Govt's infrastructure contracting criticised
Still waiting for work to begin on the Dunedin Hospital inpatient site. The outpatient building is behind. PHOTO: GERARD O'BRIEN
A lawyer at CPB Contractors, the Australian construction giant set to build the new Dunedin hospital, has gone public to slam the government's "disastrous" approach to contracting major infrastructure projects.
Meanwhile, any contract between CPB and Health New Zealand Te Whatu Ora (HNZ) to get on with the delayed inpatient build is pending, despite a promise by Health Minister Simeon Brown in January that work would start mid-year.
In a social media post liked by a senior HNZ infrastructure boss, CPB legal manager Tom Horder wrote that New Zealand was "very bad at delivering major infrastructure" and pointed the finger at contracts demanding delivery for a fixed price.
"There are some practical things we can do to improve.
"One of them is picking the right contract model for our big projects ... Over the past decade in NZ, the lump-sum model has been inappropriately applied to major projects, with disastrous results."
In the post, Mr Horder links readers to a document listing alternate contractual arrangements including agreeing some costs with the client as a build progresses and challenges emerge.
Sources have said HNZ and CPB have considered various contract arrangements, but the government is demanding a fixed price.
The decision rests with ministers, but there is an indication that an alternate contract model has been preferred by at least one senior HNZ staffer.
Mr Horder's post was liked by HNZ head of infrastructure commercial and procurement Paul Hrstich, who first worked on the project in March 2020, but has "not been involved in the project since January 2023", according to HNZ chief infrastructure and investment officer Jeremy Holman.
CPB has also worked on the project for years, under an Early Contractor Engagement (ECE) contract signed in 2021 with HNZ to plan and price the project.
However, last year former health minister Dr Shane Reti and Infrastructure Minister Chris Bishop forced a tools-down on the former Cadbury factory site after claiming a budget blowout.
After the decision to proceed again, the chance of CPB undertaking the build has been thought to be a certainty for continuity reasons and due to limited big-build competitors.
However, HNZ has issued an invitation for construction firms to tender by mid-June to finish the "substructure".
The invitation asks for a fixed price.
Naylor Love former chief executive Rick Herd said a fixed price for the Dunedin inpatient build, determined by a set-in-stone design, was "unlikely to happen due to the quality, competency, calibre and capacity of the design teams we have got in this country".
He also blamed poor government leadership.
"The government struggles to get consistency, continuity and agreement within their own teams and clinicians of what a big hospital should look like and in my experience are constantly changing their mind. This makes it impossible to fix a price."
Any agreed price would likely require a "huge contingency" and result in the contractor filing for variations throughout the build, causing "stress, antagonism and conflict".
A price tag should be attached to "unknowns" and a decision made about who carried that financial risk.
CPB declined to comment.
mary.williams@odt.co.nz
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Techday NZ
a day ago
- Techday NZ
How businesses can close out FY24–25 on solid footing and start strong in FY25–26
Many Australian businesses are bracing for increased compliance scrutiny as the financial year draws to a close. The Australian Taxation Office (ATO) has flagged several key focus areas for FY24–25, including overdue tax debts, work-related expenses, capital gains, and rental income. Non-compliance in these areas can lead to substantial penalties, interest charges, and even legal action, as repeated late lodgements can result in increased fines, while unresolved tax debts could trigger garnishee notices or legal proceedings. This serves as a timely reminder to businesses of all sizes: take the end of the financial year (EOFY) seriously or risk facing serious consequences. Businesses with inconsistent record-keeping, unclear financial workflows, or unpaid obligations are more likely to attract attention. The ATO has invested in advanced data-matching tools and artificial intelligence (AI) to cross-check reported income and deductions against third-party sources, meaning even minor oversights can trigger audit activity or delays in processing. The most common pain points during EOFY tend to come down to two things: disorganised processes and incomplete information. It's easy to miss valid deductions when receipts are scattered across inboxes or stored on personal devices as manual reconciliation can take days for lean financial teams. Payments to suppliers can also slip through the cracks when approval workflows are unclear or not followed consistently. These issues might seem minor in isolation; however, they often reflect deeper structural problems in how expenses and invoices are managed. Now is the time to close those gaps. Businesses should start by gathering complete records for income, expenses, assets, and liabilities. Finance personnel need to go beyond general ledgers and profit-and-loss statements, and carefully review reimbursement claims, subscription costs, software expenses, and travel records. The next step is to consolidate the data to get a single, accurate view of payments, especially if the business has used multiple systems to process payments or expenses. It's important to also check whether claims align with ATO expectations. For example, the ATO has emphasised again that work-from-home deductions must reflect actual usage, not estimates. It also continues to highlight common errors in rental income reporting and capital gains declarations. These areas are under close watch, and discrepancies are harder to defend when documentation is patchy. Compliance is only one part of the EOFY picture. Cybercriminals target finance teams with tax-themed scams at this time of year. According to the Australian Competition and Consumer Commission (ACCC), Australians lost more than $152 million to payment redirection scams in 2024, up from $91.6 million the previous year, making it one of the top five scam types by financial loss. This highlights the need for tighter controls. Business leaders must review who has approval access, how and where sensitive documents are stored, and the process used to verify vendor details. It's also critical to validate that everyone involved in payments or account management understands these risks and are trained to spot suspicious activity. Businesses that want to reduce risk and simplify EOFY reporting can make immediate gains by automating expense and invoice management. Automation tools reduce reliance on spreadsheets and email chains while applying consistent rules and approval flows simultaneously, which helps teams process claims faster and with fewer errors. This gives businesses of all sizes clearer visibility into spending and more accurate data for compliance reporting and strategic planning. Businesses can shift their focus to FY25–26 ahead once EOFY obligations are complete. Notably, e-invoicing will become mandatory for all Commonwealth agencies and their suppliers from 1 July 2025. Adopting this early can help businesses reduce processing times, cut operating costs, and improve cash flow. The start of the financial year is the ideal time to step back and assess what's working and what needs improvement. Delays in approvals, hard-to-produce reports, or unclear spending are signs of deeper process issues. Now's the time to fix them. EOFY is an opportunity for businesses of all sizes to improve how they manage spending, reporting, and decision-making. Those that invest in better systems now will be better positioned to grow in the year ahead.
Techday NZ
a day ago
- Techday NZ
Vectra AI named leader in 2025 Gartner report for NDR sector
Vectra AI has been recognised as a Leader in the 2025 Gartner Magic Quadrant for Network Detection and Response (NDR). The Gartner Magic Quadrant is a research methodology and graphical representation that evaluates technology vendors within a specific market, in this instance the emerging field of NDR. Vectra AI was positioned highest for Ability to Execute and furthest for Completeness of Vision in this latest report, marking a significant recognition within the cybersecurity sector. The distinction comes as cybersecurity concerns remain prominent for organisations in Australia, with data from PWC indicating that 67% of Australian organisations have identified cyber risk as their top concern in the coming year. Other issues, including inflation, economic volatility, and geopolitical factors, were ranked as lesser priorities. In response to these concerns, half of the organisations surveyed plan to increase their cybersecurity budgets by at least 6% in 2025. Vectra AI's platform is designed to defend hybrid environments against identity and network-based attacks. According to the company, its AI agents continuously triage, correlate, and prioritise genuine threats in real time, an approach intended to accelerate response and reduce alert fatigue for security professionals. The platform provides coverage across cloud infrastructure, data centres, remote workforces, and operational technology domains, supporting security teams in their efforts to mature their security operations. Hitesh Sheth, Founder and CEO of Vectra AI, commented on Gartner's decision to initiate a Magic Quadrant for NDR. "Gartner's decision to publish a Magic Quadrant for NDR reflects just how essential this market has become in modern cyber defence," said Sheth. He added, "Being recognised as a Leader in this inaugural report reinforces Vectra AI's position at the forefront of this critical space. As organisations grapple with growing complexity, identity-based attacks, and AI-driven threats, the Vectra AI Platform delivers what modern defenders need – coverage that reduces exposure, clarity that cuts through the noise, and control to act with speed and confidence." Vectra AI is also the only vendor in the report to have been named both a Leader in the Gartner Magic Quadrant for NDR and a Customer Choice Winner in the 2024 Gartner Peer Insights Voice of the Customer for NDR. According to Gartner Peer Insights, as of January 2024, Vectra AI holds a 4.8 out of 5 rating from 96 customer reviews, with 96% indicating they would recommend the platform. This customer feedback has contributed to its positioning in the latest Magic Quadrant report. The increasing complexity of cybersecurity threats, including the speed at which attackers can move laterally across identity, cloud, and network layers, has heightened demand for integrated security solutions. Sector analysts and Vectra AI alike have noted that traditional, siloed security tools can leave organisations vulnerable, driving the need for unified visibility and AI-driven detection capabilities to respond rapidly to threats. The NDR market has grown as organisations seek to supplement existing security strategies with solutions capable of offering greater detection accuracy and more timely responses. Vectra AI's platform aims to provide security teams with the means to detect, hunt, investigate, and respond to attacks spanning the full threat landscape. The company has been acknowledged for its commitment to customer satisfaction, with product performance and support frequently highlighted in customer reviews. Vectra AI maintains a focus on ongoing development to keep pace with the continuously evolving tactics used by threat actors targeting modern networks. The Gartner report recognises vendors that demonstrate both the ability to execute on their strategy and the completeness of their vision in the NDR market. Vectra AI's dual accolades from both analyst and customer perspectives come as cyber defence continues to be prioritised by organisations concerned about the shifting digital threat landscape.
NZ Herald
a day ago
- NZ Herald
Woman, 28, shares hidden cancer sign after stage four diagnosis
An Australian woman who was diagnosed with aggressive cancer at the age of just 28 has revealed the symptom that ultimately tipped her off that something was not quite right. Sam Bulloch, now 30, began to notice some bleeding when she went to the toilet – something that she put
