Coalition horse-trading is the most expensive way to build a road

Every three years New Zealand rewrites its infrastructure plans, and every three years the bill for that habit grows. Infrastructure NZ chief executive Nick Leggett is now asking parties to do something politically unnatural before the election: keep individual projects out of coalition agreements altogether.

He is right. A road or rail line traded for a confidence-and-supply vote is a promise built on the wrong foundation. Businesses that build, fund and depend on infrastructure need a pipeline they can plan around, not one that resets whenever a minor party holds the balance of power.

A wish list, not a plan

The scale of the problem is hard to overstate. The national pipeline is a $290 billion wish list spread across 12,000 projects, most without confirmed funding. Against an estimated $1 trillion infrastructure deficit, the country ranks 37th of 38 OECD nations for infrastructure value for money.

Leggett’s diagnosis is blunt. He calls New Zealand “the most centralised democracy in the world… second only to North Korea” in how infrastructure decisions get made, and estimates $11.8 billion has been lost to pausing or cancelling projects. His fix, borrowed from the Nordics, is for the Infrastructure Commission to set strategy, departments to run standardised cost-benefit analysis, and Parliament to set the funding envelope with majority cross-party support.

The ferries are the receipt

If anyone doubts the cost of churn, the Cook Strait ferries settle it. Ordered in 2021 and cancelled in 2023, the project burned through $671 million including the wind-down of the iReX contract, and the country still needs new ferries.

The less visible cost is people. Industry survey data shows more than 40% of the construction sector has lost staff overseas in the past year. Contractors don’t hire apprentices or buy plant on the strength of a press release. They invest when they can see years of funded, sequenced work ahead. Remove that certainty and the workforce leaves, which makes every future project slower and dearer.

None of this is new. Back in 2024 Leggett warned that dramatic policy swings with each change of government created a “crippling lack of certainty” for the sector. In 2025 Transporting NZ was already urging parties to sign bipartisan transport pledges, arguing long-term reform cannot be delivered inside a single term.

Neither side gets a clean sheet

The coalition deserves credit for building the institutions Leggett wants to empower, including the Infrastructure Commission and its 30-year plan. It also deserves scrutiny. In 2024, then-Transport Minister Simeon Brown unveiled a $33 billion plan prioritising 17 Roads of National Significance at the same moment Chris Bishop was asking the commission to build an independent, cross-party pipeline. That was a political announcement wearing a technocrat’s coat.

Leggett now gives the RoNS a pass, arguing they are essentially construction-ready and mainly need money. That is defensible, but the projects are not beyond question. NZTA material released in 2025 showed the RoNS programme absorbing 83% of total funding while serving regions holding 76% of the population. Labour’s Kieran McAnulty attacking Bishop for promising RoNS funding is fair game politically, though it would carry more weight if Labour’s own record on cancellations were shorter.

The one hopeful sign is that Christopher Luxon and Chris Hipkins shook hands at last week’s leaders’ debate on holding bipartisan infrastructure talks within the first 100 days of a new government. Business should hold both of them to it.

The money still isn’t there

Here is the part most coverage will skip. Keeping projects out of coalition deals fixes the governance problem, not the funding one. In January 2025 Treasury advised ministers that the National Land Transport Fund was not sufficiently funded to afford the government’s programme over the medium term, and that hard choices between higher revenue, more Crown support or delayed and cancelled projects would follow. Interest.co.nz reported in 2024 that annual transport spending was projected to reach $12 billion against road revenues of $6 billion.

There has been structural progress. The Land Transport Management Act now requires future policy statements to carry a 10-year investment plan, but that covers land transport only. Infrastructure NZ’s own 2024 submission pointed to Australia, Singapore and the UK as models, stressing that “infrastructure is a means to an end, not an end in itself”.

What the next government owes business

The test for whoever forms the next government is simple. Keep project lists out of the coalition agreement, honour the 100-day bipartisan talks, and be honest about how the gap gets funded, whether through road user charges, tolling, PPPs or Crown capital. A pipeline that is depoliticised but unfunded is just a better-organised wish list. A pipeline that is funded but rewritten every term is the ferries all over again. New Zealand cannot afford either.

Sources

• RNZ: Infrastructure NZ election plea: Keep individual projects out of coalition deals (2026-10-20)
• NZ Herald: Is politics costing NZ billions in wasted infrastructure planning? – The Front Page (2026-09-15)
• NZ Herald: ’53 years in the same business and I’ve never been so short of work’ – The Front Page (2026-10-14)
• NZ Herald: Political consensus critical to the future of infrastructure – Nick Leggett (2024-08-27)
• Transporting NZ: The threat to the infrastructure pipeline (2025-09-18)
• interest.co.nz: Road-heavy transport plan does little for bipartisanship (2024-09-04)
• NZTA: OIA-17509 Annual Review 2023/24 supporting materials (2025-01-27)
• Treasury: OIA Response 20250036 – Documents regarding deferral, stopping, prioritisation or scaling of signalled transport investment (2025-03-01)
• Ministry of Transport: Government Policy Statement on land transport 2024/25-2033/34 (2024-07-01)
• Infrastructure New Zealand: Submission on the National Infrastructure Plan discussion document (2024-12-09)