QTS-072 · Board or committee paper · 2022
NZUP Governance Group: NZUP Queenstown Package Update
Marked 'In confidence' by its author. Publicly released by NZTA / OIA-20263 on 30 Jan 2026.
Briefing to the NZUP Governance Group (meeting 10 May 2022) on the NZUP Queenstown Package's scope, budget, programme, minimum viable projects and risks. A review found costs likely to rise from the $115.0 m baseline (P50, based on Queenstown Transport Business Case estimates and a traditional delivery model) to a $177.4 m advanced cost estimate (April 2022), an increase of $62.4 m. Drivers include the Frankton North rezoning (an extra $23.2 m for signalised intersections, widening and land at SH6/Hawthorne Drive and Grant Road) and Alliance set-up and management costs not foreseen in the baseline (Alliance Management TOC $18.30 m; about $10,000-$14,000 per day). Property is the key programme risk. An early works TOC of about $8.0 m was on hold. An initial minimum viable package (SH6/SH6A, SH6A North Frankton, Howards Drive roundabout) was put at about $140 m. The paper asks the Governance Group whether to rescope to the baseline budget, seek a budget increase, or both.
What the document says
Context and purpose: Paper to the NZUP Governance Group for its 10 May 2022 meeting, authored by Richard Osborne and approved by Robyn Elston (p1). It updates the Group on scope, budget, programme, minimum viable projects and risks, and asks for guidance on rescoping to the baseline budget, seeking a budget increase, or both (p1).
Background (p2): The Queenstown Transport Business Case (QTBC) was completed in November 2020 and endorsed by the Way to Go partners in early 2021. NZUP funding covers SH6A corridor improvements (targeted bus lanes and virtual priority at signalised intersections), SH6 Frankton to Ladies Mile improvements, and Grant Road to Kawarau Falls Bridge improvements including the Frankton bus hub and SH6/SH6A intersection. The Alliance was set up in December 2020 under an Interim Programme Alliance Agreement.
Costs (pp2-3): The $115 m baseline was based on QTBC estimates with a parallel estimate by Bond CM (0.6% difference), using a traditional delivery model. A March 2022 review gave an advanced estimate of $177.4 m (+$62.4 m). Table 1 lists: Waka Kotahi indirect costs $9.56 m to $15.95 m; direct costs $3.42 m; Alliance Management TOC $18.30 m (new); property $15.85 m to $24.53 m; design $4.51 m to $8.62 m; construction $80.56 m to $94.17 m; escalation (P50) $7.96 m. Total P&G is 26% of programme delivery costs, and P50 project contingency is a further $19.8 m (p3). Alliance management costs are about $10,000-$14,000 per day (p1).
Frankton North (pp3-5): 2020 District Plan rezoning and an Environment Court order changed Frankton North to mixed use and residential, with forecast added 2028 peak flows of about 1,778-2,344 vehicles. Signalised intersections at SH6/Hawthorne Drive and Grant Road would need about 2,230 m2 of extra land; cost rises from $24.28 m to $47.44 m (+$23.2 m) (p4). Funding options include RMA mitigation by developers and swapping $2.1 m of HIF underpass funding (p4-5).
Programme and minimum viable projects (pp5-6, App B): An early works TOC (about $8.0 m) is on hold. Property is the key risk. A minimum viable set at the SH6/SH6A intersection, SH6A North Frankton and the Howards Drive roundabout would need about $140 m (p5). Table C1 compares Do-Nothing (<$30M), Minimum Scope (<$115M), Reduced Scope (about $140M) and Full Package (about $170M) (pp10-11). The Alliance was continuing work on the full programme, with 30% design due August 2022 and independent pricing by 31 October 2022 (pp1, 6).
Mass rapid transit: The paper says nothing about mass rapid transit.
Key figures
- Baseline budget $115.0 m vs advanced cost estimate $177.4 m (April 2022), +$62.4 m (pp1-2)
- Frankton North scope change +$23.2 m ($24.28 m to $47.44 m) (pp1, 4)
- Alliance Management TOC $18.30 m (not in baseline) (p3)
- Alliance management costs about $10,000-$14,000 per day (p1)
- Total P&G 26% of full programme delivery costs (p3)
- Property $15.85 m to $24.53 m; construction $80.56 m to $94.17 m; escalation (P50) $7.96 m (p3)
- P50 project contingency an additional $19.8 m (p3)
- Early works TOC about $8.0 m, on hold (pp1, 6)
- Minimum viable projects about $140 m (p5); scope options <$30M / <$115M / ~$140M / ~$170M (pp10-11)
- Business case sunk cost about $6 m if the base option is later rebuilt (p6)
Files
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Main document
Actions recorded
Governance Group to advise whether Waka Kotahi should rescope the programme to the baseline budget, seek a budget increase, or both.
Not assessed · NZTA · Meeting 10 May 2022
Provides guidance on whether Waka Kotahi should be looking at rescoping
Refine the minimum viable projects and seek QLDC and ORC views on project prioritisation.
Not assessed · NZTA
This needs further refinement and views of QLDC and Otago Regional Council sought
Discuss and agree with QLDC and MBIE a swap of HIF underpass funding towards a fourth leg of the Frankton North signalised intersection.
Not assessed · QLDC
This would need to be discussed and agreed upon by QLDC and MBIE
Alliance to continue planning for the full scope of works; complete 30% design and pricing by the Alliance and independent estimator.
Not assessed · 30% design Aug 2022; pricing 31 Oct 2022; reconciliation 16 Dec 2022
The Alliance Project team are requested to continue to plan for the full scope of works
Explore opportunities for the Alliance to fast-track works.
Not assessed
Opportunities need to be explored for how the Alliance can fast track works
Study cost
Not separately commissioned. This is an internal or corporate document.
Citation
NZTA (Waka Kotahi). NZUP Governance Group: NZUP Queenstown Package Update (2022).