Wellington's construction market has previously been described as "white hot". Photo / Jason Oxenham
Wellington's construction market has previously been described as "white hot". Photo / Jason Oxenham
Wellington's "white hot" construction market could delay the rollout of the city's new bike network, under a proposal to slash the council's capex budget by $80 million this year.
The council has an ambitious capital plan, but the construction market is experiencing a shortage of professional services, extensive delays, and cost increases across key supply chains.
"This, together with constraints on our internal staff resources is impacting on our ability to deliver our capital plan", Wellington City Council officials have warned.
They have recommended reducing the council's capital expenditure budget this year and redistributing the money over the remaining years of the Long Term Plan.
This year's original budget was $343 million, but a $77 million underspend from the previous year has also been brought forward, bringing the budget to $420 million.
Under the proposal, this would be reduced by $80 million and the money pushed into the outer years of the council's 10-year-budget.
This rescheduling would ensure investment in three waters, Tākina, Te Matapihi and Civic Square is unimpacted, but sacrifices to some high priority items would still be made.
A man taking his children for a bike a ride along Wellington's waterfont. Photo / Mark Mitchell
The Evans Bay cycleway would be delayed. There are more sea walls required for the project than originally anticipated and given the constraint on securing consultants to do that design work, it's unlikely the plan would be able to go ahead this financial year.
The next instalments of Wellington's new 147km cycling network would also be delayed.
Consultation on the bike network plan, which doesn't close until mid-December, has delayed design work. The instalments would then be held up by the availability of professional services for detailed design.
It means the designs would be completed the following financial year instead of this one.
However, the cycling changes to Newtown and the city via Adelaide Rd and Kent and Cambridge Terraces, and from the Botanic Garden to the central city via Bowen St, will still go ahead as planned.
Housing renewals would also be affected.
Finance and Performance Committee chairwoman councillor Diane Calvert. Photo / Mark Mitchell
The council would still be committed to delivering the entire Long Term Plan within the given 10-year timeframe.
Officials would also undertake things like sharing more of the risk in contracts, making use of panels for professional services, and early procurement and storage of materials where appropriate.
The proposed changes will be considered at a Finance and Performance Committee later this week.
Committee chairwoman councillor Diane Calvert said the council was facing reality and didn't have much of a choice.
"You can't spend the money if there's no one to do the work and that's what's facing us.
"It's not that we don't have the money, it's just there isn't the resources to do the work and the materials."
Calvert said council officials had signalled earlier this year that the construction market was getting tighter and access to materials becoming increasingly difficult.
"You can't keep promising something when you know there's no way you can deliver it and something has to give."
But Calvert was concerned about upgrades to City Housing, the council's social housing portfolio, being put on hold.
