PRIZE DRAW & SUMMIT CLOSE
Prize draw courtesy of Air New Zealand
Mat Bolland Chief Corporate Affairs Officer Air New Zealand with Auckland Business Chamber General Manager Events and Marketing Natalie Woodbridge
Conference close Tim McCready
KIWI VALUES KEY TO NEW NEW ZEALAND STORY
David Downs CEO New Zealand Story
New Zealand Story Group was established to enhance New Zealand’s reputation beyond natural beauty. In a competitive global economy, reputation matters. And it’s important for a country like ours, with an economy that relies on the strengths of its exports, to continue to grow and diversify.
The more we can do to ensure we’re all telling a broad, compelling and aspirational story about New Zealand, that’s grounded in our values and resonates with the world, the greater chance we have of attracting people to all that we offer.
Moderator: Tim McCready
Moderator: Tim McCready
PETER BECK Founder and CEO Rocket Lab
Founder and chief executive of Rocket Lab, Peter Beck, gave the opening keynote for the New Frontiers session at the US Business Summit. Peter is a pioneer in New Zealand’s accession in the space industry, growing to become a leading player in space, redefining the industry with the rapid and cost-effective delivery of innovative, high-quality technology.
Rocket Lab has deployed 110 satellites, with its Electron rocket the second most frequently launched US rocket annually, delivering mission success for commercial and government satellite operators.Speaking on the eve of the launch window for the CAPSTONE mission to the Moon, Peter shared with Summit attendees how his business has launched New Zealand into the forefront of deep space.
The year ahead is packed with missions, including the first launch to the moon from New Zealand’s Mahia Peninsula. Through this collaboration, Rocket Lab is demonstrating the strong partnership between New Zealand and the United States in this new frontier, as well as the leading role private business can play to forge bilateral relationships and pave the way for new areas of government collaboration.
Peter discussed how Rocket Lab has helped pave the way for New Zealand businesses to think bigger than our own backyard. Last year it listed on the Nasdaq Composite Index and has demonstrated that there is nothing holding New Zealand business back from becoming significant global players in new and exciting industries.
Moderator: Tim McCready
CALL TO ORDER
Tim McCready, MC
The business climate has been anything but predictable over the past two years.
The Covid-19 pandemic has caused upheaval and seen companies scramble to adapt to a rapidly changing environment — the most visible changes have been the rapid uptake of digital technologies and the rise of remote and hybrid working.
That unpredictability looks set to continue, but there are several underlying trends for businesses to keep in mind as they navigate the year ahead.
In response to Russia’s invasion of Ukraine, the US and EU have cut selected banks from Swift and closed airspace to Russian planes. Further sanctions have been imposed on Russia’s central bank, aimed at preventing it from accessing reserves.
While the crisis might be on the other side of the world, the economic impact will ripple through the global economy and reach NZ shores.
Russia is the world’s second-largest exporter of crude oil and refined petrol, and the world’s largest exporter of natural gas. Global crude oil prices have already reached their highest levels since 2014, and it is expected that prices will go even higher as the conflict persists. This will impact fuel, supply chains, and the cost of goods in general.
Businesses should also brace for cyberattacks, which many predict Russia will use in response to sanctions. NZ’s National Cyber Security Centre (part of the GCSB) recently released an advisory encouraging nationally significant organisations to consider their security, exercise readiness, and monitor for relevant cyber security developments.
Closer to home, the South China Sea and China’s increasing influence in the Pacific continues to cause fractures in the relationship between China and the United States.
Just prior to the Beijing Winter Olympics in a joint statement, President Xi Jinping and Russian President Vladimir Putin denounced interference from the United States in their affairs and opposed further enlargement of Nato.
While New Zealand has so far managed to carefully navigate its relationship with China, we will face increased pressure as Australia, the United States and the UK make stronger statements about China’s behaviour. At last year’s Apec CEO Summit, President Xi warned Asia-Pacific nations to not “relapse into the confrontation and division of the Cold War-era”.
Prime Minister Jacinda Ardern noted at last year’s China Business Summit that differences between NZ and China were “becoming harder to reconcile” as Beijing’s role in the world grows and changes, and that “managing the relationship is not always going to be easy and there can be no guarantees”.
With geopolitics entering a new era, businesses must walk a geopolitical tightrope and be ready to respond as events occurring elsewhere in the world impact their own operations, relationships, and people.
Since the start of the pandemic, the “Great Resignation” has gained momentum. The pandemic has shifted the mindset of employees, and seen them leave their jobs in search for a better work-life balance, remote work opportunities, increased flexibility or higher pay. In some cases they are moving to organisations that provide a better sense of purpose and meaning, with values that align with their own.
In order to remain competitive and attract and retain workers, companies have to rethink the benefits they offer and clearly articulate their purpose.
This is particularly true for knowledge sectors — those industries significantly reliant on the use of technology and human capital. The tight labour market around the world has seen those workplaces that don’t offer the flexibility and purpose demanded by their employees hindered by increased turnover in a market where good talent is hard to find.
But remote and hybrid has introduced new challenges for business.
The removal of a commute dramatically increases the pool of potential companies for employees. Someone living in Taranaki can now apply for remote working roles in Wellington or Auckland that might have previously been unobtainable to them.
It also limits the social ties that employees make with colleagues.
We have all been to staff farewells where we are told by the departing employee “it is the people here that makes it so hard to leave this job”. These connections that might have once encouraged employees to remain in their job have become weaker and will see the great resignation becoming a sustained challenge for business to grapple with.
As an alternative to negotiating remuneration with employees and becoming drawn into a bidding war with other workplaces, there has been a rise in companies offering a shorter work week as a bargaining chip.
One example of reduced hours is the four-day work week, which is gaining momentum around the world.
NZ’s Perpetual Guardian trialled a four-day week in 2018 — a world-first for a privately held company.
The eight-week experiment measured productivity, motivation and output, with staff paid the same amount for working fewer hours. It discovered productivity improved 20 per cent, and employees were more creative, committed and less stressed. It has since made the move permanent.
Perpetual Guardian founder Andrew Barnes says the four-day working week is “not just having a day off a week — it’s about delivering productivity, and meeting customer service standards, meeting personal and team business goals and objectives”.
More companies are now beginning to trial shorter work weeks.
A four-day week pilot in the United Kingdom begins in June, with 30 companies signed up so far. The pilot is run by 4 Day Week Global, an organisation that advocates for the shorter week. It says similar programmes are set to start in the US and Ireland, with more planned for Canada, Australia and New Zealand.
Covid-19 has put significant strain on the workforce. Uncertainty around job security, lockdowns, social isolation and limited social contact all contributed to the mental health crisis and exacerbated stress, anxiety and depression for both employers and employees.
The challenge of retaining good employees has seen businesses and business leaders prioritise health and build a culture of wellbeing in the workplace that openly supports mental health.
Many organisations have introduced wellbeing programmes, which include partnerships with mental health providers, subscriptions to mental health apps, fitness classes and additional days off. Last year, Westpac New Zealand introduced five days a year of wellbeing leave, and NZX-listed Vista Group introduced half-day Fridays for all its staff.
Research conducted by the New Zealand Institute of Economic Research last year on behalf of Xero showed investing in employee wellbeing can help to make a business more profitable.
It estimated that for every dollar a small business invests in company-wide wellbeing initiatives for staff, it can expect to see a return of up to 12 times within a year.
Overlaying all these trends, Covid-19 remains present. While the world welcomed the news that the highly transmissible Omicron variant is associated with less severe disease than earlier variants, a pattern of new variants around every six months has emerged.
Since there is a risk of the virus mutating each time it reproduces, the greater transmissibility from Omicron brings with it an even greater chance of new variants emerging.
It was hoped by many that the vaccine rollout would bring an end to the pandemic, but it looks increasingly likely that Covid-19 — in one form or another — is here to stay.
New tools like antivirals, antibody treatments and new vaccines are coming on board this year, which will help us navigate Covid-19 as it becomes an endemic disease.
These will be important as 2022 (hopefully) becomes the year that businesses, employers, employees and government finally reach post-pandemic normality. In a year fraught with challenges of all kinds to navigate, that is something that should bring hope to us all.
When Kathmandu achieved B-Corp certification in 2019, it became the largest Australasian retailer to be certified through the stringent process which recognises the highest standards of environmental and social performance.
“Part of being a certified B-Corp is looking at how we can benefit everyone that our brand comes in contact with, from suppliers to customers,” says Kathmandu CEO Reuben Casey.
“It helps us on that path of continuous improvement and demonstrates to our customers, shareholders, investors and suppliers that we are committed to doing the right thing.”
The Deloitte Top 200 judges commended Kathmandu Holdings for putting sustainability right at the heart of its strategy, and say this is why Kathmandu has been recognised as the winner of the 2021 Sustainable Business Leadership award. They are impressed by the leadership it demonstrates across ESG (environmental, social, governance) to drive long-term value for its shareholders and for the planet.
The Kathmandu brand was established in 1987, with Kathmandu Holdings formed in 2009 as a publicly listed company. The subsequent acquisition of hiking footwear brand Oboz (2018) and surfwear brand Rip Curl (2019) has seen Kathmandu Holdings transform from an Australasian retailer to a brand-led global multi-channel business. The Group is now working to extend Kathmandu’s B-Corp accreditation across its other key brands — Rip Curl and Oboz.
“Sustainability is central to Kathmandu’s strategy and is felt by all divisions of the company,” says Top 200 judge and Direct Capital managing director Ross George. “We were impressed with this ‘whole of company’ involvement — it is transnational and embraced by the board, management, and all levels of staff.”
Last year, Kathmandu Holdings completed an ESG materiality assessment across the group, speaking with stakeholders about where it can do better and what it should be focused on.
It also recently secured NZ’s largest syndicated sustainability-linked loan. The A$100m loan is tied to ESG and will be measured against a reduction in greenhouse gas emissions, B Corp certification, and improving the transparency, wellbeing and labour conditions for workers in its supply chain. If targets are hit, the interest rate on the loan decreases.
The judges were impressed by the bold ESG targets Kathmandu has set out to achieve by 2025, as it continues to consider how it can improve at every touch point. One of these targets was to become carbon zero by 2025. Kathmandu reached this target four years ahead of schedule, after offsetting its operational carbon footprint through Toitū carbonzero certification.
Casey says while this is a huge step, Kathmandu will continue to work towards its larger goal of net zero environmental harm by 2025. In 2022, it will set science-based targets that align with the Paris Agreement, and will hold itself accountable to those targets.
“This forces us to really understand the wider impact across the wider supply chain and value chain, as opposed to just doing what we can control,” he says. “It also helps us to influence our suppliers a bit more as well.”
Another of Kathmandu’s targets is to have 100 per cent of its products designed, developed and manufactured using elements of circularity principles.
In a first step, last year Kathmandu released its Pelorus Biofleece, made from 100 per cent recycled fabric which can degrade by 93.8 per cent in landfills at the end of its life. Later this year, it will release a 100 per cent biodegradable down jacket, with every component of the jacket able to biodegrade in landfill and marine environments.
“We are trying to demonstrate leadership and push forward the boundaries of what is possible,” says Casey. Kathmandu Holdings’ other brands are making progress towards its aim to achieve B-Corp certification across the entire group.
Rip Curl undertook a carbon audit and established a new ESG team to reflect Rip Curl’s increased focus on sustainability and take steps toward B Corp certification. The business sources its sustainable cotton in line with the Better Cotton Initiative, and this year launched a wetsuit take-back programme.
Oboz has embarked on its first materiality assessment and carbon footprint audit. Over the next 12 months it aims to work aggressively to surpass the 80-point minimum requirement to become B Corp certified. The company plants a tree for every pair of footwear sold and has 95 per cent environmentally preferred leather materials in its product range.
Country Director for Lion New Zealand Craig Baldie says the company’s success hinges on its ability to operate ethically and in the best interest of society, including looking after the environment.
The beverage brewer and manufacturer’s sustainability approach aims to strengthen the resilience of the communities in which it operates, champion responsible use of its products, and ensure its environmental legacy has a positive impact now and for future generations.
The Top 200 judges commended Lion for recognising the importance of operating ethically given the product they sell, and its focus on creating a balanced portfolio of products — including low and no alcohol options.
“Lion has been a New Zealand leader in creating a culture of responsible drinking which it calls mindful consumption,” says Top 200 judge Ross George. “It runs alcohol education programmes and is a member of the responsible drinking charity, Cheers.”
“On the employment front, Lion is an inclusive, flexible and diversified workplace.”
Baldie says Lion’s ability to operate is a privilege, not a right.
“Businesses who do the right thing for the long term are the ones that will endure,” he says. “For Lion as New Zealand’s largest alcohol beverage company, this means contributing to a positive and safe drinking culture is of primary importance.”
The judges were also impressed by Lion’s very direct commitment to the circular economy concept and its responsible practices in the supply chain, which are reflected in its commitment to a net zero value chain by 2050. This involves partnering with suppliers to measure and reduce collective lifecycle emissions.
As part of this strategy, Lion has committed to use 100 per cent renewable electricity to brew its beers by 2025 and has further stretched itself by adapting its existing science-based target to limit global warming to under 1.5 degrees. This sets a reduction target of 55 per cent by 2030 for its direct emissions from a 2019 baseline. The circular economy concept is embedded in Lion’s business performance and targets, as well as parent company Kirin Holdings’ Environmental Vision 2050.
The judges note that Lion has already made good progress.
Since 2015, it has achieved a 28 per cent absolute reduction in its carbon footprint. It has become the first large-scale carbon neutral brewer in both Australia and New Zealand and New Zealand’s largest beverage manufacturer to be certified as carbon zero.
One of its core brands, Steinlager, became New Zealand’s first large-scale beer brand to achieve carbon zero certification. To reach this milestone, Lion says it focused on reducing emissions throughout Steinlager’s product lifecycle — from growing the hops and barley, and brewing the beer, to packaging and transport.
Lion has also invested in water efficiency initiatives, reduced its waste, and is making its packaging more recyclable and reusable. Already over 97 per cent of Lion’s packaging materials are recyclable and it is targeting 100 per cent of packaging to be reusable, recyclable, or compostable by 2025.
Synlait Milk has bold ambitions to be “net positive for the planet” and instrumental in its industry’s response to climate change — a significant feat given agriculture is responsible for 30 per cent of the world’s greenhouse gas emissions and 70 per cent of freshwater use.
Synlait combines expert farming with state-of-the-art processing to produce a range of nutritional milk products for its global customers. It has put sustainability at the centre of its corporate purpose, and in 2018 set 10-year targets and an aspiration to become B-Corp certified — which it achieved last year.
“When we set these bold goals for ourselves, we didn’t know how we would achieve them,” says Hamish Reid, Synlait Director for Sustainability, Brand, Beverages and Cream.
“We are on track to beat our targets that no one thought we would achieve, and beat the timeframe as well. It’s an example of when you are really brave and put yourself out there, people galvanise around that.”
The Top 200 judges say Synlait’s executives are backing ESG strongly, and as a result the company scores well on these metrics.
“In a challenging year for the company, its focus on sustainability has not waned and it remains an industry leader with ambitious ESG targets,” says Top 200 judge Ross George.
“These are ambitious targets, both on-farm and off-farm, and have recently been updated under the Science Based Targets initiative.”
One of these targets is a reduction in emissions from the manufacturing process. Synlait is transitioning to renewable energy and has committed to not build another coal-fired manufacturing facility. A trial last year to replace a coal boiler with renewable biomass has progressed to become a permanent project.
“We now have a very clear path forward. From next financial year, we are commencing our rapid transition off coal,” says Reid. “Our original intention was early next decade, but we now think this will be entirely feasible as early as 2024 or 2025.”
Synlait works with its farmer suppliers to evolve New Zealand’s reputation as a responsible and sustainable producer of food, and help farmers understand how their management of the farm impacts on greenhouse gas emissions.
“This allows us to attract the most innovative farmers that are thinking about the future of the food system and where transitions might be happening,” says Reid. “It immediately gave us a greater supply base, because people were really interested in understanding and working together with the processor on how they might future-proof their businesses for success.”
This has resulted in on-farm emissions intensity, per kg of milk solids, reducing 5 per cent over the last year, or 10 per cent compared to its 2018 base year when its targets were first established.
Total off-farm emissions have remained stable since last year, however the emissions intensity, per kg of product, has reduced by 24 per cent compared to 2018.
“No one thought we would achieve what we have — including ourselves,” says Reid. “We didn’t think it would be possible to reduce our emissions by 10 per cent, and we have already hit the Government’s 2030 target.”
Deloitte Top 200 awards: Top business leaders crowned – NZ Herald
Infratil has been crowned Company of the Year and Skellerup’s David Mair named Chief Executive of the Year at the prestigious Deloitte Top 200 Awards.
Rocket Lab founder, CEO and chief engineer Peter Beck took out the coveted Visionary Leader award.
In its 32nd year, the Deloitte Top 200 Awards are a showcase of the very best of New Zealand business and business leaders. They celebrate the depth and range of our business community, featuring the industries and sectors that underpin our country’s success.
This year, the awards recognise outstanding results despite the ongoing challenges resulting from Covid-19, including companies and leaders from the manufacturing, retail, media, and energy sectors, all showcasing their commercial strength and agility during challenging times.
Infratil had an outstanding year in 2021, further enhancing its reputation as a savvy infrastructure and utilities investor. The company was active with its portfolio, divesting Tilt Renewables and investing in diagnostic imaging firm Pacific Radiology.
The panel of high-profile judges — convened by NZME editorial director of business Fran O’Sullivan — said Infratil’s combination of strong performances with its investment companies, especially data centres, along with its divestments and new acquisitions have added significant shareholder value over 2021.
“In addition, the company went through a fairly seamless transition of CEO from Marko Bogoievski to Jason Boyes and won the takeover battle with Aussie Super,” say the judges.
“While Infratil has been an excellent long-term performer, its total shareholder return of 65 per cent stands out.”
Another long-term performer is Skellerup Holdings, and this year its CEO David Mair took out the award for Chief Executive Officer of the Year.
The designer, manufacturer and distributor of engineered products has been led by Mair for over 10 years, and during his tenure has achieved significant revenue and earnings growth by focusing on designing and delivering critical engineered products for OEM customers.
“David is a steady pair of hands at Skellerup,” say the judges.
“He has a knack for presenting a soft, inclusive, popular leadership style with people and in strategy, but has a hands-on near fanatical knowledge of process, plant and equipment, and design for Skellerup’s manufacturing customers.”
The Visionary Leader award is one of just two awards made without finalists. This year, the award went to founder, CEO and chief engineer of Rocket Lab, Peter Beck.
The judges recognised Beck for taking New Zealand into the world of space and becoming a global leader who is redefining the space industry with ambitions that now stretch as far as Mars and Venus. Last August, Rocket Lab listed on the Nasdaq, where its market capitalisation climbed to $7.33 billion as it raised $1.14b to fund the next phase of Beck’s bold space journey — a proud Kiwi moment and bold visionary leadership from a ‘boy from Invercargill’.
Having been a finalist in the category in 2020, Patrick Strange was named this year’s Chairperson of the Year. Chair of Auckland International Airport and Chorus, he is highly regarded as an inclusive chair who brings out the best in his fellow directors and management teams.
The judges say that over the past year, Strange has taken a leadership position in the New Zealand business community by speaking up on areas where it might not have been easy — including on aspects of the Government’s Covid-19 response. He also responded robustly to aspects of the Commerce Commission’s proposed price and quality control settings for Chorus’ ultrafast broadband network.
Mercury’s William Meek has been awarded Chief Financial Officer of the Year. Meek’s career with Mercury spans 20 years and he has served as CFO for almost 15 of those, coming into the role prior to the successful float of the company in 2013.
The judges describe Meek as a highly competent CFO who thoroughly understands the financial statements of Mercury and knows how it creates value.
“Meek has delivered exceptional long and short-term impacts for Mercury,” they say. “He supported the company’s CEO in delivering superior shareholder returns and in 2021 helped execute Mercury’s successful efforts to enhance its presence in renewable generation and retail sales through two strategic acquisitions.”
NZME took out the Most Improved Performance award this year. The integrated media company – owner of the NZ Herald, Newstalk ZB, property website OneRoof and a suite of entertainment radio brands – has put a plan in place to transform into a digitally focused media business, and this turnaround strategy has seen digital revenue play an increasingly significant role in the company’s earnings.
“The market has responded positively to this strategy, with the share price climbing from a low of 18 cents in April 2020 to above $1.40 by the end of 2021,” say the judges.
Vulcan Steel has been recognised with the Best Growth Strategy award. The judges say the steel distribution company’s growth strategy has resulted in superior absolute and relative performance in the highly competitive steel distribution sector on both sides of the Tasman.
“It has executed both parts of its growth programme well with an annual revenue growth of 8 per cent and net profit growth of 38 per cent posted in the last five years,” they say.
“Vulcan is on track for another record year in 2022.”
Tourism Holdings’ Ollie Farnsworth has been awarded the title of Young Executive of the Year. With the tourism industry facing significant challenges in the last 18 months, Farnsworth approached tough issues of cost reduction and revenue generation with a constructive outlook in his role as chief commercial & customer officer.
“An innovative mindset has seen Ollie identify and effectively execute on new business opportunities including the well-known Get Moving to Get New Zealand Moving campaign,” say the judges. “His energy and empathy for customers and his people shines through in his leadership approach.”
Te Rūnanga o Ngāi Tahu (Ngāi Tahu) took out the Diversity and Inclusion Leadership award for its Cultural Confidence Programme, an innovative and comprehensive response to a very specific diversity and inclusion challenge.
“Mō tātou, ā, mō kā uri a muri ake nei — For us and our children after us’ — had the unintended consequence of raising doubts in the minds of their staff who are not of Ngāi Tahu descent, about the company’s commitment to them,” said the judges.
Kathmandu won the Sustainable Business Leadership award, which recognises businesses working toward the creation of long-term environmental, social and economic value.
The judges also chose to award a special judges’ award to Air New Zealand, in recognition of the airline’s efforts of the past two years. The judges praised all the airline’s employees who have strived to respond to the enormous challenges brought about by Covid-19, and in doing so have maintained strong support for the brand and service offering of the airline.
Infrastructure: Auckland’s light rail project poised to take a major step (NZ Herald)
Before the end of this year, the Government will decide on the route, mode, and delivery for the project for the light rail project, which will run between Auckland’s city centre and Māngere, connecting major employment hubs in the city and the airport at each end.
Transport Minister Michael Wood acknowledges the decision has been a long time coming. He first launched the promise of light rail during his campaign for the Mount Roskill by-election in 2016 which brought him into Parliament. Labour campaigned on light rail at the 2017 election, but the move was stymied by Labour’s coalition partner New Zealand First in the last term of Government.
“It is no secret that it was in a fairly challenging stage at the end of the last term, and it had the political knockback between parties,” Wood says. “We had to have a reset which is effectively what happened this year. But it’s put us in a good position to take it to the next stage.”
The three options under consideration are:
• Light rail, a modern tram on city streets;
• Light metro, underground in a tunnel under the isthmus, and underground in Māngere and Onehunga, and at street level in other areas; and
• Tunnelled light rail, underground from Wynyard Quarter to Mt Roskill, and then up at street level to Auckland airport.
They were chosen after an assessment by the Auckland Light Rail team from over 50 different options for modes and routes against the project’s three objectives: improving accessibility, reducing Auckland’s carbon footprint, and unlocking urban development in the corridor.
Not a simple decision
The Auckland Light Rail project team say tunnelled light rail from Wynyard Quarter to Mt Roskill is their recommended option, as it gives the best transport and urban benefit, with the least disruption and the best fit with the network in future. Wood says this first line will provide a base for the additional Waitematā harbour crossing and a line to the Northwest.
“It’s also important to understand that this is just the start of light rail lines in Auckland to create a joined-up rapid transit network with our separated bus lanes and heavy rail network — all of which we are currently extending and upgrading.”
The three options will be able to accommodate between 19 and 24 per cent of Auckland’s growth along the corridor. The key thing about that is it supports us with housing growth, but it also supports us with a more compact urban form,” says Wood.
“This is actually one of the more structural things that we can do to reduce emissions, because if you put someone on the fringes of the city, by definition, many of their journeys are going to be long journeys.
“If you build houses next to an amazing rapid transit network, close to schools, employment and recreation, people are going to emit much less by definition.”
Each of the three options enable a mode shift away from private vehicles and therefore a reduction in Auckland’s carbon emissions.
The light metro and tunnelled light rail options encourage higher numbers of people and therefore result in fewer emissions, however light rail on the surface has less embedded carbon because less concrete and steel is involved in the construction.
“We get to a point of carbon neutrality and start reducing carbon more quickly with surface light rail, but over the long run the others catch up,” says Wood. “At 2050, surface light rail is the better option for carbon reduction, but over the long-run, the others are.”
Cabinet’s decision later this month will weigh up all aspects including climate, cost, disruption, value for money, and the ability to open up housing. “I want to be clear with the trade-offs,” says Wood, “and in this case, it’s not a simple one.”
Opportunity for the private sector. But no PPP
Wood says a public-private partnership (PPP) has been ruled out for the Auckland light rail project, with Cabinet having already decided it will be taken forward using a public service delivery model. This is partly due to the previous iteration of the project floundering during the PPP selection process. Wood says many months could have been spent debating the merits of the delivery model, but for him, the most important thing is to move forward and deliver it.
He adds he also has a personal view that bringing PPP into public transport projects is a little more complex, “because the integration with existing networks and existing public transport operations is more complex if you have another player in the mix.”
Wood says the Government is open to PPPs when it stacks up, but stresses that there are “significant opportunities for investment right across the board” for the private sector for this project and other transport projects across New Zealand.
This will be the biggest transport project in New Zealand’s modern history, and the start of a broader programme of investing in mass rapid transport, beginning a pipeline of city-wide mass rapid transit work over the coming 20-plus years. That’s the first time we’ve really been able to say that as a Government,” he says.
“It offers industry the opportunity to start doing some forward planning. Obviously, the core transport infrastructure job needs to be done that will require both a high level of technical expertise, but also just a lot of work, as well.
“From the broader planning and urban design community, there will be a wholesale urban regeneration along this corridor that will offer opportunities for investment in commercial property, residential property — we are talking about an urban uplift of between 20,000 and 35,000 houses along the corridor.”
Community engagement encouraged
Wood says engagement from the community will be important for the project to succeed, and is a core part of the Light Rail team’s remit.
It has already been gathering the views of Aucklanders, and has found considerable excitement about light rail and the reduction in carbon footprint. But there are concerns about affordability of use, construction disruption and environmental, cultural, civic and heritage impacts.
He says the master planning phase of the project will be a critical point at which communities are brought in to share their views on what the vision should be for various communities and town centres along the light rail route.
“We want to hear the vision for communities in Eden Terrace, Mt Roskill and Onehunga over the next 50 years, and how we can bring together transport with housing, public open spaces and lively town centres.”
Transport Minister Michael Wood says his vision for Auckland’s transport network in 2050 is one that is clean, carbon-neutral, and connects and enhances communities — instead of bypassing and gutting them, “as our transport network sometimes has in the past. It supports a high level of good quality, compact urban growth, and enables more affordable, accessible places for people to live.
“Fundamentally it enables a good standard of living and enables connection to employment, recreation and to other things that are important for people’s lives.”
But the key, Wood says, is for a genuinely linked-up public transport network across all aspects of the region that people and freight can move around efficiently.
“That’s something we haven’t ever quite cracked in Auckland.
“But it’s something that all grown up, successful international cities have.”
Light rail: consisting of modern trams running on tracks embedded into the road but separated from traffic. It would travel totally on the surface. Sometimes that would be on roads and sometimes along the motorway.
The Auckland Light Rail team investigated Light Rail on Dominion Road and on Sandringham Road, and on balance, its investigations favoured Dominion Road.
One consideration was that a light rail route on Sandringham Road would require a significant power cable to be relocated to Dominion Road, which would delay works by up to two years and would mean that businesses and residents on both Dominion Road and Sandringham Road would be affected by construction disruption.
Light metro: a rail-based mode that is grade-separated (it is elevated or underground).
The Light Metro option would travel through tunnels built under densely populated urban areas and on the surface through non-urban areas, such as motorways.
Tunnelled light rail: like light rail, this option would also consist of modern trams, but would be partly tunnelled from Wynyard Quarter to Mt Roskill, with the balance of the route running on the surface (on roads and sometimes along the motorway). It would incorporate underground stations in the city centre and on the isthmus including the University precinct.
For the tunnelled portion, the alignment does not need to follow the road, so the actual route and station locations would be developed in the detailed planning phase, including through consultation with communities, iwi and stakeholders.
1902-1956
Electric trams ran from downtown at the Waitematā Harbour and across to Onehunga on the Manukau Harbour. They were then the world’s only coast to coast tramway system.
1956
The decision was made to rip up the tramlines and use buses.
Late 1960s
Auckland’s longest-serving mayor, Sir Dove-Myer Robinson, pushed for an underground rail loop known as Robbie’s Rapid Rail, including connections to Whangaparāoa, Hobsonville, Howick, the airport and an underground CBD rail loop.
1975
Robbie’s Rapid Rail was scuppered by the newly elected National government led by Muldoon.
2014
AT suggested light rail from CBD to Mt Roskill with main roads into the city reaching near capacity.
Mayor Len Brown wanted the focus to stay on getting government approval for the City Rail Link.
2016
During his by-election campaign in Mt Roskill, Michael Wood promised to fast-track a light rail system from Auckland’s Wynyard quarter to Mt Roskill.
2017
During the election campaign, Labour pledged it would build light rail from downtown Auckland to the airport within a decade.
June 2020
Then-Transport Minister Phil Twyford announced Cabinet had agreed to suspend the project until after the election because Government parties were unable to reach an agreement, with the Greens in favour but NZ First refusing to support it.
March 2021
Transport Minister Michael Wood sent light rail back to the drawing board, tasking a group of experts to develop a business case to revive the project.