The Coalition Government risks going into the 2020 election without refined plans of action for the Ports of Auckland and Auckland light rail.
Two pieces of information were revealed on Thursday, indicating it might be some time yet before decisions are made on:
- Where the port’s freight operation will be shifted to and exactly how the move will be executed;
- What the design of Auckland’s light rail will be and who will lead the project.
The Government has stressed the importance of getting these multi-billion-dollar projects right.
But it can’t be forgotten that NZ First campaigned, ahead of the 2017 election, on shifting the port, while Labour campaigned on building light rail from Wynyard Quarter to Mt Roskill within four years of taking office, and extending the line to the airport and West Auckland within 10 years.
The two new pieces of information that indicte much more work is required for these projects to get off the ground, include:
- A paper showing Cabinet isn’t completely convinced by a working group recommendation to move the port’s freight operations to Northport, so is getting Ministry of Transport officials to further investigate all options and report back so Cabinet can make a decision in May 2020;
- Confirmation from the Ministry of Transport it has only just started considering whether the New Zealand Transport Agency (NZTA), or the New Zealand Superannuation Fund and its Canadian partner, should lead the light rail project, and it isn’t yet looking at proposed designs.
Auckland light rail
Ministry of Transport CEO, Peter Mersi, on Thursday told the Transport and Infrastructure select committee the Ministry a week ago received bids on the light rail from the NZTA and NZ Infra (a partnership between the Super Fund and institutional investor, CDPQ Infra).
The Ministry is considering who the “preferred delivery partner will be, not the specific solution”.
Mersi recognised that the unsolicited bid made by Infra NZ in May 2018 proposed it leads the entire project and takes on responsibilities that currently sit with the NZTA.
He said the Ministry had to form a view around NZTA and Infra NZ's capabilities.
“Once that’s been done, obviously the starting point is whatever proposals they have put forward,” he said.
“Then there will need to be a process of working in partnership to get to the final outcome and that will involve much more engagement with communities and councils.”
Mersi hadn’t personally seen the proposals, saying the Ministry was running a “strict commercial process”.
Leaked documents to Stuff indicate NZ Infra’s initial proposal (which has reportedly changed) was much more costly and radical than NZTA’s, including a tunnel under Queen Street and elevated sections over Mt Eden.
The job of considering the bids and advising Cabinet on what to do rests with the Ministry of Transport and Treasury. It had sat with NZTA, until Transport Minister Phil Twyford decided it didn't properly consider Infra NZ's bid.
The light rail was initially an Auckland Transport project. It was passed to the NZTA when the Coalition Government was elected.
If the National Party is elected before a light rail proposal is selected, it plans to scrap the whole thing.
Ports of Auckland
Cabinet is directing the Ministry of Transport to build on the work the Upper North Island Supply Chain working group has completed, recommending the Ports of Auckland be moved to Northport.
It has directed officials to work more closely with stakeholders, recognising that if the port companies and land owners don’t agree to a plan, central government might need to take punitive measures to force their hands.
“Cabinet may wish to consider the consequences of using a legislative or regulatory approach,” the Cabinet paper said.
“These are significant levers to use given the implications for private property rights…
“We advocate early and open engagement with the owners of the current upper North Island ports comprising the three councils and land owners (Auckland Council, Bay of Plenty Regional Council, Northland Regional Council and Marsden Maritime Holdings Ltd.) and Port companies (Ports of Auckland Ltd., Port of Tauranga Ltd. and Northport Ltd.)…
“Engagement with these parties has been limited to date, and we anticipate that aligning the partners will take some time to achieve.”
Auckland Mayor, Phil Goff, earlier in the week criticised the group for providing conflicted advice. The group reported to Infrastructure Minister and NZ First Northland MP, Shane Jones, and was chaired by a former Far North mayor, Wayne Brown.
Goff told RNZ he had only had “one brief meeting of an hour and 20 minutes” with the working group. While its final report, released on Thursday, had been leaked to the media, Goff said he never got a copy.
Cabinet also agreed that “significant Crown investment”, which wasn’t entirely captured by the working group, was likely necessary.
The group estimated moving the Ports of Auckland’s freight operation to Northport would cost $10.3 billion, with the Crown’s investment estimated to be $3 billion to $4 billion over the next 10 to 15 years for the rail and road infrastructure.
Cabinet agreed additional costs like an inland freight hub in West Auckland and the “costs of negotiating and realising a potential commercial arrangement” might also fall on the Crown.