The New Zealand Upgrade Programme
The New Zealand Upgrade Programme (NZUP) is a $12 billion package of infrastructure projects. The NZUP funds projects across different sectors, including the transport, health, and education sectors. The NZUP's projects for the transport sector are entirely Crown-funded and are in addition to projects funded by the NLTP.
There are 26 transport projects in the NZUP. Most of these are road projects. A smaller proportion are rail, walking and cycling, and public transport projects. These transport projects are intended to improve travel choices, support economic growth, enable housing development, and lower carbon emissions.
Most of the transport projects are in the North Island, including several large projects in terms of cost and scope (for example, PenLink in Auckland, Takitimu North Link stage one in the Bay of Plenty, and SH1 Papakura to Drury in Auckland).
When the NZUP was first announced in 2020, the transport projects collectively cost $6.8 billion.
Budget 2023 also included additional funding for cost pressures, including $111 million budgeted for 2022/23.
The increased cost pressures faced by several projects (for example, Mill Road and Takitimu North Link) have been a significant challenge for the NZUP. As a result, the transport projects were reprioritised and their scope, scale, and costs were re-evaluated in 2021. Several projects underwent significant changes or were removed from the NZUP (such as the standalone bridge portion of the Northern Pathway project). The total cost of the NZUP’s transport projects increased to $8.7 billion and cost escalation in the construction section continues to put pressure on delivery of the programme.
We will separately report on aspects of the NZUP in our performance audit of this programme, including how its performance is reported on.
How performance is reported
Waka Kotahi and KiwiRail report on the delivery of projects in their annual reports, but there is no consolidated reporting on what has been spent and whether forecast outcomes are being achieved.
In its 2021/22 annual report, Waka Kotahi reports on the measure “proportion of Waka Kotahi NZ Transport Agency NZ Upgrade activities delivered to agreed standards and time frames”, and provides short, balanced commentary on the progress of individual projects. Waka Kotahi also publishes regular project delivery updates on its website. These updates include additional information on community engagement and project benefits.
Overall, the reporting provides some information of what is being done across projects. However, it does not make clear how, for all projects, spending is tracking against budget, how scope and costs have changed over time, and how benefits of the investment will be measured and reported over time.
Furthermore, without a consolidated view and oversight of the wider programme, it is unclear how Parliament and the public can understand how well the programme is performing.
We will separately report on aspects of the NZUP in our performance audit of this programme, including how its performance is reported on.