The Ministry of Works and Development, formerly the Department of Public Works, was founded in 1876 to push through Julius Vogel’s central government reforms. From this instrument of colonisation the MoW developed into a genuine nation building tool that benefited all New Zealanders. Yet in 1988, at the height of the neo-liberal free market reforming era it was dis-established and privatised.
For New Zealand to recover from the Great Covid-19 Recession (GCR) will require a stronger expert-led public service to successfully guide the redeployment of the nation’s resources. Whole industries, like tourism have sustained a body blow that will permanently change their nature. In particular, new purpose will need to be found for the rapidly expanding numbers of unemployed.
The Ministry of Works may need to be re-established. The MoW was extremely multifaceted, in the past it led the governments capital investment approach to developing New Zealand. The MoW had an ethos of nation building.
In the future, the MoW being a unified public service specialising in capital works, could take responsibility for forming and following through with the democratically determined strategic direction for re-making New Zealand.
A useful way of describing a public building approach to governance is the difference between positive and negative planning as articulated by Professor Alan Evans in his book Economics and Land Use Planning, (2004, P.176–180). He describes two types of plans for the built environment:
- Positive planning where the government buys the land (outright or in partnership with the landowners) and builds what it understands should be there, benefiting from the capital value uplift the developed properties creates, to fund, in part or in whole, the infrastructure provided (note local or central government may also gain rising tax revenue as a result of the economic activity induced by the public works that could also fund the infrastructure provided).
- Negative planning is the use of district plans and planning rules to prescribe or proscribe what types of land-use development can occur in an area. Yet how much and what type of built environment that is actually constructed is determined by the private sector, as long as they act within the boundaries of the planning rules.
Positive planning for towns and cities is a government-led method of constructing much of the most critical parts of the built environment in a way that the urban area can achieve low land prices that is affordable for housing, business and workers. Positive planning can be as competitive as the alternative affordable urbanisation method -an absence of planning -that allows the private sector to develop land with no rural urban growth boundaries or other land-use restrictions.
The positive planning approach has the advantage of maintaining a compact city configuration.
This contrasts with the negative planning approach (which is New Zealand’s current default with RMA District Plans) which can only achieve compactness by imposing urban growth boundaries or other land-use rules that increase land prices.
The positive planning approach and variations on it have been successfully implemented in several countries in Europe and Asia.
Examples of positive planning specific to city-building, was the planned integration of urban development with rapid transit (rail) used in New Zealand’s state housing boom of 1937 to 1955. Especially in Wellington. The planned extension of this model to Auckland and Christchurch did not occur due to a change in central government direction (Slow Train Coming: The State Changes its Mind about Auckland Transit 1949–1956, by Christopher E Harris, PhD -Planning, 2005).
A kind of positive planning was also a feature of many early European settlements in New Zealand, such as the pre-planned communities of Christchurch, Wellington, Nelson and Dunedin, where the gains from provincial government land sales at the so-called ‘sufficient price’ was used to fund infrastructures and cultural amenity (C E Harris, 2005, P.8). Or to characterised it another way, infrastructure and cultural amenity was funded by the resulting uplift in the value of government land holdings which could be sold once the ‘sufficient price’ was achieved.
Auckland’s land-use development (both the city and the rural hinterland down into the Waikato) had a different history that evolved into a model that was more about the private sector, legal and financial entities, and land speculation. It also involved some pretty unsavoury war-profiteering.
In the past the MoW took the positive planning approach to making New Zealand. In partnership with elected representatives they identified projects that would advance the development of the country. The MoW had their own economists who could evaluate and determine how nation-building projects might fit into wider considerations, such as, the economic cycle. The Ministry was at odds with a neo-liberal Treasury, as it could hold its own in economic debates. Given this fight for political-economic attention it is not surprising the MoW was dis-established.
Whether the old MoW is resurrected or if a new modern structure with a similar purpose is created, I am sure the construction community would prefer to be led by their own people much like the health community does. Leadership instilled with knowledge, science and expertise from years of professional practice, so they are at the top of their game.
Also, I am sure there were problems with the public sector approach. Gold plating? The civil service acting as if they were the permanent government (Yes Minister)? And communism has never worked anywhere? A balanced approach is probably best.
Thesis — > Antithesis — > Synthesis.
State as only developer — > Neoliberal Wild West — > Balanced public and private sector model; coordination plus competitive tension.
1870s - 1940s — > 1950 - 2020 — > 2020+? (H/T Patrick Reynolds)
The positive versus negative planning concept can be expanded from describing the building of public civil works to describing the wider New Zealand public service. Being the current ethos is that many government departments ‘negatively’ plan/contract what separate providers then do.
Meaning many government departments lack the expertise to take a ‘hands on’, ‘in-house’, ‘do it themselves’ approach. The departments are silos mostly led by generic managers without a background of expertise in the core competency of the department. There is little evidence these managers see their role as taking responsibility for remaking a better version of New Zealand.
This is no accident. This is the worldview of Treasury who prevailed to embed neoliberal free market reforms in the 1980s and 90s. Two of the key pillars of these state sector reforms were the ‘funder-provider split’ and the adoption of a ‘new public management’ model for running the civil service.
The neo-liberal reforms replaced the old model of a career public service, headed by senior figures drawn from within the public service ranks, and directed by ministers who through the democratic process were publicly accountable for the delivery of public services.
The public service was reconfigured to operate under a managerial model, with outside appointees on short-term contracts. Many services were delivered by third parties under the Treasury’s model of a contractual funder-provider split. Government departments were often stripped of professional expertise in favour of generic managers.
The Director-General of Health, Dr Ashley Bloomfield, is a conspicuous and fortunate exception to the general rule of having departments headed by non-specialist managers who do not understand the core business of their organisations and don’t have time in their short contract terms to learn that core business.
Dr Bloomfield’s success in leading the public health response to Covid-19 raises the question of ‘what else could the team of 5 million that is New Zealand achieve given expert leadership’?
New Zealand’s successful fight against Covid-19, as an example of an expert-led government department responding brilliantly to challenging circumstances, may lead to a desire from the public for change in the management ethos of the wider public service.
For example, some engineers have informed me the current Building System Legislative Reform Programme is not the full revolution required for the construction sector. That it is about shuffling other people’s liability, whether it be reducing council liability, having insurance pay for when things go wrong, reducing what activities an engineer can undertake and increasing fines and jail sentences.
These building reforms fit into the category of the ‘negative’ approach, expecting the private sector to be the ‘doer’, while the public sector limits itself to a regulatory guidance role only. The negative planning approach risks the public sector losing the connection that allows those who gain on-the-ground expertise in implementing successful new public works and services being able to rise to positions of ministry leadership.
The proposed New Zealand Infrastructure Commission -Te Waihanga, appears like it is going to be an independent body. Independent means siloed with a very narrow remit, not leading what would be useful to do, but rather keeping to narrow advisory objectives. Independent can mean disconnected and dissonant.
As to the future of construction, given New Zealand’s size the best way to keep up with technology advances would be to have a strengthened MoW.
The private construction sector struggles enough not to go bust, let alone to keep New Zealand’s construction technology progressing in a systematic manner. In Japan they have eight large construction companies that develop technologies, but our construction industry is not of the scale of Japan’s. Other Asian countries like Taiwan have an equivalent of a MoW, at least in terms of progressing earthquake engineering.
Engineering colleagues have informed me that in many cases the MoW led technology transfer. For example the Ngauranga flyover in Wellington which used the incrementally launched method (also known as a push bridge where it is built at one end and pushed out over onto the piers), the MoW bought the launching nose and let the contractor use it. This was then built by a private contractor.
Another example of technology transfer is for gas pipelines for Taranaki gas, an American company was brought over to do the pipe welding, as part of their contract they were to teach locals how to do it well.
In both of these examples a deliberate approach by the MoW allowed overseas technology to be transferred to New Zealand successfully, both technologies having become well established in New Zealand.
In New Zealand there is a desperate need for the quality of building work, especially in residential housing, to be raised to international standards. Technology transfer is a very important issue. It needs to be done well.
A bad example of technology transfer was the use of monolithic cladding, which is part of our leaky homes saga, that occurred after the neoliberal reforms that favoured generic over expertise management structures in government departments.
More recently the KiwiBuild housing scheme failed on several different levels. In particular there was insufficient demand, as house prices were too high for most renters to afford and the houses were too often poorly located. A considerable part of the failure though was the split between an inexperienced non-expert funder and providers who did not ‘buy into’ the vision. The private development sector did not want to change their established practices. Developers wanted to continue designing and selling housing estates that target the high end of the housing continuum with expensive bespoke housing. They did not want to reallocate resources to the mass building of more modest housing targeting the middle or lower end of the housing continuum.
It is unfortunate that KiwiBuild’s ‘buying off the plans’ funder/provider initiative has tarnished the whole concept. That this failure is inhibiting government departments ability to demonstrate prowess in areas where a government-led building process should have a natural advantage. Such as, spatially planning the integration of housing with transport infrastructures and master planning new built environments in locations that involve complex relationship building between multiple stakeholders -such as, local councils, multiple government departments, iwi, landowners etc.
More generally than the discussed housing, transport and construction examples, for the public and its elected representatives there is a danger that if an expert-led public service is not re-established then the public’s desire for effective responses to the challenges of the day will be thwarted. As the levers of power are disconnected.
It is vitally important for the future success of New Zealand that all its levers are fully functional because the challenges the country faces appear to be rising at an exponential rate. Addressing rising inequality, a housing crisis, a mental health crisis, the climate emergency and the Great Covid-19 Recession is a massive challenge. I suspect collectively it amounts to a rupturing crisis in our nation’s story. To get ahead of the curve New Zealand needs to use all its resources wisely.
This is a repost of an article here. It is here with permission.
31 Comments
Relax the whole idea of a Public Works Program is wishful thinking .........
Firstly, land for housing is so ridiculously expensive and in such short supply there is no way in hell they could ever make a mass-housing scheme work .
A waterlogged section in Glenfield costs nearly half a Million and in Greenhithe its over a million , a mortgage on the land alone is $1,000 a week or $52,000 a year payable in after-tax income .
We need to face the fact that we have a young generation called 'Renter " , get used to it
Secondly , who is going to do the work ?
The unemployed ?
Give me a break
You're right Boatman. Perhaps that's exactly why the government needs to step in and confront these problems. Because it forces them to realize that local and central government regulations have created these problems. Similar to how now that they're building houses they've realized how restrictive the RMA is and thrown the first half out the window
Time will tell, however remember governments do not have to develop for the same profit as private developers.
If you anything about development, with scale profit can represent 50%.
Governments job is to facilitate the necessities of life for all, rather than these private landbankers who's game is to control price through supply; maximising profit on the way through well socialising loses. They have had their day in the sun, and its time for them to move over.
Brendon, the ground has changed for any comparisons with the 'old' MoW versus current environment,. In particular, in those days there was no RMA, land prices (which dictate the price of anything on top) were minimal, no Worksafe to chew up large chunks of the work day in meetings and risk management, no credentialism (where now to jump on any machine demands a highly specific piece of paper acquired at a Modest Fee from some tertiary establishment), and no requirement for extensive work experience in any facet of construction. These historic omissions may all sound like the Wild West, but it would be hard to argue that standards were that much less in terms of accidents and lives lost. The current multiple layers all add expense in terms of outright costs, opportunity cost, and lower productivity. These costs are unlikely to be much less than 100% of raw material inputs.....
My total 'test' for all of F/R/W/T classes was driving an ancient Cat D6 in a figure 8 in front of a country cop in 1971. Total elapsed time 2 minutes. No test at all for wheeled loaders (Cat 922 and Hough 65), no test for rollers (numerous), graders (Cat 112 and Champion D686). No license to run quarry plant (jaw and gyratory crushers, hammer mill, gensets to power all electrics). No license to run rock drills and place explosives. No RMA to doze up gravel, walking a TD24 back and forth through the middle of the Hurunui river.
No kidding, there was simply zero environmental oversight or thought given. That's one reason why the 'old MoW' and assorted contractors of the era seemed so productive.....
My dad told me that up until the 1960's many heavy machinery contractors of note (Eg Doug Hood, who ran a huge operation, established Mt Hutt and has man-made Lake Hood named after him) started driving professionally before they were teens. There were essentially no rules, you just fronted up and learned on the job.
We have arrived at a place where the farce that was 'trickle-down' globalism/neoliberalism has been shown up as the con it always was - a get the elite richer scheme.
I have no problem with a more egalitarian approach to resources and use of same, but I would point out that both social constructs rely on resource draw-down, and both will suffer the consequences of not addressing same. The Limits to Growth are politically agnostic.
This is all deja vue. I laid bare the problems of our infrastructure and building problems on this site round the time of the Sky Convention Centre fire.
Both Labour and National governments had a hand in dismantling the Ministry of Works and the Clerk's of Works around the 1980s-1990s for no good reason. In fact, it's more than likely we would not have had the "Leaky Buildings" fiasco, nor the Convention Centre fire, nor the Pike River disaster, nor the Christchurch CTV "Leggo"building collapse, nor many thousands of smaller basket cases such as a friend of mine finding 2000 faults in an recent build down country by a so-called reputable house builder, if the politicians hadn't dsmantled these worthy institutions who up to that point in time had overseen the all the construction of NZs major infrastructure.
Not to mention the MOW properly training 2000 apprentices a year!
Pike River (Edit - oops! Ancient brain librarian misfired. Cave Creek...) was a platform collapse. Built by volunteers on DoC land, and no decent ties from the platform joists back to the big concrete block at the back. Just a few large nails. Rookie design mistake.
Pike River was single-shaft ventilated mine, roads driven uphill into known-to-be-gassy coal, vent at bottom of coal drive (!), no other vent shafts allowed because DoC. Rookie design mistake caused directly by stupid Gubmint constraints on use of overlying conservation land leaving engineers with no other design options.
CTV was a professionally engineered building with two design flaws: brittle columns, and a shear tower placed outside (!) the floor plates, tied in to those plates with inadequate sizes and specifications of material. Overseen by the local City Council. Shear tower stayed intact throughout the earthquakes, ties failed and let the floor plates go their wobbular way. Rookie design mistake.
Arguable that the presence or otherwise of MoW would have altered things: hindsight is 20/20. And competing jurisdictions (City Council, DoC, MBIE), each with turf to protect, would not have assisted matters either - neither would have been overjoyed at MoW elbowing their way in......
Re the CTV building, I often wonder whether anyone will ever be held to account for the failure of many new and near new buildings here in Wellington during the Kaikoura earthquake. I drive past the slow deconstruction of 2 of these opposite the old brick railway station. Buildings long considered 'earthquake prone' stayed standing while these modern designs suffered
the reason for having so many properly trained apprentices was a lot of very old school tradesman that had no interest in leaving and were just killing time and had plenty of time taken to show them. I learnt a lot from some very senior guys not just about the job and trade but about life.
I used to ride my bike an hour to work everyday, being young and fit and poor and used to meet up with my mentor at his house three doors down from the main gate having a cup of tea and reading the morning paper. as we would walk the last bit to work he would call me a dumb f**k every morning and tell me this
work close to work or work close to home don't waste you time or money in travel you can not get that back.
and I have kept that in mind and can walk to work or if in a hurry its less than a 5 minute car ride
NZ is now 95% urban. Few children have any practical hands-on skills. 40-50 years back most boys would play with bicycles, carts, motorbikes, model planes, tree houses, maybe dabble with guns, and certainly get exposed to building, concreting, and other labouring jobs through their adolescence. As trades got regulated and children were banned from after school jobs the understanding needed to be useful disappeared and will be very slow and expensive to develop in cadets.
Nothing like trying to stop an ancient Villiers-engine-powered concrete mixer, at the tender age of 9 or so, by shorting the spark plug to ground with a shovel, and discovering that ignition voltage rilly, rilly Shocks....
Mistake #1 - holding on to the metal tang of the shovel.
Mistake #2 - not grounding the shovel on the motor Before touching the spark plug....
May explain quite a lot about Me.....
So who is going to do the "public works " .......... the unemployed ?
We do not ( as yet) have the numbers of builders we had after the 1930's depression , nor do we have the massive number of demobbed soldiers we had in 1945- 1950 that could be retrained as carpenters .
Our new wave of migrants are all either skilled in areas such as IT or telecoms , or nurses and teachers , doctors , Pr . engineers and the like ........... they would not know one end of a nail gun from the other if you gave them one
The rest of the migrants are wealthy investor types who seemingly dont "work " but seem to have good incomes swanning about in Greenhithe and upmarket suburbs all day in new Land Cruisers , Lexuses , new Beemers and Teslas .
So who is going to actually do the work ?
As our economy struggles through the coming depression lots of tradespeople are going to take off to more prosperous Australia, just as they have for last 45 years. Govt's primary focus needs to be on creating economic conditions to retain those workers where there is an almost 50% higher average wage in Australia: https://countryeconomy.com/countries/compare/australia/new-zealand?sc=X…
IMO worst two things that ever happened to NZ were the abolishment of MOW (no doubt it needed modernizing but has a long list of amazing accommplisments!) and the privatising of electricity( by our dumbest ever PM - mind you that could change soon!) You only need to look at the long list of major roading cock-ups since the death of the MOW to see how missed it is.
All sounds logical in theory, but the real problem getting in the way of engineers fixing the country now is politicians.
What's the solution to that?
If we brought back MOW we would just be one step closer again to the dicks in Wellington who constantly want to spend precious public funds on the wrong things, in the wrong way, in the wrong timeframe.
This comment is half made in jest, but only half. For a logical person to stay in the industry being one step removed retains needed mental health. Politically driven projects break good people, or attract people willing to over promise and under deliver / lie, which is generally a politicians end game.
So sure bring back MOW but first explain what would be put in place to protect it from becoming full of under achievers and / or over promisers. You would need a particularly charismatic and capable leader, and I just can't see someone that awesome being up for that level of punishment.
Brendon, You raise a lot of excellent points. Your last sentence sums it up But comments are also very good. The idea of a "new" MOW is utopian thinking. The old MOW, and for that matter, NZ Rail, State Hydro, the old P&T, Naval Dockyards, etc., etc., were from a different era, were bywords for "mateship", benign management, and a male population often united by old WW2 unit loyalties. It was an era, as some comments here attest, when it was thought better to employ the unemployable, even if they sat most of the day enjoying smoko.
The stories of sloth are legendary.
But you are certainly right in saying that the contracts let by government need to be supervised by state employees with real expertise to spot and correct the inevitable "dodges" any private contractor will engage in to make a buck.
Also the idea of obtaining good research and technology and making same widely available to the construction industry is also sound.
But your idea of a state owned enterprise cornering all the good ideas, AND then carrying out the actual job in-house, is not, in my opinion, feasible in our small corner of the world.
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.