NZ infrastructure faces crisis as maintenance lags behind - Kali Mercer

New Zealand is at a crossroads. Our challenges demand smarter, more resilient infrastructure — but we can’t meet them if we’re always playing catch-up. Photo / Supplied

THE FACTS

• The Building Nations conference is being held on August 6 and 7 in Wellington
• Infometrics analysis shows New Zealand could save between $2 billion and $4.7b each year by reducing infrastructure uncertainty
• A Draft Infrastructure Plan lays out scenarios for New Zealand’s population reaching nearly eight million by 2050

When we think about infrastructure in Aotearoa New Zealand, most of us picture the obvious: the roads we drive on, the pipes that carry our water, the schools our children attend, the hospitals that keep us healthy. What we don’t often consider is the huge amount of work that needs to go into keeping those assets up to scratch.

The real story of New Zealand’s infrastructure isn’t just about building new things. It’s about how well we care for what we already have. Yet a recent report by the Helen Clark Foundation together with WSP New Zealand found that beneath our feet— and behind our walls — there’s a slow-motion crisis unfolding. That report, “Built to Last”, found that much of the infrastructure that underpins our daily lives is quietly deteriorating. Leaking hospitals and schools, under-maintained roads, and tired public buildings are becoming increasingly common across the country. These are symptoms of a systemic issue: New Zealand is not properly looking after the infrastructure it already has.

While this slow deterioration continues, we remain more focused on delivering new projects than looking after those we already have. Why? Perhaps because they’re easy to sell - ribbon cuttings and photo ops get headlines, whereas steady attention to maintenance will often go unnoticed. What we most desperately need is not glamorous: a serious, nationwide commitment to lifecycle asset management.

Asset management is the practice of planning for - and investing in - infrastructure over its entire lifespan, thinking about the needs of those using it now, and into the future. Instead of waiting until something breaks before stepping in to make repairs, this approach emphasises regular, proactive care — from design to maintenance to eventual replacement.

The price of short-term thinking

One of the key challenges is the inconsistent use of depreciation across sectors. In simple terms, as our assets wear out, we’re not putting aside enough money to fund their upkeep and replacement. Frequent mismatches between depreciation and renewal funding mean many assets are not adequately supported throughout their lifetimes. Skimping on planned, proactive maintenance and renewals means we must replace assets sooner than we would otherwise have to, or spend huge amounts on emergency repairs.

What we most desperately need is not glamorous: a serious, nationwide commitment to lifecycle asset management. Photo / Supplied

When critical infrastructure fails, it’s not just an inconvenience — it can be dangerous and costly. The old saying, “a stitch in time saves nine”, is absolutely accurate – regular, planned maintenance is vastly cheaper than waiting for an asset to fail and then propping it back up or rebuilding from scratch.

Yet we do not have the systems in place to ensure that assets are looked after. This isn’t just bad economics, it’s bad planning. As one notable example, our data on infrastructure assets — where they are, what condition they’re in, and how they’re performing — is patchy at best. Surprisingly, this is particularly the case for assets owned by central government - local governments are more accountable under the legislation.

Treasury, concerned at this, recently put in new rules requiring central government agencies to report on how they are managing they assets that they own. The first round of reporting in June last year revealed a concerningly low level of asset management practice.

We looked at six major asset-owning central government agencies for our research. Only one of those reported maintaining a comprehensive asset register – a fundamental tool for tracking what infrastructure exists, what condition it is in, and when it needs to be renewed. Just two of the same agencies are currently using detailed asset management plans to guide their strategic, tactical, and operational level decisions, including eventual disposal or sale of assets.

When it comes to spending on renewals, local governments are also better at keeping track of how they are doing than central government. Whereas local governments must link the amount their assets are depreciating to the amount they are spending on renewals, central government agencies are not required to do so. And many readers will be surprised to learn that neither central nor local government must ring-fence the money they collect from tax- and ratepayers for depreciation and put it towards renewing assets as they deteriorate. Instead, that money is often spent on routine maintenance, operational costs (paying for staff, for example), or other priorities entirely.

Kali Mercer, deputy director of the Helen Clark Foundation and WSP Fellow.

Without reliable information on how assets are being managed, decision-makers are essentially flying blind. They can’t plan wisely or anticipate future issues. Instead, they’re left to respond to crises after they happen. It’s a reactive cycle that drains public funds and undermines trust.

A system without a system

At the heart of this problem is a lack of a systems approach. We don’t just need better spreadsheets, we need a new mindset. One where infrastructure isn’t treated as a set of individual projects, but as a network of interconnected assets that serve generations.

This mindset means embracing uncomfortable truths: sometimes, the right decision isn’t to build something new but to maintain what we already have. It means asking tough questions about value — how do we get the most out of every dollar we invest over the long run, not just in the next election cycle?

Unfortunately, current political and institutional incentives often push in the opposite direction. Politicians at both central and local levels are under pressure to deliver quickly and to do so cheaply. Despite the relative predictability of ongoing infrastructure costs and the importance of good design to reduce lifetime expenses, current system settings in Aotearoa can encourage decision makers to prioritise upfront savings over long-term value.

But infrastructure doesn’t operate on three-year cycles. Good infrastructure lasts decades, and decisions must be taken in a non-political way that reflects this fact.

Crucially, we need to make our infrastructure management more transparent. While it remains hard for the public to accurately judge how decision-makers are doing on something as technical and behind-the-scenes as asset management, things are not likely to improve.

Why this matters now

Right now, asset condition data is often unavailable to the public — or even to other decision-makers within government. This lack of visibility prevents scrutiny and undermines accountability.

New Zealand is at a crossroads. Our population is growing and ageing. Our climate is changing. These challenges demand smarter, more resilient infrastructure — but we can’t meet them if we’re always playing catch-up.

Surprisingly, the Infrastructure Commission reports that up to 99% of the infrastructure we will rely on in the future already exists. That means the bulk of our infrastructure challenge is not about building more, but about doing better with what we have. Yet under current settings, we are slowly bleeding value. We’re running down our assets faster than we’re reinvesting in them. And the longer we delay, the bigger the repair bill gets.

Infrastructure isn’t free - neither is neglect. The difference is that proactive, planned investment gives us choice and control, whereas reactive investment can offer only chaos and inflated costs.

To shift from crisis mode to a future-focused strategy, we need to rethink how we plan and fund infrastructure. Here’s the good news: there are practical, proven solutions. Here are some of the key actions that would make a major difference:

· Match depreciation with renewals funding: Public asset owners should ensure every dollar accounted for as asset wear-and-tear is actually reinvested into maintaining those assets - or publicly explain why this isn’t being done.

· Improve our understanding of the performance and condition of existing assets to better inform strategic decisions. Central government agencies must lead by example and rigorously follow best practice in asset management.

· Increase transparency and public scrutiny to drive compliance with best practice and allow voters to more easily understand whether assets are being managed properly, or neglected.

· Create a reliable, proactive investment pipeline for renewals and maintenance, separated as much as possible from political decision-making incentives.

· Invest in workforce capability to ensure we have the skills to manage infrastructure well.

· Shift public dialogue: Educate and engage the public about the long-term benefits of asset maintenance - even when it means delaying new projects, or seeing rates rise faster than we might like.

These aren’t abstract ideas, they are tangible, achievable steps. And they matter not just for engineers or policymakers, but for all of us who rely on safe roads, clean water, and functional public services every day. If we continue to prioritise the short term, we will leave future generations a degraded, more expensive infrastructure system, with fewer choices to fix it.

If we act now to improve how we manage our existing assets, and insist that this is done properly without constantly cutting corners, we can ensure that the country’s infrastructure remains resilient, efficient, and capable of supporting a growing and ageing population. Photo / Supplied

But if we act now to improve how we manage our existing assets, and insist that this is done properly without constantly cutting corners, we can ensure that the country’s infrastructure remains resilient, efficient, and capable of supporting a growing and ageing population.

This is not just about pipes and pavements. It’s about stewardship. It’s about leaving behind a country that works, for the benefit of all. That means embracing the unglamorous but vital discipline of lifecycle asset management.

Kali Mercer is deputy director of the Helen Clark Foundation and WSP Fellow.