Source: New Zealand Infrastructure Commission
Research by the New Zealand Infrastructure Commission, Foundations for Growth: How infrastructure can increase productivity, spotlights the role of infrastructure in driving productivity and economic growth.
“Productivity is essential to lifting our living standards. It’s about being able to get more value out of the time we spend working, while sustaining our natural environment. In turn, infrastructure plays a key role in productivity growth – by tying together our cities and regions, connecting us with global markets, and helping us adopt new technologies,” says Peter Nunns, General Manager – Strategy at the New Zealand Infrastructure Commission, Te Waihanga.
” Foundations for Growth shows that while infrastructure is important, simply investing in new assets may not be a panacea for growth. What matters more is that new infrastructure tackles genuine ‘bottlenecks’ that are holding us back and that the infrastructure we already have is being used efficiently.
“The infrastructure we’ve built up over more than 150 years – our roads, electricity and water networks, hospitals, schools, and more – underpin our current economy. We need to ‘fix the foundations’ first if we want to keep growing, which means investing enough in maintenance, renewal, and resilience against natural hazards to retain the services we rely on,” Nunns says.
“Sometimes, we can get better value from infrastructure we already have. For example, the Commission’s research shows we get less ‘bang for buck’ from our road network than our OECD peers.
“We can boost productivity by enabling more growth in areas with good transport access, improving safety and efficiency through targeted investment, and using time-of-use pricing to fix urban congestion.
“New infrastructure can make a big difference to growth during periods of rapid technological change or significant demographic shifts, like urbanisation and population ageing. Projects that are timely, cost-effective, and well-targeted to emerging needs can help by unlocking ‘bottlenecks’ to growing and transforming our economy,” Nunns says.
“Projects that served our economy best in the past may not be the right fit for the future, however. As economies develop, the value we get from investment in digital infrastructure and energy infrastructure tends to rise, while average returns from transport investment tend to decline.
“As Foundations for Growth highlights, if we want our infrastructure to generate the greatest value for the people who use it and grow our economy, the good news is we know what it takes: a strong focus on planning ahead, choosing projects that stack up economically, and using the right tools to pay for them,” Nunns says.
The report was published alongside the National Infrastructure Plan, which represents the Commission’s advice to the Government on infrastructure investment over the next 30 years.
“Our long-term investment advice in the National Infrastructure Plan reflects the findings in Foundations for Growth. It maps out a path for lifting economic performance through infrastructure investment.
“Improving productivity isn’t about spending more, but investing carefully and strategically. We need to make sure every dollar we invest in infrastructure works as hard as possible for New Zealand’s future prosperity,” Nunns says.
Notes
- Foundations for Growth: How infrastructure can increase productivity, New Zealand Infrastructure Commission, February 2026, and a set of key findings is available at: https://tewaihanga.govt.nz/our-work/research-insights/foundations-for-growth
- The Commission will be offering a webinar on the findings from this work on 14 April from 12.30 to 1.15. To register: https://tewaihanga.govt.nz/news-events/foundations-for-growth-how-infrastructure-can-increase-productivity
