PWA Reform Update: Further PWA reforms announced aimed at facilitating critical infrastructure projects

10/03/2025·5 mins to read

PWA Reform Update: Further PWA reforms announced aimed at facilitating critical infrastructure projects

The Ministers for Infrastructure (Chris Bishop) and for Land Information New Zealand (Chris Penk) have announced a further development in the Government’s review of the Public Works Act 1981 (PWA), just two weeks after Minister Penk’s last press release.

In this release, the Ministers have introduced a targeted amendment to the PWA, which will pre-empt the wider overhaul of the PWA set to be introduced in the middle of this year. The latest amendments will focus on the introduction of the Public Works (Critical Infrastructure) Bill (Bill) focused on “amending the PWA to accelerate the acquisition of land needed for the public projects listed in Schedule 2 of the Fast-track Approvals Act, and the Roads of National Significance listed in the Government Policy Statement on land transport 2024”.

The Bill is anticipated to be released in May 2025, and is likely to come into force six months prior to the PWA review’s wider amendments. This Bill is part of the Government’s commitment to creating a “strong pipeline of critical infrastructure projects to boost economic growth and productivity”.

Key changes

The focus of the bill will be:

Premium payments: The Bill introduces new upfront incentive and recognition payments. As the name suggests, incentive payments incentivise landowners to reach early agreement with acquiring authorities.

Under this new regime, landowners who voluntarily sell their land prior to receiving a Notice of Intention (being a formal notice issued under section 23 of the Public Works Act) will receive an additional premium payment equal to 15 percent of their land’s value (but capped at $150,000).

In addition, all landowners affected by the’ accelerated process will receive a “recognition payment”. The recognition payment acknowledges the sacrifice landowners are making, and seeks to strike a balance between preserving the rights of private landowners with the need for critical public infrastructure. The maximum payment is capped at $92,000.
Removal of the Environment Court in Objection Processes: Under the Bill, landowner objections to the acquisition of their land for critical infrastructure will no longer be heard in the Environment Court. Instead, their objections will be submitted directly to the relevant decision-maker (either the Minister for Land Information or the local authority) for resolution.

Bishop stated that the objection process has been reformed as “objections to the compulsory acquisition of land under the Public Works Act can massively slow down delivery of critical infrastructure projects, causing significant time delays and cost increases”. In the past ten years there have been 49 objections to NZTA acquisition alone, which Bishop believes have caused “unacceptable” delays and cost increases.

The Ministers have also clarified that, in line with the Government’s previous commitment to better protecting Māori land in acquisitions under the PWA, Māori landowners will retain the right to object in the Environment Court, whilst also having access to the new premium payments. While this provision acknowledges Aotearoa’s chequered past with Māori land acquisition, Green Party MP Hūhana Lyndon stated that it "doesn't provide much comfort", as Māori will still be forced to forfeit their land to the Crown in situations of compulsory acquisition.

Our thoughts

While these changes may facilitate the fast delivery of critical infrastructure, we await a copy of the Bill (expected to be introduced in May) to see if the Minister’s objectives will be achieved in a manner that fairly balances landowner rights with the community need for improved infrastructure.

Removal of Environment Court

Based on what we know from the Minister’s press release and comments there are concerns around the removal of the role of the Environment Court in independently considering and deciding on landowners’ objections to land acquisitions. In removing the Environment Court objection process, there are potential concerns regarding the independence of primary decision makers.

Under the new process, if a landowner takes issue with a decision of the relevant Minister / Local Authority, that decision will simply be referred to the original decision maker for resolution, rather than going to an independent body.

The Ministers have noted the ability for landowners to appeal decisions to a court is not entirely lost, as they can seek judicial review of such decisions through the courts. However such judicial review litigation may be complex and lengthy, so that the potential for such cases to hold up critical infrastructure projects remains.

Cost of premium payments

The introduction of “premium payments” has the potential to incentivise landowners to reach early agreement with the acquiring authority. This will be potentially costly for the Crown and local authorities, with the maximum combined payment totalling at $242,000.00 per acquisition. It appears that the Government is banking on there being a sufficient trade-off in reducing delays and litigation costs by incentivising early agreement and eliminating the role of the Environment Court to offset the additional costs of compensating landowners.

We do think the additional payments are likely to provide greater certainty in negotiation, and limit delays, so as to reduce risks of escalated constructions costs, and get critical infrastructure projects off the ground quicker. As Bishop stated in his capacity as Minister for Infrastructure, “Certainty in the short-term is worth paying a bit extra for.” As there are already incentive payments under section 72 of the current PWA we assume these will not be available under this new regime.

Scope of the Bill

There are some significant uncertainties about the scope of this new Bill from the initial press releases.

First, it is unclear how this Bill may affect future projects. The Ministers noted that the Bill will be introduced in May, with the complete overhaul of the PWA to be introduced in a separate Bill in mid-2025. It is not entirely clear whether the initial Bill will be limited to the Roads of National Significance and the critical infrastructure projects approved under the fast-track legislation, or whether it will extend to future projects deemed critical for the development of New Zealand’s infrastructure. It is also unclear which entities will be able to use the Bill’s powers, and what constitutes “public projects” in terms of Schedule 2 of the Fast Track Approvals Act. We know that decisions made by Ministers and local authorities will bypass the Environment Court’s review, but will the same powers be afforded to, for example, State owned enterprises and Council-controlled organisations, who have approved projects under the fast-track legislation? We will expect to see further updates in the near future.