Amid longstanding calls for bipartisan agreement on major infrastructure projects, there are now headlines about Labour and the Greens backing the Government’s response to the National Infrastructure Plan.
Except … this support comes with some big caveats around the proposed liquefied natural gas import terminal, which Cabinet has exempted from going through the new infrastructure assurance process, Infrastructure Minister Chris Bishop has revealed.
The Government has asked two competing energy infrastructure firms (reportedly Höegh Evi and Hibiscus Petroleum) for proposals on how they might deliver the LNG facility.
And next week, the proposal will go to the Treasury-run ‘gateway’, an independent peer-review process used to assess high-risk investments like major capital projects and ICT programs. It will be one of the last projects to go through this process before it’s replaced in November.
Labour and the Greens are echoing the “reservations” about LNG expressed in the National Infrastructure Plan. It prefers energy initiatives that can “drive credible policy settings, strengthen regulatory oversight and support consumers”, rather than an LNG facility and market-led package of reforms. “Importing LNG may be a commercial option for some individual industrial and other consumers to consider, but it isn’t clear that it would lower average electricity prices,” the plan says.
Infrastructure Commission analysis, echoed by minister Chris Bishop, shows NZ spends around 5.8 percent of GDP on infrastructure, the highest in the OECD, yet ranks towards the bottom for efficiency. He gives the example of the $31m revealed to have been spent on a now-abandoned Immigration NZ ICT project.
“It sounds like an absolute cluster of epic proportions, in which basically ministers were misled,” he told a select committee yesterday. “That’s my point in the infrastructure context – if you don’t have the information, you can’t step in and do the proper assurance.”
