New Zealand, like many other countries, has a significant infrastructure gap, highlighting the need for investments.
However, with mounting debt and a limited budget, the government has increasingly turned its attention to the private sector to help bridge the funding gap.
According to the Global Infrastructure Hub, New Zealand will need to increase its infrastructure investment by around 30% from its current level. New Zealand’s Infrastructure Commission estimates the country’s deficit at more than NZ$100 billion. If it continues to invest at its current level, this deficit will double in the next three decades (Foundations for, 2024).
To address the country’s infrastructure deficit, the government introduced the “Funding and Financing Framework” on December 2, 2024, with two goals: to expand funding opportunities and encourage more efficient spending. The framework also includes a three-step guide to ensure that investments by the New Zealand government produce maximum results:
- Assess the project’s standalone funding potential.
- Develop the optimal solution for any funding and/or financing gap.
- Consider long-term implications and financial risks.
In addition to the new funding and financing framework, the government introduced several new tools and mechanisms to attract private investment in infrastructure.
A report by the law firm Bell Gully, titled “The Big Picture: Infrastructure—Changing Tides and New Opportunities,” examines the key regulatory agencies, their functions, the tools at their disposal, and the current opportunities for the sector to address the infrastructure deficit. The report discusses the release of guidelines for market-led proposals, which aim to encourage private sector participants to share their ideas for improving infrastructure. It also covers the Public-Private Partnership (PPP) model and the processes employed by procuring agencies.
Additionally, in December 2024, guidance on “strategic leasing” was released to assist government agencies in considering the leasing of assets for public service delivery, particularly in cases where the private sector might be better suited to own and maintain the relevant infrastructure. That same month, a resource management bill was introduced, which impacts decision-making timeframes for infrastructure projects.
Four central agencies and entities drive the infrastructure sector in New Zealand: the Treasury, the New Zealand Infrastructure Commission, Crown Infrastructure Delivery Ltd (CID), and the National Infrastructure Funding and Financing (NIFF).
The Treasury. Providing advice to the Minister for Infrastructure and the Minister of Finance on infrastructure issues, investment and management of key infrastructure, funding and financing, and performance monitoring of three key infrastructure agencies.
New Zealand Infrastructure Commission—Te Waihanga. It provides strategic policy advice to the government on infrastructure issues, prioritizes long-term infrastructure planning, develops a National Infrastructure Plan, and manages the infrastructure pipeline.
Crown Infrastructure Delivery Ltd (CID) – Rau Paenga. Delivering and supporting government infrastructure projects on behalf of its agencies and entities.
National Infrastructure Funding and Financing (NIFF) LTD. This new national infrastructure agency, undertaking CID’s existing functions and responsibilities, was established on 1 December 2024. NIFF aims to address the country’s significant commercial and financial expertise gap by utilizing private financing to deliver infrastructure and fill the role ambiguity between the government infrastructure agencies.
NIFF also serves as the government’s “shopfront” to facilitate private sector investment in infrastructure, including receiving and evaluating unsolicited infrastructure proposals on behalf of the government.
Invest New Zealand is another new agency created on 23 January 2025 to promote foreign direct investment in the country. It is intended as a “one-stop shop” for overseas investment and will offer tailored support to foreign investors.
Invest NZ will focus on high-potential sectors, streamlining processes to increase capital for investment in new and existing projects, including infrastructure, while also boosting research and development and attracting skilled professionals to the country.
The establishment of new agencies, tools, and mechanisms marks a strategic shift in the country’s approach to economic development. These efforts are specifically designed to increase New Zealand’s access to infrastructure funding, accelerate project delivery, and enhance the country’s capacity to respond to future challenges and opportunities.
“With all this in place, the New Zealand infrastructure sector is well-placed to step up and seize the opportunities that lie ahead,” said Sarah Anderson-Butler, one of the report’s authors.
Read the full report: The Big Picture Infrastructure: Changing Tides and New Opportunities.
Source:
Foundations for the Future: Investing in Infrastructure. (2024, September 24). Forsyth Barr. Retrieved from https://www.forsythbarr.co.nz/research-library/research/foundations-for-the-future-investing-in-infrastructure
Regulatory changes open window of opportunity in New Zealand’s infrastructure sector – Bell Gully report. (2025, February 12). Belly Gully. Retrieved from https://www.bellgully.com/insights/regulatory-changes-open-window-of-opportunity-in-new-zealand-s-infrastructure-sector-bell-gully-report/
Harford, A., Anderson-Butler, S., Garvan, N., Coull, D., Forrest, T., & Becke, I. (2025, February 12). Bell Gully. Retrieved from https://www.bellgully.com/insights/the-big-picture-infrastructure-changing-tides-and-new-opportunities/
Leave a Reply