New Zealand Infrastructure Commission, Te Waihanga has released the New Zealand Infrastructure Strategy 2022-2052 (the Strategy), which identifies New Zealand’s infrastructure challenge and, for the first time, seeks to articulate a holistic, integrated and long-term approach (and accompanying actions) to achieve Te Waihanga’s vision of a thriving New Zealand through a world class infrastructure system.
We highlight some key aspects of the Strategy below.
New Zealand’s infrastructure challenge and the case for change
The Strategy identifies an acute need to reshape how New Zealand plans, delivers and uses infrastructure, including:
- responding to an aging and increasing population (New Zealand is predicted to grow by 1.2 million people in the next 30 years);
- promoting economic engagement and growth across New Zealand;
- correcting a pattern of historical under investment in infrastructure (for both new infrastructure and maintaining existing infrastructure); and
- the need to adapt to climate change (including through the development of low-emission and renewable energy projects and ancillary infrastructure).
Emphasising the urgent need for investment and the associated difficulties this presents, headline statistics within the Strategy include:
- that $5 billion of council infrastructure is vulnerable to sea level rise;
- it is predicted that New Zealand needs to spend $60 on renewing existing infrastructure for every $40 spent on new infrastructure; and
- that New Zealand will have a shortfall of 118,500 construction workers by 2024.
The Strategy’s objectives
Te Waihanga has identified five strategic objectives necessary to address New Zealand’s infrastructure challenge:
- Enabling net-zero carbon emissions – through a combination of increased clean energy generating capacity and reducing emissions from the infrastructure sector.
- Supporting towns and regions to flourish – through better connectivity for people and supply chains (both physically and digitally).
- Building attractive and inclusive cities – through better long-term planning, pricing and public transport the Strategy aims to respond to population growth, unaffordable housing and traffic congestion.
- Strengthening resilience to shocks and stresses – by planning for risks in a coordinated way based on good-quality information.
- Moving to a circular economy – by developing a national framework for the operation of a waste-to-energy infrastructure.
Additionally, the Strategy highlights three specific areas that Te Waihanga believes will have the greatest positive impact in the next 30 years:
- Leveraging our low-emissions energy resources.
- Planning for generations to come.
- Providing better infrastructure through pricing.
Recommendations: A blueprint for action
Te Waihanga makes 68 recommendations of deliverable actions to be implemented by central government, local government and the infrastructure sector in general. The recommendations align with Te Waihanga’s five strategic objectives and seek to achieve the following outcomes:
- Strengthening partnerships with and opportunities for Māori, including building strong, meaningful and enduring relationships with iwi to ensure New Zealand’s infrastructure works for everyone.
- Better decision making, including better project evaluation and selection through cost-benefit analysis; strengthening independent advice for infrastructure prioritisation; and improving clarity around long term investment intentions.
- Streamlining project delivery, including by adopting standardised frameworks for procurement and delivery across public sector agencies.
- Improving funding and financing, including by exploring ways to access alternative funding; consolidating existing infrastructure capital funds; and improving public understanding of how infrastructure is funded.
- An enabling planning and consenting framework, including by providing infrastructure special consideration within the planning and consenting framework and taking steps to promote and enable development and the delivery of infrastructure (while also protecting the environment but without “unreasonable” restrictions).
- Accelerating the use of technology in the infrastructure sector.
- Building workforce capacity and capability, including through an investment in skills at all levels of the infrastructure sector and reducing barriers for international firms and products to enter the New Zealand market.
Progressing the Strategy: Government recognition of the need for change
The New Zealand Government presented its response to the intent and recommendations contained in the Strategy in September 2022. The Government response was overwhelmingly positive, indicating broad support for the intent of the Strategy and Te Waihanga’s recommendations. The Government’s commitment to addressing New Zealand’s infrastructure challenges has been further underlined by the recent commitment of a further $61.9 billion of infrastructure investment over the next 5 years.
The Government intends to develop an action plan and reporting programme in the coming months that will set out the next steps for the recommendations that it supports. The action plan will include expected time frames and will identify which organisations (including central or local government agency (or agencies)) will lead and contribute to individual actions.
How can we help?
The Strategy is a landmark initiative for the future of New Zealand’s infrastructure. Te Waihanga has consulted widely within the infrastructure sector, iwi and other interested stakeholders to inform the Strategy’s conclusions and recommendations. If implemented in line with Te Waihanga’s vision, the Strategy will create a fundamental shift in the delivery of New Zealand’s infrastructure in the coming years.
Due to our close involvement with leading industry bodies and key stakeholders, MinterEllisonRuddWatts is uniquely placed to comment on the challenges that the Strategy is seeking to overcome and the exciting opportunities it presents for those engaged with New Zealand’s construction and infrastructure sectors.
If you would like to understand more about the Strategy and the opportunities that it may present for your business, please contact one of our team below.
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