IPWEA NZ vice president Myles Lind calls for a public water Investor Confidence Rating.
A public water Investor Confidence Rating (ICR) would signal our sector’s confidence in our ability to continuously improve, adapt and deliver high-quality infrastructure services to our customers through better delivery options. It also opens the valve for us to bathe in the benefits of a national infrastructure pipeline.
The new Labour-led government has brought a fresh focus on our natural resources and the infrastructure needs of our communities.
Embracing this new challenge and moving away from outdated approaches to funding and delivery of infrastructure will be key to our shared success. Clear signals exist that we need to get better at procurement and use of alternate funding models – rates and council balance sheets can only take us so far.
Treasury has socialised the benefits of a national infrastructure pipeline to help facilitate improved infrastructure delivery. To make the pipeline successful and deliver benefits to the whole country, there will need to be a coordinated, multi-agency approach.
The pipeline will have to deliver well-planned projects with realistic lead times. It will be critical that projects and programmes coming out of the pipeline have passed through a robust quality assessment.
The pipeline will have to provide confidence to investors (such as ratepayers and other potential private partners) that we are planning to deliver the right things at the right times.
The ICR system developed by Treasury helps to lift an infrastructure company’s asset management practices. Specifically, it is an outcome-focused system that identifies gaps in infrastructure planning and delivery practices that may otherwise make them less attractive to investors. The ICR then targets systematic improvement.
Central government agencies, including NZTA, and those responsible for education and housing, are already benefiting from the ICR system. The opportunity exists for local government to leverage the ICR for its water services.
A water ICR is a natural next step for our sector by reinforcing the link between infrastructure planning and investment benefit as it relates to our customers.
However, let us be more ambitious. Let us publish our water services ICR scores. Let us measure our management of infrastructure against the central government infrastructure agencies.
By responding positively to enable a national infrastructure pipeline, our sector demonstrates our willingness to collaborate and bring leadership to addressing our country’s infrastructure challenges. To continue to encourage and build investor confidence in New Zealand’s infrastructure, the local government sector needs to add water.
This article was first published in the March 2018 issue of NZ Local Government Magazine.