Outcome 3

In 2019/20, the output of this outcome was Procurement Capability and Project Delivery Support through Project Support Agreements (PSAs).

Outcome: The infrastructure procurement capability of government agencies and the construction sector is improved.

Indicator 1
The projects/matters Te Waihanga supports are delivered to the satisfaction of all parties and the delivery market counterparties.
Indicator 2
Te Waihanga is regarded as a trusted advisor.
Indicator 3
Project governance best practices are in place on the projects Te Waihanga supports.
Indicator 4
Te Waihanga is driving innovation in procurement.

Te Waihanga has taken the following actions:

Project Support Agreements

A Project Support Agreement has been signed with Antarctica New Zealand. As part of this agreement we provided a range of commercial, procurement, project delivery and governance advice.

Public Private Partnership events

During the year, our Major Projects and Advisory team organised and hosted three National Public Private Partnership Contract Managers Forums in New Zealand and participated in a virtual Australia and New Zealand National Public Private Partnership Contract Managers Forum.

Public Private Partnership documentation

In August 2020, Te Waihanga was directed by the Government to oversee an interim project review of the Transmission Gully project, focusing on its procurement. This resulted in Te Waihanga publishing Report – Interim Project Review of Transmission Gully PPP Project on 20 April 2021. The review included recommendations that Te Waihanga update aspects of the national Public Private Partnership Guidance. We are currently drafting a Major Projects and Public Private Partnership Model Guidance, which will incorporate the relevant recommendations from the review.

Public Private Partnership procurement support

There are no Public Private Partnerships currently in the procurement process.

Additional information

Additional Major Projects and Advisory work that support the indicators of Outcome 3 are listed below:

Indicator 1 – The projects/matters Te Waihanga supports are delivered to the satisfaction of all parties and the delivery market counterparties

  • Te Waihanga surveyed the agencies to which we are providing project support under Project Support Agreements and received positive feedback for the Financial Year 2020/21 with a score of 8% satisfaction.
  • We continued to see a rise in agencies and subscribers contributing to the Infrastructure Pipeline, as documented in our response to Outcome 2.

Indicator 2 – Te Waihanga is regarded as a trusted advisor

Our Crown advisory work:

  • Provided independent advice to the Crown in relation to the Auckland Light Rail project and the Establishment Unit. Providing advice to the Establishment Unit and acting as an observer to its Board.
  • Supported the New Zealand Upgrade Programme – Transport Oversight Group.
  • Supported the Treasury as a member on the Capital Panel.
  • Supported the Ministry for the Environment in the Fast-Track Consenting process
  • Completed the interim review of the Transmission Gully project.
  • Commissioned the Construction Sector COVID-19 Recovery Study.
  • Advised the Crown in relation to issues emanating from its Public Private Partnership portfolio of projects.

Agency and other support work:

  • Project Support Agreements with Antarctica New Zealand.
  • Member of the Let’s Get Wellington Moving Funding and Finance Committee.
  • Member of New Zealand Upgrade Programme – Transport Oversight Group for transport project (managed by Te Manatū waha Ministry of Transport).
  • Review of business cases from several district health boards, including Counties Manukau, Nelson Marlborough, Northland, and Capital & Coast.
  • Review of the business case for the Institute of Environmental Science and Research’s proposed Kenepuru development.
  • Review of the business case for Ara Poutama Aotearoa Department of Corrections’ three waters programme.
  • Review of the business case for Te Tari Taiwhenua Department of Internal Affairs’ Tāhuhu: Preserving the Nation’s Memory programme, and providing project governance support.
  • Supported the Ministry of Education’s procurement process for the co-location of Marlborough Girls’ and Marlborough Boys’ colleges to a new shared campus.

Other:

  • Member of the Investment Officials Group facilitated by Te Tai Ōhanga The Treasury which is focused on improving the investment management system.
  • Member of the public-sector Crown Construction Collaborative Construction Forum which is an engagement between a range of central government and local government organisations regarding future major projects. The Forum includes the Ministry of Education, Ara Poutama Aotearoa Department of Corrections, Waka Kotahi NZ Transport Agency, Te Manatū Waka Ministry of Transport, the Ministry of Health, the Ministry of Justice, Manatū Kaupapa Waonga New Zealand Ministry of Defence, and high- growth councils, including their council-controlled organisations.

Indicator 3 – Project governance best practices are in place on the projects Te Waihanga supports

  • We have established a Te Waihanga project governance team and a long-term strategy. The team will implement best practice on the projects we support.
  • Under the Project Support Agreement with the Ministry for Primary Industries, we are working closely with the Programme Governance Board and programme team to establish best practices and improve the governance framework.
  • Best practice governance advice is provided on business cases that are reviewed by Te Waihanga.

Indicator 4 – Te Waihanga is driving innovation in procurement

Public Private Partnerships Programme:

Te Waihanga published its New Zealand Public Private Partnership Model Review in January 2021. The recommendations proposed a series of actions to improve the performance of the Public Private Partnership model in New Zealand. In addition, Te Waihanga is responsible for several recommendations arising from the independent Transmission Gully Interim Review. The majority of recommendations from both reviews can

be achieved by updating the guidance for Public Private Partnerships and their application in New Zealand. We have commissioned KPMG to support a comprehensive review of the current guidance and this will be complete in 2022. A further output of the review will be a clarification of the respective roles, responsibilities and expectations of Te Waihanga, the Treasury and agencies that are party to Public Private Partnership Project Agreements.

Construction Sector Accord workstreams:

We are a Steering Group member of the Construction Sector Accord, which is a joint commitment by government and industry to work together to create a high-performing construction sector for a better New Zealand. In February 2021, we appointed a Special Advisor as part of our Major Projects and Advisory team to lead our work with the Accord’s Transformation Delivery Group and co-lead the procurement and risk workstream.

We were proud to become an early adopter of the Construction Sector Accord Network in April 2021. The Network is a collective of national businesses and central government agencies and organisations committed to a higher-performing construction industry. In becoming a member of the Network we aim to uphold a set of principles and behaviours that will drive a positive construction industry. In doing so our goal is for the construction sector to increase productivity, improve resilience, raise capability and build confidence, pride and reputation.

We are currently working with the Accord on several initiatives, including:

  • a guide to COVID-19 risk management
  • revising the Standards New Zealand NZS 3910:2013 conditions of contract for building and civil engineering construction
  • establishing a panel of competent persons to act as ‘Engineer to the Contract’ and administer NZS 3910: 2013 construction contracts
  • developing practical guidance for construction procurers to achieve broader outcomes
  • developing a Capability Framework for construction procurement leaders, targeting the education and training needs of procurers.

Other procurement-focused actions:

  • A calibration study of the Better Business Case framework between New Zealand and Australia.
  • A study of the role of price in tender evaluations.
  • A health infrastructure review that looks at the delivery of health infrastructure in New Zealand and New South Wales and Victoria in Australia, with a view to advising on changes to the health infrastructure system and the Ministry of Health’s Health Infrastructure Unit to ensure the forecast unprecedented level of investment in the next decade can be made successfully.
  • A review of the market-led proposals framework and a review of the existing New Zealand guidance.

 

Measuring performance

Measure Activity  Target 2019/20 Outcome 2019/20

Te Waihanga is a trusted advisor, and the project support delivered by Te Waihanga is to the satisfaction of all parties involved.

Project Support Agreement engagement survey.

65% satisfaction.

Achieved*

Engagement with central and local government agencies.

Number of projects supported through Project Support Agreements

and

value of projects supported through Project Support Agreements.

Report on the activity.

Achieved**

The New Zealand Public Private Partnership Programme is coordinated by Te Waihanga.

Hold quarterly Contract Managers Forums and have closer integration with Australian contract managers.

Quarterly Contract Manager Forums.

Achieved***

*8% achieved a rating of 3 or higher on a scale of 1-5 from the three surveyed entities.

**Three projects supported through Project Support Agreements with a total value of NZD$2.8 These projects were: Ministry for Primary Industries - PHEL, Scott Base redevelopment, and New Zealand Defence - Accommodation Messing and Dining.

***Quarterly Contract Managers Forums