Time to bring back MoW?
When the new Christchurch stadium is completed it will be the second-most expensive rugby stadium in the world on a per-seat basis in decades, yet few believe it will end up being the second-best in the world – so what are we paying for?
A recent Insights report by the Infrastructure Commission uses the stadium as an example of how the cost of mega projects in New Zealand ends up blowing out – seemingly out of proportion to other large projects overseas.
The idea of a return to the Ministry of Works (MoW) isn’t suggested in the report, but there is a suggestion we look at growing the government’s internal capacity to plan infrastructure projects.
For some, the colloquial ‘‘Uncle MoW’’ is fondly remembered as having built the country’s largest infrastructure investments while keeping New Zealanders employed. For others, it is the free-spending nativist uncle who thinks we should just borrow a bunch of money, pay one guy to build a bridge, a few more guys to dig a hole and another person to fill the hole.
Recently, though, Uncle MoW’s fans have been having a moment. It was even the subject of an 82-page First Union report last year by Max Harris and Jacqueline Paul, who seemed to argue everything wrong with infrastructure boiled down to a culture of ‘‘contracting out’’. For the most part, though, the report skipped over the real reason many infrastructure projects globally are delivered successfully: migrant labour.
This was true even in MoW days.
Tim Shadbolt’s 1971 book Bullshit and Jellybeans details his experiences of being bossed around by a ‘‘fat Yank’’ while hearing German, Italian and ‘‘Yugoslav’’ in the tunnels of Manapouri Dam while there for work.
‘‘Why couldn’t there have been a real campaign to recruit New Zealand labour so that the money stayed in the country?’’ Shadbolt asked. ‘‘It would also have meant a few hundred Kiwis trained in hardrock mining, a valuable asset to the New Zealand workforce.’’
We have forgotten the role migrant labour plays in getting these projects off the ground, even during projects that have come about more recently. We remember the success of the ultra-fast broadband roll-out, but forget the hard work of Chorus’ migrant subcontractors. Some were being exploited while putting in fibre optic cables, others suffered through the humiliation of being booked into accommodation under the names of Pākehā managers in areas of New Zealand where landlords didn’t want to rent to Indians.
The crucial point is we have to be clear about what we want the MoW to achieve. Is it about generating jobs for New Zealanders or getting things built quickly and cheaply? Because if it is about getting things built then the real value of a MoW will come from planning projects well so the government knows what it is looking for when it puts them out to tender. But if it is a crusade to generate jobs for ‘‘domestic’’ workers then we might be better off without it.
Infrastructure Commission director of economics Peter Nunns says there is a lot of international evidence in favour of the former: ‘‘There does seem to be a link between the capability that you have inhouse to do the planning and design of these large complex projects and the success of those projects.’’
A lot of the delays and cost blowouts come from government agencies tendering out jobs, but not really understanding much of the technical detail behind them. This causes companies to hike up quotes to take account of changing decisions on projects further down the road.
But other factors make a difference. Openness to foreign innovation and investment is important – windfarm installation costs have declined because the technology is largely imported.
Competitive tension is crucial too. Madrid successfully completed one of the fastest and largest subway expansions in history by hiring multiple tunnel boring teams who ended up competing on the same project.
Between 1999 and 2003 Madrid tunnelled 75 kilometres worth of track and built 39 subway stations. The frantic pace was thanks to the Madrid Metro’s president, Manual Melis. Danish economic geographer Bent Flyvbjerg says Melis viewed the passage of time as the biggest danger to the project: ‘‘Time is like a window. The bigger it is, the more bad stuff can fly through it,’’ Flyvbjerg noted.
Having endured a pandemic, a border closure and dizzying cost-blowouts many New Zealanders would find it hard to disagree – the key is to make sure a future MoW follows this philosophy too.