Election 2020: The Provincial Growth Fund will continue to provide jobs after the elections

The $ 3 billion Provincial Growth Fund has always stirred controversy over the grandstanding of the announcement and the way the funds are allocated. But the fund looks like it could survive the election even if its champion, New Zealand First, doesn’t. Stuff Denise Piper, a Northland reporter, investigates.

Even before Shane Jones made his final announcement about the Provincial Growth Fund on Friday, opponents wept badly for his bombast.

ACT leader David Seymour said the $ 100 million for marae, which was announced in Northland, where Jones represents NZ First, was “vote buying.”

“While Mr. Jones might think he will buy votes, New Zealanders can see it,” Seymour said.

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National Finance spokesman Paul Goldsmith chimed in, saying it was an “outrageous” use of taxpayer funds so close to the election.

Jones responded by saying that marae are essential infrastructure for provincial areas.

The $ 96.5 million funding would improve 351 marae nationwide, creating more than 3,100 jobs, Jones announced with Maori Development Minister Nanaia Mahuta on Friday.

The financing is part of the refocusing of the Provincial Growth Fund to create jobs after the closure of Covid-19.

Prime Minister Jacinda Ardern said the fact that the fund’s refocusing was announced in May shows that it is not a new funding announcement and therefore does not violate cabinet rules.

She said “absolutely not” was nonsense, where politicians spend money in a certain constituency in exchange for political support.

“We continue to implement out-of-the-box projects as part of the Covid recovery … It is important that we continue to work despite the fact that there is a [election] campaign in progress.

“This is a campaign that has moved, not a work program that has moved.”

Since its inception, the Provincial Growth Fund has been affected by controversy.

First, in February 2018, there was a $ 350,000 grant to a West Coast waste-to-energy scheme that was suspended after it was revealed that former company director Gerard Gallagher was being investigated by the Serious Fraud Office.

Then, in March 2019, there was a controversy surrounding Northland’s Manea, Footprints of Kupe, where Shane Jones participated in a meeting to approve $ 4.6 million for the project, despite previously declaring a conflict of interest. .

The Auditor General later said he had no serious concerns with the conduct.

But in August this year, the Auditor General took the fund’s $ 30 million cabinet manifesto seriously, saying it was a fund within a fund with no clear objectives.

The same month, the fund again sparked controversy after $ 10.5 million was approved for a Christchurch city race track, even though the fund was designed for provincial projects.

Jones did not apologize for his unfettered political style, which he admitted sometimes bristling but was necessary to get through the job of allocating $ 3 billion in three years.

“It has been an extraordinary success,” he said.

The program has also been hampered by “anonymous and risk-averse bureaucrats” who previously only dealt with a fund of $ 11 million a year, he said.

Such a large amount of funding also means that only a fraction of the $ 3 billion has actually been distributed, although almost all of the money now goes to specific projects.

An investigation by the Auditor General found that only $ 512 million had been distributed or paid in March 2020. Of the $ 2.9 billion committed at that time, only $ 1.3 billion had been contracted.

Again, Jones is unapologetic about the deadline to start the contracts, saying the process was necessary.

“There is no way around the need to be vigilant so that all applicants go through a rigorous process. That takes time. “

Both National Party leader Judith Collins and Ardern say they will honor the commitments already made by the fund in the next term in office.

Labor previously said it would scrap the policy if elected to a second term, to criticism from Winston Peters, but on Friday, Ardern clarified that the fund would be refocused.

“Our next step is economic development plans – $ 200 million is just seed funding for that – and we are working with regional development agencies on their plans.

“The PGF was absolutely the right approach for that moment. We arrived with a lack of investment in the communities; often, without any hope of association with the Crown, such projects would have developed.

“The PGF has created an environment now where those [regional economic] plans are being developed. “