Half the country's court buildings are crumbling, some are not safe or have mould and the cost of fixing them has blown out past a billion dollars, forcing a flagship project to be crimped to fit.

In an Official Information Act response from the Justice Ministry about its $5 billion worth of property, it admits to spending a tiny fraction of what it should have to keep them up to scratch.

"More than 50 per cent of our assets are failing," says a ministry property assessment in June obtained under the OIA.

Forty-three per cent of its 100-plus buildings rated "poor or very poor", and are getting worse.

"Chronic underspend, with no additional new investment over many years has led to a portfolio in critical condition."

Tauranga is so bad it has had to send all High Court sittings to Rotorua - "placing a disproportionate burden on the Rotorua pool of jurors" and on lawyers and families, says a ministerial talking point.

But its rebuild - held up by the government in 2019 as a "model" for the country to redesign courthouses for the people - has had to be chopped in two, with just the first stage more than doubling in price to over $200m.

The documents show the next government will inherit a justice estate where the busiest courthouses are not fit for the public, defendants, staff or judges.

The June assessment warned of "13 courthouses in very poor condition".

Count among them four district and High courts in Auckland, three in wider Wellington and two in Rotorua.

"These are generally the busiest courts so their failure will cause the most disruption."

These 13 alone need revamps costed at $700m. All are behind schedule, two of them by six years; four do not even have a timetable to start.

 

A Ministry of Justice graph showing budget plan, estimated costs and due date for current major capital projects. Photo: Ministry of Justice.

The $700m would gobble up all the ministry's funding if the costs stood still, which they will not - cost escalations for nine of the 13 are at $250m and counting - and this does not factor in having to fix another 30 buildings in "poor or very poor" shape.

Ironically, the ministry has all this on the one hand, and on the other, a $170m project, Te Au Reka, to digitise the courts with shiny new IT inside these very buildings.

The documents and Cabinet papers all stress how vital good buildings are to dispensing justice.

Ministry of Justice underspending on maintenance

So just how did Justice get to this point?

"Constant underspend = continuous deterioration," the ministry's lead document sums it up.

This is next to a page that states the agency's guiding strategy: "Rise Together".

But maintenance has not been rising. The ministry has been spending just $36m a year, or 0.5 per cent of portfolio value, on infrastructure.

"For good stewardship this should be 4 percent," it says.

The documents provide little guidance to who was accountable for that.

The ministry told RNZ it was currently reassessing its properties again, to prioritise spending.

This year's storms have made things worse at the many leaky courts, Gisborne Māori Land Court, Hutt Valley and Waitākere district among them.

"We are experiencing the impacts of underinvestment now. [For example] eg temporary closure of six Auckland District Court courtrooms due to flood damage - the country's busiest court, ongoing health and safety issues more generally, impacting court staff and participants."

This then necessitates air testing for mould.

"Eleven ministry-owned sites have had regular air quality testing due to concerns there could be mould since June 2020."

Not surprisingly, the proportion of property in a bad way has jumped from 30 percent in 2020 to 43 percent, according to one internal estimate, or over half, according to another.

Plan for Tauranga court suffers delays, rising costs

Tauranga, announced in 2019 as a $100m "model" for courts everywhere, captures the problems in microcosm.

When Cabinet signed off an indicative business case in 2021, "no substantive design had been undertaken"; when it was undertaken, last year, it did not add up.

Covid had braked the project, inflation kneecapped it and it did not help when planners underestimated how big it should be.

So, the cost has doubled, to $208m, to get only the first stage of the original "Wellbeing" design done. A second stage was uncosted, and unscheduled.

But the ministry has no choice. Half its courtrooms in the city were in a building, Cameron House, "with extensive water damage, decay, and mould growth".

The High Court cannot function so has had to shift to Rotorua, "causing difficulties for victims and defendants and the local legal profession and their families", a 'talking point' for the Justice Minister said in late June.

The grand Tauranga plan had harboured very high hopes. The government in 2019 said: "This is an investment New Zealand must make to meet our commitment to put victims at the heart of the justice system". Courts had to be redesigned, the chief victims advisor, the Safe and Effective Justice Advisory group and Māori, had told it.

The ministry said the rebuild "presents an opportunity to take a bold and different approach ... to allow iwi and communities to influence how justice services are delivered in their area".

Four years on, Tauranga now harbours a warning for the many fraught projects ahead; of possible division - "several interested parties would like to see one of the higher cost options progressed" - and hard trade-offs - that "will need to be carefully managed".

Even pared back, the extra cost at Tauranga will "slightly" delay other lower priority projects, notes said. Hutt Valley's $30-40m new build, once a key project, is now on hold.

As in Tauranga, doing nothing nationwide was not an option.

A property overhaul list of courthouses up until 2033. Photo: Ministry of Justice.

Justice Ministry considers how to complete the work

A Ministry of Justice graph indicating the current condition of New Zealand's courthouses. Photo: Ministry of Justice

If base funding nationally remains unchanged, within a decade virtually all the 100 ministry courthouses and other buildings will be in poor (10) or very poor (24) condition or "have issues", the June assessment shows.

The papers mention a $1 billion price-tag over 10 years. But this was not future-proofed against the pressures noted time and again in the ministry's commentary to RNZ:

"The increased cost of construction materials and changes to regulatory requirements" such as meeting energy Green Star targets, have helped double Whanganui courthouse's new build to $90m.

"The original budget and completion dates were indicative only and were estimated prior to detailed costings and timings could or had been undertaken," it says of why seismic work at Hamilton district court is four times ahead of its budget of $10m.

Last month it got $150m to earthquake-strengthen three courts - Auckland and Hamilton District, and Wellington High Court - but such work is notoriously prone to blow budgets.

One hundred minor projects are also on the go, such as upgrading 30 docks for safety.

Other public agencies including Te Whatu Ora have struggled to get accurate business cases done, but Justice asserted its business cases were solid, while adding there was no way a project like Tauranga could have anticipated the cost rises from Covid.

"The ministry uses the Treasury's 'Better Business Cases' model."

To get the work done, it now aimed to standardise designs more, for instance, using Tauranga's design in Rotorua, and Whanganui's in Papakura.

It's also looking at changing the funding approach, paying consultants KPMG to look at that.

"Feasibility study to consider how we can fund three new builds partnering with private sector, to repay over 25 years - lease to own model," it says.

-Phil Pennington/RNZ.