Next step for regional economic recovery

Economic and Regional Development

The government has taken the next step to boost regional economic recovery with the establishment of the new fund to replace the Provincial Growth Fund.

Economic and Regional Development Minister Stuart Nash told the annual conference of economic development agencies, local government representatives and chambers of commerce the new fund is a vital part of post-COVID recovery efforts.

“Today we are launching the $200 million Regional Strategic Partnership Fund, which delivers on a manifesto commitment to keep supporting economic recovery in the regions,” Mr Nash said.

“Over this Parliamentary term the RSPF has three goals. It will work in local partnerships to enable economic and business development, accelerate Māori economic aspirations, and support sector transformation. Each region will help decide its own priorities.

“Central government will partner with local government, iwi, businesses, community organisations and other agencies to identify priorities and co-funding opportunities.

“Regions will identify priority investments which support the Government’s vision of creating more productive, resilient, inclusive, sustainable and Māori-enabling regional economies.

“Year one funding is set aside in Budget 2021, from reprioritised funding administered by the Provincial Development Unit (PDU). Further reprioritisation will occur by the PDU to reflect the Minister of Finance’s expectation of value for money and targeted investment where it is most needed.

“The $200 million fund will be seed funding for regional priorities, with further funding decided on a case by case basis.  The investments will be strategically designed to unlock various other sources of capital to get projects underway.

 The PGF invested more than $3.11 billion in regional economic development in its three year life. Existing PGF projects will continue to be progressed.

Our regions are a vital part of New Zealand’s economic strength but have been neglected in the past, stifling economic growth and living standards in regional communities.

“We are taking a new approach, focussing on building strong partnerships to help regions realise their economic potential. The PDU will work in consultation with other parts of government and the private sector to ensure a more effective all of government regional economic development strategy.

“Creating the Regional Strategic Partnership Fund is a significant move and represents another step toward creating a productive, innovative resilient and sustainable economy. 

“Investments are creating enhanced regional and community assets, improving the environment, diversifying economic activity, enabling opportunities for wider investment by local government, iwi and businesses, and boosting employment.

“The PDU will continue to have management and oversight of the new fund. It has a track record of regional investment in loans, equity and grants, and manages $4.5 billion in eight separate funds which are contributing significantly to building our regional economies.

“This process will overcome longstanding issues and barriers which have previously held back regions, while contributing to our economic recovery from COVID-19 and laying the foundation for our future,” Mr Nash said.

The PDU will adopt a new name to reflect its new focus. It will be known as Kānoa, or the Regional Economic Development and Investment Unit. Kānoa has a broad meaning through proverb and whakataukī, with reference to home fires, and to the guardian of the store house who helped others to thrive.