Stimulus created 2300 jobs, Govt estimates

Earthworks on the Kopu Bridge replacement in the Coromandel are part of the Government's transport infrastructure programme. Photo / Paul Estcourt

The Government estimates its economic stimulus package created about 2300 jobs through increased infrastructure spending of more than $500 million.

In February, the Government said it was increasing or bringing forward planned spending on housing, roading and education infrastructure.

Government figures show more than half that money has been spent with the rest to be spent through next year.

Some Governments have been winding back spending as the world economy shows signs of recovery, but Finance Minister Bill English said the infrastructure spend-up would continue as planned.

Some commentators had expressed concern at the size of Government spending and Mr English said next year's Budget cap of $1.1 billion in new spending would represent a significant reduction in the growth trend of Government spending.

In February the Government announced $124.5 million for state house upgrades and new builds under its "Jobs & Growth" package including:

* "Up to 10,000" houses upgraded at a cost of $104.5 million over the remainder of the 2008/2009 year and in the 2009/2010 year.

* An increase in the number of new state houses (over and above the 450 Housing New Zealand was adding to its stock in the 2008/2009 financial year) by 69 at a cost of $20 million in the remainder of the 2008/2009 year.

Government figures showed by the end of September Housing NZ had completed 87 new houses at a cost of $19.97 million. It had also completed 1609 upgrades, for $10 million.

Between June 30 and September 30, Housing NZ awarded contracts for upgrading a further 6100 houses during the 2009/2010 year with a further 2500 contracts to be handed out during the rest of the 2009/2010 year.

The appropriated money for this 2009/2010 upgrade programme was $85 million.

"Housing NZ has achieved its 08/09 upgrade target and is on track for its 09/10 upgrade target. In addition it has exceeded its 08/09 new builds target by 18 houses," Government papers said. "Since February, the housing component of the package has on average employed about 1000 people."

Of the $142.5 million of transport spending planned, the papers said, work had begun on all five of the big roading projects:

* Earthworks on the Rimutaka Hill Corner.
* Earthworks on the Kopu Bridge replacement in the Coromandel.
* Siteworks on the Hawkes Bay Expressway southern extension.
* Siteworks on the Matahoura Gorge realignment.
* Tenders have been received for the Christchurch Southern Motorway extension.

The cost of accelerating these five projects was estimated to be $42.5 million.

"In addition, about $54 million of the $100 million set aside for accelerating state highway renewals has already been spent.

"At their peak the projects will collectively support about 600 jobs," the papers said.

Under the stimulus package the Government announced $216.7 million of education spending including five new schools, school refurbishments and information technology infrastructure improvements being brought forward.

The papers said construction on two of the schools had already begun.

"The others are set to start next year. The acceleration of the school building projects will collectively cost $69 million.

"Construction has been completed on over half of 81 refurbishment and maintenance projects and most of the others are well advanced.

"Collectively the 81 projects are worth $71 million."

The papers said spending to make schools broadband-ready as well as spending on special schools and trades academies was under way but gave no details.

"There is no exact headcount of the number of jobs this [education spending] will support, but education officials estimate the projects will collectively support about 700 jobs at their peak."

BIG SPEND

* The Government estimates its stimulus package created about 2300 jobs.
* Infrastructure spending was boosted by $500 million.
* This included $124.5 million for state-house upgrades and new builds and $142.5 million of transport spending.

- NZPA