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Water Investment Must Not Be Drip-Fed

The government’s latest announcement around water infrastructure investment provides welcome support for New Zealand’s ailing water networks. But to support COVID-recovery, fix systemic problems and provide employment, work should start quickly rather than being drip-fed.

Civil Contractors New Zealand Chief Executive Peter Silcock said the Prime Minister’s Havelock North announcement of NZD $761m to invest in water infrastructure was well overdue as the country’s aging water networks were failing due to overload and decades of underinvestment.

CCNZ Chief Executive Peter Silcock

“This investment is a great start, but the problem is huge. Three waters services are expected to need around NZD $17 billion over the next decade, with much of the work centering around replacement of aging assets and upgrading to meet new freshwater and wastewater standards.”

He said water systems were essential for the health of the country and the environment, but there was a tendency for local authorities to work based on system failure rather than planned maintenance, with contractors often hired to install ‘patches on top of patches’.

“Now that central government has extended this support, local authorities must step up. It’s their responsibility. What we don’t want to see is local authorities using the funding as an excuse to reduce their own portion of funding and carry on with the same old approach. We must do better.”

Systemic change driven by local authorities was needed. The linking of funding to a reform package recognising the need for aggregation of local authorities as water asset owners was welcome, reducing duplication and complication, he said.

“It’s very frustrating for contractors to have to deal with multiple water authorities, so the challenge for central government in dealing with them all at once is huge. Some of the problems we face result from doing the same thing 70 different ways. Now the incentive is there, we need to fix the issues.”

Mr Silcock said it was “disappointing” no timeframes had been announced for this work, given the urgent need to upgrade systems and retain skilled workers post-COVID.

“We’re in a very strange situation. We have more than 100 ‘shovel-ready’ projects in the pipeline the government is not willing to announce just yet. But we all know work takes a long time to reach the market, and contractors can’t hold their workforce indefinitely waiting for projects to come along.”

A lack of tenders coming to market had contractors worried, with a sizable gap in projects and prospective job losses across the construction and engineering sectors, largely due to reduced spending from private clients and local government.

He said structural change would take time, but timing of the work coming to market was critical. Coupled with a lift in the council debt cap and streamlined consents, he hoped the announcement would give local government confidence to bring existing projects to market, keeping people employed and delivering on the country’s need for clean water and effective wastewater systems.

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