Rebuild of central Christchurch in Treasury's red zone

Thursday 7th April 2016

Treasury analysis of the government's major investments has highlighted major issues with the delivery of anchor projects in central Christchurch as part of the Canterbury rebuild.

In its Major Projects Performance Report July to October 2015, the Christchurch Central Delivery Programme is the only project to be labelled as 'red'. The document says that this colour means that "successful delivery of the project requires changes to budget, schedule, scope or benefits. There are major issues with project definition, schedule, budget, quality and/or benefits delivery, which don't appear to be manageable or resolvable without such changes being made".

The Treasury is particularly concerned about the governance and transition of projects from the Canterbury Earthquake Recovery Authority to new entities. A further view on this has been redacted from the public version of the report in order to "maintain the effective conduct of public affairs through the free and frank expression of opinions". The transition is labelled a "significant risk" with project planning and transition planning "not well linked".

The redevelopment of the Avon River Precinct between the Antigua Boatsheds and Fitzgerald Avenue is labelled as a particular concern. The initial design contract has been terminated and the projects costs are currently being reviewed. While some of the Treasury's observations are redacted in order to protect the commercial position of the person who supplied the information, the Treasury says that the design is currently being altered in order to meet the budget by avoiding the need to divert underground utilities.

Some elements of the Canterbury rebuild have improved in the Treasury's view. The Residential Red Zone Programme which co-ordinates and manages the acquisition and management of land in the residential red zone has moved to an amber rating from an amber/red rating, mainly because litigation risks have been mitigated through offers for both uninsured and insured properties.

Finance Minister Bill English said a follow-up report to be released in coming months would show the Christchurch Central Delivery Programme downgraded to amber/red from red "and we expect that to further improve.

But Labour's Canterbury spokesperson Megan Woods said the Treasury's concerns were a clear warning that the government "is botching the rebuild of our central city and at risk of botching the transition. These warnings must be heeded and the minister must change his approach".

(BusinessDesk)

BusinessDesk.co.nz

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