English Bill: Questions for Oral Answer — Questions to Ministers 
English Bill: Questions for Oral Answer — Questions to Ministers 
[Volume:645;Page:14166] 
4.  
Hon BILL ENGLISH (Deputy Leader—National) 
 to the  
Minister of Finance 
: Why does the Government now consider the Waterview Connection to be a potential candidate for a public-private partnership? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 Because it is a project of significant scale. Indeed it is the largest single roading project that we know of to make a public-private partnership a viable option because it may allow us to complete the project earlier than if it were funded from the National Land Transport Fund given the pressures on that fund. 
Hon Bill English 
: Does the Minister recall that late last year Labour ruled out the use of public-private partnerships in any form in order to score a political point on the day and in fact one Minister said Labour would die in a ditch to prevent any public-private partnership from being used in New Zealand? 
Hon Dr MICHAEL CULLEN 
: I think that could be described these days as an academic question. 
Martin Gallagher 
: Does the current pattern of road funding differ from that in 1999? 
Hon Dr MICHAEL CULLEN 
: Yes markedly. Total central government investment in land transport has increased by over 2½ times. Total central government public transport investment is almost 12 times higher and total central government spending on roading has doubled in that period. But there are still major infrastructure deficits that need to be overcome. 
Judy Turner 
: Does the Minister agree that the potential for a public-private partnership along the Waterview Connection is indicative of a relaxation in the Labour Government’s ideological position on private sector involvement in infrastructure; if so in what other areas does he foresee private sector involvement in New Zealand’s infrastructure projects? 
Hon Dr MICHAEL CULLEN 
: On the latter point in terms of telecommunications infrastructure of course the private sector plays the dominant—indeed the overwhelming—role and one of the arguments at the moment is whether the public sector should be playing a stronger role in that regard. I remind the member that the legislation that enables public-private partnerships which were not legal in 1999 when we became the Government was passed in 2003 under this Government. 
Hon Bill English 
: When Labour uses the term “public-private partnership” does it mean the definition given by the Minister of Transport who is meant to oversee this project when she said: “we already have public-private partnerships. We have the private sector building the roads; we have the public sector paying for them.”—is that what the Labour Government means? 
Hon Dr MICHAEL CULLEN 
: Very clearly we have public-private partnerships with small Ps because the private sector does by and large build roads in New Zealand. It is a long time since we had a Ministry of Works that built the roads. Most people in the context we are talking about today understand Public-Private Partnerships with capital Ps to be rather more specific around the nature of the private sector involvement in the management of the entire process. 
Rt Hon Winston Peters 
: Will the Minister confirm that the Government can borrow money at a lower level of interest than a business can and that businesses always want a profit; therefore why does the Government not just borrow the money build the required utility and pay it off over time—what is wrong with that option? 
Hon Dr MICHAEL CULLEN 
: Claims have been made over many years that the private sector through a public-private partnership mechanism will be able to deliver on time within budget and probably more cheaply than the standard public sector - led procedures are able to do. We have not done this previously because most of the projects we have had have been relatively small scale and the costs involved in doing the first public-private partnership did not make it worthwhile exploring the options. This is a $2 billion - plus project. It is therefore worth testing whether those assertions are correct. 
Hon Bill English 
: Can the Minister confirm that the real reasons the Government has mentioned public-private partnerships are that the Prime Minister wants a tunnel put through her electorate instead of a road that it will cost well over $2 billion—probably $3 billion—and that the Government would have to borrow the money or put petrol tax up even further to do so so it has decided to call it a public-private partnership? 
Hon Dr MICHAEL CULLEN 
: However expensive a tunnel might prove to be the National Party would be quite incapable of producing a light at the end of it. But more than that the deep tunnel option is probably cheaper than the alternative option of a cut and fill and certainly far easier to consent than trying to drive a road on surface right the way through existing areas. 
Hon Bill English 
: Can the Minister confirm that in fact Labour has been opposed to public-private partnerships the whole time it has been in office and that all it announced the other day was its intention to set up a committee to look at an option for something that cannot work under current legislation? 
Hon Dr MICHAEL CULLEN 
: Well that is certainly more precise than anything we have heard from National so far in any of these areas. But more than that the member needs to remind himself that this Government went to the trouble of passing legislation through Parliament to enable public-private partnerships which were illegal—and which party voted against that legislation at every point? The National Party voted against it. 
Keith Locke 
: Point of order—[ 
Interruption 
] 
Madam SPEAKER 
: We have a point of order. If members interject they will leave the Chamber. 
Keith Locke 
: I seek leave to table an article from the Melbourne  
Age 
 showing that a toll-funded public-private partnership motorway was much more expensive than if it had been publicly funded. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? Yes there is objection.