Industry asks Govt: We've got the workers, where's the work?

Tuesday, 21 July 2020

Earlier this month the Government’s Infrastructure Industry Reference Group selected 150 projects worth about $2.6 billion to create or retain 20,000 jobs.

Infrastructure industry leaders want the Government to release its full list of “shovel-ready” projects as confidence plummets and workers face redundancies.

Earlier this month the Government’s Infrastructure Industry Reference Group announced it would back 150 projects from more than 1900 submissions, worth about $2.6 billion to create or retain 20,000 jobs. Economic Development Minister Phil Twyford and Infrastructure Minister Shane Jones were the ministers in charge.

But Civil Contractors NZ chief executive Peter Silcock said it was “incredibly frustrating” that only 30 projects, worth about $500 million had been announced over the four weeks since the selection.

Silcock said details were “urgently needed” to save jobs and kickstart economic recovery.

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“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,” Silcock said.

He said a joint letter from industry leaders was sent to ministers in mid-June stating the urgent need but so far projects were “still trickling out slowly.”

A spokeswoman for Minister Jones said projects were being announced “as quickly as possible” once due diligence has been carried out.

”It is important that the projects are viable and offer the benefits stated by applicants.”

Infrastructure New Zealand chief executive Paul Blair said companies were running out of time.

“It’s very stressful, it’s increasing costs and it’s completely avoidable. The full list and timing of shovel ready projects needs to be released now with a clear commitment to project timeframes,” Blair said.

The industry was bleeding costs by retaining staff amid uncertainty about what the next six to 12 months looked like, Blair said.

Association of Consulting and Engineering chief executive Paul Evans said a survey conducted by the association showed 46 per cent of engineering consulting firms were experiencing cashflow and financial issues, while about the same number was considering culling staff.

“We've seen this happen before. From 1987 into the early 90s, thousands of jobs were shed, creating a capability crisis lasting a decade, whose ripples remain today. The loss of skill and capacity in engineering and construction meant under-investment in critical infrastructure,” Evans said.

Projects that had received the green light so far included four transport projects in Auckland, the Puhinui Interchange and Stage One of the Ferry Basin Redevelopment - both already under construction – improvements to the North Western Motorway, and a new $37m walking and cycling path connecting New Lynn and Te Atatū in West Auckland.

There was also $3m in funding towards a new library for Gore and $85m to Queenstown for a town centre upgrade and new arterial routes.