1 > Ensuring infrastructure and associated funding mechanisms are in place to allow for growth and maintenance in relation to housing, building, transport, broadband, tourism, flood control and the three waters.

Councils are responsible for significant assets and services, from the water that comes from our taps, the pavements we walk on, the roads we drive on, and the swimming pools and parks where we exercise. Local authority infrastructure is crucial to enabling economic activity, housing supply and well-functioning communities, however, the ongoing costs of provision and maintenance, including transport and water, create significant challenges for councils, particularly in respect of:

  • financial constraints which involve increasing operational costs, limits on debt and for some councils a small/shrinking ratepayer base;
  • renewals/upgrades to replace aging assets, and meet higher regulatory standards and increasing community expectations; and
  • growth pressures as many areas face unprecedented period of population growth and visitor numbers.

Without councils ensuring these services are available in communities and regions, wider economic activity simply could not happen. Ensuring New Zealand has the appropriate local infrastructure to meet its current and future needs is one of the most important issues facing councils and is a major component of LGNZ’s policy agenda and work programme.

< Councils manage waste and recycling, build and maintain roads, pipe sewage, and deliver many more services to communities and businesses 24/7, 365 days a year. For residents, it’s an average cost via rates of just $5 per household per day.>

Water infrastructure

Water is critical to the future health of New Zealanders and their economy and in a world facing water scarcity New Zealand’s water resources represent a significant economic advantage. Consequently, protecting the quality of water and ensuring it is used wisely is a matter of critical importance to local government and our communities. Water is also subject to a range of legislative and regulatory reforms, with the overall allocation framework under review and councils subject to national standards, such as drinking water standards.

As a result, local government is facing increased cost pressures which are exacerbated by the need to continue to improve the state of its own infrastructure, as highlighted by the presence of campylobacter in the Havelock North water supply. Likewise, extreme weather events are putting pressure on our flood protection infrastructure, as highlighted by the 2017 Edgecombe event.

New Zealand has never had an accurate picture of the state of its underground water infrastructure however, with the completion of the 3 Waters project in 2015, that gap in our knowledge has been addressed. Further information is expected from the Havelock North Inquiry. On the basis of the information provided by the 3 Waters project LGNZ is now in a position to:

  • identify and promote best practice for agencies providing water services to encourage innovation, efficiency and effectives;
  • develop tools for assessing service design (Council Controlled Organisation or in-house business unit) and sector design (scale and scope matters) in a consistent way, such as measuring return on investment; and
  • facilitate engagement and discussion on the nature of stormwater problems and the creation of a local government stormwater work programme.

LGNZ is committed to working with the Government to advance the recommendations of the 3 Waters’ programme. In order to address the pressures on councils and communities to provide more resilient and effective water infrastructure systems, including flood defenses, a collaborative approach between the two spheres of government needs to be established and funding needs to be addressed.


Good transport networks are vital for regional and national development. It is a sector in which local government plays a significant role. Not only do councils own 88 per cent of all roads, these roads carry up to eight times as much primary produce tonnage as the processed and manufactured products carried to port on the state highway network. Local government expenditure on roading in 2014/15 was over $1.23 billion, including expenditure on new infrastructure, maintenance, renewal and operations.

Of strategic importance is the size of the roading investment that the government provides. It is important that the policy and operational framework encourages councils to explore service delivery models that meet local needs and align with the increasing demands being made on the transport system. More needs to be done at a national level to address the quantity and quality of multi-modal connections. Governments need to take a holistic view to our transport networks to ensure that New Zealand benefits from an integrated transport system incorporating not just roads but rail, maritime and aviation planning. We need a national policy framework that:

  • addresses current and future demand to secure economic and social opportunities; 
  • is a safe system, increasingly free of death and serious injury;
  • delivers the right infrastructure and services to the right level at the best cost;
  • provides appropriate transport choices; and
  • mitigates the effects of land transport on the environment.

LGNZ is arguing that greater focus be given to the economic benefits and the strategic importance of transport investment. The way in which roading investment responds to growth pressure is also a matter of concern. LGNZ will actively lobby for greater funding tools for councils, for example, congestion charging and road user charges.

< Communities have a right to the infrastructure necessary to thrive economically, socially and culturally; as well as the revenue sources to fund growth and renewal over time. >

Built environment

Cities are sites of innovation and engines of economic growth. If New Zealand is to exploit the social and economic opportunities of its urban communities then we need a fit-for-purpose planning system that enables local authorities and citizens to make critical decisions’ about the nature of appropriate infrastructure and how it is funded. Addressing housing supply and affordability requires a joined-up response involving both spheres of government.

The legislative framework is not helpful. City councils lack the authority to develop new funding tools to address issues like traffic congestion or provide the infrastructure and services needed by the growing visitor and tourism industry with the result that there is under-investment in critical urban infrastructure. In addition, the continued presence of “joint and several” liability remains an obstacle to efforts to speed up consenting and encourages risk averse decision-making. We are still to find the right regulatory framework for the management of freedom campers. Positive change is occurring, for example:

  • the proposed legislation to establish “urban development authorities” to better enable urban development at scale. The use of urban development authorities (UDAs) will enable local and central government to undertake locally and nationally significant urban development projects; and
  • the establishment of the middle-sized facilities fund to provide grants for local tourism related infrastructure and ongoing discussions that are taking place with regard to other funding options.

Yet these changes do not go far enough. UDAs may speed up development but the councils still lack practical value capture mechanisms. In addressing the local costs of tourism, capital grants are helpful but the real challenge is meeting the ongoing operational cost, for which a sustainable funding stream is necessary.

Providing councils with the necessary funding mechanisms to meet community needs for infrastructure, from urban amenities and public transport to broadband, is critical. Aligned with this, LGNZ is also committed to helping councils improve the way in which they make decisions, from consenting to major infrastructure investments. However, to make real change greater collaboration with central government will be required.

What LGNZ is looking for

Legislative, policy and regulatory frameworks that provide councils with the necessary decision-making authority and funding tools to provide rural and urban communities with the services and infrastructure they require to thrive and prosper. It is essential that these frameworks enable councils to engage with their communities to identify investment needs and make the trade-offs necessary to resolve competing demands for resources and funding.

Date updated: 23 May 2017