High-growth councils have until 31 March to submit final proposals for a share of the $1 billion Housing Infrastructure Fund, Infrastructure Minister Steven Joyce and Building and Construction Minister Dr Nick Smith say.

“Council constraints in financing the necessary infrastructure - the water supply, storm water, waste water and roading - can slow down the opening up of new housing areas, which is why the Government announced the Housing Infrastructure Fund last year,” Dr Smith says.

“Eligible councils have already given us an early indication of their interest, with indicative proposals in late 2016 amounting to $1.79 billion for infrastructure. Depending on which final proposals are supported, the Fund could potentially support about 50,000 new dwellings”.

Ministers have encouraged councils to be more ambitious in their final proposals.

“Only a small number of the 17 proposals received through the expressions of interest phase would result in projects being advanced earlier than previously planned by the councils,” Mr Joyce says.

“We want to see more ambitious projects that will have a greater positive impact on housing supply over the next five years.”

Dr Smith says the process for councils to secure funding has been undertaken in two steps to accommodate the local body elections late last year.

“This has enabled councils to ‘test drive’ and refine their ideas before the final proposal stage,” Dr Smith says.

“The final proposals will be assessed by an independent panel, with priority given to those initiatives that enable the most new housing. We expect to announce the final allocations later this year.

“The Housing Infrastructure Fund is part of the Government’s comprehensive plan to grow additional housing supply alongside Special Housing Areas, the new Auckland Unitary Plan, the National Policy Statement on Urban Development, reforms to the Resource Management Act, the Crown Land Programme and the HomeStart scheme. We have been successful in more than doubling the house build rate from 15,000 to more than 30,000 a year.

“This initiative on infrastructure funding is to ensure this strong growth in new house supply continues.”

Councils have until 31 March to submit final proposals. More information is available here.

Higher than forecast tax revenues are the primary reason the Government accounts for the first five months of the financial year are ahead of forecast, Finance Minister Steven Joyce says.

The Government has released the interim Major Projects Performance Report for the period to November last year, covering 53 complex major projects across government with a whole of life cost of $37 billion.

“The Government is in the middle of our biggest ever infrastructure spend,” Finance Minister Steven Joyce says. “We are investing billions of dollars to construct hospitals, schools, roads and courts; provide equipment for our armed forces; and develop ICT capabilities to transform public services. 

“These investments are instrumental for the provision of quality public services for our growing country, and it is important that they are delivered well. Transparent reporting is a key part of ensuring agencies lift their performance in investment management.”

The interim report assesses project progress on a five-point scale ranging from Red through to Amber and then Green. 90 per cent of projects have been assessed as Amber or better with four assessed as Amber/Red and one as Red. Overall, there is an increase in the proportion of projects moving towards Green.

Major projects are a collection of the most challenging projects Government is undertaking. A Red or Amber/Red rating highlights that there are issues or risks that are either currently being addressed or need to be addressed to ensure the project is delivered successfully, and those projects are working with central government agencies to resolve those issues. 

The interim Major Projects Performance Report is available here.

Ratings

The Red / Amber/Red rated projects are:

• ANZAC Frigate Systems Upgrade – Defence (Red)
• Lincoln University/AgResearch Stage One Building Project
• Māori Land Service – Te Puni Kōkiri
• Transforming the System of Service Delivery Programme – Department of Internal Affairs
• National Bowel Screening Programme – Ministry of Health

The Police Human Resource Management Information System Project was rated Red in the previous period and has improved to Amber in this reporting period.

Two projects are close to completion and no longer require monitoring: the Christchurch Schools Rebuild Programme and the Burwood Hospital Redevelopment.

The Canterbury Public Sector Quarterly Rebuild Report content is now included in this report to provide the public with a single source of information about the Canterbury Rebuild Recovery.

The interim report covers the period July – November 2016, and was finalised before the Kaikōura earthquakes on 14 November.

The New Zealand economy continued to grow solidly in the September quarter, posting a higher than expected 1.1 per cent growth rate for the quarter and 3.5 per cent over the last year, Finance Minister Steven Joyce says.

“New Zealand’s focus on developing a strong and open economy is delivering good results for Kiwi families, especially relative to most of the rest of the developed world,” Mr Joyce says.

New Zealand’s economic growth in the year to September was the fifth strongest in the OECD ahead of Australia (1.8 per cent), the USA (1.6 per cent), Canada (1.3 per cent) and the Euro Area (1.7 per cent).

“We are starting to see the benefits of a clear and stable focus on economic fundamentals coupled with a determination to build a competitive environment from which Kiwi companies can succeed on the world stage.”

Growth in the quarter was strong across 13 of 16 industries, including:

• Business services (up 2.0 per cent)
• Transport, postal, and warehousing (up 3.7 per cent)
• Construction (up 2.1 per cent)
• Manufacturing (up 1.2 per cent)

“It’s hard to overstate the importance of key service sector exports like tourism and education in New Zealand’s economic success in recent years. They have taken up a lot of the shortfall as the dairy sector went through its downturn. Other food sectors and hi-tech exports have also contributed significantly,” Mr Joyce says.

The Current Account deficit was unchanged at 2.9 per cent for the year, well below the long-run average. New Zealand’s external debt was 58 per cent of GDP, compared with 83.8 per cent of GDP back before the GFC in 2008.

Treasury’s half-yearly Fiscal Update predicts growth to average 3 per cent per year out to 2021, with a further 150,000 jobs expected to be added to the New Zealand economy over the same period.

“The future is looking positive for New Zealand, but these are of course just forecasts. The world remains an uncertain place and it is important that the Government, businesses and households collectively keep our feet on the ground and not go crazy with the credit card. If we work hard, maintain our economic programme and increase our competitiveness we can continue to improve the outcomes for Kiwi families,” Mr Joyce says

Standard and Poor’s decision to affirm the AA foreign currency and AA+ local currency sovereign credit ratings with a stable outlook for New Zealand reflects international confidence in New Zealand’s economic and fiscal performance, Finance Minister Steven Joyce says.

“The assessment released by S & P today confirms the increasing resilience of New Zealand’s economy as we head into 2017. The Government’s careful economic management is seeing continued improvement across a range of economic measures,” Mr Joyce says.

“S & P noted an improved outlook for New Zealand’s current account deficit and an improving forecast for our net government debt.”

“The agency also noted their expectations that New Zealand’s fiscal performance will continue to improve over the medium term – and that remains the Government’s clear intention.”

The Westpac McDermott Miller Employment Confidence Survey released earlier today also shows New Zealanders are increasingly optimistic about the state of the labour market with employment confidence at its highest level in eight years.

“Strong employment confidence together with the positive recent survey of quarterly business opinion directly link back to the strength of New Zealand’s economic management,” Mr Joyce says.

“By operating sensible conservative economic policy, the government is giving businesses the confidence to invest and grow, creating more jobs for Kiwis and their families.

“There remains significant uncertainty about the world economy in the year ahead.  However New Zealanders can take confidence that our country is well placed to deal with any issues as they arise.”