Recommendation:
Implement less rigid, overlapping and time consuming statutory processes.
A distinct lack of leadership and a high-level infrastructure strategy was a major hindrance in New Zealand compared with what NZCID has seen overseas.
"The New Zealand Government does not formally identify growth priorities or provide funding or other resources to accommodate long-term growth ," says NZCID chief executive, Stephen Selwood. "Successive governments have chosen instead to define and redefine the purpose and responsibility of local government. It is not clear what the Government's planning priorities are or what the expectation is of local government to promote national direction."
Recommendation: Instead of constantly moving the goalposts for local government, an aligned strategy between local and central government would co-ordinate infrastructure planning and development.
Selwood says requiring ministerial sign-off on all regional plans would commit the Government to co-founding agreed plans and stymie investment creep in growth areas with high demand for new services.
This is one area where New Zealand was identified as having a world-class system and one of the most "evolved and efficient in the world". Fuel taxes, road user charges and vehicle licensing fees are fully hypothecated to transport spending and managed by a semi-independent national authority -- the New Zealand Transport Agency. Selwood says, however, that the strength of the funding system is also its weakness.
"The integrity of user pays depends on a robust relationship between those who pay and those who benefit from investment.
"The benefits of transport as an economic and social development tool have been under-represented in project evaluation, with priority given to value-based benefits when making transport decisions. This methodology made it more difficult to push through transport mega-projects because of high-cost, slow-burn effects and requisite changes in behaviour."
Recommendation:
Move away from immediate benefit projects to the development of new funding and project criteria to avoid creating artificial barriers to major projects.
New Zealand presently lacks an established approach to capturing the value created from new investment in infrastructure or the rights to develop.
Selwood says urban investment, particularly in transport, results in property value change proportionate to the level of amenity conferred upon an affected parcel of land. The potential for land value increase is significant, as much as double the value of land proximate to quality public services. There is a compelling moral case for capturing value created by public capital investment and rezoning.
Recommendation: Allow Government to re-capture some of the value created. Present New Zealand law allows for targeted rates to be applied in the same manner as an area levy, and options around a capital gains tax could also be implemented.
