Earlier this week, Housing and Infrastructure Minister Chris Bishop and Local Government Minister Simon Watts announced changes to how development contributions are collected for Fast-track projects to ensure unforeseen infrastructure costs are adequately funded.
The government has confirmed changes to how councils recover infrastructure costs from housing and land projects approved through the fast-track process, addressing a gap Property Council New Zealand has long flagged as unfair to both developers and ratepayers.
Housing and Infrastructure Minister Chris Bishop and Local Government Minister Simon Watts announced on 15 September that the Local Government (System Improvements) Amendment Bill will be amended so councils can set development contributions that properly reflect the infrastructure a fast-track project actually requires, rather than what an older district plan anticipated.
The gap matters because fast-track approvals can unlock development sooner, or at a different scale, than a council originally planned for. Under the current settings, that mismatch has meant some development contributions understate the true infrastructure cost, leaving councils under-recovering and existing ratepayers at risk of covering the difference.
The changes will also let councils recover infrastructure costs that cross council boundaries and amend their development contribution policies within six months of a fast-track approval without going through the usual consultation process.
As of 16 September 2026, 78 housing and land projects were eligible to seek consent through fast-track, ten of them lodged by Property Council members. Thirteen projects have already secured consent, six of them led by members.
Property Council chief executive Leonie Freeman says the changes reflect a principle the organisation has advocated for consistently.
“Property Council supports the principle at the heart of these changes: growth should fund the infrastructure it genuinely creates, not leave existing ratepayers to cover the gap,” she says. “Fast-track has been effective precisely because it gives projects certainty, so any change to how costs are recovered needs to preserve that certainty rather than erode it.”
Freeman says the sector accepts that development should contribute its fair share, provided the numbers stack up.
“Some cost recovery is fair and expected, and the sector accepts that. What matters is that any contribution is proportionate, tied directly to infrastructure the development actually requires, and calculated transparently. That’s the test we’ll be applying.”
On the removal of standard consultation for these targeted policy amendments, Freeman says speed and transparency need not be in tension.
“We support a faster process where it’s tightly scoped to fast-track projects but faster shouldn’t mean less transparent. Councils should still have to show their working, what the money is for and how the number was reached.”
The changes are an interim step ahead of the government’s planned Development Levies system, due to replace development contributions from 2029. Property Council has already told government what good design looks like for that system, including independent oversight, a defined collection period and full transparency on how costs are calculated..
“This is a bridge, not the destination,” Freeman says. “The real opportunity is Development Levies in 2029. How these interim changes are used will be a useful signal of whether government is heading in that direction.”
Property Council will continue to engage with government on the design of the Development Levies system as further detail is released.
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Sandamali Ambepitiya
Sandamali arrived at Property Council with a Bachelor of Arts and Law, and experience as an advisor with the Employers & Manufacturers Association.
Conscientious and detailed, Sandamali leads our advocacy team as Advocacy Manager. An excellent listener, Sandamali is in her element when facilitating stakeholders and members to develop our advocacy positions.
