Week in Review

No post-Covid green ‘nirvana’

Our infrastructure minister says the Government's $3b infrastructure fund is not the way to usher in a post-Covid green nirvana, Dileepa Fonseka reports

Shane Jones says advocates of green infrastructure need to face the reality that a 'shovel-ready' fund will not deliver the post-Covid reset they're looking for.

And the infrastructure minister believed there wasn't a public appetite for it either.

Cabinet will soon decide what set of 'shovel-ready' infrastructure projects will be funded from a $3b fund set aside in the Budget.

"This notion that we're somehow going to issue a green edict and all of a sudden that we'll be driving hydrogen cars and legally smoking dope in the new economic nirvana is just never ever going to work."

Academics and others, including Forest & Bird CEO Kevin Hague, have criticised the current known list of projects as asphalt-heavy and a missed opportunity to reset our pre-Covid priorities.

Jones said green infrastructure projects will be funded in the longer-term, but the first wave of projects would largely be "grey" ones to generate jobs and stimulate the economy.

"I think that the green faction run the risk of being written out of the script ... [they] run the risk of building a perception that people were out of work as opposed to pragmatically accepting post-Covid we need all types of infrastructure working and building.

"We are facing, in the post-Covid environment, one of the most severe threats to economic resilience. And I just don't think that the public or society is going to tolerate new reams of green or red tape.

"This notion that we're somehow going to issue a green edict and all of a sudden that we'll be driving hydrogen cars and legally smoking dope in the new economic nirvana is just never ever going to work."

Critics of the 'shovel-ready' fund have said the urge to get money out the door to stimulate the economy would lock in projects that were suitable for a pre-Covid environment, like roads, but not one where growth expectations might have been lowered. 

However, Jones' sense of where people's priorities are may not be wrong.

An Ipsos global poll found fewer people in New Zealand supported the notion of a 'green' economic recovery from Covid-19 than anywhere else in the world.

Fifty-six percent of us supported the statement that "in the economic recovery after Covid-19, it's important that government actions prioritise climate change". Support for a green investment-led recovery was higher in the United States, Australia, China, India and Brazil. 

Prime Minister Jacinda Ardern said the Government had already addressed many environmental priorities outside of the $3b infrastructure fund.

If the public wanted an assurance that environment priorities wouldn't take a back seat during Cabinet's latest decision they should look at how they had been integrated into others.

"We had issues with the cleanliness and ongoing degradation of our waterways so we're funding fencing and restoration of wetlands and also predator control [in the Budget]."

"This is where we have used Covid as an opportunity to boost funding for areas that will make a material difference to our environment going forward.

"You already saw in the [New Zealand] Upgrade programme the way that we've balanced finding those shovel-ready projects, but also future-proofing them. And [the] number of those projects which improve our public transport offering ... for instance, double-laning and bringing in the ability for cycle and walkways."

The need to do both

Jones said Rotorua was one of those places that needs roads and 'grey' infrastructure, the region also needed a boost after a major downturn in tourism.

The city has a housing shortfall of nearly 1700 houses and a shortage of industrial land. 

Mayor Steve Chadwick has lobbied the Government to fund a $15-30m roading project on State Highway 30.

"I fully expect that we'll hear more apocryphal accounts from the green lobby as to the danger of 'grey' infrastructure and the virtues of green infrastructure."

Rotorua Chamber of Commerce President Kiri Tahana said residents who lived in subdivisions that snaked off it had no choice but to file onto the highway when they wanted to travel to and from work.

"Our infrastructure is not fit for purpose for the current population.

"So it's not just about future-proofing it's also about ensuring the current population has the infrastructure to support current activities."

And then there was the economic devastation of Covid-19 that had hit almost instantly. Tahana remembered 100 people being laid off within the first few days of Covid-19. 

Jones said the extra construction work from this project would revive employment and enable more development by freeing up land for residential and industrial construction. 

"I fully expect that we'll hear more apocryphal accounts from the green lobby as to the danger of 'grey' infrastructure and the virtues of green infrastructure.

"It's a false dichotomy. We need both."

A 'lost opportunity'

Jones said our country's economy wouldn't suddenly change into a 'green' one overnight, that would happen organically. 

"It's not going to happen in some kind of some apocalyptic way.

"It's going to happen through planning and people investing their own money. And the Crown stripping away the barriers so the evolution can take place."

However, Forest & Bird's Hague believed the Covid-19 lockdown was just the time for such a move. He likened our locked-down economy to an oil tanker that had come to a sudden halt. It would take the same level of energy to move it in a new direction or the one we had already been going down.

"If they invest in 'grey' infrastructure at stage one. Most of their spending in subsequent stages will also be in that direction.

"What we're saying is that that's a massively lost opportunity."

He has criticised a climate of "secrecy" around the Government's intentions with the $3b fund. Cabinet should be clear on how it would decide between the projects and seek input from the public. Hague also worried about a proposal to fast-track specific projects. 

Jones said the alleged "secrecy" was just normal Cabinet process. 

"It would be wrong to ignore the commercial sensitivity surrounding some of those projects.

"And it would be wrong for Cabinet not to have the opportunity to deal with these issues in a confidential manner."

A whittled-down list of 'shovel-ready' projects had been delivered to ministers along with a list of priorities suggested by Infrastructure Industry Reference Group, led by Mark Binns.

Jones would be happy to release the projects that went to ministers, but that would be the finance minister's call to make after decisions were made.

As for fast-tracking projects: proposals like moving the dry dock from Devonport to Northland could spend a decade tied up in RMA hearings if fast-tracking wasn't green-lit alongside the Government's investment.

That's not something Hague denied, he just believed there could be good environmental reasons for making a project like that wait.

"The sole reason for putting that project through the fast-tracking process is to bypass the normal level of scrutiny that would exist.

"That's not in the interests of our country at all."

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