1. DAVID BENNETT (National—Hamilton East) Link to this
to the Minister for Infrastructure
What steps is the Government taking to ensure productive infrastructure contributes to New Zealand’s economic recovery?
Hon STEVEN JOYCE (Associate Minister for Infrastructure) Link to this
The Government is investing several billion dollars in a substantial infrastructure programme that will unclog our economic arteries, improve productivity, and secure a stronger growth path for New Zealand in the years ahead. It is an investment that also directly supports thousands of Kiwi jobs. We have outlined plans to spend $7.5 billion on productive infrastructure over the next 5 years. This programme, now under way, will make a significant contribution to our economic recovery and help give businesses the confidence to invest, create jobs, and help secure a brighter future for all New Zealanders.
Why is the Government investing over $10 billion into State highway construction over the next 10 years?
New Zealand’s geographic isolation and the distance between us and our competitors has always been a defining factor in our economy, which is why transport links are so important. Improvements in productivity will directly benefit our producers and exporters, and that is a major reason why we are investing $10 billion in State highway construction over the next 10 years. Through this investment we will significantly advance the seven roads of national significance in and around our five main centres. In addition, this construction programme will generate a significant number of jobs—for example, 300 on the Victoria Park project alone.
Hon Shane JonesGiven that the New Zealand Herald has derided the recent document on infrastructure as a plan when one is not having a plan, what criteria will be employed to access the worthwhile nature or the effectiveness of the infrastructure unit established by his Government?
The infrastructure unit has a number of functions that will help develop our infrastructure programme, and, in particular, assist the Government in determining such things as public-private partnerships. The point should be made to the member, and possibly to the New Zealand Herald writer, that the reason that infrastructure plan was not an infrastructure plan is that it was never intended to be one. It was a briefing on the development of that plan.
Fibre-based broadband services will deliver huge economic benefits for our country in terms of enhancing productivity, improving our global connectivity, and enhancing capacity for innovation. Our broadband commitment is in two parts: one is to deliver to rural areas the type of fast broadband that urban areas are now having developed, and the second is to provide urban New Zealand with a step change to ultra-fast broadband delivered through fibre to the premises. Fibre to the premises will allow firms to reduce their information technology costs, schools to provide 21st century education, the health sector to provide remote diagnostic services, families to telecommute, and Government agencies to deliver their services much more cost-effectively. All of these users will help boost national productivity and lead to stronger growth.
Hon David Cunliffe Link to this
Given the admitted lack of a plan, and the fact that turnover in the construction sector actually dropped by nearly 2 percent in the current quarter, putting a drag on growth and adding to unemployment, why has it taken the Government so long to formulate its infrastructure bids; for example, delaying by up to 1 year the roll-out of ultra-fast broadband?
There has been no delay at all in the roll-out of ultra-fast broadband. I point out to the member that the Government’s programme is already assisting in the economic recovery and I note that we have had a small positive growth number for the June quarter. This Government is focused on securing longer-term growth and productivity increases and we will see those develop over the next few years.
David GarrettIs he aware of the sorry history of Governments attempting to stimulate the economy with infrastructure spending, only to find that by the time they get the spending under way the economy has already recovered, leaving the increased Government spending crowding out the private sector and contributing to inflation pressures that cause interest rates to rise?
The Crown has a role in investing in public infrastructure that will help unblock bottlenecks and secure growth for the New Zealand economy and improve our productivity. I have yet to see in the New Zealand environment any example where roading construction has been conducted and funded by the private sector; it is a role for the Government to improve the public roading network, for example.
Is the Minister intending to somewhat scale back the huge increase in infrastructure spending planned to counter the recession, given that we now appear to be slowly coming out of it?
Although we are slowly, as the member says, coming out of the current recession, I am sure he would agree we have a huge problem in this country in terms of improving productivity and creating stronger economic growth in the years ahead. We have had very poor productivity growth over the last 9 or 10 years, which has helped to put us further behind our neighbouring country, Australia, in terms of economic growth and wealth of New Zealanders. The only way we are going to deal with that is for an aggressive across-Government approach to improve productivity and to assist the private sector, and infrastructure spending is one way in which we are doing that.