There needs to be an onus on getting skilled workers ready for the Christchurch rebuild, Opposition leader Phil Goff says, warning there is a danger of a major trades skills shortage right across the country in six months time if the government does not act quickly.
Early estimates are 10,000 homes will need to be demolished in the city, with only some of these able to be rebuilt. This is on top of the major rebuilding efforts that will be needed in the CBD, not just for the city’s longer term future, but in order for Christchurch to be a viable Rugby World Cup venue come October.
Prime Minister John Key has said it may not be possible to rebuild homes in entire suburbs and that government may offer cash to people with land too damaged to rebuild on in order for them to move to another area of the city.
There were a number of options on the table, Key told media this morning.
“There are a number of subdivisions – I don’t want to bother going into them for the purposes of the moment – but there are alternatives. That’s one good thing about Christchurch, that a number of new areas have opened up,” Key said.
“Of course the government could accelerate the consenting of those.
“There may also be people (who), if they are given the cash, might choose to buy a house in the surrounding areas and not go to a new subdivision,” he said.
Government would work through all of the options “in due course”.
“We know the worst affected areas. That doesn’t mean that that’s a particular street, suburb or area that will be abandoned, but we certainly can see the areas that have suffered substantial damage,” Key said.
“In the first earthquake [on September 4], there were about 3,300 houses that we thought would be demolished. Some of those couldn’t be rebuilt but we were more confident with the capacity to remediate the land to allow us to rebuild,” he said.
Government was less confident now about the capacity to rebuild as the February 22 quake damaged land further.
“The engineers – Tonkin and Taylor and the likes – are working through that. They’ll provide expert advice to us in due course. We can’t rush that process, but we also acknowledge that people have the desire to understand as quickly as possible what their options are, and as soon we can communicate that we will,” Key said.
Government would need to consider whether peoples’ insurance cover, along with any EQC payout, would be enough to allow them to relocate.
“But we can’t leave people high and dry so we’ll look at that,” Key said.
Some government funding may be needed for relocations, although some funding which had been earmarked for remediating land after the September quake would be freed up.
“Initially what was happening was the government was footing the bill for essentially fixing up the land to be in a condition where we believed it could be rebuilt [on] and then re-insurable. Now if we don’t have to incur those costs it gives us some options, but again we’re asking Treasury for advice on that,” Key said..
Government would probably not provide land to be built on, he said.
“But we would aim to try and put together a package which would allow people to move from one location potentially to another.”
Government would also like to keep people in Christchurch.
The process of moving people to a new property would be much quicker than if land was remediated for a rebuild.
“The initial expectations, in the first instance was that if we had to demolish homes then go through the labourious process of fixing up the land and then rebuilding, that’s in the magnitude of two to four years,” Key said.
“If we provide someone with a section, or they have an opportunity to move out of one place to another section and build a home, that could be a year to 18 months,” he said.
Every insurance company now had a relationship with a major builder, meaning there was “quite a bit of capacity there,” Key said.
“And of course there are other homes that are just vacated that people might want to sell,” he said.
Who will do the work?
The economic impact of the earthquake was negative to the Canterbury region in the first instance, but the longer term implications were “very positive,” Key said.
“Insomuch that there’ll be lots of work, lots of opportunities and, yeah, we would like to see young people getting the chance to have the skills, moving out of the trades courses that they take at Christchurch Polytech Institute of Technology and the likes and into paid employment,” he said.
However, Labour Party leader Phil Goff is warning of a major trades skills shortage around New Zealand in six months time if the government does not act quickly to create more supply of skilled labour for the rebuilding efforts.
“There’s a massive rebuilding job that needs to be done, and we’ve got to look at how we can get the skills in place as quickly as possible. We’ll need thousands of qualified people to rebuild that city,” Goff told media this morning.
“At the moment the building industry is at its lowest ebb in nearly 50 years, so there’s a lot of action that needs to be taken quickly to equip the building industry with skills, with materials needed for that rebuilding,” Goff said.
“Lack of demand has led to a lack of skills. Apprenticeships aren’t being taken on in the numbers that they were, pre-trade training is not happening in the same numbers, and many of our trades people have fled overseas to Australia,” he said.
Goff said he thought it was possible to re-skill or up-skill people quite quickly.
“I’ve been on the phone for much of the last 24 hours to industry retraining groups, to the industry itself,” Goff said.
“The fact is we need thousands of people in the construction trades and we need to use institutions like the Christchurch Polytech Institute of Technology, the private training providers, we need to use private industry, and the government needs to give absolute priority to getting those houses built,” he said.
“In six months time, we’re going to have a major skills shortage right across this country in those trades, (so) we need to address that now.”
“We’ll be looking at people coming back from Australia. But of course the pay rates in Australia are eighty to ninety dollars an hour for labour-only contractors, and it’s fifty to sixty in New Zealand, so that makes the challenge quite difficult,” Goff said.
“But if there is a certainty about a building programme there [in Christchurch], yes we can bring people back from Australia,” he said.
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