Public Private Partnerships – govt taking cautious approach

Transport Minister Paul Swain said that public private partnerships (PPPs) would have an important role to play in helping New Zealand tackle its transport infrastructure deficit. Speaking at a conference on PPPs in Auckland this morning, Mr Swain said that due to the complexity of PPP arrangements the government is taking a cautious approach.

The Land Transport Management Bill, currently before the select committee, allows for, amongst other things, PPPs and tolling.

“Submissions on the bill have raised a number of issues regarding the provisions on tolling and public private partnerships,” said Mr Swain. “One issue is the stage at which ministerial approval occurs in the process. Some have asked if the Bill could be changed so that some form of conditional approval could be granted early, in order to give investors more certainty before incurring major costs. This is a fair point. I am sure the select committee will look at this matter closely.

“Some submitters have raised the issue of the consultation process. The Bill was never intended to be the son of RMA. However, the fact is that most people are in favour of more motorways and roads that make trips faster, provided the roads don’t go through their backyards.

“Roading projects need to work for both transport users and local communities. Consultation processes needs to find a balance between the meeting the government’s transport objectives and the rights of communities.

“The government believes that involving communities and transport users early in the design of roading projects will result in achieving this better balance, leading to fewer problems in the courts and elsewhere later on.

“The select committee will be looking at whether we have got the right balance. No doubt there will be some changes.

“Finally, some submissions raised the issue of the types of projects available under the concession provisions. As far as PPPs are concerned we have taken a cautious approach, providing for Design Build Finance Operate (DBFO), given that this is the first time such arrangements have been tried in New Zealand.

“On tolling, once again we have taken a cautious approach. The public will probably accept a toll for a new bridge, for example, but may be less happy to pay for a road that they consider they’ve already paid for. Submitters have asked for greater flexibility in this area, and the select committee will be looking at this.

“Cordon tolls, zone tolling and congestion charging also offer significant potential as both a source of funds and a tool for traffic management. Following the submissions to the select committee and discussions with local authorities we are having further work done on these issues.

“These are complex issues involving, amongst other things, social equity, privacy and the like,” said Mr Swain. “There is still much debate to be had.”

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