Nigel Tutt: Plenty of options in Bay of Plenty for Budget surplus spending

It's unfortunate but essential that more investment is needed in mental health. Photo / File

Recent news of a larger than expected government surplus brings some thought about how those funds might be best spent at regional level. Priority One is the Economic Development Agency for the Western Bay of Plenty; our goal is for our economy to deliver prosperity for all of its community.

Naturally we're interested in how those additional funds could be put to good, future-focused use if the Government decided to make a one-off distribution of its funds.

Let's start with what a reasonable chunk of that surplus might be for the Western Bay. As Tauranga is the fastest-growing city in New Zealand (and has been for some time), the region having roughly 4 per cent of the country's population and 5 per cent of GDP, let's say that a fair share of the $7.5 billion surplus would be $500 million–$700m.

That's more than our proportional share but is entirely appropriate; more spend should occur in areas that have high levels of economic and population growth. It's also worth noting that this Government has so far spent very little in this area, despite having a $3b regional development fund at its disposal, so we have some catching up to do.

Hard infrastructure will always rank highly for investment from an economic perspective. Regionally, transport infrastructure is a very obvious area of need and one that has been overlooked by government in recent times. There are two areas where it could be put to great use for future sustainability.

Firstly, we must look after our port – The Port of Tauranga is the country's busiest and most efficient port, and one that handles around 12 per cent of New Zealand's GDP.

With the probable decline of the Ports of Auckland and an expanding horticulture industry, it is crucial to invest in the connectivity of the port to its surrounding region and the upper North Island, where growth is strongest.

The port is good at using rail, so improvements to key roading corridors are what is needed, Totara St/Hewletts Rd for example.

As the port is a significant economic driver, money spent on connectivity will benefit the wider region in future.

Secondly, transport infrastructure limits our housing expansion in this city. Investment in corridors that enable greenfield and infill developments is needed to keep up with growth and to keep prices at reasonable levels.

Priority One chief executive Nigel Tutt. Photo / File

Projects such as State Highway 2, Papamoa East interchange, Tauriko and public transport corridors could all dramatically improve our housing picture. In turn this improves the attraction and retention of our labour force, which is vital for our economy and future wellbeing.

While hard infrastructure is generally regarded as being good spend in economic terms, we should look beyond this to deliver gains specific to the Western Bay. We must recognise that investment in community wellbeing is important.

Social housing is an area that is crying out for investment. Social houses comprise 2.5 per cent of our housing stock, well below the national average of 4.5 per cent.

This is a poor situation for a city that also ranks badly for rental affordability. We have a great, capable, local operator in Accessible Properties that could translate investment into community benefit quickly. Flow-on effects are substantial for improving our collective prosperity.

Tauranga also ranks badly against other New Zealand cities in mental health presentation and suicide rates. Even though we're the country's fifth largest city we don't have any residential rehabilitation centres.

It is an unfortunate reality that these facilities are essential. Investment in this area will provide benefits across our community, reducing crime and helping more people to participate in the workforce.

What I've suggested above is targeted at areas that would deliver short-term gains and contribute towards longer-term strategic benefit.

This is far from comprehensive and of course there are more options – I haven't touched initiatives around public transport, climate change or tax cuts; but this would be a great start. Let's hope that we see our share of that surplus in this area.

• Nigel Tutt is the chief executive of Priority One and has commercial experience in chief executive and senior management roles in digital marketing and media, supply chain management, export planning and sales, and operations in the private sector.