If New Zealand’s swelling population keeps stretching our infrastructure and resources will it affect our ‘quality of living.
By property reporter Katharina Charles
New Zealand is a nation facing growing ‘pains’, with a swelling population stretching both patience and resource, potentially harming our quality of living, says Bayleys national residential manager Daniel Coulson.
“While growth is critical to our nation’s well-being, it must be measured, matched by a suitable allocation of resources, services and infrastructure. If not, then we face losing the quality of living that we’re globally recognised for,” he says.
“Despite a focus on alleviating national housing pressures, Special Housing Areas (SHA) and housing developments have been fast-tracked by the Government in response to our mushrooming population, however funding constraints and legislative red-tape have stalled growth as the framework which underpinning this progress has fallen short.
“The focus on housing construction has seen decision makers lose sight of what goes on top of the land - equally matched with the infrastructure that goes under the land, or how accessible it is by road. Infrastructure is a key ingredient that has long been overlooked,” Coulson adds.
Auckland’s population has grown by more than 120,000 in the past three years, leaving a lasting impression on residents coping with the pressure on pivotal infrastructure such as water, waste disposal and roading congestion.
Wellington was the fourth fastest growing region over the past three years and despite consistently ranking as the world’s ‘coolest little capital’, transport has long been considered the city’s Achilles heel.
“Meanwhile, a trip to the Christchurch CBD, the centre of Canterbury, which experienced New Zealand’s second highest growth over the past three years, reveals a city centre still recovering from the effects of the 2011-earthquake,” he says.
“Further down the South Island in Queenstown, infrastructure constraints continue to hamper the ease of access to burgeoning suburbs such as Frankton Flats.”
Mr Coulson said the past five years have seen the issue of infrastructure continue to come to prominence, with the recent Budget 2017 announcements outlining plans for the largest ever nominal investment in New Zealand’s infrastructure to date – an acknowledgement of just how polarising the issue has become.
In parallel, Auckland Mayor Phil Goff released the findings of the ‘Mayoral Housing Taskforce Report’, the fruits of a think-tank which included developers, builders, economists, architects, bankers and Government officials with the purpose of finding how best we can quickly facilitate sustainable growth and address the ever-present issue of housing supply.
Recommending changes across three key areas which included development that is sustainable through economic dips, unlocking available land for development, and paving the way for an efficient consent process.
Mr Coulson said the discussions around alternate funding options and in particular improved procedure in relation to Public Private Partnerships (PPPs) were most encouraging, with Mayor Goff remarking that findings of the report “deserve the close attention of central and local Government.”
New Zealand economist and financial analysis author Shamubeel Eaqub agrees, noting that funding constraints mean that councils need to be creative.
“Using PPP’s in simple and low risk projects to fast-track development makes a lot of sense. This frees up funding for large and complex projects, for which the council and central Government remain the best place to take on the risk,” he said.
Mr Coulson said infrastructure PPPs have worked exceptionally well overseas.
“Global cities such as Dubai, Tokyo and Hong Kong have been able to keep up with the demand of their growing populations thanks to agreements which facilitate progress through mutually beneficial contracts in which the public (or council) is the brains, and the private (or corporate) offers the funds,” he says.
In an example of just how well this can work in New Zealand, a large portion of Wellington’s traffic woes have been addressed through the four-lane, 27 kilometere, $850 million Transmission Gully.
“However, in isolation, issues of congestion remain and not all Wellingtonians are content with the solution. Rather than addressing one project through sporadic development, perhaps a more comprehensive and overarching plan could better address the issues at hand,” Mr Coulson says.
Hailed as one of New Zealand’s most significant PPP’s, the model has allowed for the total cost of the project to be spread over 25 years, freeing up New Zealand Transport Agency (NZTA) funds to be invested elsewhere throughout the country and securing the application of internationally recognised technology.
Mr Coulson said the successful implications of PPP’s arose again recently when they were publicised by the findings of Infrastructure New Zealand’s trip to Scotland under the banner ‘Building National Infrastructure Capability: Lessons from Scotland’ - where a delegation traveled to investigate Scotland’s infrastructure policy with the purpose of finding how New Zealand might maximise the Government’s $32 billion infrastructure commitment over the next four years.
“One of the key ideas from the report was the efficiency of an independent body which works with the Government to provide strategic leadership and guidance and the collaboration between the group and PPP management agencies,” he said. In a practical example of how this might improve services across New Zealand, the report cited the recently released New Zealand Ministry of Health ‘Annual Report on Drinking Water Quality’, which found that more than 10 percent of people in areas with a population in excess of 10,000 received water which was not fully compliant with national standards.
The group found that collaboration between an independent body and PPP management agencies would deliver a higher standard of service through awareness and funding where New Zealand’s water quality was currently falling short.
“While infrastructure has been steadily emerging as a matter of social importance, it was as recently as last month that Prime Minister Bill English explained intensive negotiations have been taking place since the start of the year to allow greater room for local government to enter into the PPP’s which many see as the most efficient way to relieve New Zealand of her growing pains,” says Mr Coulson.
“This is progress. Finally we are starting to see the wheels in motion for change at a greater pace, and while we don’t expect major structural changes in the lead-up to the September election, campaign promises will be directed at housing and infrastructure.”
“Solutions are emerging and by way of smart legislation, some of which will pave the way for more PPP’s, New Zealand can really begin to live up to increasing its global profile as one of the world’s most liveable countries.”