Government and construction industry launch joint plan for sector recovery

Maintaining cash flows, readying new infrastructure projects and providing new health and safety guidelines are all options on the table in the Construction Sector Accord's plan to help the industry bounce back once level 4 lockdown restrictions are lifted.

The accord is a joint commitment between government and construction industry leaders to transform the construction industry. 

The COVID-19 pandemic and associated lockdown has forced the Accord Steering Group, the team of leaders across government and industry in charge of enacting the accord, to temporarily shift focus and advise the government on how they can support the construction sector and ensure its resilience.

The result is a response plan with three phases: maintain, to keep the sector viable during shutdown; restart, to prepare for restarting works; and transform, which will refocus the accord on the goals behind its inception, creating a high-performing construction sector.

The first action from the response plan has already taken place, with the government issuing guidance and expectations to ministries, state-owned enterprises, district health boards and tertiary education institutions on how they should manage contracts during the shutdown. 

One of the directives is for agencies to continue construction work that can be continued off site—things like procurement, planning and design—and to do what they can to support the financial viability of any contractors and to help them retain workers during the lockdown.

"By taking a fair and consistent approach across Government in how we deal with thousands of contracts and hundreds of firms, we can provide the best possible chance to this industry of weathering the damaging economic impacts of the current lockdown period," Building and Construction Minister Jenny Salesa said.

The 'maintain' phase also involves identifying projects that are 'shovel ready', or are likely to be within six months, that can be prepared and ready to go once movement restrictions are lifted and industry firms are back to work. The government has asked the Infrastructure Industry Reference Group, led by Crown Infrastructure Partners chairman Mark Binns, to prepare lists of projects that fit the shovel-ready criteria.

Any projects considered will be in addition to those already funded by the government's $12 billion infrastructure package announced earlier this year.

“The types of projects the Government would consider funding include water, transport, clean energy and buildings. They would also have a public or regional benefit, create jobs and be able to get underway in short order,” Economic Development Minister Phil Twyford said.

Work is also underway to figure out how consents can be speeded up and any roadblocks removed for development and infrastructure projects beginning after the lockdown ends. 

The maintain phase will also explore the possibility of additional financial support to the sector beyond the wage subsidy scheme already in place for all businesses in the country.

The second phase, restart, is all about supporting businesses to recommence activity once restrictions are lifted.

It will include things like advising firms on what activities can go ahead under different alert levels and how to keep workers safe on site while COVID-19 is still a potential risk, as well as kickstarting the shovel-ready projects identified in the maintain phase of the plan.

A strategy will also be developed for supporting distribution of work across all subsectors of the industry, as well all geographical regions in the country.

The final phase of the plan, transform, will be something of a return to the accord's founding focus of transforming the industry into a high-performing one.

A Construction Sector Transformation Plan launched in January, outlining a three-year plan to transform the industry will be adapted to reflect the changed environment and refocused towards those initiatives prioritised in the earlier phases of the recovery plan.

Raising business performance through better procurement and business practices, creating a new consenting model and providing better assurance for subcontractors around prompt payment are likely to be part of the plan.