National is promising to create a single Crown-owned bank to streamline and fund infrastructure projects if elected into government.
National is promising to create a single Crown-owned bank to streamline financing for infrastructure projects and allow for more private sector investment if elected into government.
The Crown Financial Institution would combine several entities into a single umbrella agency named the National Infrastructure Bank which would provide advice and finance to local and central government projects.
It would act as a "careful steward" over infrastructure and provide clear lines of accountability, the party says.
"The National Infrastructure Bank will need to see that infrastructure proposals are robust, something that hasn't been the case for shovel-ready projects, the Provincial Growth Fund, KiwiBuild or Light Rail," National leader Judith Collins said.
• Other loan portfolios across the Crown balance sheet where appropriate
The bank would work hand-in-hand with the Infrastructure Commission which would work through projects' feasibility and the Bank would then find the financing. National said the bank would "unlock co-investment with the private sector" and co-ordinate the country's PPP investment programme.
It would also be an opportunity for institutional investors, such as ACC, KiwiSaver providers, NZ Super Fund and Australian pension funds, to take on investment risk in local assets.
It would be governed by an independent board "appointed for their expertise in infrastructure finance and public sector debt management" and would employ professionals with valuable technical, legal, financial and economic appraisal skills.
"It will take an intergenerational, long-term approach to finance of infrastructure in New Zealand," the policy document said.
National's finance spokesperson Paul Goldsmith used the example of the three waters network reforms as a project which would cost several billions of dollars over the coming decade.
That project would require a "co-ordinated and disciplined approach to planning and financing", Goldsmith said.
"We recognise the need for effective management of the vast sums of debt being borrowed to make sure it is carefully managed and well deployed.
"Our infrastructure bank will provide clear lines of accountability to not only ensure value-for-money, but also deliver tangible assets that underpin future development in the form of better resourced schools, health services, roads, water provisions and housing."
National has promised an additional harbour crossing if elected.
National said other projects the Bank could support included financing new toll roads through long-term bond finance in collaboration with NZTA, funding green projects, co-funding for schools and helping councils unlock housing and commercial development with loans tied to targeted rates and development contributions.
The Bank would hold a nominal amount of equity capital from the Government and existing capital would be reallocated from the organisations it would consolidate.
Funding for the bank would come from a consolidation of baseline funding from the various entities, including $8 million from Crown Infrastructure Partners and $5 million per annum for the Green Investment Fund.
Full costings would be decided following the final operational design, said National.
The party's infrastructure spokesperson Chris Bishop said the Labour-led Government had taken "a clumsy and incompetent approach to infrastructure investment".
"Just look at the Provincial Growth Fund, the lack of delivery in the Green Investment Fund and the lack of clarity over shovel-ready infrastructure projects. Loans have been paid out with no plan or purpose.
"Our infrastructure bank will act as a careful steward of our infrastructure programme, providing vital leadership and capability in the public sector as these intergenerational assets are developed."
National said the infrastructure bank would:
• Provide leadership and capability in the public sector for long term infrastructure development
• Fund new infrastructure projects for the Crown and local government.
• Provide opportunities for institutional investors and iwi to invest in financing long-term infrastructure assets.
• Develop a portfolio approach to managing infrastructure debt and associated risks, in association with the Treasury.
