Tuesday, February 27, 2024

Tough infrastructure calls for rural NZ as it rebuilds

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NZ must find better ways to pay for future projects, as the sector is struggling to attract and retain the skills needed to deliver projects.
The NZ Infrastructure Commission Te Waihanga has said that the country will need to spend $31b on infrastructure each year for the next 30 years if it is to build its way out of current and future infrastructure challenges.
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Rural communities will face some tough decisions on infrastructure in the wake of Cyclone Gabrielle, says Infrastructure New Zealand policy director Michelle McCormick.

And infrastructure that is fit for the future will not be affordable by the government alone.

“The big question being can we build back more resilience,” she said.

“We need to, and there will be hard decisions for communities.  

“As a country it will be what can we afford to maintain. Do we need to rebuild all that has been lost?

“Do we need duplication of high-grade highways and rail networks? How can we build more resilience and at what cost?

“These are the hard questions and they will be scrutinised for answers that work for communities and all of NZ.

“Potentially it is not going to be the same again.”

It will be what is affordable, sustainable and meaningful to cater to community needs.

“It might look a bit different to what we have been used to but it will be resilient into the future,” McCormick said.

Infrastructure NZ’s members are from diverse sectors across New Zealand, including engineering consultancies, construction companies and contractors, funders and advisory and legal firms. The public sector often relies on Infrastructure NZ’s pool of knowledge and expertise for advice on matters relating to the infrastructure sector.

McCormick said much has been said about NZ’s significant infrastructure deficit and the need to address it.

Infrastructure NZ policy director Michelle McCormick says the big question in the wake of Cyclone Gabrielle is whether we can ‘build back more resilience’.

The Treasury’s 2022 Investment Statement puts the dollar amount of that deficit at $210 billion. The NZ Infrastructure Commission Te Waihanga has said that the country will need to spend $31b on infrastructure each year for the next 30 years if it is to build its way out of current and future infrastructure challenges.

“That puts into context the severity of the situation NZ is in and it is simply not sustainable,” McCormick said.

“We must make better use of the infrastructure we have and find better ways to pay for future infrastructure projects including using the range of funding and financing tools we already have, which include public-private partnerships, lease structures and development contributions and developer agreements used by local government.

“Government alone cannot pay for all this. We need to look at options.

“We must also prioritise the infrastructure we build and enable the project and skills pipeline to deliver it.”

McCormick said climate change and its implications are well recognised and, with several councils around the country and the government having already declared a climate emergency, the time to act is now.

“There is an opportunity to design and build our cities, towns and rural communities that makes them better, safe and more sustainable places to live.

“There is also an opportunity to make better use of the infrastructure we already have, including using it in transformational ways. 

“Infrastructure will play a significant role in how we respond to climate change whether it is mitigation, adaptation or increasing resilience.”

The sector is struggling to attract and retain the skills needed to deliver projects as it competes with the worldwide war for talent, McCormick said.

“We are losing people we have to better pay and better opportunities elsewhere and this has been made worse by the fact we do not train enough of the people the infrastructure sector needs.”

The cyclone rebuild will take place over a series of steps, she said.

“It might be one lane or 4WD connection before we get to a plan, and once we get an agreed plan we need bipartisan – the government and people of NZ need to commit going forward.”

The timeframe is unknown.

“We are still ascertaining in the response what the plan will need to be and how that will look,” McCormick said. 

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