Busted phones and trains – don’t worry money and reports are on the way

Though the troubles at Telecom’s XT network and at Kiwi Rail’s Wellington suburban passenger services have struck from two different directions (the former contemporary bungling, the latter historical) they highlight the poor state of New Zealand’s infrastructure.

When our businesses try to compete with the world, clogged motorways, power failures, slow broadband, busted trains and non-functioning phone services put us a huge disadvantage. Not overlooking the personal hassles involved.

They provide some great humour though – see XT network for sale on TradeMe.

For sure other countries have similar problems, but in New Zealand they’re mostly a lot worse (unless we’re talking about real third world countries or Sydney’s motorways).

In the World Economic Forum’s Global Competitiveness Report 2009-10 we rank 35th in the world for infrastructure compared with 20th for overall competitiveness and 5th for our economic institutions which Brash and Co bang on about as the cause of our economic woes.

In infrastructure we were sandwiched between Estonia (34th) and Saudi Arabia (36th).

Our port and air infrastructure are the best performers (22nd and 17th in the world respectively) and electricity and roads the worst (53rd and 43rd).

After years of underinvestment in infrastructure the current Government has made it one of its priority areas, spending $10.7 billion over 10 years on new roads and $1.5 billion on ultrafast broadband.

KiwiRail and the Greater Wellington Regional Council are spending $550 million to improve Wellington’s passenger rail services. Auckland’s getting $1.6 billion.

How much it’ll cost Telecom to fix the XT Network failures is not clear, but it has so far shelled out $15 million to unhappy punters and has warned financial markets to expect lower earnings for the year to the end of June.

There’s also an extra (I think) $7.5 billion to be spent over five years on a government infrastructure investment programme targeting roads and telecommunications, and apparently in the same programme, non-infrastructure stuff like schools, housing and hospitals.

Infrastructure definition: The basic physical systems of a country’s or community’s population, including roads, utilities, water, sewage, etc. These systems are considered essential for enabling productivity in the economy. [Courtesy http://www.investorwords.com/2464/infrastructure.html]

Anyway all good, but to give you an idea of what we are up against, Australia’s spending A$43 billion on its broadband network, on which work started earlier this month.

Our lot are not expected to get underway till the second half of this year when commercial agreements with the Government’s partners (one of which is prospectively Telecom, hah!) are finalised.

So that’s Australia out of the 2025 race starter’s block on broadband while we’re still deciding which midgets (dollar wise) are going to run.

But that okay because there are more reports on the way:

• There’s the National Infrastructure Plan (due “early 2010”) setting out a “high-level view of the state of New Zealand’s infrastructure and include a stock-take of existing infrastructure and anticipated future requirements”. and
• Mid-year there’s the release of economic and public policy research group Motu”s four-year, $1.6 million research project into net benefits provided by New Zealand’s infrastructure.

Feel better now?