The New Zealand Council for Infrastructure Development has welcomed today's announcement of the Morrison & Co Public Infrastructure Partnership Fund backed by an initial $100 million from the New Zealand Superannuation Fund.

"This provides the opportunity for New Zealanders to invest in building and improving New Zealand's social infrastructure from schools to hospitals, water services to street lighting. It also provides an opportunity to bring private sector innovation and a whole of life management focus to the procurement of long term national infrastructure assets, says NZCID Chief Executive, Stephen Selwood "Internationally public private partnerships (PPPs) have been successful in the development and renewal of schools, hospitals, courts, street lighting, water services, waste, recycling and telecommunications. Empirical research has consistently shown PPPs to perform well in terms of value for money and on time delivery.

"The PPP model enables government agencies to oversee and control service standards while allowing the private sector to reduce costs through good management and innovation and share the risks. "For example, in schools, teachers and headmasters are able to get on with the job of teaching, instead of having to look after all the buildings and facilities. Selwood says.

"PPPs have been shown to offer several benefits over more traditional public sector procurement: - The private sector takes on the risks of design, construction and long term operation and maintenance of the infrastructure. If there's cost blow-outs, the private sector bears those costs, not the taxpayer.

- Having an investment stake in the asset means that the private sector is highly incentivised to design, build and maintain the asset to the highest standard that will endure over its entire life.

- Private sector skills in innovation in design, construction, asset management and ongoing maintenance are brought to the fore in a competitive tender process that provides improved value over time.

- Value for money is an inherent part of the bid process. If the PPP bids are lower than the expected cost of public sector provision, then the contract is awarded. If the PPP bid is higher, the public sector will procure the asset as usual.

- Injection of private finance means that more projects - schools, hospitals, courts, prisons and other social services, can be built sooner than traditional "pay as you go" public sector procurement

-Extra revenue is often generated to offset costs by using the infrastructural assets in an innovative and commercial manner (e.g. on-site day care, night classes in idle classrooms)

"PPPs are not the total answer to addressing New Zealand's infrastructure needs, but they are a useful means of providing better value for some public infrastructure service provision. The Public Infrastructure Partnership fund announced by Morrison and Co provides another tool in the toll box to drive innovation within the infrastructure sector and provide better outcomes for investors and the public alike".