At issue is the disastrous chopping and changing which has gone on in recent years when successive governments have axed projects launched by their predecessors, notably by pouring a “shower of the proverbial” personally over those that gave them the tick.
National canned Labour’s light rail project. It also scotched an agreement to buy new Cook Strait ferries from South Korea.
This is untidy and we need to become more sophisticated.
Investors will be heartened that Bishop is looking to include an Opposition perspective during the two-day summit on March 13 and 14.
From a Labour perspective, the hard political calculus is that it’s in the party’s interests to show up given on current political polling it could find itself in a position to form the next Government after the 2026 election.
But the real driver should be the opportunity to demonstrate the behind-the-scenes work Bishop and Edmonds have led to forge bipartisan agreement on the main planks of New Zealand’s evolving long-term infrastructure plan does have teeth.
It is not just words. Both parties are prepared to act as “adults in the room” when it comes to infrastructure. It is costly to do otherwise.
Last November, the Government released “New Zealand PPP Framework– A Blueprint for Future Transactions.”
Notably, it includes forewords by the Prime Minister, Bishop, Simon Court, who is Bishop’s under-secretary, and Edmonds.
Not only is she Labour’s finance spokesperson, she also holds the shadow infrastructure portfolio.
Edmonds’ words are instructive: “Swings in priorities each election cycle don’t help New Zealand’s infrastructure deficit. We need to be smarter about the way we plan and deliver infrastructure if we are going to deliver the infrastructure New Zealanders need now and into the future”.
“Having an agreed framework for how all governments manage PPPs is vital for providing the sector with confidence. This PPP Framework outlines clearly how governments of all stripes should think about PPPs as a procurement method.
“We support PPPs when they maintain some form of public ownership/control of critical infrastructure and align with Labour values of fairness and cooperation.
“A robust analysis that demonstrates long-term cost-effectiveness and better value for public money must guide consideration of PPPs. Although we might disagree on specific projects, Labour welcomes this framework to help guide future decisions.”
The framework has been well-signalled to prospective investors.
There is also much detail on the National Infrastructure Funding and Financing website about opportunities.
PPPs in New Zealand are not new. Eight PPP projects have been developed since 2011, including three correctional facilities, two Roads of National Significance state highways, and three bundles of primary and secondary schools.
The service delivery outcomes achieved through these projects to date have been positive, in many cases outperforming similar projects delivered using other methods. Standardised or modular designs from PPP projects and asset management lessons have also begun to be implemented elsewhere.
Bringing the Opposition to the table was not an apparent option when the Prime Minister publicly confirmed to me last December he would host a major Infrastructure Investor Summit in mid-March.
In the December Herald interview, Christopher Luxon told me he was excited about the summit and forecast it would be the catalyst for connectivity between large offshore funds and New Zealand.
The New Zealand Transport Agency was collaborating with other agencies to ensure that projects were fast-tracked to deliver a new generation of Roads of National and Regional Significance to support economic growth and get people and freight to where they want to go quickly and safely. He said Cabinet Ministers would take part highlighting that the then Transport Minister “should be able to stand up and offer a package of roads for example as an asset class”. Bishop will now talk to the transport projects instead of previous Transport Minister Simeon Brown who is now expected to talk to opportunities with hospital upgrades.
Invitations went out late last year to a range of funds and some local infrastructure entities, sparking many local players to ring around to see who had made the cut.
The guest list has been capped around 100.
Getting the right people in the room is key to the success of any summit.
The Prime Minister has reputably insisted that participation is at chairman and CEO level, but that neglects the fact the most powerful person in many funds is the chief investment officer.
There are niggles. While the New Zealand Superannuation and, most likely, ACC will be in the tents, some trading banks are aggrieved their overall investment in NZ’s economic success is not being valued and cherished – in fact, they are now the targets of Government ire over their claimed anti-competitive behaviour and decisions to pull away from banking fossil fuel companies.
The key official players are Treasury deputy secretary Leilani Frew, NZTE Australian investment director Andrew McGowan, National Infrastructure Funding and Financing CEO Graham Mitchell and CFO Andrew McGavin; and New Zealand Story major events director Jonathan Alver, who has to pull the summit into a well-oiled machine and deliver a memorable gala dinner to suitably wow visitors.
At a basic level summit will showcase upcoming infrastructure opportunities, including investment and development opportunities, and provide an overview of NZ’s infrastructure vision.
It will highlight the Government’s Infrastructure vision, enabling policy and legislative work programme, the approach to partnering with private sector organisations to deliver the infrastructure New Zealand requires over the coming years and importantly, to showcase specific infrastructure investment/deal opportunities in several public infrastructure areas.
Foreign investors are seeking clarity over New Zealand’s foreign investment regime.
The Prime Minister is close to sorting a lengthy stoush on this issue.
Last March, Associate Finance Minister David Seymour took a paper to Cabinet advocating opening the door wider to foreign investors. The only major restriction in his view was for national security reasons – “we’re not opening the door to Russia”.
The draft policy dovetailed nearly with the Coalition’s moves to increase economic momentum by introducing fast-track consenting legislation for major projects.
But New Zealand First and some members of National had issues.
Those are now pretty much overcome – and need to be.