Infrastructure spending to get boost of billions in May Budget

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$812 million will go towards repairing State Highway 1 around Kaikoura.

Finance Minister Steven Joyce will lift infrastructure spending by $4 billion more in the May Budget than previously indicated and an extra $7b in the following three Budgets. Of the $4b extra in next month’s Budget $812 million will go towards repairing State Highway 1 north and south of Kaikoura, which was damaged in the November earthquake.

Details of how the rest will be spent will have to wait until May 25, Joyce said in a formal pre-Budget speech to the Wellington Chamber of Commerce today. However, he announced a new debt target for the Government, to reduce net debt to between 10 per cent and 15 per cent of gross domestic product (GDP) by 2025. The current target is to reduce net debt to about 20 per cent of GDP by 2020; it is expected to settle at 24.3 per cent by the end of June.

On the issues of tax cuts, Joyce said the Government remained committed to reducing the tax burden “and in particular the impact of marginal tax rates on lower and middle income earners, when we have the room to do so.” Joyce also hinted at greater use of public-private partnerships (PPPs). Joyce said that the boost to capital expenditure would represent the biggest addition to the Government’s capital spending in decades.

“To put that into context, the net new capital allocated in the last four Budgets was $4.8 billion, of which $4.1 billion was funded through the proceeds of the mixed ownership model programme.” In between Budget 2016, the Government was forecasting just $3.6b in new capital spending between Budget 2017 and Budget 2020, which would now be $11b in new capital spending.

“If you add the Government’s budgeted new capital investment together with the investment made through baselines and through the National Land Transport Fund, the total is around $23 billion over the next four years, or an average of nearly $6 billion per year.” And we want to extend that further, with greater use of public-private partnerships, and joint ventures between central and local government and private investors.”

Joyce said New Zealand’s stronger economic performance flowed through to the Government books. For the first eight months of the current financial year, tax revenue was nearly 4 per cent ahead of predictions in Budget 2016. “Our surplus in the eight months to February was $1.4 billion. That’s more than $900 million more than was predicted in the [December] half-year update. “A growing and more resilient economy allows us to meet some of the pressing needs that the Government is faced with from time to time.”

But he said one of the biggest risks to the New Zealand economy were the “more insular” economic policies being pushed overseas and by the government’s political opponents domestically. “Many politicians, even those in New Zealand, want to be more protective on trade, slash immigration, reduce foreign investment, institute radical new environmental regulation, centralise wage bargaining, blow up our R&D [research and development] incentive system or stop much needed roading being built, and increase taxes. “That’s the opposite of a recipe for growth. That’s a recipe for stalling growth.”

Source:

  • Audrey Young
  • NZ Herald
  • Photo: Mark Mitchell

NZTA updates plans for $1.25 billion East West Link between Onehunga and Mt Wellington

Transport chiefs have released a new animation showing how they expect a major new highway in Auckland will ease congestion.

The East West Link between Onehunga and Penrose is designed to improve travel between State Highways 1 and 20.

The road is a priority project for supporting the long-term growth of Auckland and the continued economic development of New Zealand, the NZ Transport Agency (NZTA) says.

It includes a new four-lane road on the northern side of the Mangere Inlet connecting SH20 at Onehunga and SH1 at Mt Wellington. The estimated cost is $1.25 billion to $1.85b.

The two-minute video details some of the features along the route of the new road, including walking and cycle paths joining Onehunga to the Sylvia Park shopping centre, a new coastal boardwalk and new planting.

NZTA says the design in the video has evolved from community feedback, including open days and engagement with local residents and community groups over the past three years.

“The changes made as a result of feedback can be seen in the animation, including the lowering of the East West Link into a trench along the length of the Onehunga Wharf,” said NZTA Auckland highway manager Brett Gliddon.

“This trench provides the opportunity for future development of the land above it and creates a seamless connection between the wharf and the town centres of Onehunga and Mangere Bridge. This design responds to one of the biggest areas of concern for the local community.”

Another change is an elevated interchange at Great South Rd, with on- and off-ramps in both directions from the East West Link to Great South Rd and Sylvia Park Rd.

“The business community and transport operators identified concerns with the efficiency and reliability of a standard intersection between the East West Link and Great South Rd. We listened to that and developed the interchange as a result, which will allow local traffic to separate from state highway traffic,” said Gliddon.

“At the same time, we have included a cycleway through the area, maintaining dedicated off-road cycle and pedestrian connections.”

The animation also shows how the new road will enable better access to the waterfront at Mangere Inlet which will be transformed with 16km of new walking and cycle paths.

Wetlands will treat stormwater from the area before it flows into the harbour.

Source:

  • NZ Herald

Auckland to Whangarei motorway on the cards

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A motorway from Auckland to Whangarei has been flagged by Transport Minister Simon Bridges. Speaking at today’s sod turning to mark the start of the $709.5 million Puhoi to Warkworth motorway, Bridges said over time the motorway would extend to Whangarei, a distance of 162km.

Prime Minister John Key and Bridges turned the first sod during a tour of roading projects north of Auckland, including a new roundabout in the township of Waimaukau. Bridges said the Government had pledged to build a four-lane road of national significance from Puhoi to Wellsford and the entire corridor to Whangarei was very important.

“A lot of people talk about the Brynderwyns and the need for a very strong solution there. “You have got Northport up closer to Whangarei, which is again justification for doing a much more significant job all the way. “Whether that’s to road of national significance standard or something different to that I couldn’t say at the moment … but as Transport Minister I’m very attracted to progress more significant road improvements, not just through to Wellsford but up to Whangarei,” Bridges said.

He said realistically it was not five or six years away, but probably a decade of more away. New Zealand Transport Agency chairman Chris Moller said the agency was looking at the Whangarei to Auckland connection but a motorway could be 30 years away. The Puhoi to Warkworth motorway extends 18.5km over difficult terrain from the Johnstone Hills tunnels just south of Puhoi to just north of Warkworth.

sssCritics have nicknamed it the “holiday highway” to the intense annoyance of Northland leaders. The new motorway will have two lanes in each direction divided by a central median with a safety barrier. Both Bridges and Rodney MP Mark Mitchell stressed the safety benefits of the new motorway. Said Mitchell: “Safety is definitely a No 1 concern. Unfortunately the piece of road we have to use at the moment comes with hazards and we have too many serious injuries and fatal accidents on that piece of road.”

The project is the second public private partnership (PPP) for a state highway, after the Transmission Gully motorway in Wellington. Under the latest PPP, the Northern Express Group will finance, design, construct, manage and maintain the Puhoi to Warkworth motorway for the 25 years following a five-year build. The motorway is due for completion in 2021. Incentives built into the contract will ensure the motorway is one of the safest in New Zealand with lower grades and be more resilient to natural disasters and road closures.

Bridges said a decision had not been made on whether to toll the new Puhoi to Warkworth motorway. Route protection of the next stage of the motorway from Warkworth to Wellsford is underway. The NZ Transport Agency is planning to release an indicative route early next year. The Automobile Association is delighted that construction is officially underway on the Puhoi to Warkworth motorway extension. “Many people from outside Northland don’t understand what a vital step forward this is for us,” AA Northland District Chairman Steve Westgate said. “It’s not just about safer, quicker and more reliable journeys, it’s about the economic opportunities that come with it. This project will improve our connections with Auckland, New Zealand and the world.”

Source:

  • Bernard Orsman
  • NZ Herald

 

Western Motorway Upgrade – Auckland

 

Source: NZTA

A busy decade ahead!

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Waterview Project – Auckland

Around $110 billion will be spent by central and local government on infrastructure over the next 10 years – but more money will be needed from user-pays and other charges, Finance Minister Bill English says.

The Government has also announced it will develop national data standards for roads, water and buildings, which it hopes will avoid a “silo” approach to expensive new projects.

“Centres of excellence” will be established with people who can help government departments and councils with the analysis and presentation of data.

“Expensive and long-lived infrastructure assets won’t deliver the right results if planning occurs in silos,” Mr English said in a speech unveiling the 2015 National Infrastructure plan at the New Zealand Council for Infrastructure (NZCID) symposium in Christchurch this morning.

The plan contains 145 initiatives which are designed to help the country cope with ageing infrastructure, and increasing pressures from a growing population, much of which will occur north of Taupo.

NationalMegaProjectsAug20Mr English said there would need to be an increased focus on “non-asset solutions”, such as charging those who have a strong demand for the use of infrastructure.

“This isn’t a new idea. Taxes on fuel to pay for the National Land Transport Fund mean we already use demand management tools in roading.

“And all councils meter large water consumers. New technology will offer greater opportunities for managing demand for infrastructure assets over the next 30 years.”

Mr English said that such charges should not be used without considering benefits to improved infrastructure, such as increased productivity or well-being

“And charges for infrastructure use should never be used simply to raise revenue.”

A key focus of today’s plan is the need to renew ageing networks of existing infrastructure, Mr English said. That included schools, which have an average age of 42 years.

The Ministry of Education has recently surveyed all of the country’s state and state-integrated schools and found them to be in poorer condition than thought.

Damp, mouldy conditions at schools including Northland College and Western Springs College in Auckland have made headlines recently. Both those schools are scheduled for hugely-expensive upgrades.

“New Zealand’s population is ageing. The median age has increased from 32.8 years in 1996 to 36.9 years today, and is expected to reach 42.7 years in 2043,” Mr English said.

“This has implications for the types of services New Zealanders will want, the infrastructure required to deliver those services, and the available funding.

“Some of our regions will grow in size, while others will shrink. By 2045, the demographers expect another 1.2 million people to be living in New Zealand, with most of that increase expected to be north of Taupō.

“Those people will require housing, transport, electricity, water and telecommunications. They will also help to pay for it.”

Mr English also today released a pipeline of capital spending for central government departments, which he said showed the Government’s commitment to transparent dialogue with local government and industry.

When National came to power in 2008 discussions with councils and departments on infrastructure were often short-term in focus, Mr English said, but a smarter approach was needed to meet the significant challenges over the next 30 years.

Local Government NZ, which represents the country’s 78 local and regional authorities, last month made a number of proposals funding councils, including fuel levies, taxes on tourists, and collecting rates on Crown-owned land.

Those were dismissed by Local Government Minister Paula Bennett, who warned councils to look at their own spending and high wages rather than chasing the Crown or ratepayers for more funding.

LGNZ president Lawrence Yule, who has said local government is facing unprecedented economic and demographic change, welcomed today’s 30 year plan.

“While local and central government will not agree on everything, over the timeframe of this plan LGNZ will continue to drive strategic performance improvements across its infrastructure including the three waters, roading and transport, as well as a new partnership with central government on risk management of local assets,” Mr Yule wrote in a forward to the plan.

Today’s report notes that climate change is predicted to cause sea level rises of 30 centimetres by 2050, and that flooding is already New Zealand’s most frequent natural disaster at a cost of around $51 million each year.

Local authorities are already noting that the rising water table is hastening the degradation of pipes.

Source:

  • Nicholas Jones
  • NZ Herald
  • Photo: Nick Reed

$4.2 billion for Auckland transport

mainmotorway_620x310Auckland is receiving 30 per cent of a national land transport budget of $13.9 billion over the next three years.

The Government’s Transport Agency has this afternoon announced that the Super City – with about one third of the country’s population – will receive $4.2 billion for state highways, local roads, public transport, walking, cycling and road policing.

About $3 billion – or just over 71 per cent – of that will be Government money from fuel taxes paid into the National Land Transport Fund, leaving Auckland Council to pay the remaining $1.2b.

That does not include projects outside the land transport programme for which the council is allocating Auckland Transport an additional $1 billion, including for the City Rail Link.

Aucklanders will also contribute $520m of “external revenue” such as parking fees and fines, and public transport fares.

Their city’s share of the overall “partnership” pot from the national programme will include $1.175 billion for public transport, $960 million to maintain highways and local roads, and $91 million to improve cycling and walking.

That is additional to $24.75m the Government said last week it would contribute to Auckland from its $100m urban cycleways fund.

Today’s transport announcement opens the way for early starts on a $1 billion package of road freight connections between the Southern and Southwestern motorways, and also commits funds for the first time to design an extension of the Northern Busway, from Constellation Drive to Albany.

It includes $48m to continue preparations for a $760m motorway extension to Warkworth, which the Government hopes will be built as a public private partnership from late next year.

The transport programme has allocated $268m to widen the Southern Motorway beyond Manukau, and has increased the budget to complete the Waterview Connection and related projects along the Northwestern Motorway on Auckland’s long-awaited western ring route from $2b to $2.27b.

The national allocation represents a 15 per cent increase in land transport funding from previous 2012-15 programme.

Transport Minister Simon Bridges says the $13.9b programme represents the largest ever spend on land transport, and will deliver on Government priorities of increasing economic growth and productivity, improving safety, strengthening regional transport networks, lifting investment in public transport and cycling, and ensuring value for money.

The Government’s share of the national programme amounts to $10.5 billion.
Roads will account for $10.3b of the programme.

That comprises $6.3b for state highways which are fully Government-funded and $4b for local roads, about half of which are financed by councils and their ratepayers.

Almost $2b has been earmarked for public transport nationally, a 21 per cent increase, and investment in cycling will more than triple – to $251m.

But the Green Party says the programme is focussed too heavily on “carbon-polluting transport infrastructure, rather than building a clean, balanced and efficient system for the 21st Century.”

Transport spokeswoman Julie Anne Genter said National had chosen to continue spending more than $1b a year “on a few carbon-polluting motorways that haven’t even passed a business test.”

She commended the increase in money for urban clearways, but criticised the Government’s “foolish and unjustified policy of not funding rail infrastructure from the National Land Transport Fund, even though rail is obviously a form of land transport.”

Regional allocations for the coming three years:

Allocation to other regions for the coming three years include:

  • Auckland – $4.223b
  • Northland – $460m
  • Waikato – $1.812b
  • Bay of Plenty – $591m
  • Wellington – $1.439b
  • Hawkes Bay – $245m
  • Taranaki – $187m
  • Manawatu-Whanganui – $450m
  • Gisborne – $120m
  • Greater Christchurch – $1.575b
  • Canterbury (outside Christchurch), Otago, Southland and West Coast – $977m
  • Upper South Island – $221m

Source:

  • NZ Herald
  • Photos: Brett Phibbs

Karapiro Viaduct time-lapse video

Karapiro Viaduct time-lapse video – part of the NZTA Cambridge Bypass Project currently underway in the North Island.

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