22 Oct 2019

Auckland light rail: NZTA admits delaying process

12:34 pm on 22 October 2019

The NZTA chair has acknowledged the agency dropped the ball in its early handling of Auckland's light rail project, as the NZ Infra proposal grips ministers.

NZTA Chairman Sir Brian Roche

Transport Agency Board chairman Sir Brian Roche. Photo: RNZ / Dom Thomas

NZTA's new board chair Sir Brian Roche said the ordeal had disappointed ministers.

"We the agency were given a job to do ... and for whatever reason ... we didn't get it done. That's delayed the process, that's frustrated ministers," he told Morning Report.

"This is a huge project on any scale, and it took the agency by surprise, that's understandable."

However, he said the agency was in "a really good place now".

"We're really comfortable that under the Ministry of Transport there will be information made available so an informed decision can be made in the next calendar year."

Sir Brian said the agency has been under significant pressure in the last 12 to 18 months and that had been publicly recognised.

"With the refresh of the board and new chief executive, I think that we're making really good progress. The interim chief executive has done a great job ... we're heading in the right direction."

He said there was no question the light rail project had been delayed relative to the government's expectation, and that could have an effect on costs.

Sir Brian said he did not think the delay put the project at risk.

"The issue of cost can't be ignored, but you also have to consider the value that it will bring.

"This is a transformational project. It will change the way people think about the rapid transit of people."

NZTA had been sounding out potential options for funding and building the network - including an unsolicited bid from the NZ Super Fund.

The then-interim-chair of the NZTA, Nick Rogers, reportedly dismissed the bid, describing it as little more than a six-page powerpoint presentation.

The Transport Ministry is now considering two proposals - one from the NZTA, and the other from NZ Infra - a joint venture by the Super Fund and CDPQ Infra.

Deputy Prime Minister Winston Peters has said he'll be watching out for potential cost blowouts for Auckland's light rail project, after warnings from a source within the transport industry.

Prime MInister Jacinda Ardern at Parliament 21 May 2019.

Prime Minister Jacinda Ardern Photo: RNZ / Dom Thomas

Prime Minister Jacinda Ardern told Morning Report talking about cost blowouts was a bit premature because the design of the project or builder weren't confirmed yet.

"Obviously, we are on different timelines from when we started that because we have a pretty unique proposal in front of us now from NZ Infra."

The promise to build light rail from downtown Auckland to the airport within a decade was made by Ms Ardern in her first policy announcement and campaign rally as party leader, ahead of the 2017 general election.

"We're committed to building light rail to the airport. All of the transport agencies agree this is the next major public transport for Auckland. It will get 11,000 commuters off the road every hour. We absolutely need it."

To ignore the second the proposal would not be good practice, Ms Ardern said.

"I have always described the NZ Infra proposal as being substantively different both in terms of the financing of it using the Super Fund but also on some of the detail."

She wouldn't say if going with the NZ Infra proposal would mean building heavy rail or not.

"The difference here is we believe we have to build rail from the city centre out into the south to Māngere - that is how we're going to have a world-class city that deals with congestion."

'A public-public investment model'

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Transport Minister Phil Twyford Photo: RNZ /Dom Thomas

In a statement, Transport Minister Phil Twyford said the light rail would be a game-changer for Auckland.

"What NZ Infra is proposing has never been considered before in New Zealand, based on a public-public investment model. This includes co-designing the asset with the government and its partners, with the majority of financing and risk transferred to NZ Infra.

"There are significant differences in how the two options would be financed and delivered. The NZTA is exploring a range of procurement, financing and delivery models, including alliances and public-private partnerships, and will continue to develop these.

He said both options for delivering light rail were credible but neither were fully developed.

"This process will take up to six months and will mean we won't have spades in the ground in 2020. But it will provide us with the certainty we need to progress a multi-billion dollar project which will transform Auckland."

NZ Infra, in a statement, said it was pleased to be part of the process to advance light rail in Auckland.

"We are currently preparing a range of information that we will provide to the ministry," NZ Super Fund chief executive Matt Whineray said.

CDPQ Infra managing director Jean-Marc Arbaud said: "NZ Infra is committed to presenting the government with the highest quality light rail proposal possible."

Twyford to blame

National's Transport spokesperson Chris Bishop said after two years Mr Twyford had nothing to show for what was a Labour flagship policy.

"He's been a disaster in every portfolio he's dealt with. He failed on KiwiBuild, light rail is fast becoming KiwiBuild 2.0, the slow tram down Dominion Rd is fast becoming a slow-moving train wreck for the government. And Phil Twyford is ultimately the person to blame, he's responsible."

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