By Nick Leggett, Chief Executive, Infrastructure New Zealand

In 2025, the Aotearoa New Zealand infrastructure industry is urging the government to build on progress made in 2024 by continuing to streamline its planning, funding and delivery systems, and to start bringing projects to market as soon as possible. As always, open and consistent communication between the government and the private sector will be essential to align priorities and fully harness the sector’s expertise to help achieve this goal.

Much of the focus for 2025 will naturally be on the progress of legislation to amend and replace the Resource Management Act (RMA).

Successive governments have moved to replace or substantially reform the RMA, but due to the vagaries of Mixed Member Proportional (MMP) politics and the short (three‑year) parliamentary term, none have effectively landed and delivered the on-the-ground system changes needed. The last government actually did pass replacement legislation during its final days, but one of the new Coalition Government’s first moves was to repeal this (citing over-the-top complexity and increased uncertainty) and temporarily readmit the RMA. So, one step forward, two steps back.

Permanent replacement of the RMA with more enabling legislation is promised to be introduced to Parliament in mid to late 2025. While that doesn’t provide much time before the next election (due in late 2026), I am confident we may finally see permanent RMA replacement achieved during this term, as the three governing parties are aligned on matters of infrastructure, and the utilisation of natural resources and the environment.

Before that happens, we have another RMA Amendment Bill going through the parliamentary process, which is designed to ease consenting requirements, and simplify the system in areas related to infrastructure and energy, housing, the primary sector, and emergencies and natural hazards. We also have the legislation to establish the new regulatory framework for water services delivery, another to enable offshore renewable energy development, and a bill to provide for time-of-use charging schemes to help reduce congestion in our major cities.

A coalition commitment that will receive greater attention this year is the proposed passage of legislation providing for a referendum on extending our parliamentary term from three years to four.

For the infrastructure sector, this could have very positive ramifications.

While a number of our major political parties are adopting a more bipartisan stance on infrastructure, there is little doubt that shifting to a four-year parliamentary term could help provide greater political and policy certainty in the Crown’s infrastructure planning and delivery.

Under the current three-year term, governments have limited time to design and implement major projects, or even make significant progress, before facing re-election. This short timeframe often means decision-making is about achieving tangible results as quickly as possible – something that doesn’t necessarily align with infrastructure priorities.

Our MMP system also means that while the major party leading our government may not change with each election cycle, the political make-up of governing coalitions, and therefore commitments, do. A Labour Party in coalition with New Zealand First, for example, is going to have different priorities to a Labour/Greens government.

Moreover, a longer parliamentary term would provide confidence to the industry and encourage more private investment. Political stability is critical for attracting private sector participation in large-scale infrastructure projects, particularly for international investors and those looking to partner with government through mechanisms like public‑private partnerships (PPPs).

Outside of the legislative sphere, much more progress is required on the replacement of the aging Interisland ferry fleet. There was disappointment that the announcement before Christmas lacked details around cost and procurement, and while it is positive that the private sector is being encouraged to put market-led proposals forward, it will be critical to settle on a solid plan that can provide certainty of costs and timings as soon as possible. This is, after all, the SH1 link between the North and South islands.

A major sticking point still seems to be whether or not the ships are rail-enabled. I am not convinced that rail-enablement is necessary when such a small proportion of New Zealand’s freight is carried by rail and the associated costs of providing for roll-on roll-off capability are seemingly so high, particularly with regards to the port-side infrastructure; however, with the three coalition parties having very different views on rail capability, there promises to be some very interesting political negotiations during the year.

The year ahead will also see the bedding in of the National Infrastructure Funding and Financing Company, and the other significant system changes made during 2024. This needs to include the continued expansion of new funding and financing models, and the utilisation of private capital for both central and local government projects. The first regional deal is expected to be signed in 2025, and further development of the Infrastructure Priorities Programme and the National Infrastructure Plan, enabling more informed infrastructure decision-making, can also be expected.

Most critical for 2025, from an industry perspective, is the need to start bringing some major projects to market.

The current amount of work in the market is undermining the sector’s capacity to contribute to the future infrastructure pipeline that we know is on the way. Delays in planning, prioritising and funding projects at both the central and local government levels are causing the under-utilisation of the sector’s expertise, and making it difficult for companies to maintain a viable workforce. This is not only concerning for those within the sector, but will also serve to increase project costs and push out timeframes when the time does come to upscale.

There were some small signals at the end of last year that the tap will soon be turned on, but our sector cannot wait indefinitely. We require a steadily building program of work so there is confidence to invest in the skills and capabilities needed to deliver the critical infrastructure that New Zealanders understand we need. The government successfully improved the infrastructure delivery system last year, with good bipartisan support from Labour. This year is the year that the government must begin to crank out the projects and demonstrate action that improves people’s daily lives and the productivity of New Zealand.