Transmission Gully construction to start in 2014

Wellington's Transmission Gully project will be New Zealand's largest PPP to date. Picture / NZTA

With major projects on the horizon and funding costs at historical lows, local consortia need to move quickly if they are to capture the opportunities offered by public-private partnerships, writes David Green.

Construction on the Transmission Gully alternative route to Wellington will begin in the second half of next year - just before the next general election - Prime Minister John Key announced today.

He expected the 27 km project to be ready for use by 2020. Transmission Gully forms part of the Wellington Northern Corridor which is estimated to cost $2.5 billion.

He said morning peak time traffic from Levin to Wellington is expected to improve by 40 minutes.

He also said the new corridor is projected to reduce the number of fatal and serious traffic crashes from 140 over five years after its completion to 100.

Mr Key made his announcement to a lunch of 600 hosted by the Wellington Employers Chamber of Commerce.

He said the preferred bidder for Transmission Gully would be announced early next year.

Mr Key said nine days from now marked five years since his Government was elected in 2008.

He said that as well as facing the worst global financial crisis since the Great Depression, Government spending was out of control, having increased by 50 per cent over five year.

"The turnaround in the Government's books has been nothing short of remarkable."

About 65,000 net new jobs had been created in the past two years and the unemployment rate was expected to drop as the economy gathered pace.

He cited a number of polices that had encouraged jobs and growth including resource management law reform, water storage, electricity transmission, oil and gas exploration,
primary growth R and D partnerships and Roads of National Significance.

He said the Government was also encouraging key commercial projects in regions to helplift growth such as the irrigation in the Hawkes Bay, and oil and gas exploration, in Northland it was Treaty of Waitangi settlements, land productivity and the Puhoi to Wellsford highway and the roll-out of ultrafast broadband and rural broadband.

"The Opposition is talking the regions down at the moment," he said "but that is just politics."

The policies they were promoting would damage regional economies, he said.

"A recipe of more taxes, nationally-equalised pay rates no matter where you live, a rollback of employment law reform, higher ACC rates and a reversal of RMA reforms would severely damage growth."