By Grant Robertson, Finance Minister, Labour MP for Wellington Central.
Today, the Government announced a major investment to future-proof New Zealand’s infrastructure.
When we took office two years ago we were confronted with infrastructure that had been neglected for nine years.
There were problems around the country - you’ll remember news stories about mould and raw sewage in hospital walls, overcrowded school classrooms, a shortage of state housing, and roads that had been announced but not paid for.
Those were just some of the challenges we were faced with and we are making good progress repairing that damage. We have significantly increased our investments in our first two years into upgrading hospitals, new school classrooms and in roads and rail to name just a few.
We have been doing this while managing the Government’s accounts carefully, keeping public debt low and the books in good shape.
It will not have escaped anyone’s attention that the global economy is facing challenging times.
Headwinds like the US-China trade war and uncertainty created by issues like Brexit are having an impact on confidence and activity around the world, including in New Zealand.
The good news is that New Zealand is in a strong position. Relatively, we are growing stronger, and forecast to grow stronger, than the countries we compare ourselves to.
Our unemployment rate is low – a full percent lower than Australia’s, and wages are rising – particularly for low and modest income earners.
This comes down to the strength of our businesses, and the investments that we are making as a Government to support the economy and working New Zealanders.
Since we’ve been in office, the interest rate the Government pays to borrow money has more than halved.
We now have a once in a generation opportunity to rebuild and invest for the future.
That’s why we have announced $12 billion of new capital investment to be spread across a range of areas including transport, health, education and climate change.
Of that 12 billion dollars, eight billion will go now on specific shovel-ready projects and four billion is available for future budgets.
Transport takes up the largest share of the investment with $6.8 billion for new transport projects, with a significant portion of that going to roads and rail.
The other areas include $300 million for District Health Board assets, up to $300 million for regional investment opportunities, $200 million to reduce carbon emissions from the public sector, and the previously announced $400 million one-off increase to schools’ capital funding.
The specific details of the projects will be announced in early 2020.
This major investment is forecast to boost New Zealand’s economic growth over the next five years – this will benefit everyone in New Zealand and that’s why we are doing it.
We want New Zealand to grow and prosper with modern infrastructure that is fit for purpose, strong and resilient.
We’re going to build a better New Zealand while also keeping debt down and running sustainable surpluses across the economic cycle.
Grant Robertson is Finance Minister and Labour MP for Wellington Central.