Infrastructure groups want several things from Budget 2024: clarity, urgency, and funding. But the number one concern was commitment.

In early April, four leaders of the infrastructure industry wrote to Infrastructure Minister Chris Bishop with their concerns. Unlike the rest of the world, New Zealand’s sector was slowing down. Burdened by complicated processes and with little project continuity, it was steadily bleeding out valuable staff to overseas markets.

The mood in the sector was negative, and nearly half of one survey’s respondents said increased funding for infrastructure and maintenance projects was the single most important thing for the new Government to handle.

And yet funding wasn’t the entire problem. Even with projects expected to arise from new fast-track legislation or as a result of the reformed Resource Management Act, industry professionals reported feeling wary about the certainty of their work. These professionals suggested focusing on transport and water systems, ※work that we know needs to be done regardless of political direction and future infrastructure planning§. But this would only ease the mood if New Zealand could somehow decouple proposed projects from its three-year political cycle.?

The industry letter to Bishop warned of ※significant concern about the influence of political cycles on infrastructure planning and investment§. They’d like to see a committed pipeline to water, rail and public transport projects, with clear objectives and a long-term focus. Ideally, they hoped local councils would be able to be funded to chase up any water projects. But more than anything else, the infrastructure heads just wanted a commitment. Otherwise, when a project finally lands, there might not be anyone here to see it through.

Pressures have mounted because of supply chain problems, funding scarcity and project insecurity. These pressures have combined to produce somewhat of a unique statistic: according to the Royal Institution of Chartered Surveyors 2024 Quarter One Report, New Zealand’s construction activity index was at the bottom of the Asia-Pacific table, only clearly ahead of China and just barely ahead of Qatar and Hong Kong. Nearly everyone else in the region was tracking positively.

This lack of action has been felt by industry executives, but also by on-the-ground workers like James from Dunedin. He told Newsroom on Monday that it didn’t really matter what the Budget said this week; he wasn’t sure the New Zealand Government could offer him very much in terms of support, that it might not be ※sustainable§ for them. James said a lack of consistent work is a common strain on the wider construction industry. And, in response to the strain, are these skilled labourers seeking greener pastures? ※F*** yeah,§ they are, said James.?

※A lot of people, if they’re gonna move, they just think of moving to Australia. Because they know the wages in Australia are gonna be better than if they moved [domestically], even to Wellington. What’s the point of moving a few hundred ks when you could move a few thousand ks for a lot of extra money?§

James said that better wages, better public support and more available work were luring many of his contemporaries over the Tasman, a pattern that was specified by the industry letter to Bishop. ※If we lose people,§ warned the letter, ※it will be very hard and expensive to attract them back when we need them for delivery.§ And the rate of loss has been significant: according to their letter, out of the surveyed vacancies in their sector, 23 percent were because of workers headed overseas.

These workers possess the skills, experience and connections necessary to satisfy a rekindled New Zealand infrastructure appetite. And though the wider industry outlook regarded the proposed Fast-Track Approvals Bill as a good sign for new projects, the first six months of this Government’s term - like many a new Government’s - has been dominated by back-tracking.?

Major projects have been canned, notably the upgrade to the Interislander ferry system, Let’s Get Wellington Moving, and Three Waters. Each of these was an important point in the letter, which prioritised public transport, rail and water projects as the most obviously in-need. For water works in particular, the letter recommended local councils be funded to carry out the work, in recognition of ※the need for localised decision-making and investment capabilities§.

Earthquake-strengthening projects, too, may be put on hold as Building and Construction Minister Chris Penk brings the relevant review forward. His proposal involves an immediate three-year extension to all non-lapsed deadlines, putting a damper on the industry. Though this isn’t an individual project, the thousands of buildings in need of renovations have provided a reliable work pipeline for many builders.

Though these major projects may not directly affect someone like James, their existence provided a considerable lifeline for the wider industry he sits in, and their cancellation meant planners had to go back to the drawing board. It was precisely this type of instability that the letter to Bishop highlighted, and that the industry will no doubt be left with regardless of what is announced in Thursday’s Budget.

For example, on March 4, Minister for Transportation Simeon Brown reiterated his commitment to building 15 new Roads of National Significance. Regardless of where the money comes from - and some of it looks set to come from increased tolling - Brown said ※Investments in these essential corridors will ＃ create a more productive and resilient transport network [and] drive economic growth.§?

No doubt a boon, but unmistakably similar to the announcement of the last Government’s support for the ill-fated Let’s Get Wellington Moving, which also promised to ※boost growth§ and ※unleash ＃ the high-productivity economic powerhouse§ that is the Wellington waterfront CBD. Infrastructure professionals may well have reason to be wary of such projects.

Elsewhere, infrastructure workers have found themselves repeating projects. As a country prone to environmental hazards, New Zealand’s transport and telecom infrastructure has borne the brunt of many a storm, earthquake or flood, and the result is repeated works on some of the most at-risk sites.?

After the North Island floods and Cyclone Gabrielle, former Finance Minister Grant Robertson announced a $6b National Resilience Plan with the aim of ※building back better§. In late April of this year, the new Government accidentally released the title of a Treasury paper directed at now-Finance Minister Nicola Willis: ※Discontinuation of the National Resilience Plan§.?

About half of the fund had been allocated already, leaving just over $3b to play with - a number not far off to the final, ballooned price tag on the cancelled ferry project. All up, the promise of $6b for resilience work lasted only a year, while the rates of ※unprecedented§ storms rise in tandem with their associated damages.?Repair work following these storms, or our expected future seismic events, will require a reliable workforce.

With all these projects and funds feeling relatively unstable, industry groups are eyeing up the Fast-Track Approvals Bill and RMA reforms with caution. Both pieces of legislation aim to reduce wait times and confusion and increase the range of projects available in New Zealand. The fast-track bill comes pre-loaded with a list of projects to consider, which has not been made public.?

The projects on this list represent a significant possible source of work for infrastructure companies, but members of the Opposition, including former Green Party co-leader James Shaw, issued a familiar warning: though the current Government might be willing to accept a proposal, any companies looking to fast-track their project might find the rules changed ※next time there is a change of Government§.?