5. Question No. 5—TransportCHRIS BISHOP (National—Hutt South) to the Minister of TransportQuestion No. 5—Transport5. CHRIS BISHOP (National—Hutt South) to the Minister of Transport: Is it correct that the Government is assessing only two bids for the Auckland light rail project—one from the New Zealand Transport Agency and one from NZ Infra—and if so is he confident that the Crown will receive value for money from this procurement process?Hon PHIL TWYFORD (Minister of Transport): After years of under-investment in our largest city's transport system and the gridlock that that caused our Government is determined to build the transport networks that a modern international city needs. It's not correct to characterise the process as containing only two bids. Cabinet has asked the Ministry of Transport (MOT) to run a competitive process between two approaches. One is the proposal from NZ Infra which would see it finance build own and operate the light rail lines and the other approach being developed by the New Zealand Transport Agency (NZTA)—[Interruption]SPEAKER: Order! Some of us are interested in the answer and yelling it down is not good enough.Hon PHIL TWYFORD: It's not correct to characterise the process as containing only two bids. Cabinet has asked MOT to run a competitive process between the two approaches. One is the proposal from NZ Infra which would see it finance build own and operate the light rail lines and the other approach being developed by NZTA would include the more conventional public-private partnership (PPP) or design and build models. Early next year Cabinet will decide which of these two approaches it prefers and of course value for money will be central to that decision. In either case there will be huge opportunities for the private sector in delivering this project.Chris Bishop: Why did the Government not publish the requirements document which set out the objectives it required from the Auckland light rail projects and then solicit bids from the market?Hon PHIL TWYFORD: As I said it's a competitive commercially sensitive process. The requirement documents are commercially sensitive but the member can see if he goes to the Ministry of Transport website that the following objectives have been set out for the project: improved access to employment education and other opportunities. This is fundamentally a transport project. It's about providing high-capacity efficient and high-speed rapid transit across the city but there are other objectives: an enhanced urban environment enabling of quality urban development in places like Māngere Onehunga and Mount Roskill and a high-quality service that's attractive to users. This Government is the first Government to invest in the vision that Mayor Robbie had 40 years ago. We're not delaying and prevaricating and constantly putting off as that Government did when they were in office.Chris Bishop: How does he know that the New Zealand Transport Agency and NZ Infra approaches represent the best value for money for the light rail project when he has never gone to the market and solicited bids from other possible infrastructure providers?Hon PHIL TWYFORD: The decision that Cabinet made to institute this two-track process was informed by a market-sounding exercise by NZTA that engaged extensively with the private sector infrastructure construction and finance community. But all of these decisions including the design and the configuration of the networks—the work is under way now including value for money in the cost of those projects. That information will inform the Cabinet decision early in 2020.Chris Bishop: Why once the Government had received the unsolicited bid for light rail from NZ Infra did he not open up the bidding to the whole market to ensure value for money for taxpayers?Hon PHIL TWYFORD: Because based on due diligence by the Ministry of Transport a competitive process has been set up which allows the private sector—Chris Bishop: Between two bidders.Hon PHIL TWYFORD: No it allows the private sector to bid into a process. The NZ Infra proposal is a unique and compelling opportunity to invest the New Zealand Superannuation Fund funds and their Canadian partners in a public-public model that hasn't been seen in this country. Given how keen that side of the House is on PPPs I'm surprised that they don't want us to investigate this option.Michael Wood: Why is light rail needed for Auckland?Hon PHIL TWYFORD: That's a very good question. Congestion in Auckland costs hundreds of millions of dollars every year in lost productivity. The city's growing by 40000 people per year—[Interruption]SPEAKER: Settle—both sides!Hon PHIL TWYFORD: Every year there are between 10000 and 12000 extra cars on the road in Auckland. We cannot go on allowing our country's biggest city to grind to a halt. We have to invest in modern rapid transit systems and that's what this Government is determined to do.Chris Bishop: Why did the Government ask the New Zealand Transport Agency to assess the NZ Infra unsolicited bid for Auckland light rail when the transport agency was developing its own proposal for light rail at the same time?Hon PHIL TWYFORD: In 2018 Cabinet asked NZTA to put aside the preliminary work it had been doing on the light rail project and do an assessment on both the NZ Infra unsolicited proposal and other more conventional PPP and design and build approaches. The NZTA—as Sir Brian Roche said a couple of days ago—failed to do that job properly and that's why Cabinet gave the job to the MOT.Michael Wood: What role did the earlier decision to commence work on route protection between the city and airport—including Auckland light rail—play in allowing the procurement process to proceed?Hon PHIL TWYFORD: Well significant preparatory work had been done by all of the transport agencies and in March 2017 Simon Bridges stated that route protection for light rail was a significant step for Auckland and would secure better transport options for both Aucklanders and visitors to the city. The then transport Minister also advocated a staged integrated transition to light rail along the preferred airport-to-city route. For once I agree with Simon Bridges.