In August 2020, the then Ministers of Transport (Hon. Phil Twyford) and Infrastructure (Hon. Shane Jones) announced that a review would be undertaken into various aspects of the of the Transmission Gully motorway project. Those aspects were: how the project was awarded for the agreed price; whether the price was realistic; and whether the risks then identified were appropriately considered and taken into account. Issues such as whether the project represented value for money are not part of this review. The Transmission Gully motorway is the first transport infrastructure to be procured under a Public Private Partnership (PPP). As a "horizontal project" through difficult terrain, subject to significant geotechnical and environmental challenges, it has been considerably more difficult than the two previous PPP projects undertaken in New Zealand (which were "vertical projects"). This fundamental factor needs to be understood when analysing how the project has proceeded. A road through Transmission Gully was first proposed a little over a century ago. As the main route north (SH 1) became more and more congested various additional routes were considered, but Transmission Gully emerged as by far the most feasible. The main question then became what project construction model would be adopted. The PPP model had been under discussion for some time in New Zealand and, in the early years of this century, was being widely applied in some similar jurisdictions. The Confidence and Supply Agreement between the Labour-led Government and the United Future Party in 2002 provided for looking at alternative forms of funding for roading projects. In 2008 the PPP model was specifically considered in the context of the Waterview project in Auckland. In 2009, the new National Government signalled the possibility of Transmission Gully proceeding under some form of PPP as one of its programme of Roads of National Significance, though Waka Kotahi, NZ Transport Agency was not specifically instructed to consider this model until 2012. Funding pressures arising out of the high costhbrs of the Canterbury sequence of earthquakes were important in leading to this decision.gbr The model adopted, an 'Availability PPP', incorporated advanced procurement and commercial models to refine design and carry out the construction delivery of the motorway with a 25-year operating phase using defined service and performance standards. This kind of procurement model was new to Waka Kotahi and had had limited use in New Zealand. Subsequent physical, environmental, and commercial challenges in the delivery of the project have highlighted potential inadequacies in the PPP contract that suggest scrutiny and diligence of the procurement phase may be informative to future infrastructure procurement of this nature. A review at this stage is, therefore, appropriate to learn what has gone well and what has gone less well. Following Minister Twyford's announcement in August 2020, the New Zealand Infrastructure Commission, Te Waihanga sought to appoint a reviewer and were fortunate to obtain the services of Steve Richards of Brisbane, a highly experienced professional expert in this field. We were appointed by the Commission as peer reviewers to assist with the process, bringing engineering, construction, management, governance and government processes skills to the table. The review began in mid-October. We have been impressed with the way Steve Richards has gone about his task and are pleased to support careful consideration by the relevant agencies of the recommendations in this report.
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