Melling interchange and RMA reform hit Treasury’s amber/red risk threshold

Wednesday, 15 July 2026

Treasury has flagged “major risks” with both the Lower Hutt Melling Interchange upgrade and Resource Management reform in an independent review of the projects.

It is unclear what prompted Treasury to give the two projects an “amber/red” rating in late 2025, the second-lowest grade in its Gateway Review process.

Chris Bishop, who oversees both projects in his ministerial portfolios, referred questions to the responsible agencies, saying the relationship between Treasury and the agencies involved was operational.

The agencies said neither project currently faced cost blowouts or delays and that work to strengthen performance and address identified issues was already under way.

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The Melling Improvements project has a budget of $1 billion, with $743 million of that going into construction and the rest into elements such as consenting, design and demolition.

The work included creating a grade-separated Melling interchange, demolishing the existing Melling Link bridge, building its replacement, and upgrading walking and cycling infrastructure. It was scheduled for completion in 2031.

It is part of the RiverLink project - originally priced at $700m and expected to begin in 2023, it was slated for completion in 2027. But cost pressures saw the price tag soar past $1b, forcing the project to be “sliced and diced”.

Instead of a diamond-shaped design, the new Melling interchange was refashioned into a “half clover” that uses fewer retaining walls.

It took so long to put RiverLink into place that the regional council – responsible for $295m of the programme – kicked off work on its share to upgrade flood defences between the Ewen and Kennedy Good bridges, citing the need to get on with the job to protect central Lower Hutt from flooding.

The planning system transformation programme - the second project reviewed by Treasury - will replace the Resource Management Act (RMA) at a cost of $294m It is planned to be fully in place by 2029.

The programme involved $41m for the first stage of the system’s digital and data foundation and $32.9m to establish and operate a new tribunal aimed at supporting timely, accessible and independent resolution of planning disputes.

Between October and December last year both projects received amber/red ratings following Treasury’s independent Gateway Review, which it undertakes for many high-risk capital projects.

According to a Treasury fact sheet, the rating means “successful delivery is in doubt with major risks or issues apparent in a number of key areas. Prompt action is needed to address these, and establish whether resolution is feasible.”

The Post approached the Ministry of Cities, Environment, Regions and Transport (MCERT) and NZTA for comment.

A NZTA Waka Kotahi spokesperson said the review did not highlight the risk of delay or cost escalation for the Melling project.

“It did emphasise the importance of strong programme partner relationships and clear communications. An action plan is in place to address this. Currently, the Melling Transport Improvements project is on schedule and on budget. The project team is focused on maintaining this.”

A MCERT spokesperson said the RMA reform project’s scale, complexity and pace required the ministry to bring in additional skills and capabilities to support the programme.

“This included a refreshed governance approach, the appointment of independent advisers, and investment in additional specialist personnel to lead key elements of the reform (such as the delivery of the new digital architecture).”

It accepted all the recommendations of the review with most of them completed with the rest well-advanced.

The spokesperson said its action plan had been reviewed by the gateway process and had subsequently been given an amber rating (which meant under the framework significant issues still existed but seemed resolvable if acted on without delay).

They said the amber review rating reflected the solid foundations laid for the programme’s initiation and mobilisation phase.

Neither NZTA nor MCERT have released the Treasury reviews.