Uncertainty ‘adding a quarter’ to NZ infrastructure costs

Creating a certain future pipeline of projects could save as much as 26.5% on the cost of future infrastructure schemes in New Zealand, research has suggested.

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Figures compiled by Infrastructure New Zealand suggest that streamlining delivery by government committing to a more certain infrastructure pipeline could result in productivity and savings improvements of between 13% and 26.5% on future infrastructure projects. 

If applied, these savings could increase the amount spent on infrastructure delivery by between NZ$2.3bn and NZ$4.7bn per year over the 2025-31 period, the Estimating the Costs of an Uncertain Infrastructure Pipeline report found.

“Right now, uncertainty around the infrastructure pipeline creates confusion for industry, restricts its ability to invest in labour and equipment, and limits the number of potential suppliers for projects,” said Infrastructure New Zealand chief executive, Nick Leggett. “That inefficiency is expensive.”

While the analysis focused on the New Zealand infrastructure market, the findings clearly demonstrate the importance of maintaining a stable and certain pipeline wherever projects are being developed, the world over.

The research, which was carried out by Infometrics on behalf of Infrastructure New Zealand, can be found here.