Govt to Launch National Infrastructure Agency to Boost Private Sector Investment

The NIA will serve as the Crown’s primary contact point for private sector investment in infrastructure, facilitating the entry of private capital to address New Zealand's infrastructure needs.

The New Zealand Government is set to establish the National Infrastructure Agency (NIA) on December 1st, repurposing Crown Infrastructure Partners (CIP) to enhance private finance and commercial capability in the country’s infrastructure sector, Infrastructure Minister Chris Bishop announced today.

The NIA will serve as the Crown’s primary contact point for private sector investment in infrastructure, facilitating the entry of private capital to address New Zealand's infrastructure needs. It will partner with government agencies and local authorities on projects involving private finance, administer central government infrastructure funds, and continue the work currently undertaken by CIP.

Minister Bishop emphasized the importance of bridging the infrastructure gap through private investment. “The NIA will help facilitate private capital into New Zealand’s infrastructure to help close our infrastructure gap faster,” he stated, highlighting that the new agency will be "open for business" to investors and project proposers shortly.

Recognizing a capability gap within the government in utilizing private finance and complex procurement models, the NIA will provide expertise in areas such as build-operate-transfer models, Public Private Partnerships (PPPs), and value capture mechanisms. It will collaborate with government entities on projects involving these funding arrangements, while accountability for such projects will remain with the lead agency.

The government’s ambitious plan to capitalize on innovative funding tools like tolling and value capture will see the NIA play a central role in ensuring that beneficiaries of publicly funded infrastructure also contribute to its costs. The NIA will also administer central government infrastructure funds, potentially expanding its role after a review of existing grants and funds across the government.

The NIA is expected to employ around 60 staff by 2025, with an annual operating budget of approximately $26 million. This expansion represents a significant increase in both staffing and funding, which will be reprioritized from within the existing infrastructure system.

In tandem with the establishment of the NIA, the government is undertaking broader reforms to simplify and reorganize the Crown’s central infrastructure system. From December 1st, the Infrastructure Commission will retain its role as the government’s independent strategic advisor, focusing on long-term strategy, while the Treasury will take over responsibility for PPP policy and support for the Infrastructure Minister. Rau Paenga will be tasked with providing project delivery services to Crown agencies with low infrastructure delivery capability.

Minister Bishop expressed confidence that the NIA will unlock more capital and enhance the capability within New Zealand’s infrastructure system, stating that both are crucial for delivering the projects the country needs. He added that the NIA’s establishment is part of broader efforts to streamline and improve the public sector infrastructure system, which has been criticized for its complexity and inefficiency.