What is the package?
The package provides funding for a selection of regionally important State highway projects, drawing on the Future Investment Fund. The package has three parts:
- Up to $80 million to accelerate five critically important regional projects:
- Kawarau Falls Bridge, in Otago
- Mingha Bluff to Rough Creek realignment, in Canterbury
- Akerama Curves Realignment and Passing Lane, in Northland
- State Highway 35 Slow Vehicle Bays, in Gisborne
- Normanby Overbridge Realignment, in Taranaki.
- Up to $5 million to finalise investigation and consenting processes, and $115 million for construction, for six projects:
- Whirokino Trestle Bridge replacement, in Manawatu/Wanganui
- Motu Bridge replacement, in Gisborne
- Opawa and Wairau Bridge replacements, in Marlborough
- Taramakau Road/Rail Bridge, on the West Coast
- Loop road north to Smeatons Hill safety improvements, in Northland
- Mt Messenger and Awakino Gorge Corridor, in Taranaki.
- Port of Napier access package, in Hawke’s Bay
- Nelson Southern Link, in Nelson
- Rotorua Eastern Arterial, in Bay of Plenty.
Why is this package necessary?
Many of the projects in this package have been delayed in the past. However, the projects are important to their respective regions, and will address economic efficiency, safety, and resilience issues for regional networks.
Where is the money coming from?
Up to $212 million will come from the government’s Future Investment Fund. This fund is available for Capital expenditure, and as State highways, all of these projects qualify.
Any funding in addition to this would come from the National Land Transport Fund. This is most likely to occur if investigations into the projects in Napier, Rotorua, and Nelson find the projects are worthwhile relative to other priorities at the time. The current estimate for the cost of these projects is up to $220 million.
Why was this not included in the GPS?
The GPS allocates funding from the National Land Transport Fund towards activity classes, rather than to specific projects. The government has identified these projects as being of particular regional importance, and so has approved additional funding from outside of the National Land Transport Fund to accelerate their progress.
How were the projects chosen?
The projects in this package have been signalled by local governments as high priority for a number of years. However, most of the projects were unlikely to go ahead under current settings for a number of years. The projects are expected to have good benefit-cost ratios, and will make good government investments.
Can additional projects be considered?
Currently, the projects in the named package are the only ones being considered for specific government funding. Other projects in non-metropolitan areas, including on State highways, will be eligible for funding under the Regional Improvements activity class if they are good quality projects with support from local government.
Why aren’t these projects being subjected to the normal funding criteria?
The regular funding criteria require projects to meet a number of thresholds, including their fit with national priorities. While these projects perform well on some aspects of these thresholds – some of these projects have good benefit-cost ratios, for instance - they are often regionally-important and fit less well with national priorities.
For this reason, the government has chosen to accelerate these projects with specific additional funding.
How are you ensuring these projects are quality expenditure?
The government has guaranteed the funding of five projects, as their investigations and designs are complete, the projects are good quality, and they are ready for construction to commence. These projects have minimum expected benefit-cost ratios of greater than 1, and greater than 4 in some cases.
Six more projects have not yet been investigated, but are expected to also be high quality projects. The government has approved $5 million to finish the investigation stages of these projects, and has committed to funding the projects from the Future Investment Fund if the investigation confirms the expenditure is justified.
Is the government funding the Hawkes Bay, Nelson and Bay of Plenty projects?
The Napier Port Access Package, the Rotorua Eastern Arterial, and the Nelson Southern Link are relatively expensive, and require extensive investigation and design compared to the other projects in this package. However, their regional importance means their investigation should be accelerated, to test whether they will likely qualify for funding from the National Land Transport Fund.
The government has made available $12 million to accelerate the investigations and designs of these projects to get them to a stage where they are ready for investment through the National Land Transport Fund.
How has local government been involved in creating this package?
Most of the projects in the package were identified as being of high regional priority through the Regional Land Transport Programmes developed by local government.
What impact will this have on local government/communities/ratepayers?
As these are State highway projects, all funding will be delivered by the Crown, and the NZ Transport Agency will manage their construction on the Crown’s behalf. The NZ Transport Agency will work with local communities through their regular engagement process.
How does this package relate to RoNS and other State highway projects?
This package improves the efficiency, safety, and reliability of the regional State highway network. Some of these projects will improve travel between RoNS and regional communities, and others improve the State highway linkages between rural towns and cities.