Auckland and Wellington
Health infrastructure
7 YEARS
State Highways
Local roads
$3.5b
School property
10 YEARS
$0.75b
3 YEARS
$1.7b
3 YEARS
$2.1b
$4.0b
4 YEARS
Future Investment Fund
This Government has established the Future Investment Fund to
receive all proceeds from the mixed ownership model, estimated
to be between $5 billion to $7 billion over the next three to five
years. The Fund will invest in capital projects that have economic
and social benefits for New Zealand which are greater than the
cost of capital. The first $1 billion from the Fund will be allocated
to 21st Century Schools, including: building new, modern
$5.1b
7 YEARS
$4.0b
3 YEARS
schools; rejuvenating existing schools on the same site; building
new, modern teaching areas in existing schools; and wiring up
many more schools with fibre to take advantage of Ultra-Fast
Broadband. Other capital projects from the Fund could include:
investing up to $400 million in irrigation schemes; hospitals; rail
and public transport development; public sector information and
communication technology; and infrastructure recovery from
natural disasters.
11
Case
study
Waikato expressway
The Government is investing around
$2 billion to complete the whole of
the Waikato Expressway by 2019.
The Waikato Expressway will provide
102km of continuous divided fourlane highway from the Bombay Hills
to south of Cambridge, passing to the
east of Hamilton and to the north-east
of Cambridge. It will become the key
strategic transport corridor for the
Waikato region, connecting Auckland to
the agricultural, tourism and business
centres and the wider economic
hinterland of Waikato and the Bay of
Plenty. As a nationally strategic and high
volume route, the expressway will also
provide better connectivity to the rest of
New Zealand.
The expressway will allow for increased
economic growth and productivity
for Auckland, Waikato, and the Bay of
Plenty through more efficient movement
of people and freight. This improved
connectivity will allow for improved
Case
study
travel times, improved travel reliability,
reduced fuel and vehicle operating costs
as well as significant reductions in the
number and severity of road crashes.
Increased capacity on the highway will
allow for more consistent travel speeds
and will take large volumes of throughtraffic away from the centres of Huntly,
Ngaruawahia, Cambridge and Hamilton.
Its completion will improve the quality
of life in these communities, improve
safety, reduce congestion and provide
journey time savings, estimated at up to
20 minutes on the trip from Auckland
to Cambridge. Important cultural and
historic sites such as the urupa on Taupiri
Mountain and the Rangiriri Pa will benefit
from the improvements provided by the
expressway.
Tauranga Eastern Link
The Tauranga Eastern Link is the Bay of Plenty’s largest roading
project and a key strategic transport corridor for the region.
Projected to carry over 20,000 vehicles by 2021, the Government
is investing around $455m in the 23 kilometre project. Work
started on the project in 2010 with four of the seven bridges
required now in mid-construction. The project is due for
completion in 2016.
The Western Bay of Plenty has experienced significant and
sustained population growth in recent decades. This growth is
expected to continue over the next 30 years with the population
projected to double to 286,300. This growth is also matched by
the increase in freight moved from the eastern and central Bay of
Plenty out to the Port of Tauranga. The Eastern Link is designed
to manage this growth and ensure the efficient integration of
industrial and residential land use with the transport network in
the growth of the region. Recognising the Tauranga Eastern Link
as a Road of National Significance is one way the Government is
contributing to the infrastructure to support this growth and the
opportunities it provides for businesses and the wider community.
will also prove a safer and more direct route for vehicles travelling
between Tauranga and Paengaroa, with the high number of truck
movements routed away from the centre of Te Puke and the
existing state highway. The route will provide travel time savings,
improved safety and reduced fuel costs for those travelling to and
from Tauranga and the wider central and eastern Bay of Plenty.
The route will also create high quality access and connectivity for
new residential, commercial and industrial development areas to
the east of Tauranga.
The Tauranga Eastern Link will provide a more direct alternative
to the current State Highway 2 and improve access to the Port
of Tauranga, one of New Zealand’s largest ports, increasing
productivity for regional and national freight traffic. The project
12
Initiatives
We are committed to providing the best possible infrastructure
platform to support the New Zealand economy and business growth.
Strengthening rail, sea and air
Building our roading network
Efficient rail hubs, air and sea ports
playing a key role as part of an
integrated transport network.
A fast and efficient roading
network connecting our regional
economies, reducing congestion,
and encouraging business,
tourism and jobs.
Securing our energy future
Ensuring a regulatory
environment to support
diverse sources of reliable
and renewable energy at
competitive prices.
Telecommunications services
that increasingly support
New Zealand’s position as a
competitive business location and
improve living standards.
The Government is
focussing on Building
Infrastructure in
these key areas:
Rebuilding Christchurch
Rebuilding the infrastructure to enable
a vibrant and dynamic Christchurch to
continue to play its part in our nation
and economy.
Developing high
speed broadband and
telecommunications
Improving water storage
and use
Improving both the
productive and the urban
water sector, delivering a
sustainable approach to water
infrastructure management
into the future.
Boosting housing and building and
construction
Investing in hospitals and schools
Strengthening the building and
construction industry and improving
the affordability of housing.
Schools, hospitals and other social
infrastructure that are well managed
and deliver services that are innovative,
efficient and focused on what
New Zealanders really want and expect.
The following pages set out the actions in each of these themes. Taken together, the actions in this report and across the
Business Growth Agenda will provide the basis for a productive, competitive and innovative economy that can deliver the
prosperity and wellbeing New Zealanders aspire to.
13
Case
study
Kopu Bridge
Construction of the $47m Kopu Bridge was brought forward
in 2009 as part of the Government’s $500m Jobs and Growth
Plan. It benefits the local tourism industry in particular by
providing easier access to local businesses, and improved
travel times and reduced fuel costs for emergency services,
business operators, local residents and holiday travellers.
The Kopu Bridge Replacement project included a new
580m-long, two-lane bridge over the Waihou River, a new
four-leg, two-lane roundabout at the junction of State
Highway 25 and State Highway 26, and 2.5km of associated
approach roads, including a new link road to State Highway
26 (Thames to Paeroa) east of the bridge. The bridge and
approaches have a design speed of 100km/h.
The old bridge crossing the Waihou River was built in
1927/28 and had only one traffic lane. An average 9000
vehicles used this section of State Highway 25 each day, but
during holiday peaks this number can more than double.
The one lane bridge was a traffic bottleneck, particularly
during holiday peaks, with traffic queues up to 14km long.
From a resilience perspective, the bridge and embankment
design will not adversely affect flood levels with the project
designed to accommodate 100-year floods.
The seven Roads of National Significance (RoNS)
Puhoi to Wellsford
Victoria Park
Tunnel, Auckland
SH1
SH1
Completing the
Western Ring Route
SH16
SH20
Waikato
Expressway
Tauranga
Eastern Link
SH1
SH2
Wellington Northern Corridor
SH1
Christchurch Motorways
SH1
14
SH73
SH74
Victoria Park Tunnel
The first of the RoNS has been completed
with the Victoria Park Tunnel (VPT) project
in central Auckland finished. The project
has successfully removed the last major
bottleneck on Auckland’s central motorway
network. It has involved the construction of
a 450m cut and cover tunnel for three lanes
of northbound traffic, reconfiguration of the
Victoria Park flyover for four southbound
lanes, and widening the motorway through
St Marys Bay by one more lane in each
direction. At a cost of $370 million, the
project has increased the southbound
capacity of the Victoria Park viaduct to 6,000
vehicles per hour, up from 4,250 previously
and saving drivers approximately 20 minutes
on their trips during peak periods.
Initiatives
A fast and efficient roading network connecting our regional economies,
reducing congestion, and encouraging business, tourism, and jobs
New Zealand relies on a robust transport network to move
people, goods and services safely and efficiently. Around 92%
(by weight) of all freight within New Zealand is moved by road
and roughly 85% of New Zealanders commute to and from
work by road every day.
highways within and around our five largest metropolitan
areas. They will also link our major sea and air ports more
effectively into the State Highway system. Completing these
projects will enable greater efficiencies on the transport
system and in the wider New Zealand economy.
Our high-use highways make up only 6.5% of our total roading
network, but account for 17% of total kilometres travelled. The
Government’s ambitious Roads of National Significance (RoNS)
programme is made up of seven major roading projects that
will ease prominent traffic bottlenecks on those high-use
The Government is also focused on supporting the growth
of regional economies by providing new and enhanced
infrastructure that removes bottlenecks around regional
centres and improves inter-regional route security and safety.
Complete the Waterview Connection
Comprising 2.5km of tunnel, the Waterview
Connection project will integrate an extra
4.8km of 6-lane motorway through and
beneath Auckland’s Western suburbs, linking
State Highways 16 and 20 to complete
a motorway ring route around the city.
Currently all Auckland through-traffic, which
can reach daily vehicle counts of up to
200,000, must use State Highway 1, which
passes through the city’s Central Motorway
Junction and over the Auckland Harbour
Bridge. The Waterview Connection will also
create a direct motorway route from the CBD
to the airport, reducing traffic on local roads
and cutting travel time between the two
points by over 15 minutes. At a cost of $1.4
billion, work is on track to be completed by
2015/16, about one year ahead of schedule.
Fast track the Waikato Expressway
Road of National Significance
The Waikato Expressway project will improve
safety and reliability and reduce travel
times and congestion on State Highway 1
by delivering a four-lane highway from the
Bombay Hills to south of Cambridge. The
Expressway is being built in eight sections
and will improve economic growth and
productivity for Auckland, Waikato and Bay of
Plenty; improve the reliability of the transport
network through a more robust and safer
road; reduce travel times between Waikato
and Auckland; and support the growth
strategy for central Waikato. Completion of
the whole Waikato Expressway is targeted for
2019.
regional road projects that will enhance
productivity and economic growth. These
include the Rotorua Eastern Arterial, the
Waiwakaiho Bridge in New Plymouth and
Hairini Link and Pakowhai Road in Hawkes Bay.
Improve the resilience of key
inter-regional routes
With local government, we will focus on a
number of projects to improve the resilience
of key inter-regional routes, including:
Fast track work on the other four
Roads of National Significance
We are working hard to complete or
substantially progress the remaining four
projects by 2020 – Puhoi to Wellsford,
Tauranga Eastern Link, Wellington Northern
Corridor and the Christchurch Motorways.
This is an ambitious programme that will
challenge both the New Zealand Transport
Agency and the roading industry. Scheduling
for the projects is being considered as a
whole, this means that if any of the segments
within a project is subject to a delay, others
can be accelerated in their place.
›› Mt Messenger on State Highway 3
›› the Manawatu Gorge
›› the Napier–Gisborne highway
›› the expressway to the Port through Napier,
linking the Hastings industrial area and
the Port
›› the northern parts of the Wellington
Northern Corridor, linking the central
North Island to Wellington and the South
Island.
These projects will be advanced through the
National Land Transport Programme.
Regional road projects to enhance
productivity and economic growth
Through the National Land Transport
Programme, and in partnership with local
government, we continue to develop key
Other actions the Government is taking to build our roading network
Evaluate four new
Roads of National
Significance for
development
Defer planned
2011 fuel tax
rise and cancel
Auckland
regional tax
Allow heavy
vehicles to
operate on
specified routes
Modernise
and simplify
land transport
legislation
for Road User
Charges
Complete the
Victoria Park Tunnel
15
Case
study
Wellington commuter rail
In mid-2011 Government announced a
further $88.4 million funding package
over eight years to complete the
transformation of Wellington’s rail
services.
This takes to $485 million the amount
committed to the Wellington commuter
rail system over the last 5 years,
including the double tracking and
electrification to Waikanae, and new
rolling stock.
Significant improvements have been and
continue to be made to aging overhead
traction systems and signalling across the
network. The new investment will further
improve and maintain the reliability
of commuter services for passengers
that took over 11.2 million trips on
the Wellington metro rail network in
2011/12.
Years of under-investment in the network
prior to the current work programme
meant the lines were in need of major
works to support the Wellington
commuter system. This work programme
Case
study
has largely been completed.
The government funding included a
90 percent grant to Greater Wellington
Regional Council to purchase 48 new
Matangi 2-car trains from Korea. This
order of Matangi trains has now been
delivered.
The original proposal had been to
refurbish the rest of the Wellington trains
to operate alongside the new Matangi
trains. However, in August 2012, the
decision was made to replace these older
trains with a further order of 35 new
Matangi 2-car trains. This purchase will
be supported through the National Land
Transport Fund and provide Wellington
with a complete, modern and reliable
Matangi fleet.
Auckland commuter rail
The Government has provided a total of $1.6 billion to upgrade
Auckland’s commuter rail network so it can carry a larger share of
Auckland’s daily commuter workload. Funding of nearly $1.1 billion has
been provided for KiwiRail to upgrade the rail network in Auckland. The
$600 million Project DART (Developing Auckland’s Rail Transport) has
improved the capacity, reliability and reach of Auckland’s metro rail
network. This included the redevelopment of Newmarket Station and
Junction, the duplication of the Western line from Newmarket to Swanson
and construction of the new rail link to Manukau.
The current $500 million electrification project is providing the overhead
masts and wires that will power new electric trains, and a new signalling
system will provide for more frequent trains at peak times and additional
capacity to help to meet current and future passenger demand.
In 2011, the Government announced a $500 million loan to Auckland
Transport and a grant of up to $90 million towards the purchase of a fleet
of 57 three-car electric trains and the construction of a new depot in Wiri.
The repayment of the loan will be supported through the National Land
Transport Fund. The first trains are due to be delivered in 2013.
Together these trains and network upgrades will transform the metro rail
system in Auckland and ensure the rail corridors play their part in the
wider Auckland transport solution.
16
Initiatives
Strengthening rail, sea and air infrastructure
Efficient rail hubs, air and sea ports playing a key role as
part of an integrated transport network
The shape of our country and the nature of our population
means that our transport infrastructure is expensive to
build, operate and maintain compared to many other
countries. As our lifelines to international markets, it is
essential that our air and sea ports are well connected to
our road and rail networks. Our sea ports are responsible
for 99% of our exports by weight and our airports are our
gateway to over 4.8 million arrivals every year. In Auckland
and Wellington, rail plays an important role for commuters
with recent investments modernising and extending the
network. With rail use for freight predicted to increase
70% over the next 20 years, rail also plays a significant
role in an integrated transport network and is especially
well suited to move heavy products over longer distances.
The Government is committed to an integrated transport
network to support efficient nationwide movement of
passengers, domestic goods, and exports and imports.
Commit $750m to the $4.6b KiwiRail
Turnaround Plan
Investigate the development of a new
sea freight terminal at Clifford Bay
Development the National Airspace
Policy
A 10-year Turnaround Plan is underway
to fundamentally reconfigure KiwiRail as
a financially self-sustaining commercial
entity. The plan involves major procurement
and project work, and a shift to becoming
a customer service and customer
relationship-focused organisation. Since
the start of this plan in 2011, substantial
investment has been made in new rolling
stock (locomotives and wagons), increasing
ferry capacity and reducing transit times on
key parts of the network. Freight volumes
have increased in all categories, and major
customers have demonstrated their support
for the new strategy by committing to
co-investment in warehousing and other
facilities.
We are leading an investigation of the
option of using Clifford Bay in Marlborough
as a base for ferry terminal operations.
This investigation has considered the
proposal from a national transport network
perspective, as well as the financial,
economic, operational, and commercial
viability of the option. The results of the
investigation are currently being considered
and a public announcement is expected
shortly.
The National Airspace Policy was issued
in April 2012. It provides guidance to the
aviation sector on the future direction of
airspace design and designation, and the
principles that will be followed in decisionmaking on airspace matters. The policy
sets the framework under which the Civil
Aviation Authority is currently developing
the National Airspace and Air Navigation
Plan, which will guide the aviation sector
regarding future airspace design and
the new and emerging technologies
to be employed in communications,
navigation and surveillance and air traffic
management.
Invest $1.6bn to upgrade Auckland
commuter rail and $485m for Wellington
The Government is making a major
investment in improving the performance
of the metro rail networks in Auckland and
Wellington. In Auckland, more than $1.6
billion is being spent to modernise and
extend the network while in Wellington
some $485 million is being spent on
extending the network, upgrading the
network infrastructure and helping the
Greater Wellington Regional Council
purchase new Matangi trains.
Respond to the New Zealand Productivity
Commission enquiry on freight
The Productivity Commission has completed
an enquiry into international freight
transport services, concluding that although
the sector is performing well, there is scope
for improvement. Key areas identified
for improvement include workplace
productivity and port governance, a better
balance in the Resource Management Act
between environmental outcomes and the
net economic and social benefits arising
from infrastructural development, current
exemptions for shipping companies from
the Commerce Act should be removed so
that normal competition laws apply, and
to better coordinate investment in freight
infrastructure, greater use should be made
of ‘facilitated discussion’ models. We are
currently considering the Commission’s
report and will be making announcements
shortly.
Implement an improved Freight
Information Gathering System
The Freight Information Gathering
System was launched in 2010 to provide
an overview of containerised freight
movements around New Zealand. All
10 container ports in New Zealand are
now feeding data into the system. The
information will allow infrastructure and
planning decisions to be based on robust,
reliable and consistent data relating to the
movement of freight within New Zealand.
The system is being extended to cover rail
and bulk shipping, and it is anticipated
that it will be extended further to provide
information on road freight.
17
Investment analysis
Spot
light
Refining NZ
A key contributor to the national and regional economies
$365 million investment – The New Venture Te Mahi Hou
Situated at Marsden Point near Whangarei, New Zealands only oil
refinery was officially opened in 1964. Today the refinery processes
a wide range of crude oil sourced from domestic and offshore
markets to produce premium and regular petrol, diesel, jet fuel, fuel
oil, roading bitumen and sulphur.
In April, shareholders agreed to proceed with The New Venture
Te Mahi Hou, a $365 million investment in a Continuous Catalyst
Regeneration Platformer (CCR) that will upgrade petrol production
capability and secure substantial energy savings. The CCR will replace
an existing 1960s semi-regenerator unit which otherwise would
have required around $105 million to extend its operational life.
The investment analysis of the project including investigating the
resilience by modelling over 1,000 iterations of different variables
including market outlook, oil prices, costs etc. Upon completion in
late 2015 the project will lift the refinery’s share of New Zealand’s
petrol demand from around 55% to 65%.
Following a significant upgrade and expansion in the 1980s and
continued investment in newer technologies in the last 20 years, the
refinery now has a crude oil capacity of 135,000 barrels a day. The
refinery is consistently rated in the upper quartile of refineries in
the world for reliability*.
Refining NZ supplies more than 70% of all fuel products for the
New Zealand market, with almost half of all fuel production being
sent to the Auckland Terminal located at Wiri, South Auckland via a
purpose-built 170 kilometre pipeline.
Oil products are critical to the country’s quality of life as well as
sustaining and growing the New Zealand economy – oil products
from Refining NZ meet 40% of the country’s total energy needs.
Significantly, the refinery is a key contributor to the regional economy
with every job at the refinery creating another two in Northland and
another six in specialist sectors supplying the refinery.
Benefits of the CCR project include:
›› Improving the robustness of critical oil supplies
›› Improvement in energy and environmental footprint – including
reducing emissions from the refinery by 120,000 tonnes per year
›› Boost to local economy with high quality job creation plus 300
jobs during construction
›› A project payback over 8 years for shareholders
The refinery is a key contributor to the regional economy with
every job at the refinery creating another two in Northland and
another six in specialist sectors supplying the refinery.
*As reported by Solomon Associates, a company which benchmarks the performance of refineries throughout the world in relation to variables such as reliability, cost and efficiency.
18
Initiatives
Ensuring a regulatory environment to support diverse sources
of reliable and renewable energy at competitive prices
Over the next 40 years, New Zealand’s energy mix is
expected to change, and there will be significant changes
in technology and infrastructure. Trends that might have
a tangible impact on energy requirements include the cost
of international oil, decreasing cost of large and small scale
renewable generation, energy efficiency improvements,
smart meters, smart appliances, second generation biofuels,
general advances in technology and electric vehicles.
Invest $5b to update the National Grid
Transpower plans, builds, maintains and
operates the National Grid, which links
generators of electricity to distribution
companies and major industrial users.
Transpower has a major capital investment
programme underway, forecast to
be around $5 billion over 10 years
to significantly increase the capacity,
performance and resilience of the grid. The
three largest projects are the:
›› North Island Grid Upgrade project (total
project value of $824 million)
›› High Voltage Direct Current Pole 3 project
to upgrade the inter-island cable ($672
million)
›› North Auckland and Northland Project
($473 million)
Progress towards the target that 90%
of electricity will be generated from
renewable sources by 2025 providing
supply security is maintained
In 2011, over 43,000 GWh of electricity
was generated and 77% of this was
generated from renewable energy sources
such as hydro, geothermal and wind.
Internationally, New Zealand has the
Ensuring secure and resilient supplies of energy is critical
to our businesses while regulatory certainty is required
for companies looking to invest in expensive and long life
energy assets. As a small, stable, democratic country with an
open, internationally-focused economy, New Zealand is in
a good position to attract investment and build on existing
strengths.
third-highest renewable energy share of
electricity generation in the OECD (behind
Iceland and Norway). Over 300 MW of
renewable electricity generating capacity
is currently under construction and an
additional 3,600 MW already in possession
of the appropriate resource consents.
New Zealand’s abundant renewable energy
resources are cost-competitive with fossil
fuels as a source of electricity generation
and it is likely that that these will fuel the
majority of electricity generating capacity
that will be built over the next decade.
Reduce red tape by removing bans
on incandescent light bulbs and new
thermal power stations
Part 6A of the Electricity Act 1992 was
repealed on 23 December 2008 to remove
a restriction on new fossil-fuelled thermal
electricity generating capacity. Removing
the restriction was intended as a security
of supply measure aimed at easing strains
on the energy sector, especially during a
dry winter. Around the same time, plans
for new energy efficiency standards which
would phase out conventional incandescent
light bulbs in favour of energy efficient
bulbs were abandoned.
Other actions the Government is taking to secure our energy future:
Transfer assets
between the State
owned electricity
generators
to encourage
competition in
the electricity
market
Require major
generators to
put in place
an accessible
electricity hedge
market
Introduce
compensation
for consumers
in the event of
a conservation
campaign or dry
year power cuts
Reduce
bureaucracy in
the electricity
sector by replacing
the Electricity
Commission
with a more
focused Electricity
Authority
Encourage consumer switching to
enhance competition in the electricity
market
What’s My Number is a consumer switching
campaign run by the Electricity Authority.
It is designed to encourage competitive
markets by providing consumers with
information about their ability to switch
retailers, the ease of doing so and the
potential savings that can be made. The
Electricity Authority has estimated that the
national average household saving made
by switching to the lowest priced power
company servicing the area is $165 per
annum. For the seven month period from
1 June to 31 December 2011, the switching
rate was 28 percent higher compared to the
same period in 2010.
East Coast oil and gas development study
A study has been commissioned to consider
the potential for onshore oil and gas
development in the East Coast. The study will
provide national and local economic impact
assessments of development scenarios and
a high level assessment of the environmental
footprint. It will include the infrastructure that
will be required.
The study is expected to be completed by the
end of the year. It is jointly funded by MBIE
and eight East Coast councils.
Review oil
security in New
Zealand, including
identifying measures
to improve domestic
capability to respond
to infrastructure
disruptions
19
Ultra-fast broadband
Case
study
Manaia View School
Manaia View School was the first school connected to the UFB
initiative. Clustering with four other schools, Manaia View
connected in September 2011 with up and down speeds of
50 Mbps (Megabits per second).
UFB has enabled the school to dramatically increase the number
of devices they had and were able to connect at any one time.
Whereas large files would often take overnight to download, if
at all, now it all happens in seconds. This has changed how the
school interacts and communicates with parents and the wider
community, and enabled teachers to use the internet for their
planning and assessment processes.
Most significantly, UFB and being able to connect multiple devices
has seen a dramatic shift in the engagement and motivation of
the students, leading to substantial increases in achievement and
decreases in truancy and lateness.
Case
study
Magnetism
Magnetism is a 22 person software development company
with clients around New Zealand, in Canada and the United
Kingdom. The company uses a 10Mbps symmetric service at
its office in Whangarei and a 50Mbps symmetric service in
Auckland. As a Microsoft partner, it can often move 30GB in
a single file load and owner Mark Smith says without a UFB
connection he simply couldn’t operate.
Magnetism saves time with live business interactions,
sharing screens in video and over teleconference, and money
because staff don’t need to travel or work offsite at a client’s
business. The UFB connectivity Magnetism enjoys has been
one of the factors enabling it to reach a global marketplace.
As an IT provider, Mark forsees that businesses of all sizes will
begin to move data such as payroll and accounts to the cloud.
In his other role, as President of the Northland Chamber
of Commerce, Mark believes UFB offers provincial youth
the opportunity to gain the same skills as their urban
counterparts. Further, he says UFB positions provincial towns
for greater innovation, providing global opportunities which
can be nurtured within close-knit business communities.
20
Initiatives
Developing high-speed broadband
and telecommunications
Telecommunications services that increasingly support
New Zealand’s position as a competitive business
location and improve living standards.
The telecommunications sector is growing in importance,
both in the benefits it can bring for society and all the other
infrastructure networks. Enabling the fast and efficient
exchange of information, telecommunications connects
our communities and our businesses to each other and
to the rest of the world. New Zealand’s expenditure on
telecommunications infrastructure as a percentage of
GDP is lower than the OECD mean. New Zealand is in the
middle of the OECD pack for average advertised broadband
Invest $1.35b to roll out Ultra-Fast
Broadband (UFB)
The UFB will bring fibre optic technology
to homes, schools, hospitals, marae and
businesses – enabling peak downlink speeds
of at least 100 Mbps, and uplink speeds of
at least 50 Mbps.
Invest $300m to roll out the Rural
Broadband Initiative (RBI)
The RBI will deliver broadband to 252,000
rural households at prices and levels of
service comparable with urban areas –
broadband peak speeds of at least 5 Mbps
to 86% of rural homes and businesses.
Before this initiative started, only about
one-fifth of rural homes and businesses had
broadband of 5 Mbps.
Accelerate digital television switch over
to enable higher value use of 700 MHz
spectrum (4G spectrum) for ICT purposes
The earliest possible digital switchover
date has been agreed and plans now well
established with the first regions having
ceased analogue transmissions at the end of
September 2012. Plans for re-allocation of
the spectrum are well underway and we are
on track to have the allocation completed by
the time the spectrum is available nationally
(December 2013).
Investigate the level of competition in
the trans-Tasman roaming market
In April 2011, the New Zealand and
Australian Ministers for Communications
and Information Technology announced the
launch of a full market investigation into the
provision of trans-Tasman roaming services.
A draft report released in August 2012
found that, in the absence of coordinated
intervention by New Zealand and Australia,
customers were likely to face uncompetitive
outcomes. Submissions have been invited
and a final report is likely to be released
before the end of the year.
Regulate
termination
rates to improve
competition
New Zealand
and Australian
Ministers for
Communications
and Information
Technology
1,700km
69,000 rural houses
Approximately 1,700 kilometres of fibre
has been laid throughout New Zealand.
Through the RBI, more than 69,000 rural
houses and businesses now have access
to improved broadband.
76,000 premises
The year one target for the UFB initiative
has been exceeded by more than 6,000
premises, with the fibre network now
reaching more than 76,000 schools,
businesses, hospitals and households.
download speeds, but the cost of accessing broadband
and mobile telephone appears to be higher than in most
other OECD countries. There are signs of improvements,
however, with the number of broadband subscribers per 100
inhabitants increasing faster in New Zealand than in other
OECD countries since 2006. The Government has a number
of actions underway, aiming to balance intervention to
encourage competition with sufficient certainty to invest.
Remote rural schools
Ten out of 57 remote rural schools have
been connected to faster broadband.
Year one
results
24 towns
UFB deployment has started in 24 towns
and cities and the first UFB connections
are available in 17 of these regions.
21
Initiatives
Rebuilding the infrastructure to enable a vibrant and dynamic
Christchurch to continue to play its part in our nation and economy
The devastating earthquakes of 2010 and 2011 have
had a major impact on our second largest city that has
impacted across the Canterbury region and across the
country – Canterbury is home to over 560,000 residents and
contributes to 12% of national GDP. The Government acted
quickly to establish the Canterbury Earthquake Recovery
Authority to provide leadership, quick action on urgent
priorities and to coordinate the recovery effort.
Establish and manage a Canterbury
Earthquake Recovery Fund of $5.5b
Development of a justice and
emergency services precinct
A dedicated fund of $5.5 billion has been
established to meet the Government’s share
of repairing essential local infrastructure,
mainly water and roading infrastructure,
along with repairing or rebuilding state
owned assets such as hospitals, schools,
and state highways.
An Expression of Interest for the design is
expected by the end of 2012. This will be
followed by site acquisition and the letting
of construction contracts.
Establish Invest Christchurch to
facilitate investment
Located within the Christchurch Central
Development Unit of the Canterbury
Earthquake Recovery Authority and
professionally staffed by a team of
investment facilitators. Invest Christchurch
has a focus on local and national investors,
business and development communities.
An international investment marketing
campaign will be launched later this year.
22
A key priority has been to restore confidence in our physical
environment, recognising the scale of damage with 1600
buildings alone, needing to be partially or completely
demolished. The Government is committed to rebuilding
and restoring the services that it provides in Christchurch
and firmly focused on planning a better and brighter future
for Christchurch, that is future proofed and will benefit
New Zealand as whole.
The horizontal infrastructure
work programme being carried
out by the Strengthening
Christchurch Infrastructure
Rebuild Team includes:
Facilitate the development of a new
Christchurch convention centre
88 projects totalling $220 million
under construction
A business case is currently being prepared
and the site cleared of existing buildings
with construction expected to start in late
2013 or early 2014.
39 projects totalling $135 million
being estimated for construction
Christchurch Hospital redevelopment
We have approved the redevelopment
of the Canterbury District Health Board’s
hospitals. With a final cost likely to be
more than $500 million, this will be the
largest hospital build in the history of
New Zealand’s public health service.
Develop and release the Christchurch
Central Recovery Plan
Underwrite the development of a
temporary 17,000 capacity stadium
The recovery plan continues the theme of
innovation and creates a smaller, greener
central city that will set Christchurch apart
from any other urban centre. Included in
the plan are a number of anchor projects
including a convention centre, sports
stadium and a metro sports centre. For the
anchor projects for which the Government
has primary responsibility, such as the
hospital redevelopment, justice and
emergency precinct and education facilities
we are getting on and making them happen.
Completed in March 2012, the new stadium
was built on land in Addington and includes
undercover seating for 8,500 people as
well as corporate hosting facilities. We
underwrote the $20 million cost with
funding support from the Christchurch City
Council and the New Zealand Rugby Union.
$2.2b
estimated cost of
infrastructure rebuild
91,990 sq m road pavement laid
18.6 km fresh water, 48 km waste
water and 3.3 km storm water
pipe laid
164 projects totalling $1 billion
being designed
206 projects totalling
$80 milllion being handed back
to asset owners
Initiatives
Investing in hospitals and schools
Schools, hospitals and other social infrastructure that are well
managed and deliver services that are innovative, efficient and
focused on what New Zealanders really want and expect
With over $115 billion of infrastructure assets, the public
sector plays a critical role in our economy. Ensuring that
this large amount is well managed and targeted to where
it is has the most benefit is a key priority. Hospitals and
schools make up a significant portion of these assets and
it is important that the infrastructure is well managed,
in the right place and supports the delivery of high
quality education and health services. Much of our social
$1.75b of capital spending by DHBs
The Government has committed to an
extensive programme of capital spending
across the health sector. Investments
made include the construction of a new
Whakatane public hospital, building
new elective surgery theatres, the future
proofing of Middlemore Hospital through
a three stage project, the Rotorua Hospital
redevelopment and the purchase of key
technology and equipment like linear
accelerators. At a time when money has
been tight, we have continued to invest and
grow the public health service.
Invest $1b in 21st Century Schools
From the Future Investment Fund we have
committed to investing $1 billion to further
modernise and transform our schools.
This investment will help to strengthen the
delivery of education. The investment will:
build new, modern schools; rejuvenate
existing schools on the same site; build new,
modern teaching areas in existing schools;
and wire up many more schools with fibre,
to take advantage of UFB.
Capital investment in police stations
A significant capital investment programme
has been underway on refurbishing and
modernising police stations, including:
Ormiston Road, Otahuhu, Manurewa,
infrastructure is old or was established in areas where
the demographics and needs are very different from what
is required today. Fast changing technology is opening
up new opportunities for how public services, including
health and education, are delivered. The Government is
committed to the public service being more innovative,
efficient and focused on delivering what New Zealanders
really want and expect.
Pukekohe, Rolleston and Rotorua. In
addition, there has been a focus on a
more efficient use of capital across the
social sector, including a new shared
facility between Police and Child, Youth
and Family in Whakatane and the plans
for a new emergency services precinct in
Christchurch.
Undertake a nationwide review of the
school property portfolio
School property is the second-largest
publicly owned estate, with a book value
of $10.2 billion spread across more than
2,300 schools and 8,000 hectares. It is
important we know school property is being
managed effectively and an independent
review is underway of how school property
is provided and managed. The review
will result in a package of initiatives to be
reported back by the end of 2012.
Establish the Health Capital Investment
Committee
The Capital Investment Committee has been
established to develop a new centrally-led
process for the national prioritisation and
allocation of health capital funding. As
a sub-committee of the National Health
Board, the committee will establish a new
capital process to enable better planning
and prioritisation of funding and investment
in the health sector in future years.
Complete the first schools Public Private
Partnership
In April 2012, we announced a Public
Private Partnership contract with Learning
Infrastructure Partners consortium for
two Hobsonville Point schools – a primary
school due to open in Term 1 2013 and
a secondary school due to open early in
2014. The consortium will design, build and
finance the schools and will be responsible
for maintaining them throughout the 25
year contract. The Public Private Partnership
model realised upfront cost savings as
well as a range of other benefits, including
allowing the Board of Trustees and school
leadership to not worry about maintaining
school property, allowing them to fully
focus on student learning and achievement.
Opening of the new prison at Wiri
Construction has started on the new Public
Private Prison – expected to open in 2015.
With a $170 million or 17% saving over
conventional procurement models, the
new prison will support the Government
in reaching the target of 25% reduction in
reoffending by 2017.
23
Initiatives
Improving water storage and use
Improving both the productive and the urban water
sector, delivering a sustainable approach to water
infrastructure management into the future
New Zealand’s water infrastructure provides for the
needs of communities and primary producers. Good
water infrastructure management can reduce the risks
of ecosystem stress, provide opportunities for recreation,
tourism and customary use, provide for good public health,
contribute to New Zealand’s clean, green image, and add
to investors’ confidence. Water resources are critical for
the primary production sectors. Water is New Zealand’s
competitive advantage for our export industries.
Consistent financial forecasts
For the first time, all councils are producing
ten-year long-term plans with the three
urban water services clearly and separately
identified. This also involves financial
forecasts in a consistent format to give
the public a clear picture of planned
expenditure and funding sources for the
renewal of existing infrastructure, increases
in levels of service, or to cater for increased
demand.
Non-financial performance measures
New non-financial performance measures
for the ‘three waters’ urban water
infrastructure are being developed for local
authorities for implementation in the 2015
long-term plans.
Local Government Funding Agency
The new Local Government Funding Agency
(LGFA) was incorporated in December
2011 and is owned by 18 Councils and the
Crown. The primary purpose of the LGFA
is to provide more efficient funding costs
and diversified funding sources (including
foreign currency) for New Zealand local
authorities.
Improve local government regulatory
performance
The water sector rated poorly when measured against the
principles in the National Infrastructure Plan 2011, with
management, regulatory settings and governance requiring
the most attention.
Through a range of initiatives, The Government is
committed to improving both the productive and the urban
water sector, delivering a sustainable approach to water
infrastructure management into the future.
Local Government Infrastructure Expert
Advisory Group
The Expert Advisory Group is looking at
how to reduce the cost of purchasing,
providing and maintaining local government
infrastructure, including the impact
infrastructure standards have.
Fresh Start for Fresh Water programme
A new strategic direction for fresh water
management is being developed through
the Fresh Start for Fresh Water programme.
This programme of reform includes
consideration of water objectives, limits and
allocation mechanisms (which form part
of the regulatory framework within which
water infrastructure is developed) and is
informed by the work of the Land and Water
Forum.
Community Irrigation Fund
The Community Irrigation Fund has, from
2008/09, provided grant funding support to
the design of upgrades to existing irrigation
scheme infrastructure and the investigation
and design of new community schemes.
Scheme proposals that would provide
an addition irrigated area of 28,500 ha
are in the detailed design stage and near
construction ready.
Irrigation Acceleration Fund
The primary focus of the new Irrigation
Acceleration Fund is to support the
development of rural water infrastructure
proposals to the investment-ready
prospectus stage. The Fund provides $35
million over five years from 2011/12 to
support the development. To date the
Irrigation Acceleration Fund has allocated
$13.5 million across eight projects
investigating the development of 150,000 ha
of new irrigation. Over the next 12 months
three of these projects will be considered
for funding for the next more detailed
stages of their development. Projects
proposals involving the development of up
to a further 190,000 ha are expected in the
next two years.
Crown Investment of up to $400m
The Government is committed to investing
up to $400 million from the Future
Investment Fund to accelerate commercial
scale irrigation projects. The funding would
provide bridging equity stakes in irrigation
schemes that have a viable commercial
future.
A Productivity Commission enquiry into
local government regulation, investigating
how to improve regulatory performance.
The draft report is due in December 2012.
24
Spot
light
Irrigation
Irrigation plays an important role in
agricultural productivity and is a major
contributor to the New Zealand economy.
In 2002/03, irrigation was estimated to
contribute around $920 million net GDP “at
the farm gate”, over and above that which
would have been produced from the same
land without irrigation. Since then, the area
of irrigated agriculture and horticulture
has increased by about 25%, from 480,000
hectares to around 600,000 hectares. With
smart planning and investment there is
significant potential for further irrigation
development.
Current and proposed
infrastructure development
CURRENTLY IRRIGATED AREA (ha)
HAWKES BAY
PROPOSED IRRIGATED AREA (ha)
700,000 Ha
385,000 Ha
TASMAN/NELSON
WELLINGTON
110,000 Ha
40,000 Ha
15,000 Ha
Advancing current infrastructure proposals
would provide an additional 420,000 ha
of irrigation, and improve the reliability of
current irrigation. Most of the proposed new
area involves storage.
CANTERBURY
OTAGO
Regional scale proposals
340,000 ha
Figures are approximate
Hawkes Bay (Ruataniwha,
Ngaruroro, Tutaekuri)
Wellington
(Wairarapa)
Nelson/Tasman
(Waimea East)
Canterbury (Central Plains,
Coleridge, Hurunui, Hunter Downs)
40,000 ha
30,000 ha
6,000 ha
260,000 ha
Community scale proposals
80,000 ha
North Otago
Irrigation Company
The North Otago Irrigation Company has
employed a successful business model to
bring irrigation water in a staged manner
to over 13,000 hectares of farmland in the
rolling downlands of the Waitaki district
since the company’s inception in 2004. The
irrigation scheme involved the construction
and operation of a piped, pressurised
network of mixed pumped and gravity
lines. This delivers water efficiently under
pressure to almost ninety shareholder
farms and in almost all cases no further
pumping is required on the farm. The
funding partnership model involved users,
Waitaki District Council and Meridian Energy
– enabling the scheme to be built. Today,
the scheme is 100% owned and operated by
the users.
The scheme was found to provide positive
benefits for the Waitaki District. The gross
revenue of the land irrigated has increased
by $43.95 million or just over 300%, the
cash farm surplus gained from having
the irrigation scheme in place is $14.91
million per annum for all farms, and labour
employed in the scheme is approximately
double that without the scheme.
involving more than
10 individual schemes
Case
study
Having invested in over-build in the initial
scheme development, and there being
significant amounts of land available for
irrigation of the scheme, the company has
now embarked on a development plan to
expand into Stage 2. This will upgrade and
expand the distribution of the network to
deliver the additional 50% (4 cumecs) of
consented water from the Waitaki River.
The company was granted Irrigation
Acceleration Funds for development of part
of the Stage 2 programme in May and plans
to apply for further grants for development
of future phases.
25
Case
study
The Messines Road reservoir, Wellington, during its recent enlargement and
earthquake strengthening. Both tanks have been excavated and enlarged, with the
project almost doubling the storage capacity from 3.5 million to 6 million litres.
Capacity Infrastructure Services
Capacity Infrastructure Services demonstrates that
providing water infrastructure services across three councils
strengthens coordination, reduces cost and increases resilience.
Capacity was established as a council-controlled trading
organisation in 2004 by the Wellington and Hutt City councils. Its
purpose is to provide water, wastewater and stormwater network
management services at the best possible value. In 2008, Upper
Hutt City became a Capacity client.
To 2012, Capacity has saved its shareholder councils over
$3.8 million.
The benefits delivered extend well beyond cost savings, however.
With a staff of 65, Capacity represents the largest pool of expertise
in water services network management outside Auckland. This
provides client councils much greater resilience than they could
sustain on their own – in terms of staff development and career
progression, knowledge management, risk management, and
in the event of emergency. In addition, as an external provider,
Capacity’s performance accountability and financial transparency
requirements are more robust than for most council departments,
while city asset ownership, policymaking and required levels of
service all remain with individual councils.
26
“…studies show that
including bulk water supply
across the region within a
whole-of-network approach
would provide savings of over
$7 million over five years”
There is considerable scope to provide further savings and network
efficiencies across the Wellington region through Capacity. Porirua
and Upper Hutt City have been invited to become shareholders,
improving the value of region-wide standards and information
management – while studies show that including bulk water supply
across the region within a whole-of-network approach would
provide savings of over $7 million over five years.
Initiatives
Boosting housing and building and construction
Strengthening the building and construction industry and improving
the affordability of housing is a high priority for this Government
The Government is encouraging a more efficient productive
sector focused on building it right the first time. The building
and construction sector has been one of the least productive
and efficient contributors to the economy – building and
construction accounts for only about 4% of New Zealand’s
GDP, compared to 7% for Australia, 8% for the United
Kingdom or 9% for the United States. Social benefits will
flow from an increase in productivity as many of those who
work in the sector are often in lower socio economic groups.
Increasing skills increases wages and streamlining the
construction procurement pipeline helps mend the boom/
Increase accountability in building
and construction through legislation
to improve consumer protections and
reduce compliance costs
The Government has passed legislation,
the Building Amendment Act 2012, that
reinforces accountabilities for building work
and Building Code compliance of all the
parties involved in construction projects. It
also introduced the framework for providing
for a risk-based approach to building
consent and inspection requirements
so that these are aligned to the risk and
consequences of building defects and the
skills and capabilities of those doing the
work. This will deliver earlier identification
and consideration of project risks, greater
accountability by designers, documented
means of managing those project risks and
transparency on liability. For the residential
sector, this means that consenting for
simple and low houses built by Licensed
Building Practitioners will be streamlined,
which should result in fewer delays.
bust cycle which has been a feature of the industry.
Well functioning housing markets are important to
economic performance and to individual and family
wellbeing. Abrupt house price adjustments can pose a risk
to financial and macroeconomic stability. Poor quality,
overcrowding and other manifestations of a housing
shortage have adverse impacts on health, education and
other determinants of living standards. Housing is a large
part of individuals’ consumption, investment and savings
decisions and the recent rapid rise in house prices has
contributed to net wealth inequalities.
Reduce the cost of do it yourself building
work by removing regulatory hurdles
The legislation also allows DIYers to
continue to build or renovate their own
homes while protecting future purchasers
of the property. It also cuts red tape
and speeds up the building process by
introducing Risk Based Consenting. The
owner-builder exemption allows DIYers to
continue carrying out building work, but
they must take responsibility for that work
and this will be kept on the Local Authority
property records for future owners to see.
Fast track building consents for
standard, multiple-use building designs
A new streamlined National Multiple-use
Approval Service for volume builders was
launched in 2010. Without compromising
quality and safety, MultiProof fast-tracks
building consents for standard, multipleuse building designs – saving time and
money for both consumers and builders.
With MultiProof designs, only site-specific
conditions need to be checked by local
councils, reducing the time-frame for
building consent decisions from 20 days to
just 10 days.
Respond to the New Zealand Productivity
Commission enquiry on affordable
housing
The Productivity Commission has completed
an enquiry into housing affordability,
concluding that there are multiple barriers
to more affordable housing. We agree
with the Commission that a coherent and
determined push across a broad set of
policy areas is required to meaningfully
improve housing affordability. We will:
›› Ensure that the planning system is
facilitating greater land supply for
housing and not restricting the types of
houses that can be built
›› Reduce the cost and time of regulation
that affects housing development
›› Improve decision-making and planning
practices from local government
›› Decrease the cost of construction by
providing opportunities and incentives
for the building industry to improve
productivity
›› Transform the social housing sector to
make the best use of limited government
capital, to better meet the requirements
of those in need while that need lasts,
and to give people more choices.
27
Initiatives
Review the Accommodation Supplement and Income Related
Rent Subsidy as part of the Social Housing Reform Programme
A state home and the Income Related Rent that goes with it amounts
to a considerable taxpayer subsidy for a household. We will review
this benefit to ensure that it goes to those in the greatest need, for
the duration of that need.
Update building standards to reflect earthquake lessons
Other actions the Government is taking to boost housing
and building and construction:
Implement
a $1 billion
financial
package for
leaky homes
The Government is well advanced in its review of earthquake prone
buildings (EPBs). A set of policy proposals has been circulated to
deal with the issue of EPBs including retaining the life safety bottom
line, improving disclosure of risk of EPBs and informing the general
public. We are also currently responding to the 71 recommendations
made by the Canterbury Earthquakes Royal Commission and in
conjunction with Standards NZ, are making preliminary technical
changes to building standards in particular concrete and steel
standards. A list of buildings with features similar to those of the CTV
building including stairs and non-ductile columns have also been
identified and we are liaising with Territorial Authorities to mitigate
the risk from these buildings.
Ensure by 2013
every state
house built
before 1978 that
can be insulated
is insulated
Spot
light
Productivity
Partnership
The Government has led the establishment
of the Building and Construction Sector
Productivity Partnership, which aims for
a 20% increase in sector productivity by
2020. This Partnership is a unique private
sector/government partnership aiming to
bring real benefits to the industry and all
New Zealanders.
The Productivity Partnership consists of a
Governance Group, which sets the direction
for the Partnership, and four workstreams
which are: Skills, Evidence, Procurement
and Construction Systems. Members of the
workstreams are drawn from the industry,
industry bodies, research organisations and
government departments.
With a very solid work programme, the
Partnership has led the set up of an
Auckland Procurement Pipeline and a
similar concept is being investigated for
Christchurch and nationally. This pipeline
allows industry and the Government to work
together to ensure supply chains of products
and skills are available at the right time in
the right place and in a way that drives work
forward rather than holding it back.
The partnership has also worked with the
sector and industry training organisations
28
Spot
light
to develop a skills strategy to lift skills and
productivity in the building sector. Four
priorities have been identified:
›› Getting it right the first time – addressing
quality issues and avoiding rework
›› Eliminating the down time – effectively
managing labour so it is better deployed
and less time is wasted
›› Working towards meaningful careers –
developing pathways into and through
the industry so people have careers
rather than jobs
›› Multi-disciplinary team work – increasing
collaboration between firms, different
parts of the sector, and education
providers.
The Productivity Partnership’s Evidence
Workstream has developed a Research
Action Plan to identify the most important
knowledge gaps and the key research
questions that need to be developed into
research projects. This plan underlines the
need for thorough and innovative research
to ensure the best tools are developed to
improve productivity in the sector.
Tāmaki
Transformation
Programme
Tāmaki faces many challenges: lower
than average household incomes; a high
unemployment rate and high proportion
of beneficiaries; high crime rates; and low
decile schools. Tāmaki also has a range of
natural advantages, including: proximity to
the Auckland CBD and other employment
centres; coastal boundaries; green spaces;
and a location on a key transport corridor.
The Tāmaki Transformation Programme
has strong links to the Government’s
planned changes for the way in which
social and affordable housing will be
delivered, providing opportunity to test
models of new ways to achieve better
housing outcomes.
We have established a company with
the Crown and Auckland Council as
shareholders. Funding of $8.5 million
was provided to deliver activities related
to strategic planning and building a
business case.
We expect that the number of houses
in this area will at least double from
the current 5,000 over the 15 to 20
year timeframe of the regeneration
programme.
Progress
Indicators
Completed
In progress
Implementing
New project
Strengthening rail, sea
and air infrastructure
The Government is focused on making substantial progress
in the following Building Infrastructure initiatives
Action
Status
Lead
Review and simplify land transport legislation to speed up planning processes
Implementing*
MoT, NZTA
Modernise and simplify land transport legislation for Road User Charges
Completed*
MoT
Regional road projects to enhance productivity and economic growth
In progress
NZTA, MoT
Improve the resilience of key inter-Regional routes including Mt Messenger on State
Highway 3 and the Manawatu Gorge
In progress
NZTA, MoT
Complete the Victoria Park Tunnel to remove the last major bottleneck on the
Auckland motorway system
Completed*
NZTA, MoT
Construct the Waterview Connection to complete the motorway ring route around
Auckland
Implementing*
NZTA, MoT
Fast track the Waikato Expressway Road of National Significance to improve safety,
reliability and journey time
Implementing*
NZTA, MoT
Fast track work on the other four Roads of National Significance
Implementing*
NZTA, MoT
Evaluate four new Roads of National Significance for development
New project
NZTA, MoT
Defer 2011 planned fuel tax rise and cancel Auckland regional tax
Completed*
MoT
Allow heavier vehicles to operate on specified routes to improve freight productivity
Implementing*
MoT, NZTA
Commit $750m to the $4.6b KiwiRail Turnaround Plan
Implementing*
KiwiRail,
Treasury
Invest $1.6b to upgrade Auckland commuter rail and $485m for Wellington
Implementing*
MoT,
KiwiRail
Investigate the development of a new sea freight terminal at Clifford Bay Terminal
In progress*
MoT,
Treasury,
NZTA
Respond to the New Zealand Productivity Commission enquiry on freight
In progress
MoT
Develop the national airspace policy to guide the future direction of airspace design
and designation
In progress
MoT
Implement an improved Freight Information Gathering System
In progress
MoT
Also in
29
Developing highspeed broadband and
telecommunications
Progress Indicators
30
Action
Status
Lead
Also in
Invest $5b through Transpower to update the National Grid and increase capacity,
performance and reliability
Implementing*
Transpower,
MBIE
Progress toward the target that 90% of electricity will be generated from renewable
sources by 2025 providing supply security is maintained
Implementing*
MBIE
Encourage consumer switching to enhance competition in the electricity market
Implementing*
MBIE
Reduce red tape by removing bans on incandescent light bulbs and new thermal
power stations
Completed*
MBIE
Transfer assets between the State owned electricity generators to encourage
competition in the electricity market
Completed*
MBIE
Require major generators to put in place an accessible electricity hedge market
Completed*
MBIE
Introduce compensation for consumers in the event of a conservation campaign or
dry year power cuts
Completed*
MBIE
Reduce bureaucracy in the electricity sector by replacing the Electricity Commission
with a more focused Electricity Authority
Completed*
MBIE
Complete an East Coast oil and gas development economic study
New project
MBIE
Review oil security in New Zealand, including identifying measures to improve
domestic capability to respond to infrastructure disruptions, and contribute to
international oil security
In progress
MBIE
Resources
Roll-out Ultra-Fast Broadband through fibre to 75% of New Zealanders by end of 2019
Implementing*
MBIE
Innovation
Roll-out the Rural Broadband Initiative to deliver high quality broadband and increase
connectivity
Implementing*
MBIE
Innovation
Accelerate digital television switch over to enable higher value use of 700 MHz
spectrum (4G spectrum) for ICT purposes
Implementing*
MBIE
Regulate mobile termination rates to improve competition
Completed*
MBIE
Establishment of a National Cyber Policy office to enhance New Zealand’s cyber
security
Completed
MBIE
Investigate the level of competition in the trans-Tasman roaming market
Implementing
MBIE.
ComCom
Establish and manage a Canterbury Earthquake Recovery Fund of $5.5b for the
Government’s share of rebuilding infrastructure and Crown owned assets
Implementing*
Treasury
Facilitate the development of a new Christchurch convention centre
In progress
CERA
Establish Invest Christchurch to facilitate investment
In progress
CERA,
Treasury
Develop and release the Christchurch Central Recovery Plan
Completed
CERA
Redevelop Christchurch Hospital to enable it to meet current and future needs
Implementing
CERA
Development of a justice and emergency services precinct
In progress
CERA
Christchurch Temporary Stadium: underwrite 17,000 capacity stadium in Christchurch
Completed*
CERA,
Treasury
Infrastructure
network
Boosting housing and
building and construction
Improving water storage and use
Investing in social infrastructure
Progress Indicators
Action
Status
Lead
Health facilities: $1.75b of capital spending by DHBs to support improved frontline
delivery of health services for patients
Completed*
MoH/DHBs
Invest $1b in 21st Century Schools to modernise and transform our schools
In progress
MoE
Undertake a nationwide review of the school property portfolio to consider how 21st
century teaching spaces can be provided in the right locations at the most efficient
whole of life cost
Implementing
MoE
Establish the Health Capital Investment Committee to improve planning and
nationally prioritise investment
Completed
MoH/DHBs
Complete the first schools Public Private Partnership to realise cost savings and allow
the new Board of Trustees to focus on student learning and achievement
Implementing
MoE
Opening of the new prison at Wiri to deliver value for taxpayers and support the
Government’s focus on reducing reoffending through strong performance measures
focused on rehabilitation and reintegration
In progress
Corrections
Capital investment in police stations including refurbishment and modernisation to
better support frontline policing and reducing crime
Implementing
NZ Police
Establish a new Irrigation Acceleration Fund to support the development of irrigation
schemes
Implementing*
MPI
Resources
Invest up to $400m to encourage irrigation and water storage development
In progress
MPI
Resources
Develop and implement a new strategic direction for fresh water management
through the Fresh Start for Fresh Water programme
In progress
MfE
Resources
Respond to the newly established Local Government Infrastructure Expert Advisory
Group investigating how to reduce the cost of purchasing, providing and maintaining
local government infrastructure
In progress
DIA
Support and facilitate the establishment of the new Local Government Funding Agency
Completed
DIA,
Treasury
Develop and introduce new non-financial performance measures for the ‘three waters’
In progress
DIA
Implement new consistent financial forecasts for local authorities including the
identification of planned expenditure and funding sources
Completed
DIA
Consider how local government regulatory performance can be improved and costs
to business reduced
In progress
DIA,
Treasury
Implement a $1b financial package to assist leaky home owners
Implementing*
MBIE
Ensure by 2013 every state house built before 1978 that can be insulated is insulated
Implementing*
MBIE
Reduce the cost of do it yourself building work by removing regulatory hurdles
Completed*
MBIE
Fast track building consents for standard, multiple-use building designs
Completed*
MBIE
Respond to the New Zealand Productivity Commission enquiry on affordable housing
In progress
MBIE,
Treasury
Deliver on the Tamaki Transformation Programme to support changes in how social
and affordable housing will be delivered
Implementing
MBIE
Review the Accommodation Supplement and Income Related Rent Subsidy as part of
the Social Housing Reform Programme
In progress
MBIE
Update building standards to reflect earthquake lessons
Implementing
MBIE
Encourage debate on use of demand management and pricing in infrastructure sectors
In progress
NIU, MoT,
NZTA
Strengthen the infrastructure network information base, especially relating to future
demand and asset condition and performance information
In progress
Treasury
Complete the review of and changes to the Resource Management Act
In progress
MfE
Establish the Future Investment Fund for investing in public infrastructure assets
In progress
Treasury
Also in
31
Resilience
Spot
light
Lyttelton Port
Lyttelton Port of Christchurch is the major deep-water port in the
South Island, the hub of regional trade, and plays a vital role in the
global transport network. The port caters for a diverse range of
containerised, bulk and break-bulk trades and offers a full array of
shipping services to exporters and importers, 24 hours a day, 365
days a year. That trade is essential to Canterbury and South Island
businesses and consumers.
As a key component of New Zealand’s international supply
chain, the port believes in the importance of maintaining their
infrastructure and assets. This included engaging experts to analyse
the geology of Lyttelton harbour and the history of engineering
structures, to determine their potential susceptibility to seismic
events. Case studies were also prepared to demonstrate the effect
of seismic design methodology on new structures and seismic
remediation of existing structures. A risk assessment process was
also undertaken and this study saw the development of a Seismic
Standard for Port Infrastructure introduced into the port.
The February 2011 earthquake was far more damaging than the
September 2010 earthquake. Though the magnitude was lower at
6.3, the epicentre was just a few streets up the hill from the port, a
little to the west, and just 5km deep. The ground accelerations were
the highest ever recorded and this led to the degree of damage in
and around Christchurch. However, within two weeks, port trade
was operating, including the resumption of normal container-line
services. The only exception to this was cruise ships, which the port
was unable to take for the remainder of the season.
In the financial year just finished the port handled record container
volumes and cargoes continue to grow throughout the region in this
seismic era.
The port remains a critical component of Canterbury’s strategic
infrastructure and planning is underway of what will probably be a
four to five-year reinstatement programme.
Total Container Volumes
2011
2010
2009
2008
2007
290,842 TEUs
273,789 TEUs
259,933 TEUs
250,657 TEUs
228,284 TEUs
In the financial year just
finished the port handled record
container volumes and cargoes
continue to grow throughout the
region in this seismic era.
TEUs or twenty-foot equivalent units, refer to the size of a standard
container and are the standard capacity measures for container
ships and terminals
32
Relationship to CrossCutting Themes
The Government has three additional cross-cutting themes, which it intends
to see reflected across the Business Growth Agenda workstreams.
Māori Economic Growth
Regulation
The Māori economy is significant, with
a sizeable Māori asset base in fishing,
forestry, agriculture and tourism, four of
our key export earners and all requiring
quality infrastructure. The Māori cultural
dimension is also an essential part of who
we are as New Zealanders. Realising the
potential of the Māori economy is pivotal
in lifting Maori economic outcomes and
in strengthening New Zealand’s economic
prospects more generally.
The Government is committed to ensuring
smart regulation that is fit for purpose.
This will be a lens placed across all of the
Business Growth Agenda workstreams
to help deliver a more productive and
competitive economy. Smart regulation can
help facilitate the planning and delivery of
the infrastructure needed to provide the
platform for economic growth, especially
in the Energy and Telecommunications
sectors.
Beyond being users of infrastructure,
Maori are increasingly becoming involved
as providers of infrastructure, including
geothermal energy. The Māori Economic
Development Panel is due to report and
the Government will actively consider the
Panel’s recommendations and take forward
a response, in partnership with whānau, iwi,
Māori businesses and collective ventures.
Using a new assessment model, the
preliminary assessments of major
regulatory regimes were released in August.
The new model allows consideration of
factors that can help improve economic
performance – competition, innovation,
exports, compliance costs and trade and
investment openness.
Greening Growth
A number of actions underpinning the
Business Growth Agenda are addressing
the recommendations of the Green Growth
Advisory Group – most specifically within
the work programmes for the Innovation,
Resources and Export Market themes.
Within the context of Building Infrastructure
and implementation of the National
Infrastructure Plan, the advisory group’s
recommendations are being taken into
account with a greater focus on demand
side management to improve energy
efficiency.
›› The on-going regulatory challenge
in telecommunications is to ensure
legislation keeps pace with technology
and market development, while ensuring
there is sufficient stability to encourage
investment.
The release of the preliminary assessments
will enable the Ministry of Business,
Innovation and Employment to work with
the Treasury and the other agencies to
ensure monitoring regimes are in place and
issues are addressed.
A further assessment will be undertaken in
2013.
The preliminary assessments highlighted
areas that either need further investigation
or where they may be areas for
improvement. Relevant to infrastructure,
the report identifies that:
›› There is little hard data on the
competition front
›› Recent regulatory changes (Part IV)
and changes in how the Commerce
Commission exercises its powers may be
causing uncertainty
›› There are questions about whether
the regulatory regime for gas supports
optimal investment, the allocation of
pipeline capacity and the regulatory
model (in particular whether
New Zealand has too many industry
specific regulators).
33
For more information
To provide feedback on this report, please email [email protected]
For more information on the Business Growth Agenda see www.mbie.govt.nz/bga
For businesses seeking information on building resilient and coordinated infrastructure:
www.transport.govt.nz | 04 439 9000
›› For more information about the legislative, regulatory and policy settings for land, sea and air
transport in New Zealand
›› For information on land transport including the Roads of National Significance, state
highways, and public transport
www.nzta.govt.nz | 04 894 5400
›› For more information about rail freight and transport
www.kiwirail.co.nz | 0800 801 070
www.transpower.co.nz | 04 495 7000
›› For more information about the national electricity transmission grid
›› For businesses seeking to participate in the Irrigation Acceleration Fund or invest in irrigation
www.mpi.govt.nz | 0800 00 83 33
›› For more information about the recovery strategy, policy and planning for Canterbury
www.cera.govt.nz | 0800 7464 2372
›› For firms or people wanting to invest in Canterbury
›› For businesses or local government wanting to find out more about the Public Private Partnership
programme
›› For information on the National Infrastructure Plan
www.treasury.govt.nz | 04 472 2733
›› For information about government finances and budget publications
›› For more information about best practice regulation
›› For information on the regulatory environment including consumer law, intellectual property,
labour regulations, and building regulations
www.mbie.govt.nz | 0800 674 4688
›› For information on the rollout of Ultra-Fast Broadband and the Rural Broadband Initiative and on
the future use of the 700MHz spectrum
›› For information on building and construction, social housing and the leaky homes financial package
›› For information on the energy sector
›› For more information about the Resource Management Act reforms and the Fresh Start for Fresh
Water Programme
www.mfe.govt.nz | 0800 499 700
›› For infrastructure providers or companies interested in using and sharing geo-spatial data
www.linz.govt.nz | 0800 665 463
›› For general information on the Better Local Government reforms
www.dia.govt.nz | 0800 257 887
34
35

BGA progress report: Building Infrastructure November 2012

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