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Infrastructure stocktake findings released

19 May 2004 Media release

Infrastructure stocktake findings released

The findings of New Zealand’s first nationwide infrastructure stocktake have been released today by Economic Development Minister Jim Anderton.

The stocktake covers New Zealand’s transport, energy, water and telecommunications networks. A key component was an audit undertaken by PricewaterhouseCoopers on behalf of an intergovernmental group headed by the Ministry of Economic Development.

Mr Anderton said the audit findings were largely reassuring.

“Sound infrastructure is essential to economic development, our standard of living and social well-being. This audit shows that although there are some problem areas, these have all been previously identified and are being addressed. While that is no reason for complacency, we can have confidence that the country’s infrastructure is basically in good shape.

"This is good news after the neglect of the 1980s and 1990s when the hands off approach of governments led to power crises, roading problems and rail track degradation. We are now getting back on track, but still have the negative results of that period to deal with," Progressive leader, Jim Anderton said.

The main concerns identified in the stocktake include:

- Electricity security of supply, both short-term, arising because of the failure of the market to provide for security margins, and long term, created by uncertainty around fuel availability and regulatory issues;
- Lack of investment in electricity transmission due to uncertainties about who should pay for investment and under what pricing methodology, coupled with land access issues;
- Road congestion in some areas, especially Auckland, as a result of a failure of governance and funding arrangements to ensure appropriate levels of investment and demand management;
- Water allocation issues, due to deficiencies in the statutory framework for prioritising water allocation between competing users; and
- Poor drinking water quality in some areas due, in part, to lack of funds to treat existing water supplies, and lack of appropriate expertise to manage water supplies.

“These concerns are all the subject of government action. For instance, the new Electricity Commission is tackling electricity issues, the Auckland transport package addresses that region’s road congestion and last week’s $11 million pre-Budget announcement will help small communities with high tourism flows fund the water and sewerage infrastructure they need. The recently announced review of the Resource Management Act is another example of the government’s determination to deal with the concerns identified in the audit," Jim Anderton said.

Mr Anderton said Budget 2004 would include $500,000 to fund future stocktake work in the coming year, if needed. To assist this work he invited anyone with new information that would substantially add to the stocktake findings to send it to the Ministry of Economic Development by 30 July 2004.

“I hope that audits will be done every three years in future. With a systematic process we can ensure that issues are identified early, so they can be tackled before they become major problems.

“Taking stock regularly may sound like commonsense to anyone who runs a business or a household but as a country we have not done it for a very long time, if ever.” Jim Anderton said.

Copies of the full stocktake audit report and related papers can be found on www.med.govt.nz/irdev/econ_dev/infrastructure/

New information that will substantially add to the stocktake work should be sent to infrastructure.stocktake@med.govt.nz

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