Transport Minister challenged over government contracts

Posted at 8:00am Wednesday 16 Jun, 2021

Michael Wood, centre, meets the Wharehine team along with Mahurangi-based MP Marja Lubeck and Rodney Local Board member Colin Smith.
Michael Wood, centre, meets the Wharehine team along with Mahurangi-based MP Marja Lubeck and Rodney Local Board member Colin Smith.   

Rodney firms deserve a “fair go” on bidding for government jobs, Transport Minister Michael Wood was told during a visit to Wharehine's head office in Wellsford.  

Minister Wood travelled up from Wellington on June 4th at the invitation of Rodney-based MP Marja Lubeck, having just announced $5 billion worth of infrastructure projects across New Zealand.

Wharehine managing director Rob Gibson said mid-sized companies with around 100 employees often “don't get a look in” for government contracts. He said for instance, Wharehine was not given the opportunity to bid for the Dome Valley safety improvement project.

He believes Waka Kotahi NZ Transport Agency (NZTA) only invited large Australian-owned contracting firms to bid. The contract was awarded to Fletcher subsidiary, Higgins.

“We don't want handouts, we just want the opportunity to make our best offer,” Rob said.

He said backroom negotiations resulted in budget blowouts akin to the cost of Penlink, on the Hibiscus Coast, increasing from $411 million to $830 million.

“All that money doesn't have to go offshore,” he said.

Minister Wood agreed, saying the Government spent $51 billion a year on goods and services and it ought to benefit the communities in which it was spent.

He said that government ministers did not influence how Waka Kotahi awarded contracts, but he would remind it of the importance of using local contractors where possible.

He added that the Ministry of Business Innovation and Employment, along with Economic and Regional Development Minister Stuart Nash, were reviewing how government contracts were awarded.

“We do want competitive tension and for medium-sized businesses to thrive,” Mr Wood said.

NZTA's director of regional relationships Steve Mutton and chief transport planner Paul Glucina were scheduled to attend the meeting, but were absent.

Meanwhile, Minister Wood announced this month that a number of previously promised projects, as part of the NZ Upgrade Programme, would be scrapped due to budget blowouts.

However, the planned Penlink connection between State Highway 1 and Whangaparaoa was retained.

A new railway spur between the northern line and Northport, at Marsden Point, was also introduced to the NZ Upgrade Programme. It will see two million tonnes of freight for export moved through Rodney annually.

When asked about the Warkworth to Wellsford motorway, which was consented but not funded, Mr Wood said the project would not yet provide a “resilient transport outcome”.

He said objectives set by the Climate Change Commission had “raised the hurdle” for approving motorways. Further, he said the more motorway that was built, the higher the annual maintenance budget would become.

On tolling the Puhoi to Warkworth motorway, Mr Wood said he was keeping an open mind while reviewing evidence and he expected to make a decision within the next two months.


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