Principal Economics 2022
Preface
Executive summary
Table of Contents
1
Introduction
1.1
Scope of this report
1.2
Efficient decision-making
1.3
The downstream benefits of efficient infrastructure decisions
1.4
Our approach and the structure of the report
2
Background
2.1
Infrastructure decision delays
2.1.1
Improved timing of investments and providing flexibility in decision-making process to avoid future bottlenecks
2.1.2
Delays are driven by a range of uncertainties
2.2
Economic impact of infrastructure investments
2.2.1
Impacts of time saving in the IDM process
2.3
Wellbeing context
3
Waikato Expressway
3.1
40 years of planning
3.2
Previous studies of the impact of the Expressway
3.3
Description of the direct impact of the Expressway
3.3.1
Economics and social impacts
3.3.2
Network performance and safety impacts
3.3.3
Tourism
3.3.4
Land use planning
3.4
Expressway’s impacts so far
4
Our approach
4.1
Measurement of the direct benefits
4.1.1
Feedback from the stakeholders
4.2
Capturing the downstream benefits
4.2.1
Our sub-regional CGE model
4.2.2
Inputs to our CGE model (shocks)
4.2.3
Assumptions of our modelling
4.2.4
Our results
4.3
Total forgone economic activity from IDM delays
5
Conclusion and further discussion
5.1
The direction of policy frameworks
5.1.1
National Policy Statement on Urban Development (NPS-UD)
5.1.2
Resource Management Act (1991) (RMA)
5.1.3
Direction of change and other relevant policy frameworks
5.2
Limitations of our analysis
References
Appendix A – The operating cost of the infrastructure sector over time
Appendix B – PECGE model description and its closure
Appendix C – Waikato Expressway – estimated costs over time
Appendix D – Sourcing mechanism in the PE-CGE model
Great decisions are timely
Table of Contents
1. Introduction
1.1. Scope of this report
1.2. Efficient decision-making
1.3. The downstream benefits of efficient infrastructure decisions
1.4. Our approach and the structure of the report
2. Background
2.1. Infrastructure decision delays
2.1.1. Improved timing of investments and providing flexibility in decision-making process to avoid future bottlenecks
2.1.2. Delays are driven by a range of uncertainties
2.2. Economic impact of infrastructure investments
2.2.1. Impacts of time saving in the IDM process
2.3. Wellbeing context
3. Waikato Expressway
3.1. 40 years of planning
3.2. Previous studies of the impact of the Expressway
3.3. Description of the direct impact of the Expressway
3.3.1. Economics and social impacts
3.3.2. Network performance and safety impacts
3.3.3. Tourism
3.3.4. Land use planning
3.4. Expressway’s impacts so far
4. Our approach
4.1. Measurement of the direct benefits
4.1.1. Feedback from the stakeholders
4.2. Capturing the downstream benefits
4.2.1. Our sub-regional CGE model
4.2.2. Inputs to our CGE model
4.2.3. Assumptions of our modelling
4.2.4. Our results
4.3. Total forgone economic activity from IDM delays
5. Conclusion and further discussion
5.1. The direction of policy frameworks
5.1.1. National Policy Statement on Urban Development (NPS-UD)
5.1.2. Resource Management Act (1991) (RMA)
5.1.3. Direction of change and other relevant policy frameworks
5.2. Limitations of our analysis
Figures
Figure 1 Productivity gains from efficient infrastructure decision-making process lead to GDP gains and improved wellbeing outcomes for New Zealand communities
Figure 2 $1.29 billion annual cost of consenting projects
Figure 3 Strategy and business planning
Figure 4 Impact of supply shortage
Figure 5 The contribution of efficient infrastructure decisions to the Treasury’s four capitals
Figure 6 The timeframe for different phases of the Expressway
Figure 7 Waikato expressway sections as defined in March 2010
Figure 8 Improvements in commercial and industrial developments
Figure 9 Change in HCV travel in the Waikato Road network (2009–2019)
Figure 10 Share of each region from GDP of wholesales, heavy manufacturing and construction (%)
Figure 11 Growth in employment density and real house prices
Figure 12 Changes in GDP of sectors by location
Figure 13 Combined impact of RM system and planning regime
Figure 14 Real PPI – Heavy and civil engineering construction
Tables
Table 1 The wider economic impact of Waikato Expressway
Table 2 Description of the Do-minimum and the Expressway scenarios
Table 3 Comparison between Parker et al.’s HCV forecast and actual growth
Table 4 Macroeconomic impact of the Waikato Expressway
Table 5 Regional impact of Waikato Expressway
Table 6 Regional employment and wages
Table 7 Industry-level outputs
Table 8 Industry-level employment
Table 9 High level housing and infrastructure outcomes of NPS-UD and the RM reform
Table 10 Regional employment and wages
Table 11 TERM sourcing mechanism
References
References
Appendices
Appendix A. The operating cost of the infrastructure sector over time
Appendix B. PECGE model description and its closure
Appendix C. Waikato Expressway – estimated costs over time
Appendix D. Sourcing mechanism in the PE-CGE model