Hence the calls for a grand vision.
Can I foresee a grand plan for Auckland, mirroring Oslo (100% electric vehicles), London/New York (finance), Dubai (futuristic), Singapore (urban mobility), or Riyadh (future infrastructure)? No. Such visions typically require deep central and local government pockets, which we do not have, and the ability to execute.
Maybe I’m just a sceptic. But any country that can manage to spend invest around 5.8% of gross domestic product (GDP) annually on infrastructure over the past 20 years (one of the top spending countries in the Organisation for Economic Co-operation and Development) yet we rank towards the bottom for efficiency with capital productivity typically a negative number, needs to get some runs on the board first.
There are too many basics to fix first, including infrastructure – spending and management of projects, education, government and council finances, risk management, productivity, and housing – before you could ever embark on something truly differentiating.
In rugby parlance, it would be setting a game plan to score lots of tries but without a tight five to deliver the ball.
Start by bringing greater independence into the management of local government assets via a fully independent investment committee. The same for many central government assets. Council and central government assets total $700 billion. Imagine a 1% improvement (do the maths).
The entire Auckland stadium situation is another case in point. The Request for Proposal noted Auckland could not afford four stadiums and the current mix. What does Auckland still have? The same stadium mix.
Auckland and New Zealand is not impotent though when it comes to offering something different. We reside in a fractured world that is becoming increasingly divided with dissatisfied populations, populism on the rise and security a key theme.
Perhaps the greatest addition we could add to Auckland (and New Zealand) would be a return to the political centre this election at a time other countries are moving to the periphery. The periphery is destabilising and drives short-term decision-making. All cities with real vision have taken a long-term view.
If we want to embed the long game, that requires a shift in the political landscape to give greater policy stability across the political cycle.
We reside in a fractured world that is becoming increasingly divided with dissatisfied populations, populism on the rise and security a key theme.
Cameron Bagrie
The playbook on that is not easy and covers economic and social facets with real leadership. But imagine the allure of a country or city that is devoid of the extremism percolating against the current global backdrop? You would fill your boots with talent and capital, with the right migration settings, which we have moved towards.
A broken model
For decades, Auckland has been at the forefront of New Zealand’s broken economic model.
We sold more expensive houses to each other, and Auckland house price growth would exceed national growth.
Credit facilitation has become too dominated by housing. The wealth effect from housing was a contributor to spending. We relied on bums on seats to drive growth via migration and tourism. Migration and tourism can add value – if delivered correctly.
The endgame is housing unaffordability, clashes between generations and weaker productivity (with the latter influenced by many other factors).
With each monthly stagnation in house prices, reality is setting in that New Zealand and Auckland’s growth model needed to and is changing. Hooray.
The stats
Auckland is a $160b region, accounting for 38% of New Zealand’s GDP in 2024, but represents 33% of the population.
At face value, the region is punching above itself, with GDP per person $88,355, compared to $78,233 across the nation.
Wellington supposedly has the highest GDP per capita figures across the country ($92,7760), with a huge government centricity about it, which in my view means we should be wary of what regional GDP per capita figures say. Regional breakdowns of GDP can be somewhat arbitrary.
Auckland’s nominal growth exceeded the national average between 2000 and 2024 (288% versus 266%).
However, on a per capita basis GDP in Auckland rose 160% between 2000 and 2024 compared to 166% across New Zealand as a whole. Auckland has underperformed.
Cities are supposed to benefit from agglomeration economics, or the benefit of scale. Agglomeration occurs through the closeness physical capital, companies, consumers, and workers. There is a flipside. Poorly planned agglomeration (infrastructure) can see cities choke as infrastructure fails to keep up with spread. Yes, that means more inner-city living close to existing infrastructure and a world-class transport system far beyond what Auckland has, which will need to be paid for by society.
A rise in the tax burden over the next decade is inevitable. The only question is the magnitude, which will be a function of growth, and the spending efficiency of the tax/levies/rates paid.
Liveability
Auckland is slipping down the rankings and “economics” is at the core.
Auckland ranked 85th in Oxford’s Global Cities Index 2025. Wellington came in at 78th. For perspective, Australia had three cities in the top 20.
Driving the (lower) ranking were low scores for Economics and Quality of Life, with Auckland ranked 154th for economics, which covers a city’s size, growth, GDP per person, employment, stability, and economic diversity. The quality-of-life ranking was 239th. This covered income inequality, income per person, housing expenditure, life expectancy and the crime rate. Auckland commuters lose 66 hours a year stuck in traffic and its rising. Goodbye quality of life. Hello, Central Otago and the South Island.
Auckland was benchmarked in 2024 (The State of the City Benchmarking Tāmaki Makaurau Auckland’s international performance), against Vancouver, Portland, Austin, Dublin, Copenhagen, Helsinki, Tel Aviv, Brisbane and Fukuoka as comparable cities.
Oxford ranked eight of the comparables higher. Vancouver (37th), Portland (50th), Austin (47th), Dublin (13th), Copenhagen (18th), Helsinki (38th), Tel Aviv (36th), Brisbane (23rd) with Fukuoka the exception, coming in at 205th.
Auckland has lost ground. A common denominator is Auckland’s low rankings for the economy and quality of living. But so has the nation when you look at GDP per capita ranking, which is in the lower quartile of the OECD.
It all starts and ends with productivity
Forget about grand visions. Think small to stand tall. Focus on productivity. We all know the stats. Productivity used to average 1.4% a year in New Zealand. The decade average is now 0.3%. Lacking productivity translates into an income problem, which magnifies cost-of-living pressures.
The enablers are not sexy or grand. They are competition, innovation, AI, digitisation, quality infrastructure spend, red tape, and education. Signs are promising in some areas (education), sub-par in others (AI embracement), flip-floppy in others (necessary housing intensification) and downright disappointing when it comes to competition policy.
There are supposedly some exceptions to New Zealand’s productivity trend. Annual average labour productivity growth in Auckland city centre over the last 20 years (1.6%) has been double that of the rest of New Zealand (0.8%), according to the July 2025 edition of the Auckland Economic Monitor.
The city centre has apparently kept this up since 2019, with the city centre’s productivity premium over the rest of New Zealand rising from 21% in 2004 to 40% in 2024. Agglomeration economics can work. If you want agglomeration economics to work, look no further than having a major proportion of your population around the CBD or easily accessible to it. And that requires transport infrastructure. Much hope is being placed on the City Rail Loop but Auckland suffers from not having a broader rapid transport system.
The bottom line
Beware the promise or the allure of magic potions. They tend to be snake oil. No grand vision for Auckland will ever work if we do not have a productivity and income story to back it up. Get the foundation right before you build the house.
My big hope this year is that New Zealand moves towards the political centre, going against the trends we are seeing globally. With that, the prospect of real long-term decision-making becomes more feasible.