On 30 May, Finance Minister Nicola Willis delivered the Government’s 2024 Budget. The Budget contained several measures that will significantly impact the freight industry, including substantial investments in infrastructure. These will begin to address the deficit in investment in New Zealand’s transport networks, hopefully returning them to a state that supports the sector’s growth.

Infrastructure investment:

The Budget allocates more than $68 billion to infrastructure projects over the next five years, focusing heavily on transport. This includes $2.68 billion dedicated to roads, rail and public transport, with specific funds for constructing 17 new Roads of National Significance and the Rail Network Investment Programme. These enhancements aim to improve the efficiency and reliability of freight transportation.

Regional Infrastructure Fund:

A new $1.2 billion Regional Infrastructure Fund is designed to bolster regional economies through new and existing infrastructure projects. This fund is expected to improve regional freight routes and reduce logistical bottlenecks.

Cyclone relief and resilience:

More than $1 billion is allocated for cyclone relief, resilience and emergency preparedness, including nearly $939 million for the New Zealand Transport Agency and local councils to repair and upgrade local roads and state highways. This is crucial for maintaining and improving the resilience of freight routes affected by natural disasters.

These measures demonstrate the Government’s commitment to supporting the freight industry through improved infrastructure, enhanced regional connectivity, and increased resilience to environmental challenges. These investments should support freight operations and reduce total cost of ownership, ultimately benefiting the broader economy.

National Road Carriers’ focus now shifts to ensuring as much of the allocated money gets spent where our members need it and that every dollar is used to deliver quality infrastructure that will stand up to the demands of a soon-to-be-growing-again economy.

The bigger picture is how New Zealand fixes the growing deficit between the revenue it collects from transport users and the cost of building and maintaining networks.

Funding and delivery models:

The Government is exploring alternative funding and delivery models for major transport investments, including Public Private Partnerships (PPPs) and value capture mechanisms. These approaches are intended to generate additional revenue and deliver infrastructure projects more efficiently, which could lead to faster completion and better-maintained transport networks. None of these are revolutionary ideas and there are plenty of examples globally where they have been used. National Road Carriers will keep an eye on proposals to use any of these alternatives to ensure they stack up and deliver value.

The most important message that came through on 30 May was that this is a government planted in reality that understands the importance of GDP growth and that every dollar of government money is generated by someone else who produces something and, therefore, needs to be spent wisely.

For that, we are grateful and we look forward to ensuring members see tangible results as their tax money is spent.

As always, please contact any member of our team on 0800 686 777 with any ideas, queries or feedback.