The Crown Financial Institution would combine several entities into a single umbrella agency named the National Infrastructure Bank which would provide advice and finance to local and central government projects.
It would act as a "careful steward" over infrastructure and provide clear lines of accountability, National says.
The Bank would consolidate:
• New Zealand Green Investment Finance Limited
• Residual holdings at Crown Irrigation Investments Limited
• Loans made by the Provincial Growth Fund
• Other loan portfolios across the Crown balance sheet where appropriate
In its policy document, National said infrastructure banks provide a "long-term perspective" on financing and developing infrastructure, act as a bridge between government and private investment and increase the availability of finance for infrastructure projects.
The infrastructure bank would also be an opportunity for institutional investors, like ACC, KiwiSaver providers, NZ Super Fund and Australian pension funds, to take on investment risk in local assets.
It would be governed by an independent board "appointed for their expertise in infrastructure finance and public sector debt management" and would employ professionals with valuable technical, legal, financial and economic appraisal skills.
"It will take an intergenerational, long term approach to finance of infrastructure in New Zealand," the policy document said.
National's finance spokesperson Paul Goldsmith used the example of the three waters network reforms as a project which would cost several billions of dollars over the coming decade.
That project would require a "co-ordinated and disciplined approach to planning and financing", Goldsmith said.
"We recognise the need for effective management of the vast sums of debt being borrowed to make sure it is carefully managed and well deployed.
"Our infrastructure bank will provide clear lines of accountability to not only ensure value-for-money, but also deliver tangible assets that underpin future development in the form of better resourced schools, health services, roads, water provisions and housing."
National said other projects the Bank could support included financing new toll roads through long-term bond finance in collaboration with NZTA, funding green projects, co-funding for schools and helping councils unlock housing and commercial development with loans tied to targeted rates and development contributions.
The Bank would hold a nominal amount of equity capital from the Government and existing capital would be re-allocated from the organisations it would consolidate.
Funding for the bank would come from a consolidation of baseline funding from the various entities, including $8 million from Crown Infrastructure Partners and $5 million per annum for the Green Investment Fund.
Full costings would be decided following the final operational design, said National.
The party's infrastructure spokesperson Chris Bishop said the Labour-led Government had taken "a clumsy and incompetent approach to infrastructure investment".
"Just look at the Provincial Growth Fund, the lack of delivery in the Green Investment Fund and the lack of clarity over shovel-ready infrastructure projects. Loans have been paid-out with no plan or purpose.
"Our infrastructure bank will act as a careful steward of our infrastructure programme, providing vital leadership and capability in the public sector as these intergenerational assets are developed."
National leader Judith Collins announced the policy at Forsyth Barr in Wellington today.
"A key part of National's plan to deal with the current economic and jobs crisis is to deliver world-class infrastructure that grows our economy and to gets Kiwis back to work.
"To do that we have to invest, and every dollar borrowed must be spent wisely on projects that improve our economy and build productivity."
National said the infrastructure bank would:
• Provide leadership and capability in the public sector for long term infrastructure development
• Fund new infrastructure projects for the Crown and local government.
• Provide opportunities for institutional investors and iwi to invest in financing long-term infrastructure assets.
• Develop a portfolio approach to managing infrastructure debt and associated risks, in association with the Treasury.
• Provide advice and expertise to the Crown on financing models for infrastructure.
• Ensure the Crown receives value for money from its infrastructure finance structures
• Actively monitor the debt portfolio and recycling funds over time.
• Develop and implement commercial models that unlock co-investment.
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Comments
This nonsense appears to be straight out of the old Social Credit Party playbook. Talk about scraping the bottom of the barrel. National will next be suggesting that the Reserve Bank print off all the extra $$$$$ needed to fulfill their empty promises.
Forget 'back to the future', Collins is screaming 'forward to the past'.
But let's just imagine how this would play out if it were to happen, Collins would use taxpayer money to create a bank to loan money to rich people, and would then revert to the Privatization Strategy of old, and sell the bank to the rich people for a pittance.
Thus the circle would be complete, the poor would be much poorer, and the rich would be much richer, and the potholes and broken bridges would be Labour's fault.
Collins isn't stupid, but she thinks voters are stupid enough to be ripped off twice with one policy.
So create another government asset using our money, that can be sold for a profit or not, because we all know how good governments are at asset sales. What happens to our investments then? I would pull out of Kiwisaver right now rather than let a 'new' bank get there grubby mits on it.