New Zealand must focus on managing multi-million dollar projects more effectively

August 11, 2015

New Zealand needs to focus on managing big multi-million dollar projects more effectively, leading national major infrastructure development head says.

Stephen Selwood, chief executive of the New Zealand Council for Infrastructure Development (NZCID), says just as important as large investment is ageing growth in demand.

“Councils that have introduced volumetric water charges have been able to significantly reduce demand and consequently defer the need for capital investment. But most councils do not charge for water,” Selwood says.

“This means people tend to waste this highly precious resource and councils are forced into investment to support demand. Similarly on our congested roading network – we make roads free and then complain that demand is too high at peak and we pay through the nose in lost productivity and frustrating congestion.

“Putting a price to use congested road networks would not only raise money to support future investment but encourage people to travel another way or at another time or take public transport. Managing demand more effectively means better use of our existing transport systems.”

The $40 billion Christchurch rebuild, the $4 billion Auckland Harbour Crossing, the $3 billion plus City Rail Link, waterfront and CBD development, the $10 billion Roads of National Significance, the KiwiRail turnaround plan and New Zealand’s regional water irrigation schemes are nation-shaping projects. They will underpin the future development of the country’s two largest cities and help regional development across the nation.

Selwood says it is crucial New Zealanders make the most of such significant investment in infrastructure in a generation. The Capital Intentions Plan issued by Treasury earlier this year identified 3659 infrastructure-related projects across central and local Government and private sectors at a total spend of $110 billion over the next 10 years – or $11 billion a year.

About 350 key decision makers including four cabinet ministers, senior public officials from central and local government and infrastructure industry leaders from construction, design, finance, professional advisors and service providers across the infrastructure sector will discuss project plans at the annual NZCID Building Nations symposium in Christchurch next week - on August 20 and 21.

“The Christchurch rebuild has ramped up but a lot of focus is on Auckland too. Despite good progress, the 2015 PwC Cities of Opportunity report ranks Auckland third to last for transport infrastructure, just in front of Johannesburg and Nairobi. For a city of just one and a half million people that’s unacceptable. Of even greater concern, Auckland Transport projections show that despite planned transport investment and because of increased density where there isn’t transport capacity, congestion will get much worse – especially in the inter-peak,” Selwood says.

“Without a change in direction, the proposed western aligned harbour tunnel and the western and southern motorway corridors will all be choked by 2040. We can and must do much better. Getting Auckland moving will require less in-fill, much more targeted intensification centred on high frequency public transport routes, and potential development of a satellite city to the south where demand, road and rail capacity all exist. Auckland is a small but growing city of opportunity. We can solve congestion if we chose to but we’ll need to use every tool in the box to do so.”

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