This letter will be sent out to Mayors, Chairs and CEs this afternoon.
Kia ora koutou,
The Waka Kotahi Board recently reviewed the investment targets for all activity classes in the 2021-24 National Land Transport Programme (NLTP) that were agreed when the programme was adopted in August 2021. This is normal process during the delivery of a NLTP.
COVID lockdowns, supply chain delays, the tight labour market, and the reprioritisation of transport programmes to better address recent policy changes, have affected the sector’s ability to deliver on the ambition in the 2021-24 NLTP.
Many organisations have delayed the start of new projects or are delivering projects at a slower pace than originally forecast because of increased costs, funding pressures and supply disruptions. As a result, forecasted funding demand is much lower, with the situation remaining uncertain and there being ongoing changes to programme delivery.
Forecast revenue for the 2021-24 NLTP period is estimated to be $600 million down (or about 5 percent of projected revenue at the time the NLTP was adopted) while project costs are higher than originally expected, putting pressure on this NLTP. In response, the Board has changed the activity class targets and established new target ranges in line with what we know we can afford to fund or finance.
Based on projected funding demand from recent council and Waka Kotahi forecasts which have also considered forecast revenue, investment limits have been reduced for the following activity classes:
• Public Transport Infrastructure
• Walking and Cycling
• Local Road Improvements
• Road to Zero Activity
• Investment Management
Investment targets in the Public Transport Services activity class has been increased.
The activity classes that have remained the same are:
• Local Road Maintenance
• State Highway Maintenance
• State Highway Improvements
• Coastal Shipping