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Home / Business

Infrastructure, transport failures highlight need for timely investment - Fran O’Sullivan

Fran O'Sullivan
By Fran O'Sullivan
Head of Business·NZ Herald·
28 Jun, 2024 05:00 PM6 mins to read

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The Interislander ferry Aratere is towed back to Picton after running aground. Photo / Tim Cuff

The Interislander ferry Aratere is towed back to Picton after running aground. Photo / Tim Cuff

Fran O'Sullivan
Opinion by Fran O'Sullivan
Head of Business, NZME
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THREE KEY FACTS:

  • New Zealand was struck with three major transport and infrastructure failures: The Interislander ferry Aratere, an RNZAF Boeing 757 and a Transpower electricity pylon.
  • Defence Minister Judith Collins has brought forward the timeframe for making decisions on the replacement of the RNZAF Boeings.
  • A report from the Helen Clark Foundation found a major element in the infrastructure gap is the failure to build bipartisan consensus on investment and financing.

Fran O’Sullivan is a business commentator with more than 40 years’ experience covering markets, politics, foreign affairs and trade. She has written a column for the Business Herald since April 1997 and has won numerous awards for her journalism.

OPINION

It’s way beyond time for New Zealand to jettison our “number 8 wire” mentality, get real and invest in next-generation assets and importantly, maintain them.

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The fortnight in which “everything broke down” has been a wake-up call for the Government and business alike.

It’s been embarrassing, to say the least:

  • Broken-down RNZAF 757 Boeing. Check.
  • Transpower electricity pylon keeling over. Check.
  • Cook Strait ferry running aground. Check.

The impact on our country’s image is obvious.

That these are publicly-owned assets makes the brand damage to New Zealand doubly so. As one business player mused: “It’s as if we are sliding into being just another Pacific Island – the ones we fly in assistance to when cyclones or earthquakes strike – instead of being first-world.”

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Also, it is hardly a great signal to major investors out of Singapore and Japan, who the Government are courting to invest in New Zealand infrastructure, when we are failing to adequately maintain what we already have.

The RNZAF engineers do a stellar job keeping their two 757 aircraft in flight well past the time they should have been replaced. They dumped fuel and flew the 757 back at low altitude from Papua New Guinea (PNG) to Brisbane after repairs were made so the Prime Minister’s business mission to Japan could connect with a redirected Air New Zealand flight to Tokyo – but the crucial first day was missed. The Prime Minister – whose team always have a back-up in place – was able to make all his meetings after he flew out from PNG via Hong Kong a day earlier on a commercial flight.

The upshot is that Defence Minister Judith Collins has brought forward the timeframe for making decisions on their replacement. It would appear there is bipartisan support for this move.

But there is a lesson here.

Next time the Prime Minister takes a business mission offshore – particularly to India where Christoper Luxon is keen to secure a bilateral trade deal – just fly commercial. If business members are serious about the opportunity, they will pony up their own airfares, as 50 business people in fact did when a private sector delegation went to India last August to promote closer trade and investment.

A Cabinet minister recently put it to me that the impact of flying commercial would be to make it difficult to muster journalist delegations. A suggestion: just subsidise them.

It’s not as if the Government – via the Asia New Zealand Foundation and other avenues – is not in the business of underwriting media travel in the first place.

Another alternative is to simply leave on a Saturday – not a Sunday – so if there is a breakdown, there is time to either repair the plane or organise commercial flights to get there on time. That would have worked for former Prime Minister Sir John Key, who was forced to cancel the first day of his 2016 mission to India after the Air Force Boeing 757 transporting him and 80 other passengers broke down in Townsville.

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Too simply, really?

It is obvious that this is not the only area where there needs to be an audit of vital infrastructure.

The latter two breakdowns could have resulted in loss of life if the Transpower pylon had fallen on someone or caused an electrocution. Or if the KiwiRail ferry had lost its steering capability in Cook Strait when high seas were running.

In truth, rank incompetence was the causal factor on the pylon incident that resulted in power being cut to 100,000 households in Northland. Transpower CEO Alison Andrew has confirmed the toppling of the pylon was due to contractors removing too many nuts from bolts connecting the tower to a base plate. This occurred during routine maintenance by Omexom on the transmission tower and its baseplate near Glorit, north of Auckland. Transpower – which spends about $150 million to $200m a year maintaining towers across the country – has stopped all base plate work across the country.

An inquiry will probe whether sabotage is a factor.

Then there is the Aratere.

It is extraordinary that the steering system of the Interislander’s Aratere ferry had been overhauled just three weeks before it veered off course and hit the shore in calm waters off Picton.

Put that against a Herald exclusive revealing the Aratere experienced a power blackout in 2023 due to disintegrating tape that had been used to hold wiring together, and it is clear that this number 8 wire mentality of using such kit to repair a major part of the ferry’s electrical infrastructure is Amateurville.

Annual maintenance costs to keep the fleet running are said to almost double to $65 million by next year, and keeping KiwiRail’s ferries afloat will be difficult given an assessment of the fleet’s condition raised concerns about steel corrosion, metal getting weak and cracking, and prohibitive maintenance expenses.

These increased maintenance costs will simply have to be met.

A report out this week from the Helen Clark Foundation traversed a number of key issues relating to closing the infrastructure gap.

A major element is the failure to build bipartisan consensus on infrastructure investment and financing.

Governments burn cash by pulling the plug on investments made by their predecessors: Three Waters; Auckland Light Rail and iReX – KiwiRail’s proposal to replace the existing ferry fleet with larger vessels requiring major shoreside infrastructure – are cases in point.

This approach cannot continue.

It is simply ludicrous.

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