Derailing Auckland - Unravelling the Assumptions

Public spending and productivity

Economic commentators call increasingly for the private sector to lift productivity  to compete in trans-national markets.  However, we hear less about the need for wise public investment as a condition of productive nations, cities, and business.  Maybe we need to hear more.  

In particular, ill-considered infrastructure imposes unnecessary costs on producers, consumers, and taxpayers. It does so directly through excessive spending and racking up liability for the maintenance and depreciation of poorly performing assets, and indirectly through the impact on credit markets. 

Governments at all levels need to take a highly rigorous approach to investment if they are to avoid undermining the competitiveness of regions.  Yet all too often major public projects are based on weak assumptions. Ideally, no public spending of substance would be undertaken without considering  the risk of getting it wrong and the regret that follows bad decisions – fiscal, economic, and political.

Risks – and the regrets

That does not appear to have been the case with the latest report justifying spending up large on a central rail link/loop (CRL) to enhance public transport in Auckland.

This post considers some of the assumptions about employment that underpin the latest argument for the $3bn or thereabouts needed to improve rail-based commuting into and around central Auckland. It compares the employment numbers projected to justify rail with recent  history.

Of course, recent history is not necessarily a guide to the future.  But forecasting significant shifts to justify the CRL calls for more convincing arguments than we have seen to date. The contingencies - events or behaviours that vary in practice from those projected - need to be analysed.  And the regret arising from getting the assumptions  wrong (which include wasted funds, reduced revenue, foregone opportunities, and fiscal blowout) need to be fully assessed.  

In this case, there is every chance that these assumptions are too weak and potential regrets too big to justify proceeding with the CRL.

 

Weighing up alternative outcomes

Assessing risk does not simply mean drawing high and low variants around a central projection.  This inevitably favours adoption of a single central forecast which, by definition, will be a compromise and countenances little departure from trend.  And if there is one thing we know about the future of our cities, it is that the events and technology we don’t expect will play a big part in shaping it.

Assessing risk means weighing up the probabilities of different events and outcomes and appraising the costs they might impose.  At the very least, a risk-averse approach would review downside rather than upside risks as a basis for sensible investment.

Projecting past mistakes

There is no sign of risk analysis in the documents promoting the Auckland CRL.  And this is a critical shortcoming with respect to the key employment projections on which the promise of unacceptable congestion without the CRL rests. 

The growth assumptions that underlie the most recent arguments about inner city congestion derive from a model developed by the now-defunct Auckland Regional Council. Projections from the model published in 2009 suggested total employment growth of 41,000 jobs between 2006 and 2011, a 6.8% gain (for a projected city total of 642,800). In fact, Statistics New Zealand’s Business Directory show just 12,500 jobs gained (from 616,230 to 628,780 – based on the new Auckland City boundaries). 

In other words, the projection published just two years earlier overshot actual growth to 2011 by over 300%!  How can we have confidence in this model, especially when in its latest incarnation the 2011 estimate is 682,000, or 53,700 (7.9%) more than the actual Business Directory count.

 

Forecasting future employment – or simply wishful thinking?

The 2031 projection on which the case for the CRL is based requires  an annual increment of 12,500 jobs a year: in the five years to 2012 the equivalent figure was just 2,600.  True, it was much higher over the preceding five years (19,000 a year) but the questions that need exploration today are (1) are we are faced with a ground shift in the economy as a result of the GFC, a complete restructuring for which the outcome remains a mystery and, if not, (2) when  might we expect the return to business as usual implicit in the model.  Because the later that happens the further astray the model projections will be and the greater the regret from overinvesting in rail infrastructure.  

In fact, there are still too many risks on the international economic horizon to have confidence that an early correction might offset the current shortfall in actual compared with projected employment.  Why risk funding a marginal increase in Auckland’s public transport capacity and patronage based on what are demonstrably over-optimistic employment growth assumptions? 

(And it is a marginal increase: according to the study, 45% of commuters into Auckland already use public transport - 8% rail.  Boosting that high level of public transport dependence, especially if at the same time we are pushing cycling, walking, and inner city dwelling as responses over-dependence on the private car is a tough challenge.  How much do we need to spend just to get a slightly bigger rail share and not, at the same time, cannibalise an effective bus system? Executive Summary, p45).

 

Where will business – and employment -- grow?

The case for the CRL depends heavily on assumptions about business growth and location.

According to the study employment in the city centre was 90,940 in 2006 (Supporting Report p.22). It projects this to reach 147,000 by 2041 (1,600 more jobs per year).  This  62% growth contrasts with  51% projected for the rest of the City. It bears little resemblance to what has gone before.

 

Between 2000 and 2012 employment in the CBD grew by 25% (660 per year) and in the rest of the City by 24% (9,460 per year).  So where is the analysis or logic to support the fundamental shift assumed, especially if it contributes, as the report suggests, to increasing congestion?  The likelihood is a return to declining CBD employment share (the long-term trend) in the interim as more firms opt for localities elsewhere. 

Or is the plan simply to reduce the location choices available to business?  Because it won't work.  If it gets too hard to locate where they want to go, or the cost of favoured land -- and rates -- get too high, then businesses may exercise their choice to leave Auckland altogether, relocating some or all of their functions elsewhere in New Zealand or overseas.  Why adopt spending policies to accelerate this process?

Back to the assumptions: when the city fringe is added, inner city employment is projected in the report to reach 203,100 in 2041.  This is 25% of an already optimistic forecast for the entire City .  This substantial gain in inner city employment share is based primarily on the CBD growing from 12% to 18% of the total – another overdose of optimism on the part of the proponents of the CRL.

So what’s the starting point?

How these figures are derived is difficult to follow in the published reports.  However, a quick analysis of whether different parts of the city are gaining or losing employment share illustrates why we should be wary of assumptions about a substantial increase in centralisation.

Between 2000 and 2012 the CBD, CBD fringe, and inner suburbs (Rest of Isthmus) all lost share to other parts of Auckland in manufacturing, retailing and wholesaling (see table, below). Production, distribution, and lower-order business services are decentralising, especially into the southern corridor. Retailing and hospitality services – considered drivers of CBD growth– have also been decentralising.  The CBD is losing share in health and social services and professional and scientific services, although some of these are still gaining on the fringe and inner suburbs. 

Changes in Shares of Auckland City's Jobs by area, 2000-2012
(Source: Business Directory, Statistics New Zealand)

Some sectors are becoming both dispersed and centralised at the same time.  Logistics, information services, and financial services gained share in the CBD and further out in the city, perhaps hiding emerging sub-sector specialisations.   Others certainly favour the CBD.  Various business services and education stand out, but these, and arts and recreation services, have not necessarily been the big movers in  the past decade and there are no strong grounds for expecting them to be so in the future. 

A self-defeating case?

The fact that the proposed CRL does not stack up  on economic grounds makes reliance on the ill-founded projections of central city employment on which it is based all the more worrying. 

If we narrow our "recent history" to just the last two years there is some evidence of a gain in CBD jobs relative to the rest of the city.  But such  centralisation is simply an outcome of recession, the geographic expression of companies consolidating in difficult times, and the rate of growth slowing slightly faster outside the CBD.  However, projecting this state of affairs forward raises interesting questions about  how far we  expect the New Zealand economy to stagnate – and what the long-term consequences will be for Auckland of it doing so.  The conditions favouring centralisation may also be the conditions that undermine the city's growth. Equally, healthy growth across the city is a precondition to a healthy CBD.

At this time of  uncertainty it is manifestly unwise to  promote substantial capital expenditure that may well lower capital productivity and incur the ongoing taxpayer and ratepayer liability  this imposes when it is more important to promote sustainable growth .  If nothing else, addressing economic and employment growth by overspending on a project of dubious merit will guarantee that the exaggerated demand projected to justify the CRL does not come about. 

Auckland Spatial Plan – Part 2: What would I do?

A sideline view

In my previous blog I expressed a concern about over-inflating the spatial plan for Auckland – promoting it as the panacea for the region’s ills.  Equally, a deterministic an approach that seeks to enforce behavioural conformity by mapping a particular urban form onto the region is unlikely to be successful.

It’s easy to stand on the sidelines and criticise, though.  What if I had responsibility for designing a spatial plan for Auckland?  Fortunately, I don’t.  But without accountability it’s easy to offer advice.  So here goes.

Can we limit prescription?

I liked Ree Anderson’s light handed approach, one that focuses on function rather than form, and priorities rather than comprehensiveness.  That’s the approach I would like to follow, one starting with how places within the region work and recognises relationships among them. This is along the lines of the network model applied to Zurich over the years, which Shane commended to us.

In keeping with this approach, let’s limit prescription. Let’s develop a framework within which people and organisations can be creative in addressing the environmental, economic, and community issues they will face.

How?  Well, I accept there do have to be bottom lines to start with, no go areas around which the plan can be developed. Then we need to address how infrastructure and land-use might evolve to support whatever growth Auckland experiences, and, finally, think about turning the whole thing into a framework for reducing uncertainty and resolving growth issues as they arise. 

We still need bottom lines

The bottom lines are the immutable, non-debatable features the community wants preserved. They will be given weight by being defined sparingly. Beyond volcanic cones, ranges, estuaries, wetlands, and shorelines they might relate to regional parks and open spaces (a town belt would be good), cultural heritage, iconic structures, critical infrastructure, and hazard avoidance.  Many of them we know about already.  Others will emerge from listening to the community. 

We cannot afford to overdo them, though, because we should be prepared to spend what it takes to secure, enhance, and preserve our bottom lines.  Relying on regulation is an inferior option.  If we cannot afford it, it may not be a bottom line that we can justify.

Make sure our infrastructure is affordable

Infrastructure is critical to community, economy, and environment.  Network services such as electricity and gas, water supply, wastewater, and drainage need to be integrated to deliver on all three fronts.  Like the transport network, they must meet the diverse demands of business and residential communities within a constrained physical – and fiscal – environment. 

The spatial plan is the place to pin down the key trunk services and their possible extensions.  It is also the place in the spatial plan to highlight the region’s critical infrastructure lifelines.

Beyond that, though, we need not rush the detail or commit to unproven investment.  The real key with infrastructure is its efficiency.  Does a major commitment lead to a commercial return?  If not, does it generate sufficient benefit to justify public expenditure?  The alternative is monumentalism – extravagant infrastructure spending for dubious returns. 

If the demand for major investment does not materialise the outcome will be lower aggregate productivity.  Over-capacity or redundant public projects add to the fiscal deficit, create structural distortions, and undermine economic performance.  The larger a project and the more imprecise the rationale, the more suspicious we should be. 

So let’s be sparing in what new commitments are written in and ensure that ill-justified works are not imposed on Auckland simply by inclusion within the Spatial Plan. Significant initiatives should be subject to the disciplines of rigorous evaluation both in their own right and as part of an informed view of how Auckland might develop.

And how might Auckland develop?

Envisioning the future

Ree Anderson suggested differentiating between things that work for individual places and Auckland-wide themes.  The vision should be discriminatory, but founded on realistic priorities and not a vague wishlist.

I’m a technician, not a visionary.  So I go to observation and measurement as my starting point.  Let’s first map where people live and where they work, socialise, and play today.  What’s here now will dominate Auckland’s activity patterns over the next thirty years.  And what people are doing today should provide some guidance as to land use needs tomorrow. 

But we should also look hard at emerging values and behaviours. We should think about inter-generational change in needs, tastes, and attitudes. We need to look and listen to diverse views to expand insights about the future and avoid extrapolating the limits implicit in our own knowledge.

We will find that distinctive communities and settlements are already being carved out within Auckland.  The spatial plan may have to provide for an emergent localism, and avoid submerging community character with a preoccupation with densities rather than people and places.

The emergence of distinct communities raises interesting land use possibilities in terms of encouraging – and allowing – people to meet future needs in a series of urban and ex-urban villages each with its own character. 

Acknowledging the limits to our knowledge of the future

Of course, we also have to explore options for accommodating population and employment growth.  Any detailed forecast of either is bound to be wrong. That has been the recent experience. Instead, projections should be undertaken to ensure that we maintain options, rather than to fool us into closing options down because we think we know now all there is to know about the future.

Better to stick with principles and leave choices to be made by future decision-makers rather than to anticipate particular outcomes built on current behaviours and knowledge.

So where will we develop?

There is a contrast between centralised and decentralised settlement, and the current thinking presumes that the former will – or should – prevail over the latter.  But perhaps we should avoid policies that promote one over the other. We have been slow in Auckland to acknowledge the reality and challenge of simultaneous concentration and decentralisation.  We need to cater for both.

Decentralised development need not depend on expanding the urban edge, though, the option implicitly favoured by present policies.   It might occur instead through the growth of distinctive centres along major transport corridors within and beyond the current Metropolitan Urban Limit. 

The spatial plan cannot necessarily pick where ex-urban centres will be or how they will evolve over the next thirty years. It might try to signal some of the more obvious candidates – Pokeno and Drury in the south perhaps, Warkworth and Wellsford in the north, Waimauku in the west and Beachlands in the east.  Beyond that, it can simply set out the conditions under which new, efficient, and attractive settlements might emerge and be linked.  Fortunately, Auckland’s new governance structure has increased settlement options within what has become a large unitary authority.

The role of the spatial plan, then, might be to set out the conditions under which different land uses might proceed, rather than to say what can or should happen, and where. 

What sort of plan? The physical framework

Bottom lines, urban villages, outlying centres, lifeline infrastructure, and land use principles can be tied together in the spatial plan, not as an exhaustive overlay of zones but as a framework around which the city can evolve.  The plan might provide for a string of centres across a strong linear transport network, a range of villages within the existing urban fabric, separated by leafy suburbs and parks, an iconic CBD as the meeting place of Auckland’s peoples and cultures, and harbourside, and the infrastructure needed to support these diverse places.  

The keys, though, will be the linkages between functional centres, not the boundaries between zones, and the principles which might be observed in the interstices rather than rules stitched into a map.  The plan should almost certainly identify those special bits of Auckland where we are prepared to meet the cost of avoiding change.  Equally, though, it should highlight the extensive areas that remain from which the changing needs of a city of growing communities might be met in the future.  

The plan can be flexible rather than exhaustive, at least in the first instance, indicative rather than definitive, informed by principles rather than prejudice, and transparent in terms of where the costs and benefits of its elements fall.

It should leave the detail open, subject to continuing development in light of the circumstances, preferences, the means, and the views of the day.   

Opting for simplicity and structure in the spatial plan might well provide the best way for the council can meet its 2012 deadline.  And keeping the plan general but informed might be just enough to satisfy diverse interests and expectations without making commitments that prove problematic down the track.

Auckland Spatial Plan – 1: A Plan for all Seasons

Resolving issues of governance, sustainability, economic development, etc, etc, etc

Building on the suggestion of an international review panel that Auckland should have just One Plan, the Royal Commission on Auckland Governance promoted the spatial plan as a unifying and integrating element for the region’s development under a single council.  The Commission commenced with the modest aim that the spatial plan would be “the starting point for the protection of Auckland’s environment and its heritage and the development of good urban design” (p199). 

However, it then set very high expectations for what the plan might achieve.

First, it suggested that the plan would “inform Auckland’s social and economic strategies, the regional policy statement and district plan developed under the Resource Management Act 1991, and specific service delivery strategies” but then it said that it should “coordinate plans for growth, economic development, and social well-being” (347).  It recommended an ambitious 30 to 50 year time frame. 

The Commission further stated that the spatial plan should:  

“analyse population, households, employment, major social infrastructure, open space networks, city-shaping infrastructure of roads, rapid transit, transport services, active transport networks including pedestrians and cyclists, water, wastewater, and stormwater networks, and major energy lines. It should identify the green and ecological network of the region, and areas that should be protected from all development and their natural values enhanced. It should identify growth areas for the region to accommodate urban population, and household and economic development, specifying timing, priority, methods, and agencies involved. The plan would address sustainability, outstanding urban design, a more efficient energy future, climate-resilient development, and the creation of cohesive communities” (531).

It said what tools should be used to prepare the plan, and proposed that it be informed by existing plans and by the new council’s own vision for Auckland, presuming concordance among them.  

It said that the Plan should feed “into the funding plans for key infrastructure (public transport, water, wastewater, stormwater, community facilities)”.  It would inform and be reinforced by an infrastructure plan for the region and be a tool for setting and enforcing Metropolitan Urban Limits. 

The compact city option

Peter Winder, CEO of the now defunct Auckland Regional Council outlined his take on Auckland’s spatial plan in September this year. He illustrated the incremental expansion of the urban area in the past, and its relationship to increasing mobility and an expanded transport network.

Peter highlighted the role of urban limits in planning for growth.  Initially, they were a tool for managing urban expansion.  Generous limits were drawn up in the 1950s in association with a commitment to major road network expansion.  Among other things, they helped open the north of the region to urbanisation following the construction of the Harbour Bridge.

In the 1970s, with revised planning legislation and growing economic uncertainty, a new concern to protect New Zealand’s primary sectors saw a hardening of metropolitan limits in a bid to preserve agricultural land in the region.

The rationale shifted again under the Resource Management Act 1991 as under the influence of Smart Growth proselytisers from North America, the Metropolitan Urban Limits (MUL) took on a life of their own in the interests of "sustainability".  No longer were they simply a tool for protecting valued rural or natural areas, but now they were an instrument for containing and reshaping the urban community.

To some commentators, this has been the source of problems – high cost land and poor housing affordability, a disincentive to industrial investment, traffic congestion and air pollution.  While there has been little definitive analysis to establish their merits in Auckland, MULs have been widely adopted as an urban planning tool.

Peter suggested that options for Auckland's future revolve around the pace at which expansion continues. Under these circumstances, the MUL would remain the defining feature of the spatial plan, whether that is the intention or not.

It was certainly explicit in the Royal Commission’s own policy stance:

“One of the key tools to secure a sustainable future for Auckland is to identify appropriate boundaries for urban expansion. The spatial plan will identify locations within existing urban areas where “densification” is appropriate in order to make public transport viable. Increasing sprawl would have an undermining effect on the provision of public transport and could make improvement unaffordable. Dense cities use less energy per person than the more dispersed model. For these reasons, the MUL is a key policy and the consequent control of land use will require significant enforcement efforts”.

This line of argument raises a number of questions. Despite the assertion that denser cities use less energy per resident, the costs and benefits of enforcing higher densities remains contested.  In any case, promoting land use plans to sustain a public transport preference smacks of the tail wagging the dog, a dangerous posture when public transport requires significant subsidy and its long term energy advantages remain unproven.

In any case, good public transport can lift long-distance commuting, enabling more people to dwell further from the centre.  This is not necessarily conducive to higher densities.  And given that commuting is a diminishing share of total transport use – and that public transport is an inferior option for non-commuting travel – the resulting dispersal may increase total transport demand .  

Peter’s options for the spatial plan echo the Royal Commission's argument.  They suggest that the rate of sprawl across the urban edge might be dictated only by the extent to which development can be forced upwards, and that this is desirable on the grounds that the higher the density the slower the pace of urban sprawl and the greater the prospect for viable public transport. 

Other than promoting increased densities, though, and protecting the obvious no-go areas, there is no sense of real changes or choices in the way we might live and work in Peter’s alternative maps.  Those that can afford nothing better will be confined to medium-rise living in crowded centres, and the others will do what they can to secure a place in existing suburbs, force their way over the city edge, or pick up a high amenity apartment on a central ridge-line or on the harbour edge.

Defending the city ramparts (keeping the hordes in rather than out) to support public transport is promoted as the means to shape infrastructure, dictate how we work and live, and incidentally, slow down an undifferentiated and undistinguished vision of growth by overspill.  Is that really what Aucklanders want?

Getting Real

I have raised concerns about Auckland’s spatial plan in previous blogs.   If it is seen as a panacea for all Auckland’s challenges – governance, sustainability, urban design, resource management, economic growth, community development – as the Commission seemed to think, the plan is bound to disappoint. 

The expectation that spatial regulation will determine economic and social behaviour echoes a long-discredited environmental determinism paradigm.  Its inadequacies have been well illustrated in the tortuous process of defending the 1999 Regional Growth Strategy with its own map and boundaries, and the long struggle since in getting Policy Change 6 in place so that the Regional Policy Statement might more effectively enforce this somewhat confined view of the world.

From ideology to expediency

We actually have the chance now to be more realistic in terms of what might be achieved through a spatial plan (and its bedfellow, the unitary district plan) and more pragmatic in our approach. Rather than defend our past positions,we might allow for the complexities of community and economic development and for the uncertainties that surround the future of housing demand, where we work, and where we play.

The Council’s commitment to completing the spatial plan quickly reflects a pragmatism and recognition, among other things, that any significant initiatives it might raise will need to be reflected in the Long Term Council Community Plan.

But haste also has its risks if expediency rather than reason prevails.  It could amount to little more than a recycling of a dated compact city paradigm; or designed simply to deliver the silver bullet of infrastructure spending.  It could inadvertently set up a master plan for locking down land use; or simply promote a planners’ view of how people should be obliged to live, a plan locked into the here and now of conventional wisdom.  That's what we need to avoid.

A framework for moving forward

Ree Anderson, Manager, Regional, Community & Cultural Strategy recently presented her thoughts on spatial planning to the New Zealand Planning Institute. In quoting the Torremolinos Charter she potentially turned two decades of spatial determinism in Auckland on its head:

Spatial planning gives geographical expression to the economic, social, cultural and ecological policies of society.

She brings four key components to the fore: balanced socio-economic development, an improved quality of life, responsible management of the environment, including built environment and heritage, and a rational land-use plan.  In effect, the spatial plan should be a reflection of society’s aspirations as these might be translated into policy, and not imposed on them to reflect a particular ideology or normative view of development.

Rather than proffering maps as options for her audiences to consider, she has invited responses around three possible elements of a spatial plan:

(1)    Big budget priorities – what public investments are needed, and where?

(2)    Place-based priorities – what needs to be done for individual localities?

(3)    Region wide themes – what needs to be done to make the region as a whole work better?

The notion of building up the spatial plan from understanding the physical limits to development, the communities’ aspirations, and the emerging character of local places, and those matters that require a region-wide perspective seems preferable to seeking region-wide conformity in development within a map of boundaries.

Keeping an open mind rather than extrapolating past preconceptions and practice is more likely to enable the region to deal with uncertainty and change.  Identifying what needs to be done and how – and what sits beyond the bounds of reasonableness – is likely to be more efficient and effective than exhaustive and fixed – and inevitably imperfect – prescriptions of land uses .  Getting the bare bones together, the foundations for planning, rather than trying to lock-down the future in master plan makes a lot of sense.

I might just try to respond to Ree’s challenge in my next posting.

Think Big – the Sequel?

Preparing Auckland's Spatial Plan

The New Zealand Herald recently profiled the man who will oversee Auckland’s spatial plan.  Roger Blakeley has had an impressive career.  His new job is the latest in a series of senior career shifts which equip him well to oversee preparation of a thirty year plan for the region. 

However, Reporter Bernard Orsman only picked up on the last twenty years or so of Dr Blakely’s career.  He omitted his presumably formative early years at the Ministry of Works and Development. It’s worth raising what the Ministry stood for then, and what it might teach us now.

New Zealand’s Legacy of Central Development Planning

The Ministry was New Zealand’s super-planning and construction arm of government.  Founded as the Public Works Department in 1886, it operated as the agency of national development until dismantled by the Labour government 110 years later.  During that time it conceived and developed the nation’s transport and electricity infrastructure, designed and built schools, hospitals, and other public buildings.  It operated through seven large regional offices, a legacy of New Zealand’s provincial beginnings.

It was a highly centralised but effective agency, appropriate for a youthful, under-populated country with scarce human resources dispersed across a difficult physical environment.  It set upon developing its emerging urban centres with their ports, airport, growing populations and industry, and opening up provinces through rail and road in a reasonably balanced manner.  It build dams and power houses in remote areas and reticulated electricity throughout the land.  It dominated the planning and construction of public infrastructure for most of the 20^th century.

Think Big and National Development - a late experiment in central planning

Like me, Dr Blakely will probably recall that in the late 1970s and early 1980s when the Ministry was the logical arm of government to provide services to the Minister of National Development and “Think Big”.  This was the centrally conceived and designed programme intended to lift New Zealand out of the economic doldrums with a series of substantial capital projects to increase self-sufficiency in liquid fuels, exploit the Maui gas deposit, and lift foreign exchange earnings.

Like Auckland’s proposed spatial plan today, Think Big 20 years ago had a long-term time frame.  It was a programme of what, for the time and place, were massive publicly-sponsored industrial works.  They were born of a narrow and largely political consensus out of an ostensibly conservative government. This consensus was strong enough to over-ride early concerns of the Liquid Fuels Trust Board – the assembly of public and private sector experts appointed to oversee the core projects– regarding the economic efficiency of some of the projects.

Consequently, the Board developed a priority list reflecting instead “strategic” and other non-economic criteria to justify fast tracking the programme under the National Development Act. 

The result was the ill-fated Motunui Synfuels plant, and a host of supplementary projects.  These may have provided a Keynesian-style boost to the economy through construction impacts.  Unfortunately, their economics foundered on (among other things) what proved to be a seriously flawed assumption that oil prices would continue to escalate over the coming decade. 

There has been no real attempt to measure the impact of the Think Big programme, and views remain divided [1].  Commercially the results were poor, and the impact on both the government deficit and the foreign exchange account negative.  There may have been other costs, as well, through such things as inefficient use of the Maui gas resource and under-pricing of electricity generating capacity for expansion of the Bluff aluminium smelter.

So what are the lessons for a 30 Year Spatial Plan?

No doubt there are lessons from the MWD and Think Big that Dr Blakeley with his early experience in the Ministry of Works and Development can reflect on for Auckland’s planning. 

For example, ill conceived plans, centralised plans, and plans prepared in haste, may be more costly than no plans at all.  A decade is a very long time in forecasting project outcomes.  Uncertainty is not something to be assumed away – the consequences of getting it wrong should inform every big decision.  Flexibility and resilience needs to be built into projects.  Fall back positions need to be left open. 

Economic efficiency is over-ridden at a cost: the rationale for projects and plans that do not stack up in terms of economic benefits needs to be both transparent and robust.  Plans and projects should be firmly grounded in analysis and evidence, and not simply emerge from workshops, caucusing, consensus among colleagues, and group think.  

The National Infrastructure Plan and Auckland’s Spatial Plan – Think Big reborn?

The risks of getting the spatial plan wrong in Auckland are high, especially if it shapes infrastructure spending.  We can ill afford over-investment or investment in the wrong projects or wrong places.

The risks are likely to be even more critical in a spatial plan in which infrastructure is seen as playing a formative role.  This may well be the case.  Richard Forgan, executive director of the recently formed National Infrastructure Unit, suggested at a seminar conducted by the Institute of Public Administration (IPANZ) in Auckland recently that spatial plan may be where the National Infrastructure Plan is given expression. [2] 

Based on his diverse experience, and no doubt the experience of the team he has assembled, Dr Blakeley will recognise, though, that infrastructure exists only to serve the reasonably foreseeable needs of communities and their businesses.  Infrastructure cannot be imposed from the top down but should reflect a realistic understanding of development trends, prospects, and possibilities, and their land use consequences.  Poorly conceived, centralised plans can undermine society’s wealth.   Perhaps that is why the Ministry of Works and Development was seen in the 1980s as past its use by date.  Let’s not resurrect it in a different form in Auckland.

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[1]          http://en.wikipedia.org/wiki/Think_Big,  www.techhistory.co.nz/ThinkBig/Petrochemical%20Decisions.htm

[2]          The National Infrastructure Unit is based in Treasury.  It is responsible for preparing a National Infrastructure Plan, with a board of appointed experts from the private and public sectors overseeing it.  Sound familiar?