Alan Pollard, Chief Executive, CCNZ.
You’ve heard it before, and you’ll hear it again – the most critical issue facing contractors remains the need for a steady reliable and funded programme of ongoing work. You cannot operate a business when the income that you rely on is subject to political interference, ideological influence, and rapid change.
Infrastructure investment has long been negatively influenced by short central and local government electoral cycles, and short planning horizons. With so much uncertainty and so little long-term planning (10-year Council ‘Long-term’ Plans span too short a horizon), contractor businesses cannot, with any confidence, invest in people, plant and equipment, and new and emerging technologies. Often this leads to the so-called ‘boom and bust’ cycles that have historically characterised the construction and infrastructure sector.
So, with this in mind, I was honoured to receive an invitation to attend the Prime Minister’s Infrastructure Investment Summit held in Auckland recently. This summit brought together key Government ministers, opposition spokespeople, Government department leaders, construction business leaders, iwi representatives, and global financial leaders to hear the Government’s infrastructure vision, and to hear Government ministers pitch for private investment partners to build the critical infrastructure that our communities need. Global funders from about 16 countries attended, responsible for managing trillions of dollars in funds.
To be fair, I went to the summit with fairly low expectations. As both the Prime Minister and Minister for Infrastructure noted, there have been many “talk fests” on infrastructure held in the past, but most had failed to turn into meaningful action. I was pleasantly surprised. This summit felt different, and I came away with a feeling of cautious optimism. Why is this?
First, there were presentations from a number of key Ministers – the Prime Minister, Finance, Transport, Infrastructure, Health, Justice, Courts, and Corrections. There was also Education, Immigration, Trade and Regulation among others, as well as local government representation. I was struck by how well they understood their portfolios, the challenges each faced, and what role infrastructure investment would play to deliver much needed outcomes.
Second, the Opposition was in the room and involved in the discussion. Although some post-summit comments from the Labour infrastructure spokesperson about public private partnerships were unfortunate and left me wondering if she understands what they actually are – cross-party consensus on the way forward for infrastructure is essential if we are to have a clear pipeline and direction for infrastructure construction.
If we are to address the infrastructure deficit (estimated at $210 billion by the Infrastructure Commission), we have to take a long-term bipartisan approach to infrastructure planning and investment. That doesn’t mean agreeing on every project, but it does mean agreeing on and providing funding for critical infrastructure projects that will span multiple electoral cycles and remove the ‘cancel culture’ that has historically reflected the vast ideological differences that have characterised the left and right parties.
Third, Government Ministers appeared connected with respect to the challenges ahead. Ministers pitched for capital projects within their respective portfolios. The Minister for Education and Immigration outlined how her portfolios will support building the workforce capacity and capability to build these assets, and the Minister for Regulation outlined how his department will support removing, or streamlining, the regulatory barriers that have been handbrakes to infrastructure investment in the past.
This is the first time in my many years of working with various governments from all sides of the political spectrum that I have witnessed a government so aware of the broader ecosystem that needs to function to deliver the outcomes that our communities need.
Fourth, again this is the first time that I have witnessed first-hand Ministers pitching projects to the investor community. Their presentations were slick and well researched, and I understand that the Government may have already received expressions of interest from investors to partner on some key infrastructure projects.
So, overall, I congratulate the Government on this initiative. Now we must turn this into action. The future for infrastructure investment in this country looks very positive, which can only be positive for our civil construction sector.
Of course, while the future looks positive, the next nine to 12 months will remain challenging. I have met with the Minister for Infrastructure and Transport and will shortly meet with the Minister for Local Government (which includes the government water reforms). I also continue to engage with the NZTA.
Our conversations have centred on what projects can be brought forward to fill the current project void, or what incentives can be put in place to encourage, particularly, local government, clients to bring forward their work programme.
We are also exploring whether there are other levers we can use to retain existing staff, including government funding to support employers to invest in training, enabling a more capable workforce for when the projects start to flow.
I want to acknowledge how tough it has been for our members, contractors and associates alike. Many have had to make tough decisions to keep their businesses operating. My team and I are doing all we can to advocate on your behalf, to ease the burden, and provide support.
Advocacy is a long game, with progress happening behind the scenes rather than in full view. I can, however, assure all members that we will always act in your best interests, that we are fully committed to doing the best for you, and that we will not let up until we see work flowing again.
Parting words from Jeremy Sole- a final column