Facts and Issues: Towards a National Infrastructure Plan
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ISBN: 978-0-478-33080-9 (online) NOT GOVERNMENT POLICY Note to Reader The Minister for Infrastructure indicated in his recent speech to the ‘Building Nations’ Symposium that the National Infrastructure Plan “…will evolve through time. The first draft should be ready early next year. Areas not identified in the plan will not necessarily be excluded from future public investment. It will be updated regularly - and no doubt we will get better at doing it.” This document is a precursor to the Plan. It contains a sector-by-sector description of New Zealand’s existing infrastructure, information about planned investment and a description of current policy settings. We would now like to answer a number of questions: 1. Base information: Is the sectoral analysis contained here an accurate and informative description of the sector? If not, what changes are required to make it so? 2. Missing issues: Are there important infrastructure issues not mentioned in this document? 3. Decision-making: This document suggests that for projects to contribute to community/national welfare and economic growth, they must have expected benefits (measured comprehensively) that are greater than their estimated costs (also measured comprehensively) – see the decision-making principles in the ‘Policy Context’ chapter. As well as considering distributional or equity considerations, are there other considerations that should be taken into account and if so, what is the case for that? 4. Cross-sectoral issues: What cross-sectoral issues are faced by operators/users of infrastructure in each sector? This document identifies a number of cross sectoral issues. Are there other cross-sectoral issues that should be included in a National Infrastructure Plan? 5. Regulatory reform: Are there important regulatory constraints on the development of infrastructure that are not being addressed by the government’s current regulatory reform programme? 6. Aspiration: For each infrastructure sector, is it possible or desirable to define the service level New Zealand should aspire to? If so, what should it be and why? 7. Link to economic growth: What additional investment would help New Zealand to increase its rate of economic growth? How can we be confident that this additional investment is a prudent use of scarce funds? Both the private sector and the local and central government sector have a role in providing infrastructure. The National Infrastructure Unit of the Treasury is therefore approaching a number of private sector and local government organisations seeking information and views on these questions. We prefer submissions that, where possible, provide empirical or other evidence to support the views they express. Submissions should be made in writing by 5 October 2009 and sent to: The Executive Director or by email to [email protected] National Infrastructure Unit The Treasury PO Box 3724 Wellington 6 SEPTEMBER 2009 INFRASTRUCTURE: FACTS AND ISSUES | ii NOT GOVERNMENT POLICY Contents NOTE TO READER...........................................................................................................................................ii INTRODUCTION ............................................................................................................................................. 1 INTRODUCTION TO THIS DOCUMENT ............................................................................................................................ 1 PURPOSE OF A NATIONAL INFRASTRUCTURE PLAN .......................................................................................................... 2 WHAT WILL THE PLAN COVER? ................................................................................................................................... 3 PREVIOUS RESEARCH ................................................................................................................................................ 4 STRATEGIC DIRECTION ................................................................................................................................... 5 IMMEDIATE PRIORITIES ............................................................................................................................................. 5 Broadband ...................................................................................................................................................... 5 Roads of national significance ........................................................................................................................ 6 Transmission ................................................................................................................................................... 6 Rugby World Cup 2011 ................................................................................................................................... 7 CURRENT POLICY WORK ........................................................................................................................................... 8 Electricity ........................................................................................................................................................ 8 Water/Irrigation ............................................................................................................................................. 8 Improving effectiveness of government’s infrastructure spend ..................................................................... 9 LONGER‐TERM ISSUES ............................................................................................................................................... 9 Auckland Transport Planning and Urban Form .............................................................................................. 9 Road funding and pricing ............................................................................................................................. 10 POLICY CONTEXT ......................................................................................................................................... 11 ROLE OF MARKETS AND GOVERNMENT ...................................................................................................................... 11 GOVERNMENT SERVICES ......................................................................................................................................... 12 CENTRAL VERSUS LOCAL GOVERNMENT FUNDING ........................................................................................................ 14 PROJECT EVALUATION, PRIORITISATION AND DECISION‐MAKING ..................................................................................... 15 ASSET MANAGEMENT............................................................................................................................................. 16 SECTORAL ANALYSIS .................................................................................................................................... 18 TRANSPORT: ROADS ............................................................................................................................................... 18 Description .................................................................................................................................................... 18 Analysis ......................................................................................................................................................... 23 TRANSPORT: RAIL .................................................................................................................................................. 25 Description .................................................................................................................................................... 25 Analysis ......................................................................................................................................................... 28 TRANSPORT: PORTS ................................................................................................................................................ 30 Description .................................................................................................................................................... 30 Analysis ......................................................................................................................................................... 32 TRANSPORT: AIR SERVICES ....................................................................................................................................... 35 Description .................................................................................................................................................... 35 Analysis ......................................................................................................................................................... 37 ELECTRICITY .......................................................................................................................................................... 37 Description .................................................................................................................................................... 37 Analysis ......................................................................................................................................................... 40 GAS ...................................................................................................................................................................