5 Jul 2011

Stonger infrastructure will carry a cost - minister

10:41 pm on 5 July 2011

Transport Minister Steven Joyce admits everyone will have to bear the cost of making the country's billion-dollar infrastructure projects more resilient.

The Government has released its second national infrastructure plan on Monday, which covers developments such as schools, hospitals and roads, and how to strengthen them against future disasters, like the Canterbury earthquakes.

It will spend more than $17 billion during the next four years, and and additional $5.5 billion will be spent rebuilding Canterbury.

Green Party co-leader Russel Norman supports the move to improve resilience but says it will cost more to ensure infrastructure can withstand a one-in-100-year event.

Mr Joyce, who is also Associate Minister for Infrastructure, told Morning Report that while he does not have a price tag for making the projects more resilient, the reality is that there will be a cost for ratepayers, taxpayers or users.

He says many of the big roading projects have already have such costs factored into their budgets.

Infrastructure Minister Bill English says it is inevitable in the wake of the Canterbury earthquakes that infrastructure and buildings will have to be constructed to a higher standard.

Business wants more clarity

A business lobby group says the Government will need to make its infrastructure investment intentions clear, if it wants to get the private sector to open its wallet.

Business New Zealand chief executive, Phil O'Reilly, says the second plan is an improvement on the first, released last year, but the Government must provide more detail in order to unleash private sector investment.

He says he recognises that the Government is just starting the process, without a great deal of institutional memory on the matter. Transport and telecommunications are two key areas to get right, he says.

The Council for Infrastructure Development says the plan fails to address future funding needs, and the Government will need to look at alternative funding options, such as toll roads.

Chief executive Stephen Selwood, says that, in Auckland alone, there is a $10 billion gap between what the council is intending to do and the current funding forecast.

Mr Selwood says the pay-as-you-go funding model of road user charges and excise tax will not be enough to pay for future roads.

The next national infrastructure plan will be released in 2014.