New Zealand / Politics

Labour sets out investment non-negotiables

20:22 pm on 14 March 2025
Opposition leader Chris Hipkins speaks to media after making his State of the Nation speech on 7 March, 2025, flanked by Carmel Sepuloni (left) and Barbara Edmonds.

Opposition leader Chris Hipkins speaks to media after making his State of the Nation speech on 7 March, 2025, flanked by Carmel Sepuloni (left) and Barbara Edmonds. Photo: RNZ / Nick Monro

Labour has set out its bottom lines and the boundaries of its bipartisan approach to foreign investment.

The government's Infrastructure Investment Summit has come to a close, with the international delegates now heading back to their respective countries (or, in some cases, joining the prime minister on his trip to India) after two days of learning about New Zealand's economic and regulatory settings, and what could be on offer.

Much was made in the build-up about the bipartisan spirit of the summit, with both government and opposition aware of the need to see through projects beyond election cycles.

Labour's spokesperson for finance, and head of the new savings and investment portfolio, Barbara Edmonds, was given a speaking slot, in which she set out Labour's values and what it would or would not entertain.

RNZ/Reece Baker

Labour's spokesperson for finance Barbara Edmonds. Photo: RNZ / REECE BAKER

While she said the next Labour government would honour public-private partnership (PPP) contracts that have been entered into with this government, she told investors there were certain things completely off the table.

Hospitals, schools, prisons, and "critical infrastructure" were non-negotiables.

"These are the essential public services, and people expect their government to safeguard them for the benefit of all New Zealanders long into the future," she said.

"The reason why investing in New Zealand has been seen as a privilege is because successive governments agreed that there are some things too important to New Zealanders to sell off."

The government has said its redevelopment of Christchurch Men's Prison, which would be funded through a PPP, would remain in Corrections' control after delivery.

But Edmonds told media that Labour was ruling out private capital expenditure as well as operating expenditure, and was concerned that some poorly negotiated PPPs could end with the taxpayer footing the bill.

"It comes down to the risk profile. So where does the risk fall? Where does the affordability threshold fall?

"What we've seen from previous PPPs, the cases haven't been strong, where governments have come in and changed contracts, that's where the risk has fallen on the taxpayer to fork out more money for it. We want to make sure there is better value for money."

As for what would stay on the table outside those non-negotiables, it was a resounding "It depends".

In her speech, Edmonds set out Labour's support for investment, so long as it was sustained, targeted at long-term change, and provided returns to New Zealanders instead of delivering all the profits offshore.

But she would not rule projects in or out.

"It all depends [on] where the risk falls, what the benefits are to New Zealand. Again, it's up to the government. This is their summit, this is their gig. They need to keep us informed if they want that bipartisanship," she said.

The Prime Minister said the government was not just looking at PPPs to fund projects.

"We've talked a lot about PPPs, but we've also, in our one-on-one conversations and our small-group breakouts, there's a whole range of funding and financing tools that are used all around the world," he said.

"All I can do as the prime minister and as the government is to say, 'Hey, listen, I think Kiwis expect this to be something that actually has some consistency going forward.' More importantly, the investors need certainty and clarity."

Luxon claimed investors were "blown away" by the summit, and the task was now turning that interest into something tangible.

Prime Minister Christopher Luxon delivers his speech to investors at the New Zealand Infrastructure Investment Summit. Photo: Lawrence Smith / Stuff

"I now want full court press on making sure we bring these opportunities to market and we actually land them, and we actually get them set up, and we do everything that we can as a government to get the barnacles off the boat, so that then when we do the deal and the contracting with the investors in which there's a lot of interest, we now bring it home and actually get it converted and get the money flowing into the country," he said.

It was difficult to gauge the investors' responses to the different speeches, projects, and announcements.

Media were not allowed in the main room of the venue, with commercial confidentiality given as the reason for the restriction, and the only opportunities to talk to investors came when they were shepherded into the media room.

Investors that the media were allowed to speak to were naturally in support of the event.

They made it clear they wanted certainty, particularly given the long-term pipeline of infrastructure, and the risks of new governments reneging previous commitments.

CDPQ is a Canadian investment fund, that was involved in the Auckland Light Rail project before it was hosed down in 2020.

Its Australasia regional infrastructure chief Jean-Étienne Leroux said what investors were looking for from New Zealand was stability and predictibility.

"So making sure that there is a framework, there is an approach to attracting foreign capital that lives through the political cycles is very important, so definitely that bipartisan approach is a very important one," he said.

José Manuel Entrecanales, chief executive of Spanish firm Acciona, said investors needed to know they had the backing of society and representatives on both sides of the political spectrum.

As for whether the summit actually was bipartisan, Edmonds said the Labour would continue to hold the government to account, but that the conversations on the sidelines with investors were "beneficial."

There are some projects everyone can agree need to be done.

A new Waitematā Harbour crossing, for example.

Bishop appeals for international input on Harbour crossing

The transport minister set out the next step in a procession of steps towards getting a step closer to a crossing, by telling investors the government was all ears to their ideas.

"Many of you will be from countries that have done mega-projects like this. Frankly, it has been a long, long time since we have," Bishop told them.

"We need your thoughts, we need your lessons."

The "market soundings" would involve one-on-one engagement with civil contractors, maintenance providers, investors, and debt financiers.

They would be asked for their feedback on design elements and approach to delivery, as well as the market appetite and capacity.

The New Zealand Transport Agency would also test interest on funding, financing, and procurement options.

While none of that sounds definitive, Bishop said it was because history had shown the risks of sounding definitive.

"The history of this stuff is politicians do a desktop study, it takes forever, it costs a lot of money, and then everyone gets excited about a particular option.

"Then they announce it without actually having talked to the private sector about what might be deliverable and how the financing and how the economics might stack up," he said.

"So we're doing that work first before we start to firm up decisions about what we will build, how we will build it, and when we will build it."

Labour was quick to support the need for the new crossing, though again Edmonds would not rule in or out whether the party would support a PPP, and again stressed the need for the government to keep it informed.

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