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20 Oct 2020

When will New Zealand’s ‘shovel-ready’ infrastructure projects move forward?

Recently, Auckland returned to Alert Level 3 lockdown status. This move was initiated by the Prime Minister’s announcement that four new cases of Covid-19 had been detected. The PM, along with Director General of Health Dr. Ashley Bloomfield, said that these new cases were not connected to overseas travel. Their investigation showed that the cases were not linked to any high risk workers such as those working along the borders or in the hospitality industry.

All of New Zealand has been proactive at controlling the spread of Covid-19 and had finally achieved 102 days without any new cases. Health officials are trying to determine how these new cases could have happened. Tracking down the source of the contagion and locating those who may have been exposed are big tasks for health officials. Many are worried that the country will need to return to a strict lockdown.

There are economic worries as well. Business owners along with the average citizen are concerned about the New Zealand economy. With the borders closed, this limits exposure but it also means that tourists can come into the country. With tourism at a standstill, this points to a deepening recession.

Victoria reported 721 new cases on 31 July, which was a record high. Since then, the numbers have gradually declined until just recently.

In order to help the struggling economy, the NZ government set aside $3 billion for economic recovery. The stimulus package is known as the Covid Response and Recovery Fund. The money will be spread across each region of NZ including assistance for the infrastructure. The recovery package includes about $210 million for flood protection projects and climate change remedies. Another $155 million would go toward ‘transformative’ energy projects.

The construction industry was not forgotten in this economic aid package. $180 million has been designated for large-scale construction projects including:

  • The final section of the Coastal Pathway in Christchurch
  • Auckland City Mission HomeGround (housing, healthcare and social services)
  • Gisborne Rugby Park’s grandstand
  • The Marlborough District Library and Art Gallery in Blenheim
  • An inland port at Whakatu for Port of Napi

There were a total of 1924 submissions from local businesses seeking economic support during the covid crisis. After lengthy deliberations, the list was reduced to 802, then 150 which have been approved for financial assistance.

Some of these are ‘shovel-ready’ construction projects that are considered critical in order for New Zealand’s economy to make a full recovery. In spite of the assistance, these projects have been slow getting started. With new delays coming too often, many are worried that New Zealand’s construction industry could be in trouble.

New Zealand chief executive, Peter Silcock, was recently quoted saying that the current situation is ‘incredibly frustrating.’ He added, “We know the work is out there, but unless we know where, what, and most importantly when projects will start, contractors are left totally in the dark. They will have no choice but to put workers off or face the risk of companies going under.”

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