Thursday saw manger of a New Zealand fund announcing that it has signed up the state pension fund as its first investor, looking to use private capital to help fund public infrastructure works.

A sum of up to NZ$100 million ($66 million) would be contributed by the New Zealand Superannuation fund to a fund with an initial investment limit of NZ$500 million, to be managed by infrastructure investment firm HRL Morrison and Co.

Morrison and Co spokesman Peter Coman specified that the funds are being raised by the Public Infrastructure Partnership Fund (PIP), with the aim to develop social infrastructure such as schools, student accommodation and hospitals.

Coman said: "We're advanced on a couple of negotiations, so within six to 12 months we'd like to have some transactions under our belt. The PIP fund will look to work with individual government agencies on projects, and will seek opportunities in a programme of infrastructure investment designed to help the economy recover emerge from a long and deep recession."

Though the infrastructure would be built by PIP; however, it will not run the facilities. The government will make slow payments before taking ownership of the asset in 25 to
35 years.