New Zealand Government amends Local Government Act to recover infrastructure costs

The New Zealand Government is moving to amend the Local Government Act 2002 to allow councils to recover infrastructure costs linked to Fast-track projects. The changes will be progressed through the Local Government (System Improvements) Amendment Bill in Parliament this week.

Housing and Infrastructure Minister Chris Bishop stated that while Fast-track approval aims to reduce red tape for housing, energy, and investment projects, it does not permit developers to bypass infrastructure constraints. He noted that existing development contributions often fail to account for Fast-track developments because they are based on district plans rather than the actual, accelerated use of land. This can lead to unexpected needs for network upgrades or the use of capacity planned for other areas.

Local Government Minister Simon Watts added that the amendments will enable councils to adjust development contribution policies to recover eligible capital costs. The goal is to ensure that the costs of additional infrastructure are met by the developments themselves rather than being shifted onto existing ratepayers.