Hon Chris Bishop
Minister for Infrastructure
Hon Erica Stanford
Minister of Education

The Government will establish a new school property agency to help ensure Kiwi kids can learn in safe, warm and dry buildings.

“The Government inherited a school property system bordering on a crisis. The previous government made big promises to school communities, but its unfunded, bespoke, expensive projects weren’t deliverable and left schools across the country waiting – often for years – for the classrooms and refurbishments they so badly needed,” Education Minister Erica Stanford says.

“Our Government took immediate action to sort this out. We initiated a Ministerial Inquiry into School Property, I instructed the Ministry of Education to focus on offsite manufacturing solutions and improving communication with schools. A value for money review was also completed which helped inform a more fiscally responsible approach.

“These immediate actions are working, we’ve already lowered the average cost of a classroom by 28%, meaning we were able to deliver 31% more classrooms last year compared to 2023, 583 classrooms in total. Currently new classrooms cost on average $620,000, compared to the $1.2 million average cost per classroom at the end of 2023.

“The report also found the Ministry of Education’s processes for managing the school property portfolio needed overhauling, that schools struggled with a lack of transparency, unclear prioritisation of projects, and inefficient project planning and delivery.

“The Inquiry recommended the Government create a new entity separate from the Ministry of Education to manage school property. The Government accepted this recommendation, and Cabinet has now also agreed on the form that this new entity will take.”

The New Zealand School Property Agency (NZSPA), a new Crown agent, will be responsible for planning, building, maintaining and administrating the school property portfolio. The Ministry of Education will remain responsible for education policy and network decisions, including where growth is required. This separation will allow the Ministry to focus on education outcomes, while the board of NZSPA will be responsible for the school property portfolio.

“A Crown agent balances flexibility, transparency and Ministerial direction while bringing commercial discipline to the leadership and board oversight. It will have a dedicated board with the commercial acumen appropriate to support informed investment decisions for the second largest social property portfolio in New Zealand,” Infrastructure Minister Chris Bishop says.

“With the establishment of the NZSPA, schools can expect improved project delivery and communication, better value for money, and an increased level of transparency around decision making.

“The agency will be established in this Parliamentary term. A Ministerial Advisory Group will provide specialist independent advice on the transition to the new agency. This group is chaired by Murray McCully, with Mark Binns, Rick Herd, Sarah Petersen and Craig Stobo as the other members.

“School communities can be assured that works and improvements currently underway will continue as planned while we work through the next steps. Our focus remains on driving efficiencies across the school property portfolio through a combination of cost-effective repeatable designs and offsite manufactured buildings,” Ms Stanford says.

“We’re backing our schools with the infrastructure they need to succeed – for teachers, for communities, and most importantly, for kids.”

Notes:

The Ministerial Advisory Group members are:

• Hon Murray McCully CNZM CF served as Minister of Foreign Affairs for eight and a half years and Member of Parliament for thirty years. Hon McCully is the Chair of Te Tai Tokerau Water Trust and Chair of Whangārei District Holdings Limited. He was lead independent reviewer for Ministerial Inquiry into School Property.
• Mark Binns is the current Chair of National Infrastructure Funding and Financing Limited, and Director for Hynds Limited, Auckland International Airport and Mercury Energy. He is a former Chief Executive of Meridian Energy and led the company through the largest IPO in the country’s history. Prior to this, Mark was Chief Executive of the Infrastructure division of Fletcher Building.
• Rick Herd led Naylor Love to become one of the largest privately owned construction companies in New Zealand. Rick is known for raising industry standards and actively contributes to industry bodies like Registered Master Builders and Construction Health and Safety NZ. His is a director of Port Otago Limited, ENI Engineering Limited, and Nelmac Limited.
• Sarah Petersen is a chartered accountant specialising in risk and governance in the Far North region. Sarah is a current Director and Audit Committee Chair for Tupu Tonu | Ngāpuhi Investment Fund, and the Deputy Chair/Audit Committee Chair for Far North Holdings, the asset management arm of the Far North District Council. She was previously the CFO for Cognition Education Group, a global education delivery and consultancy company. Sarah sits on the Board of the Chartered Accountants Association of New Zealand.
• Craig Stobo provides a high level of financial acumen combined with industry knowledge and governance experience. He has held numerous governance positions and is currently the Chair of the Financial Markets Authority, NZ Windfarms Limited, and the NZ Local Government Funding Agency. He previously chaired the boards of Precinct Properties and AIG NZ.

The number of classrooms constructed:

• In 2023: 444 additional teaching spaces
• In 2024: 583 additional teaching spaces (+31%)

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