Delaying infrastructure has cost the country billions, report finds

A new report shows pausing, cancelling and delaying infrastructure projects has cost New Zealand an estimated $11.8 billion in the last 25 years.

Projects like Auckland Light Rail, Transmission Gully, and the Interislander ferry replacements have all been paused, delayed or scrapped by various governments.

The report, The cost of stopping: Assessing the true cost of delaying, deferring and cancelling infrastructure projects, was released on Thursday and commissioned by Civil Contractors New Zealand, Infrastructure New Zealand and Water New Zealand.

It found inconsistent investment in infrastructure was driving up costs and eroding productivity.

Report author Shamubeel Eaqub said the research challenged the assumptions that stopping projects saved money.

“The surprising finding is how expensive pausing or cancelling projects really is. Delays create inflation costs, productivity losses and defer public benefits that compound over time.”

Eaqub said stopping or delaying projects causes inflation costs, workforce issues and delayed benefits for the community.

“Infrastructure construction delivers public benefit. When looking at delaying or cancelling of projects, we need to be careful we aren’t unnecessarily denying our communities access to these benefits.”

The report recommended committing to a multi-year infrastructure pipeline, and requiring a full assessment of costs before stopping a project.

Eaqub said the report’s findings were timely as councils and central governments grappled with major infrastructure reform and funding pressures, particularly due to conflict in the Middle East.

The report was accompanied by a “cost of stopping” tool to help decision makers calculate the full impact of pausing or cancelling projects.

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