Proposal for a National Infrastructure Plan

Infrastructure Australia has released its National Infrastructure Plan, the organisation’s latest report to the Council of Australian Governments (COAG). 

Infrastructure Australia Chairman Sir Rod Eddington AO said, “Our aim in preparing this plan has been to provide governments and the community with a clear set of actions to take advantage of the opportunities offered by the growth of the Asian economies over the next half century.”

These actions include:

1. Establishing a single national infrastructure fund.
2. Moving from grant funding of infrastructure to a system that encourages private investment.
3. Selling or long-term leasing of government infrastructure assets and reinvesting the proceeds in new infrastructure.
4. Wider application of user-pays funding arrangements, especially but not only in the freight sector, but on the proviso that users get a say in scoping new projects.
5. Improvements to project governance and procurement to reduce the cost of developing new infrastructure.

Sir Rod noted that there are “challenges in pursuing these reforms” - mainly because the community is wary of change - but “failure to pursue these reforms will leave a poor legacy for our children and our grandchildren”.

The Urban Development Institute of Australia (UDIA) particularly welcomed the idea of a national infrastructure fund, having consistently argued that a consolidated infrastructure fund and rigorous cost-benefit analysis are necessary to meet Australia’s infrastructure needs.

“Most people living in any large Australian city would have experienced firsthand how road and public transport infrastructure is failing to meet demand,” said UDIA National President Julie Katz. “If we don’t rethink how we fund infrastructure, congestion and bottlenecks in our cities will only worsen.”

The proposed infrastructure fund would consolidate a variety of existing Commonwealth funding sources into a single fund, providing a pool of $100 billion to be allocated to critical infrastructure projects backed by a sound economic case.

A recent UDIA survey of public and private sector professionals in the development industry revealed that the provision and funding of public infrastructure was the most significant challenge to developing property, ahead of planning and regulations.

“Communities all across Australia are in desperate need of productivity-enhancing infrastructure,” said Katz. “Failure to take action risks condemning the next generation of Australians to reduced living standards.”