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National
Infrastructure Unit
Publication

National Infrastructure Plan - March 2010

Regulatory Issues

Our vision is that New Zealand's transparent and lean regulatory environment will balance the interests of different stakeholders, allocate property rights efficiently and provide for decision-making processes that give the private sector the confidence to invest in infrastructure in New Zealand, and to partner with central and local government.

In the context of infrastructure, the objective of regulations is to ensure sufficient certainty and consistency for business to operate competitively and with confidence, and with minimum transaction costs. New Zealand's productivity performance has been very low by international standards (22nd out of 30 OECD countries) and there is concern that this may in some part be the result of the cumulative cost of compliance, particularly on small businesses. Consequently, the Government has initiated a regulatory review programme to identify and remove inefficient and superfluous regulation.

The regulatory review programme's general principles for good regulation include that they:

  • be the minimum necessary to achieve its objectives, having assessed costs, benefits and risks
  • be as generic and as simple as the sector allows
  • be appropriately durable, predictable and adaptable
  • where appropriate, accord with international best practice while being mindful of our commitment to a single economic market with Australia
  • minimise compliance costs imposed, and
  • aim to minimise adverse impacts on:
    • innovation and investments
    • competition
    • individual responsibility (with appropriate risk balance), and
    • property rights.

In conjunction with this, the Infrastructure Plan will have a particular focus on identifying and reducing existing hurdles to investment in infrastructure. There are a number of infrastructure-related legislative and regulatory reforms under way or in progress, as follows.

Resource Management Act

The Resource Management Act 1991 (RMA) is the principal legislation for managing New Zealand's environment and allocating natural resources. It aims to provide a regulatory framework that enables regional and territorial authorities to achieve integrated management of natural and physical resources, along with the effects of their use and development.

The Government believes that the RMA is creating unnecessary delays and compliance costs which are hindering economic growth and infrastructure development. Streamlining and simplifying the Resource Management Act is an important part of the Government's overall economic strategy (especially given that its programme for economic recovery includes major infrastructure investment).

As a result, the Government has launched a major reform of the RMA. In the first phase of reform, it developed a package of measures to:

  • reduce the number of frivolous and vexatious objections and appeals (including those motivated by trade competition reasons)
  • improve the processing of applications for proposals of national significance
  • establish an Environmental Protection Authority (EPA)
  • improve plan development and change processes
  • improve resource consent processes
  • improve the efficiency and effectiveness of national instruments
  • strengthen enforcement and compliance mechanisms, and
  • streamline decision making.

These measures were brought together in the Resource Management (Simplifying and Streamlining) Amendment Bill 2009, which passed its second and third readings on 8 September 2009. The Act came into effect on 1 October 2009.

Ministers' and officials' focus has now shifted to the second phase of reform, which will progress over a longer timeframe and examine a range of more complex issues. The primary objective of these reforms is to achieve least-cost delivery of good environmental outcomes, including (among other things) improving the economic efficiency of implementation without compromising underlying environmental integrity.

Specific areas for investigation include aquaculture, the role and functions of the Environmental Protection Authority, fresh water management, and urban design and infrastructure issues.

With regards to infrastructure, the Government will focus on identifying options for improving:

  • RMA designation provisions
  • central government direction on infrastructure proposals
  • compensation provisions under the RMA and Public Works Act, and
  • the interface between the RMA and the Public Works Act, and other Acts.

The work being undertaken is directed at removing unnecessary barriers and identifying new mechanisms, so that infrastructure development can be progressed in as timely a fashion as possible.

Environmental Protection Authority

An Environmental Protection Authority (EPA) was an election policy of the Government; it involved the expansion of the Environmental Risk Management Authority (ERMA) into an EPA with increased responsibilities including the national regulatory functions of the Resource Management Act (RMA). Phase one of the Resource Management Act reforms saw a transitional EPA set up in the Ministry for the Environment with a limited range of functions. Cabinet has recently agreed to expand on this as envisioned in the election manifesto. Further work is being carried out as to the exact form the EPA will take.[41]

Other reviews and legislative changes

The Corrections (Contract Management of Prisons Amendment) Act removes the prohibition on the use of public private partnerships in the management of prisons. The Infrastructure Bill changes utilities’ access to transport corridors and provides for a mandatory code of practice to manage the use of transport corridors by utilities.

There are also a number of reviews under way including Air Quality regulations, Telecommunications Service Obligations, the Land Transport Management Act 2003, the Public Transport Management Act 2008, the Local Government Act 2002, the Building Act 2004, the Climate Change Response Act 2002, the Dairy Restructuring (Raw Milk) Regulations 2001 (part of the Dairy Industry Restructuring Act 2001), the Food Act 1981, the Watertight Homes Resolution Services Act 2006, the Foreshore and Seabed Act 2004, the Overseas Investment Act 2005 and Regulations, and the Electricity Review.[42] Complementary measures to facilitate the rollout of broadband are also being considered. These may or may not involve regulatory changes.

Notes

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