The Government is unveiling plans for the creation of a new Ministry of Cities, Environment, Regions and Transport (MCERT), which it says will support an "ambitious reform agenda" in housing, transport, urban development and the environment.
The MCERT will pull together the existing Ministry for the Environment, the Ministry of Housing and Urban Development, the Ministry of Transport, and local government functions from the Department of Internal Affairs.
A Chief Executive will be appointed during the first half of 2026, with a target for the Ministry of Cities, Environment, Regions and Transport to be fully operational by July. The MCERT unveiling closely follows details of the Government's Resource Management Act reform plans.
Housing, Transport, RMA Reform and Infrastructure Minister Chris Bishop says MCERT will be at the centre of tackling some of New Zealand’s key economic and environmental challenges including housing affordability, the infrastructure deficit, and adaptation to climate change.
"The Government has a series of ambitious and complex policy reforms underway across all of these areas, from Going for Housing Growth, a renewed emphasis on transit-oriented development, congestion pricing and the transition to electronic road user charges for all vehicles, Local Water Done Well, City and Regional Deals, and the National Adaptation Framework. Underpinning it all is planning and local government reform," says Bishop.
"Responsibility for many of these reforms currently spans multiple agencies. For example, solving our housing crisis is impossible without fundamental planning reform, which is currently the responsibility of the Ministry for the Environment (which looks after city, district and regional plans). It is also impossible without reforms to infrastructure funding and financing," says Bishop.
He says MCERT will combine the key levers shaping economic growth and productivity, including planning, land use, housing, transport, water, and the interface with local government, making advice integrated and accountability clear.
The last National-led government established the Ministry of Business, Innovation and Employment (MBIE) in 2012. MBIE combined functions from the Ministry of Economic Development, Ministry of Science and Innovation, Department of Labour and Department of Building and Housing.
The then-Economic Development Minister Steven Joyce said MBIE would; "assist the Government drive forward its business growth agenda and make it easier for businesses to engage with the Government."
Public Service Minister Judith Collins says uncertainty and change can be unsettling but Cabinet has agreed on plans for MCERT, and public servants working at the four affected agencies deserve transparency and honesty.
The Government's announcement on the establishment of MCERT also quotes Local Government and Climate Change Minister Simon Watts and Environment Minister Penny Simmonds. The press release makes no specific mention of potential public service job cuts.
Staff 'fearful about their job security'
Public Service Association (PSA) National Secretary Duane Leo says given the scant detail in the announcement, staff at the affected government agencies will have a lot of questions about their future.
"These changes will affect hundreds of people working at the Ministry for the Environment, Ministry of Housing and Urban Development, Ministry of Transport, and in the local government and digital functions of the Department of Internal Affairs," Leo says.
"That uncertainty is leading to unease among staff. We are already hearing from our members that they are fearful about their job security and frustrated that this is being done right before Christmas."
Leo says Public Service Commissioner Brian Roche has acknowledged staff concerns and a commitment to work closely with the PSA.
"The Government must ensure these vital public services are properly resourced so the new agencies and the public servants who work for them can deliver for all New Zealanders," says Leo.
Meanwhile Labour's Infrastructure spokesperson Kieran McAnulty says the Government is creating a new mega-ministry nobody asked for.
"The lack of progress on transport and housing has nothing to do with the need for another MBIE-like mega merger and everything to do with the Government’s poor decisions and lack of funding," McAnulty says.
"If they funded the transport announcements they’ve made
"How are we going to see any results in these crucial areas when the Government is busy working on a restructure? This is the wrong focus at the wrong time, from a government that is totally out of touch with Kiwis," says McAnulty.
Heed the lessons from MBIE
Dom Kalasih, Chief Executive of Transporting New Zealand, says the road freight lobby group is cautiously welcoming the establishment of MCERT.
"As the national road freight association, Transporting New Zealand has been providing input on congestion pricing, the transition to universal electronic road user charges, and City and Regional Deals, just to name three," Kalasih says.
"Navigating across different agencies, officials and Ministers gives us a good sense of how the current structure isn’t well set up to deliver effective reform."
However, he says the Government needs to heed the lessons from the creation of MBIE.
"A 2024 Treasury review of MBIE noted that the agency’s large size could ensure economies of scale in its provision of services, but cautioned that addition of work programmes and portfolios risked making MBIE unwieldy and fostered internal competition for policy resources. Avoiding similar risks for MCERT will require careful management," Kalasih says.
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