Latest / The SME Stream / Nick Leggett: Infrastructure NZ CEO on the Government's approach to public-private partnerships for infrastructure

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Nick Leggett: Infrastructure NZ CEO on the Government's approach to public-private partnerships for infrastructure · The SME Stream

• 0:00
  Speaker 1: The government has released it's refreshed Public Private Partnership framework.
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  Speaker 1: It was part of the National Act coalition agreement and
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  Speaker 1: the government says it'll help deliver a new generation of
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  Speaker 1: vital infrastructure projects. Interestingly, the fore word written by Labor's
• 0:13
  Speaker 1: Barbara Edmonds. So is that a sign of some bipartisanship
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  Speaker 1: on this issue. Nick Leggett is Chief Executive Infrastructure New
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  Speaker 1: zealandies with me this morning.
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  Speaker 2: Hey Nick, Hi Ryan?
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  Speaker 1: What sticks out for you here? I mean the first
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  Speaker 1: one that they look at is the risk, So who's
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  Speaker 1: taking on all the risk? And at the moment we
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  Speaker 1: might be putting people off by putting too much risk
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  Speaker 1: on the contractors.
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  Speaker 2: Yeah, I mean that's that has been a bit of
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  Speaker 2: an issue here. And of course if you want public
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  Speaker 2: private partnerships to be successful, you've got to actually attract
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  Speaker 2: the private sector and having is much understood upfront about
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  Speaker 2: the project and if you think about you know that
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  Speaker 2: the underlying land the New Zealand's got some rocky parts
• 0:59
  Speaker 2: of the country, but also getting in and buying land early,
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  Speaker 2: establishing as much as you can know so risk can
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  Speaker 2: be properly allocated. The thing is that the private sector's
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  Speaker 2: prepared to take risk. Of course, it just will be
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  Speaker 2: priced into the job. But this is you know, we're
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  Speaker 2: very immature where it comes to public private partnerships. We've
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  Speaker 2: only built eight the last labor government paused them, so
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  Speaker 2: we haven't sort of evolved them properly. So this frameworks
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  Speaker 2: really important and it means the government doesn't have to borrow.
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  Speaker 2: And the other point about a public private partnership and
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  Speaker 2: there'll be people driving on roads now that aren't in
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  Speaker 2: good conditional taking their kids to schools, to school buildings
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  Speaker 2: that should have been replaced and renewed. We need to
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  Speaker 2: do better where it comes to our infrastructure assets. And
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  Speaker 2: it's the thing about a PPP. It's not just about
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  Speaker 2: building the road or the school. It's about taking a
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  Speaker 2: whole of life approach to that particular asset. And the
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  Speaker 2: private sect not only owns and builds it, but they
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  Speaker 2: maintain it. And Ryan, I think Kiwis know the government
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  Speaker 2: has been pretty poor over many decades at maintaining our
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  Speaker 2: public assets.
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  Speaker 1: And so the room it's just one le my car
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  Speaker 1: our testament to that. Just on that because it's related
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  Speaker 1: to your point. So the part of this framework is
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  Speaker 1: that any PPP must stack up against other potential models
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  Speaker 1: of delivery, which seems entirely reasonable. Are there types of
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  Speaker 1: projects that actually wouldn't be suitable for PPPs and if so,
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  Speaker 1: what types of projects?
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  Speaker 2: Yeah, look, it's a good point. I mean I think
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  Speaker 2: you know, there'll be many, many projects that aren't suitable.
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  Speaker 2: I mean, you have to have scale so our road
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  Speaker 2: would be suitable. But frankly, Ryan, it's another conversation we've
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  Speaker 2: got to have because it's better to have an income
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  Speaker 2: stream from these assets that are public private partnerships. So
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  Speaker 2: a road with a toll on it is going to
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  Speaker 2: be much more appropriate than a road without a toll.
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  Speaker 2: And you know people will also go to Australia and
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  Speaker 2: other parts of the world. We're road tolling for good,
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  Speaker 2: decent pieces of road standard and people don't mind paying
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  Speaker 2: more if they get places quicker and more safely. And
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  Speaker 2: as you know, you say, the rooms of their car
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  Speaker 2: are not damaged. And so it would be those large
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  Speaker 2: projects or a whole lot of individual, smaller projects bundled together.
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  Speaker 2: And you know, we have we've had school PPPs and
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  Speaker 2: you know what, the schools love them because it means
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  Speaker 2: that teachers and principals get to educate kids. They're not
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  Speaker 2: focused on being property managers every time the light manails.
• 3:35
  Speaker 1: Or and they're in a room that's not covered in mold. Nick,
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  Speaker 1: thank you very much for that this morning. Great to
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  Speaker 1: have you on the show as always. Nick Leggative executive
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  Speaker 1: at Infrastructure New Zealand. They've put the PPP framework up
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  Speaker 1: online for those who might be interested. Ex I was
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  Speaker 1: having a look at the report by Stephen Joyce. They
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  Speaker 1: looked into the new agency they're setting up to as
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  Speaker 1: their funding vehicle for PPPs this morning