Regional Development Minister Shane Jones has outlined more details of the Government’s $3 billion provincial investment fund

The Government will inject tens of millions of dollars into regional rail, roading, tourism and forestry initiatives as part of its promised multibillion-dollar investment into New Zealand’s regions.

Regional Economic Development Minister Shane Jones launched the Provincial Growth Fund in Gisborne on Friday morning, saying the selected projects will make a “real difference to the people of provincial New Zealand.”

The $1 billion per annum fund was agreed to as part of the Government’s Coalition deal in October last year.

Jones says more than $60 million will be invested into the first tranche of the package and will be distributed to Northland, Tairāwhiti-East Coast, Hawke’s Bay and Manawatū-Whanganui and the West Coast of the South Island.

In a Cabinet paper, the NZ First MP says the bulk of the funding will be distributed later this year and early next year with most of the delivery taking place from late 2018 through to 2020.

Social assets, such as hospitals and schools, will be excluded from the fund as their primary purpose is not lifting regional productivity potential, the Cabinet paper says.

In December, Cabinet agreed that any “significant sector and infrastructure investments” of more than $10 million will require Cabinet sign off. It considered increasing the limit to $20 million under “exceptional circumstances” but what those circumstances were was never defined.

Jones wants that limit to be lifted to $20 million for all bids, meaning projects costing between $1 million and $19.9 million would only need sign off from the relevant delegated Minister – for example, the Minister of Transport would need to sign off a roading project.

“In considering this further in the context of the nature and number of bids that are currently in the pipeline, and based on advice from external fund managers, I propose we consider this again and increase the upper limit to $20 million for all bids,” he says.

“Not solely in exceptional circumstances, to reduce the load this will place on Cabinet. These bids will receive a high level of scrutiny from delegated Ministers.”

One billion trees

Jones also officially kicked off the Government’s ambitious one billion tree planting programme, saying he expects 55 million trees to be planted this year.

Planting will be lower in the initial years due to natural seedling and land constraints but will then ramp up quickly, Jones says.

He expects 70 million trees to be planned next year, 90 million in 2020 and 110 a year for the next seven years.

The new trees will be a combination of public and private planning over the next decade.

Jones has also revealed the Government has enlisted state-owned farmer Landcorp to plant two million trees over the next two years and to review its portfolio to identify any other potential land for planting.

“We expect to be able to make more announcements about where trees will be planted this year in the coming months,” Jones says.

Independent advisory panel

As previously flagged by the Minister, a panel will oversee the distribution of the $3 billion fund and more details were released on Friday morning.

“An Independent Advisory Panel has been appointed to assist the decision-making of ministers and officials, supported by a new Regional Economic Development Unit within the Ministry of Business, Innovation and Employment to work directly with regions, ensuring this isn’t a Wellington-driven fund,” Jones says.

The panel will be chaired by RNZ Governor and Rural Equities Limited deputy chairman Roger John Finlay.

“Historically, New Zealand’s economic strength, resilience and innovation has come from our provinces and I look forward to advising on the reinvigorating effects that investment will bring to these communities,” Finlay says.

Who gets what?

Projects receiving funding from Jones’ announcement include:

  • $17 million to help create jobs, address infrastructure deficits, enhance tourism opportunities and diversity in Northland’s economy
  • $9.2 million to boost tourism and forestry opportunities (including $2.3 million to redevelop Gisborne’s Inner Harbour and $5 million for KiwiRail to reopen the Wairoa-Napier line for logging trains)
  • $8.75 million to reopen the Wairoa-Napier rail line for logging trains, as well as an upgrade to the Whanganui line
  • $6.5 million for a Government sponsored tree planting scheme
  • $6 million towards the “revitalisation” of the Whanganui Port and the upgrade of the town’s rail line
  • $1 million for two-cycle trails in the West Coast

The reaction

The funding announcement has drawn a mixed response.

The Council of Trade Unions called it the “biggest opportunity we’ve had to create sustainable, flourishing communities in our regions in an entire generation.”

Federated Farmers is also upbeat, with Vice President Andrew Hoggard saying it is a useful first step to boost vitality outside the main centres and BusinessNZ say it’s a positive for the economy.

But not everyone is a fan.

The Taxpayers' Union calls the $3 billion fund a lolly scramble, criticizing the lack of a real cost-benefit analysis of the spending.  

Outgoing National leader Bill English says regional New Zealand will be feeling let down by all the “hoopla.”

“The Government’s Provincial Growth Fund so far is nothing more than a rebranding of National’s Regional Growth Programme and falls well short of the high expectations it's created,” English says.

“This investment won't compensate for bad employment law, bad immigration policy, and restricting foreign investment.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment or click on the "Register" link below a comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current Comment policy is here.

35 Comments

So the Gisborne to Wairoa line stays closed or did i miss that.

One step at a time grasshopper.
Its going to take a while to repair the damage left by National.

Yes even they worked out there is zero demand for the service. The Wairoa-Napier route has the same demand but they are wasting taxpayers money opening that to save face on the election promise.

the cycle trails are one thing JK got right for regional NZ, having riden a few of them they bring employment for locals in supplying shuttles, food and accommodation

Beefing up wanganui to palmy rail line for the increase in timber exports coming through to welly or napier can only be good - main trunk line through palmy coming back, next funding toward expanding palmy inland port to deal with all the rail coming from the smaller regions and distributing it along the main trunk line and to napier port

Do you have any economic basis to your comment? Or do you just like choo choo trains?

"In recent years the amount of freight moved by rail has increased substantially, and started to gain market share in non-bulk areas as well. Freight on the North Island Main Trunk line between Auckland and Palmerston North saw an increase of 39% in freight volumes between 2006 and 2007. The five daily trains on the 667 km line reduced truck volumes on the route by around 120 per day.[22] In 2008, the government proposed to spend $150m to enlarge tunnels for the bigger ISO containers now operating.[23]

A 2008 study by the Ministry of Transport predicted that by 2031 rail freight volumes would increase to 23 million tonnes per annum, or 70% on the 2006 – 2007 financial year"

https://en.m.wikipedia.org/wiki/Rail_transport_in_New_Zealand

So bit of both really

Next time you see a long freight train chugging along, count the containers. Imagine that many trucks on that stretch of road on that day. There are several such trains make their way from Tauranga to Hamilton, daily.

He don't muck around. The boy done good.

He did muck around watching hours of porn DVDs fraudulently paid for by the taxpayer.
This guy also wants to be able to dish out any old pork barrels (to his mates?) up to 10 mill without Cabinet approval. Now that's not mucking around....

Would you prefer types like Barnaby Joyce?

All I can say about that Grade A hypocrite is that I am so relieved that he revoked his NZ citizenship when he did.

Now, I am not an NZF voter and find Shane Jones a bit blowhardy, however, booking up a few porn DVDs or maybe pay-per-view movies and not thinking that they will end up on an account that is not your own one, is probably just easy enough to do after a few bevvies. It was hardly fraud, for crying out loud. If you are going to commit fraud, even an idiot knows to make it worthwhile. That is a serious case of blowing things out of all proportion. If it was the Stars Wars trilogy, no-one would have batted an eyelid.

There are/were moral, criminal and IQ elements to the saga.
What sort of man would waste precious hours watching this utter crap, while pissed, and stupidly getting pinged for a pathetic little fraud??
Brave new world?

Blown out of all proportion

Just like the double dipper from Dipton

Hardly

So when is the Kaeo bridge coming????... exactly
After a $9000000 Waipapa roundabout???

The silly thing about the $9 mil intersection is it will mostly serve kerikeri traffic travelling in circles.
Not much flows north past that point.
And it bogs down at christmas of course.
Activity seems to have started on the Taipa Brige...maybe.

That roundabout will be real good for those rear-wheel drive turbo Nissans though

And the ancient Jaguars that transport rather ancient british looking people around the intersection.
We did a sort of Dukes of Hazard act to get out of it at Christmas.

要想富,先修路,少生孩子,多种树。
---- one of the most popular slogan in early 1980s in rural China.

It translates to
"Prosperity needs more roads, less newborns, and more trees"

oops error

I love it. I like trains. Not so sure about the tree planting. Sounds nice, but where do you plant them? Why not just let wilding pines grow freely where they will? That way they choose the habitat that suits them best. Just need to figure out how to make the $$$s work.

Where are the bridges for Northland? I know, what about mines for the West Coasters? Oh, no, er, sorry, idiotologically verboten. I apologise, I didn't realise what I was saying. Please don't send the thought police, er....

Before they spend on Tourism in Northland,why don't they try and reduce the crime rate or else tourists just won't go near the place.

How do you reduce the crime rate in Northland other than locking up half the population (@ $60k/head)/year)? Or saturate that large sparsely populated area with police (@$100k/head/year)?

The largest driver of crime is poverty in youth as so many studies have shown.

Poverty and drug addiction. "P" (as predicted a couple of decades ago) has become the scourge of our society and it is ably accompanied by synthetic drugs. Deal with that and we are half way there, but it can't be done via heavy handed measures, short of the moves of Duterte, even if they are working, addicts are addicted, the pointy end of a gun won't change that.
The only way to deal with those who are destroying people with this stuff is to kick that stool out from under them, legalize, regulate, treat and prevent.

Amen

More newborns, less immigrants

The Jones Boy, the boy done good.

HCC have announced that a passenger train could be running to Auckland by the end of 2018.
A couple of snags as i see it
1..Journey to take 2 hrs and 20 minutes
2..Have to change trains at Papakura.
How about spending some of that train money on the main trunk line.

The main trunk line is barely used - total of 7 trains per day in both directions - subsidising it takes away containers from coastal shipping as much as trucks.. Best close it down or prepare it for self driving trucks. Rail has been an ongoing economic disaster for about 50 years.

New Plymouth needs to use rail more, trucks are ruining a nice waterfront area.

Opening the Wairoa-Napier line for logs is utter lunacy. Its only 100km and they have to take them off a truck and on to the train then unload them from the rail and truck them out to the log wharf (wharf wont take a train weight) For the last three years it was open they took 325, 0 and 12 tonnes of logs(about 12 logs in a year!) The unloading and loading will use any CO2 saving they may make - and requires extra labour/cost. Predicted annual CO2 savings were tiny anyway - one round trip of a 747 to the UK emits about the same.
They need to stop this or risk losing all credibility.