Costs force roads rethink

By MATHEW DEARNALEY

North Shore City Council will scrimp on road resealing projects this financial year, blaming soaring maintenance costs fuelled by the region's construction boom.

It has decided to resurface just 30km of roads, instead of a usual annual quota of 46km, to avoid what works and environment committee chairman Joel Cayford says would have been a 2 per cent rates rise to pay for a cost blowout of more than 70 per cent.

Dr Cayford said yesterday that tenders from contractors priced the original work programme at $6.7 million, up from a council estimate of $3.9 million.

His council was "appalled" at such a steep rise and was seeking urgent talks with the Government and other Auckland local bodies over what it feared was a regionwide problem.

Dr Cayford said rising oil prices, higher standards of quality assurance and the heavy demand for construction work were blamed for the increase.

But market forces were the biggest culprit "and we need to make sure contractors are not taking advantage of booming construction demand to make huge profits at the expense of North Shore City ratepayers".

Roading NZ chief executive Chris Olsen denied that his members were profiteering, saying North Shore had rolled over annual maintenance contracts for five years with only minor rises.

"There was quite a bit of catch-up needed - the contractor has been losing money on the job. North Shore were getting a very good deal."

He said the council had also tightened its work specifications in the face of cost rises in bitumen, aggregate and labour.

Transfund operations manager Bob Alkema, whose state-funding organisation covers about half the maintenance costs of council roads, said he hoped North Shore's was a "one-off" case, but he would monitor other local body contracts for inflationary trends.

He said this would become clearer in the next few weeks as more maintenance work was contracted for summer.