KEY POINTS:
Labour has labelled the Government's infrastructure package, intended to insulate against the economic chill, as timid.
Prime Minister John Key and a host of ministers announced today that five new schools and 10,000 state houses would be upgraded as part of the Government's $500 million infrastructure package announced today.
It included $216.7m for education, $142.5m for transport and $124.5m to be spent on housing.
About $100m is for projects due to begin before June 30.
Most of the projects were already planned and have been fast-tracked to boost the Government's economic stimulus plan.
Finance Minister Bill English said the announcement was part of wider moves to soften the "sharp edges" of the recession and prepare for economic recovery.
There were rough estimates that the package would protect or create 2000 jobs.
Labour's finance spokesman David Cunliffe said this compared badly to the 68,000 jobs that Treasury estimated would be lost in the coming months.
Labour leader Phil Goff said the package was timid, a "drop in the bucket" that amounted to little more than bringing a few spending projects forward.
Mr English said the Government was doing what it could, considering that New Zealand had gone into recession a year earlier than the rest of the world.
The previous government had also begun cutting taxes and increased spending.
This meant the overall stimulus of all recent moves was about 4 per cent of GDP and further moves were limited due increasing debt levels.
Last week, the Government announced a tax relief for small and medium enterprises and earlier a recovery programme for people who lost their jobs due to the recession.
It also legislated for further personal tax cuts from April on top of those already passed into law by Labour.
The announcement today included construction on five new schools - Mt Wellington Primary, Papamoa Primary, Kerikeri Primary, Hingaia Primary and Papamoa Secondary - is due to start by April 2010. Almost $69m has been allocated for them.
Papamoa is in Tauranga, Kerikeri in the Far North, Mt Wellington in Auckland, and Hingaia in South Auckland.
In addition, $114m has been allocated to help build and renovate existing school structures.
Education Minister Anne Tolley said $34m was allocated to get broadband to the schools with the "greatest need."
Up to 10,000 existing state houses will get a makeover worth $104.5m and 69 new state houses are to be built within six months at a cost of $20m.
Five transport projects have been fast-tracked, at a cost of $42.5m.
They are the Kopu Bridge replacement, near Thames in the Coromandel, Muldoon's Corner on the Wellington side of the Rimutaka Hill Road, just below the summit, the Motahorua Gorge realignment, on SH2 near Hawke's Bay, the Hawke's Bay Expressway southern extension and the Christchurch southern motorway.
Up to $100m will be invested in smaller road maintenance and renewal work, $34m to be used on projects set to start before June 30 and $66m in the following two years.
The package has been funded entirely through borrowing and is just $500m of a "total envelope" of $5 billion, Mr English said.
"It doesn't amount to new debt as of today, it's already there in the track. Now we're starting to draw down the cash into projects."
The package includes the projects that were easiest to bring forward, he said.
Today's announcements include:
* Education - $216.7 million of spending, including five new schools, school refurbishments and maintenance and ICT infrastructure improvements.
* Transport - $142.5 million of spending, spanning five large state highway projects and a programme of smaller, regional roading improvement projects.
* Housing - $124.5 million of spending, allowing Housing New Zealand to upgrade and renovate 10,000 more state houses, and build 69 new state houses over the next six months.
More details
The 94km Waikato Expressway from Mercer to south of Cambridge is not part of the package and will be among the very large infrastructure projects the Government will consider for fast-tracking.
Mr Key did confirm an insulation programme for state houses.
He said on Monday that expanding it to private sector housing was a later possibility. Upgrades of some school properties that have already received planning consent will also be included.
CTU Secretary Peter Conway welcomed the announcement, saying it was important to take advantage of relatively low public debt to invest in infrastructure.
"The investment in schools and housing are exactly what is needed at this time," he said.
However, Mr Conway said there should be more investment in people and the environment.
Finance Minister Bill English said the package would help New Zealand through the economic downturn.
"Infrastructure is an important part of our Jobs and Growth Plan and this is just the first announcement about bringing forward worthwhile projects that will help us through the current economic challenges and contribute to driving up New Zealand's long-term economic competitiveness," Mr English said.
In brief
Transport: Five major state highway projects will get an immediate $42.5m boost, with $142.5m worth of funding to be fast-tracked overall.
* Kopu Bridge replacement, SH25 Waikato, $21.7m fast-tracked (total $47m), due to start June; * Motahorua Gorge realignment, SH2 Hawke's Bay, $5.4m fast-tracked (total $40m), due to start October;
* Hawke's Bay Expressway southern extension SH50 (total $50m), due to start October;
* Rimutaka corner easing, SH2 Wellington, $11.7m fast-tracked (total $20m), due to start October;
* Christchurch southern motorway, SH1, $3.7m fast-tracked (total $180m), due to start March 2010.
About $100m will be used for maintenance and renewal work, with $34m to be spent on projects starting before June 30 and the remaining $66m over the following two years.
Housing: $124.5 million to be spent on state housing.
This includes $104.5m to upgrade 10,000 existing state homes over the next 18 months and $20m to build 69 new state homes within six months.
The new four-to-five bedroom state homes will be in:
* West and North Auckland (seven houses at a cost of $2.1m);
* Central Auckland (three houses, $1.1m);
* South Auckland (14 houses, $4.9m);
* Waikato/ Coromandel/ King Country (six houses, $1.1m);
* Bay of Plenty (six houses, $1.6m);
* East Cape/ Hawke's Bay (11 houses, $3.3m);
* Wellington/ Hutt Valley (five houses, $1.5m);
* Canterbury/ Nelson/ Marlborough (10 houses, $2.9m);
* Southern (seven houses, $1.6m).
The renovation money will be used to upgrade houses ($95m) and ensure they are healthy ($9.5m).
The upgrade will include insulation, ventilation, heating, redecoration, kitchen and bathroom upgrades, strengthening and roofing.
Education: $216.7 million to be allocated to schools to accelerate construction and renovation and the role out of broadband.
The projects include:
* $68.7m to build five new schools -- Mt Wellington Primary, Papamoa Primary, Papamoa Secondary, Hingaia Primary and Kerikeri Primary.
* $30m for 64 schools to build new administration buildings, halls and libraries.
* $9m for expanded facilities at special schools and satellite units.
* $34m to upgrade ICT infrastructure at schools to make them broadband-ready.
* $30m to improve four Upper Hutt schools -- Upper Hutt College, Heretaunga College, Fergusson Intermediate and Maidstone Intermediate.
* $11m to replace outdated and rundown buildings in seven schools -- Pt Chevalier School, Manurewa East School, Cambridge High School, Karanui School, Somerfield School, Christchurch South School and Lyttelton Main School.
* $6m to establish a trades academy on Mangere's Southern Cross Campus.
* $28m to help schools accelerate existing building projects that are stalled.
- NZ HERALD STAFF with NZPA
