TOWER calls for KiwiSaver involvement in infrastructure PPPs

Friday, 5 March 2010 1 Comment

Chief executive officer of TOWER Investments Sam Stubbs says public private partnerships (PPPs) are a logical answer to the multi-billion dollar, multi-decade funding needs of infrastructural development in New Zealand.

"KiwiSaver schemes are natural investors in infrastructure PPPs because they have long term investment horizons that match the long-term nature of investing in infrastructure.

"New Zealand's KiwiSavers are collectively building up a huge and growing pool of funds under management that could help provide a substantial proportion of the capital these PPPs would require."

Stubbs believes New Zealand can progressively bootstrap much of its capital requirements for infrastructural development out of the ever-increasing pool of KiwiSaver capital.

"KiwiSaver-sourced capital is already there and growing by the day, but what is missing is an available supply of suitable infrastructure PPPs to invest some of that capital in."

He says some of the infrastructural priorities the National Infrastructure Plan has identified are potentially attractive from a KiwiSaver investment point of view, including broadband, electricity, and roads of national significance.

"A strong selling point for getting KiwiSaver involved in contributing capital to infrastructural development is that only New Zealanders can invest in KiwiSaver and so the infrastructural assets could stay in New Zealand hands."

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