By 2045, another 1.2 million people will live in New Zealand. It is time to rethink how we build and maintain the infrastructure networks on which we all rely.
The futurist Alvin Toffler coined the phrase 'future shock' nearly 50 years ago to describe what happens when the pace of change becomes so intense that societies start to spin their wheels. Decision-making gets way too hard, and the infrastructure we take for granted begins to overload and become chronically inefficient. Sound familiar?
More recently, the management consultancy McKinsey published its views on the pace of change today. They reckon that compared with the Industrial Revolution, change is happening 10 times faster and at 300 times the scale, which means 3000 times the impact.
Part of what defines our Kiwi character is the cherished laid-back lifestyle - the beach, the barbecue, the summer getaway. But let's not kid ourselves about the impacts of rapid change on our small South Pacific nation. One day in the not so distant future, if we want a cup of tea and a lie down, we might not be able to rely on clean water flowing from the tap or uninterrupted electricity to boil the water.
Recently, people have been pouring into New Zealand. We have been seeing net gains from Australia for the first time since 1991 and a population growth rate of 2.1 per cent. More than 60 per cent of this population growth is likely to be in the Auckland region. Other regions may even lose population.
How is our national infrastructure coping with population change and growth? Not too well, if you take our national housing and urban traffic issues.
The Government's national infrastructure unit recently reported that over the next 30 years our country will face some real challenges with ageing networks. Over the next 10 years, its report estimates around $110 billion will need to be spent on infrastructure.
Local Government New Zealand has looked at our water, wastewater and stormwater networks and estimates their replacement value across New Zealand at around $35.7 billion. Around one quarter of these assets is more than 50 years old.
To meet the cost of renewing and maintaining infrastructure to keep pace with future change and growth we will all need to think smarter - ratepayers, councils, central government, and those involved in construction and maintenance.
How will it be funded as our population ages and communities push back on rising rates? How can we future-proof our infrastructure as our climate changes and sea levels are predicted to rise by 30cm by 2050? Already, flooding is this country's most frequent natural disaster with an average cost each year of around $50 million.
We need to explore how councils and industry can work collaboratively to utilise expertise across the sector to provide solutions. There is a good model already operating in a city that has had more than its share of infrastructural challenges.
In Christchurch after the 2010 and 2011 earthquakes, it was not feasible to replace damaged assets on a like for like basis, it was simply not affordable. In response, the Stronger Christchurch Infrastructure Rebuild Team (SCIRT) was formed.
It is responsible for repairing and replacing Christchurch's three waters (water, wastewater and storm water), roading and bridge networks as well as some retaining walls and stopbanks.
SCIRT is an alliance between Christchurch City Council, Canterbury Earthquake Recovery Authority, New Zealand Transport Agency, City Care, Downer, Fletcher Construction, Fulton Hogan, and McConnell Dowell.
"Alliance contracting" is a recognised way of achieving good results from infrastructure programmes. It is particularly effective where scope is uncertain, risk is difficult to define, and speed of repair is critical.
The SCIRT model has provided a cost effective option by combining the efforts of planners, designers, contractors and asset owners to deliver an end-to-end solution based on actual need and what is affordable. All parties share the risk and poor performance is penalised.
Do we need to wait for another disastrous event before we take a more innovative approach to a problem that all councils face and is putting greater pressure on available funding each year?
As we head towards local body elections in October, an open conversation about the health status of our national infrastructure is needed. It is an opportunity to ask where the considerable burden of responsibility and cost for renewing and maintaining infrastructure lies now, and where it should lie in the future.
- Robert Jones is chief executive of Fulton Hogan.