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National
Infrastructure Unit
Publication

Infrastructure: Facts and Issues: Towards the First National Infrastructure Plan

Analysis

252. In terms of broadband uptake, the diagrams that follow demonstrate that New Zealand is catching up with the OECD average, and our overall ranking in uptake (measured by broadband subscribers per 100 inhabitants) has increased from 22nd out of 30 OECD countries in 2003 to 19th out of 30 in 2007. The number of broadband subscribers in New Zealand now exceeds the number of dial-up subscribers.

New Zealand's Broadband Uptake 2003-2007
New Zealand's Broadband Uptake 2003-2007.
Source: OECD
OECD Broadband subscribers per 100 inhabitants, by technology, December 2007
OECD Broadband subscribers per 100 inhabitants, by technology, December 2007.
Source: www.educationcounts.govt.nz

253. The relationship between investment in ICT and growth is one that has been widely considered. The Economist Intelligence Unit (EIU) published a report “Reaping the Benefits of ICT”[65] in 2004 identifying three specific areas in which ICT impacts GDP:

  • ICT investment;
  • ICT production; and
  • Increased productivity arising from ICT usage.

254. The EIU considers that the biggest pay-off from ICT is from sustainable boosts to productivity growth throughout the rest of the economy in the ICT-using sectors.

255. In its 2006 World Telecommunications Development Report,[66] the International Telecommunications Union (ITU) observed that the most important economic impact of the spread and use of ICT is in transforming the way individuals, businesses and other parts of society work, communicate, and interact. It notes that measuring the economic impacts of the spread and use of ICT is particularly difficult given the nature of ICT as “enabling” or “General Purpose Technologies”. While the extent of the impact differs across countries, there is a general consensus that ICT has a positive impact on economic growth by increasing productivity.

256. Although ICT has different impacts across countries, the impacts are most visible in those countries and areas that have the highest ICT penetration levels. Some examples of the benefits include:

  • E-commerce - this allows companies to reduce production, administrative and sales costs and increase revenues;
  • Teleworking - saving people and businesses time and money, and reducing traffic congestion and its environmental impacts
    • Over 10 per cent of the 100,000 employees at British Telecom (BT) worked from home during 2006. BT estimates that ICT-enabled telework allows the company to save over GBP £60 million per year; and
  • E-government services
    • A 2005 study by the EU confirmed that e-government services were producing real benefits for EU citizens, governments and businesses by saving time and increasing flexibility. Online income tax declarations save European taxpayers an estimated 7,000,000 hours per year. When generally available and widely used in all member states, such e-services have the potential to save over 100 million hours each year.

257. Because of the link between ICT and growth, the government has decided to invest $1.5 billion in rolling out fibre-optic cable to homes, as detailed in the Planned Investment chapter later in this document.

Notes

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