Part 1: Introduction

New Zealand Transport Agency: Delivering maintenance and renewal work on the state highway.

1.1
In this Part, we describe:

The purpose of our audit

1.2
We carried out a performance audit to assess how well the New Zealand Transport Agency (NZTA) delivers maintenance and renewal work on the state highway network (the network).

1.3
NZTA spends about $430 million a year on maintaining and renewing the state highway network. NZTA employs consultants and contractors in 25 sub-networks – called "network management areas" (areas) – to maintain and renew the network on its behalf. NZTA manages these consultants and contractors through a range of different service delivery models.

1.4
NZTA's network management consultants carry out the day-to-day management of the network, including annual and long-term works planning, information management, preparing and monitoring physical works contracts, and superficial inspections of structures on the network. Physical works contractors carry out a range of maintenance and renewal work. In general, there is one network management consultant for each area, and numerous physical works contractors working for each network management consultant. There are also regional bridge consultants, working throughout the country in nine regions. They are responsible for carrying out detailed inspections of bridges and other structures on the network.

1.5
This is the second of two reports presenting the findings of our performance audits on NZTA's maintenance and renewal of the network. Our first report – New Zealand Transport Agency: Information and planning for maintaining and renewing the state highway network – focused on NZTA's information and planning for maintaining and renewing the network. That report was published in September 2010. We split our work into two consecutive audits because good information and planning is an important precursor to delivering effective maintenance and renewal work.

How we carried out our audit

1.6
We examined relevant documents, plans, and reports and spoke to NZTA staff, including:

  • national office staff and managers from NZTA's Highways and Network Operations Group (HNO group), responsible for maintaining and operating the network; and
  • other HNO group staff, and the network management consultants, physical works contractors, and regional bridge consultants responsible for five areas – Northland, Auckland Motorway, Auckland Harbour Bridge, Wellington, and Southland.1

1.7
We examined NZTA's procurement planning and contracts for maintenance and renewal work in these areas. We also examined NZTA's relationships with, and performance monitoring of, its consultants and contractors in these areas. Figure 1 provides an overview of the five areas we focused on during the audit.

Figure 1
Overview of the five areas that we focused on during our audit

Area Network length (kilometres) Vehicle
kilometres
travelled
2009/10 (million)
Maintenance
and renewal
expenditure 2010/11
($million)
Service delivery model*
Northland 750.8 947 28.0 Traditional
Auckland Harbour Bridge 1.7 98 5.0 Performance Specified Maintenance Contract
Auckland Motorway 317.4 3650 48.8 Alliance
Wellington 292.8 1663 24.1 Hybrid
Southland 805.0 589 20.3 Traditional

* See Figure 3 under paragraph 2.19 for an explanation of these models.

1.8
For each area, we present case studies to show the sorts of day-to-day issues and challenges we identified during our audit and how NZTA could learn from these experiences.

What we did not audit

1.9
We did not audit:

  • the appropriateness of the level of funding for state highway maintenance and renewal;
  • new and improved capital infrastructure or upgrade work, or disposals of assets on the state highway network; or
  • the maintenance and renewal and funding of local roads managed by local authorities.

The structure of this report

1.10
In Part 2, we describe how NZTA designs and selects service delivery models for maintenance and renewal work. Part 3 describes how NZTA maintains relationships with its consultants and contractors, and monitors their performance, and Part 4 describes how NZTA understands the quality and value of the maintenance and renewal work being delivered. Part 5 sets out our key overall observations from this audit and the previous audit (report published in September 2010) about how NZTA could improve the cost-effectiveness of maintenance and renewal work.


1: These were the same areas we visited as part of our first audit into NZTA's information and planning for maintaining and renewing the state highway network.

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