New Zealand is currently experiencing unprecedented levels of economic growth, Connal Townsend observes
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here are many ways to prioritise funding infrastructure projects in a growing economy. The previous National government focussed on roads which they saw as strategic for economic growth. The new government clearly understands the provision of infrastructure is crucial to developing sufficient homes for the growing population and are planning to deliver broader multi modal solutions. We see benefits in both approaches.
National’s strategic roading
The last government took the approach of prioritizing funding towards “Roads of National Significance”. The projects they took on will certainly make a significant contribution to economic growth and continue to benefit the country for years to come. In Auckland, the major projects National prioritised include the Victoria Park Tunnel and the Western Ring Route. A major part of the Western Ring Route, the Waterview Connection and Tunnel opened in July 2017, completing the links to the airport from the north and west, much to the delight of locals as congestion has been dispersed. These major developments make it easier for goods and services to move steadily throughout Auckland. They also assist nationally by providing links between Auckland Airport, Ports of Auckland and inland freight hubs across the upper North Island. In short, these roads will reduce the cost of doing business in Auckland and throughout the country. Further south the Waikato region is set to welcome a four-lane highway from the Bombay Hills to south of Cambridge. The Waikato Expressway, which
is being built in seven sections, is due to be completed by the end of 2020, and will reduce travel times between Auckland and Taupo by 35 minutes. In Wellington, the Northern Corridor improvements will mean the travel times on SH1 between Wellington Airport and north of Levin are more reliable. With a total length of approximately 110km when finished, this route will improve connections to Wellington’s port, CBD, airport and hospital. Additionally, on top of the 8000 jobs created for its construction, the project is likely to create an extra 850 permanent jobs in the region. With the earthquake has come significant challenges for Canterbury and its infrastructure. The ambitious, Christchurch Roads of National Significance programme is currently underway and has been injecting over half a billion dollars into Canterbury economy. Once complete, it will provide critical access to and from the Christchurch CBD, Christchurch International Airport and the Port of Lyttelton.
Labour’s holistic infrastructure
With a new government comes a new approach to infrastructure, and a move to focusing very much on people, and their quality of life. We support this holistic approach. The schemes currently being considered focus on investing in public transport, which we support. The plans initially focus on Auckland, where the greatest need is, but they also intend to look at the regions. We welcome the goals of decongesting Auckland, and the use of more public transport options. The new government intends to
invest in more electric trains and will electrify the current tracks to from the Auckland CBD to Pukekohe. They are also looking into building light rail from the CBD to Auckland Airport. We believe it will be important for the government to prioritise good urban design around the new transport hubs that are created, including parks and shopping centres to make sure they are user friendly, and places people enjoy going to. The City Rail Link (CRL) has been an objective of the Auckland Plan from the start. The new government are picking up where the last government left off, which is great. The project is part of a vision of opening up Auckland and constructing routes across the central suburbs through to the airport, West Auckland, and later extended to the North Shore. Our Auckland Executive applauds these goals and intends to work closely with the new government to help achieve them. Rightly, the new government aren’t just focusing on Auckland. They intend to look at creating a passenger rail service linking what is known as the “golden triangle”, between Auckland, Hamilton, and Tauranga. In Wellington they are fast-tracking a feasibility study on rapid transit to the airport, which is likely to consider a light rail option. They are also intending to invest another $100million in capital investment into greater Christchurch and a multi-modal public transport system, including commuter rail as a first step.
Funding and financing innovations?
This government is interested in looking into different methods of financing infrastructure to get it started and moving quicker.
Building communities
The new government’s goal is to build more houses, but we need them to remember that it takes more than just houses to build communities. In order for communities to thrive they need parks and shopping centres; places for people to work and places to recreate. In order to construct the new infrastructure the government is planning at pace, we encourage them to lessen the red tape needed for these projects to get going. Our members will be the people building both the houses and infrastructure the government would like to see. We look forward to working closely with the new government to help them achieve those goals.
Connal Townsend is Chief Executive of the Property Council NZ, which represents the interests of the commercial property investment industry – including commercial, industrial, retail and property funds PROPERTYANDBUILD.COM YEARBOOK 2018
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PROPERTY & BUILD
Economic growth provides fresh opportunities
Currently they’re looking at options such as collecting a regional fuel tax, infrastructure bonds, targeted rates, and techniques aimed at capturing the capital value uplift of properties near the new developments. Public Private Partnerships will continue to be an excellent way of ensuring these projects progress at pace. The new government are going to be taking a completely new approach to how funding is prioritised, and it will be interesting to see how this affects infrastructure projects. The Prime Minister announced in February this year that she wants New Zealand to be the first country in the world to assess all bids for budget spending against new measures that determine not just how spending will impact on GDP, but also on natural, social, human, and possibly cultural capital. It will be interesting to see how this new innovation will work in practice.