Increasing well-designed high-density development, growing smaller cities, increasing public transport investment, utilising value capture, making BIM compulsory for large-scale projects, moving to a user-pays road system and privatising energy and water infrastructure are among some of the 78 reforms put forward in Infrastructure Australia’s just-released 15-year plan.

If followed, Infrastructure Australia says the plan would see the average Australian household almost $3000 better off a year by 2040.

“Across the nation, we must encourage strategic and integrated planning,” Infrastructure Australia chairman Mark Birrell said. “We can show that we have learned the lessons of the past, pursuing best practice procurement and delivery that sees new infrastructure constructed for the right reasons at the right price.”

The reforms are detailed under four broad aspirations: productive cities, productive regions; efficient infrastructure markets; sustainable and equitable infrastructure; and better decisions and better delivery.

“This plan provides the foundation on which all levels of government can act over the coming decades. The reforms and projects it recommends will, once delivered, drive our nation’s competitiveness and prosperity,” Mr Birrell said.

Priority projects identified

The plan also contains a list of priority projects and initiatives identified by Infrastructure Australia.

Only two projects feature in the “high priority project” list, meaning they have undergone a full business case assessment by Infrastructure Australia. These are the CityLink-Tullamarine Widening in Melbourne and the Perth Freight Link in Perth.

The majority of projects fall under the “high priority initiatives” or “priority initiatives” list, which are those “that have been identified to address a nationally significant need, but require further development and rigorous assessment to determine and evaluate the most appropriate option for delivery”.

“The Priority List is ultimately a platform for better infrastructure decisions – it provides rigorous, independent advice to governments and the public on the infrastructure investments Australia needs,” Mr Birrell said.

Proposed high priority initiatives include:

  • Sydney Metro, NSW
  • WestConnex Stage 3, NSW
  • Cross River Rail, QLD
  • Gawler Line rail upgrade, SA
  • Hoddle Street capacity upgrade, VIC
  • Melbourne Metro Rail, VIC
  • Western Sydney Airport, NSW
  • Preserve corridor for East Coast High Speed Rail, National

“Some of the ideas will be tough to progress, but let that all be part of an open public dialogue about the infrastructure people want, the outcomes it should deliver and the best ways to plan and pay for it,” Mr Birrell said.

“The public policy changes and major projects in the 15-year Plan, once delivered will drive our nation’s prosperity and maintain our quality of life.”

One eyebrow-raising suggestion has been putting the canned East-West Link (or at least a project to “improve the connection between Eastern Freeway and CityLink”) on the high priority list for Melbourne.

The Andrews Government went into the election promising to scrap the project, and having to pay a kill fee to contractors already engaged.

Greens Senator Janet Rice, spokesperson for transport, said the public had rejected the project, and the focus should be on public transport.

“Tony Abbott dubbed the last Victorian election ‘a referendum on the East West Link’ and the toll road received a clear thumbs down,” she said.

“The Infrastructure Australia report lists Melbourne Metro Rail as high priority, so let’s get on with this congestion-busting project.”

Industry welcomes plan

The plan has been welcomed by industry bodies.

The Property Council of Australia said it was “a wake-up call” to policymakers.

“This report pulls no punches on the logjam of infrastructure projects that Australia needs,” PCA chief executive Ken Morrison said.

“The report is a wake-up call to policymakers in federal, state and local governments that we need a pipeline of planned infrastructure projects and we need to better align planning and infrastructure.”

He said the fact there was only two projects ready to go needed to be a catalyst for change.

“Notwithstanding the recent work of many state governments, this report is a damning indictment on the adequacy of our infrastructure planning.”

However, Mr Morrison said the PCA was “concerned” about value capture as a funding mechanism.

“Introducing new infrastructure taxes have the potential to stifle the very growth that any new infrastructure is set to create,” he said.

  • See our post this week on the executive summary of a submission to the Senate Inquiry into “the role of transport connectivity on stimulating development and economic activity”, by  Peter Newman, Evan Jones and Sebastian Davies-Slate, Curtin University

Engineers Australia said it represented a step forward in removing politicisation of infrastructure development.

“The plan is based on an aspiration of better decisions and better delivery. We now call on governments to use the Infrastructure Australia plan to provide community with assurance that they are getting value for money from their tax payer dollar,” Engineers Australia chief executive Stephen Durkin said.

Consult Australia called the plan and priority list a “sophisticated and phased approach”.

“Infrastructure Australia has done an excellent job of pulling together a document which explores a broad range of issues and challenges facing the infrastructure sector in a comprehensible yet easily digestible document,” Consult Australia chief executive Megan Motto said. 

“In particular they have shown cognisance in areas where political sensitivity calls for a nuanced and pragmatic approach.

“For example the suggestion of a public inquiry into road user charging is a sensible way of addressing both the lack of robust information regarding the current pricing system and the emotionally charged nature of this highly political issue.”

She said the success of the plan would be demonstrated by “implementation and improvement” and called on the government to make a timely response to the recommendations.

The Water Services Association of Australia said the recommendation to privatise commercial government-owned infrastructure was a matter for individual government shareholders, however WSAA executive director Adam Lovell said “the water-specific recommendations in the plan provide a strong platform for the urban water industry regardless of future ownership”.

Select recommendations:

  • To meet the demands of population growth Sydney, Melbourne, Brisbane and Perth should accelerate the delivery of high-quality, higher density development within established urban areas
  • All governments should ensure that processes are in place to deliver high-quality, well-designed, higher density development, connected to infrastructure and public amenities
  • Governments should upgrade legacy capital city passenger transport infrastructure to deliver higher capacity, high-frequency services across all modes
  • The Australian Government should initiate a public inquiry, to be led by a body like the Productivity Commission or Infrastructure Australia, into the existing funding framework for roads and development of a road user charging reform pathway
  • The Australian Government should require all project proponents seeking Australian Government funding to consider whole-of-life maintenance costs in their business case, and where possible they should be captured within the proposed contract structure
  • Australia’s state and territory governments should seek to increase the funding sustainability of public transport provision both through the pursuit of operating efficiencies and a more appropriate alignment of the funding burden between public transport users and taxpayers
  • Governments should routinely consider value capture opportunities in all future public infrastructure investments
  • All governments should transfer their remaining publicly owned electricity generation, network and retail businesses to private ownership
  • Governments, through the COAG Energy Council and the Australian Energy Market Commission, should introduce more flexible network tariffs in the near term
  • The Australian Energy Market Commission, in cooperation with governments, should develop electricity metering competition to facilitate the efficient, market-led rollout of smart metering technologies, taking into account positive and negative lessons from Victoria
  • Governments and regulators should evaluate the likely impacts of emerging and disruptive technologies on the national electricity market and recommend specific reforms to address potential regulatory failure and technology disruption
  • Governments should define a pathway to transfer state-owned metropolitan water utility businesses to private ownership to deliver more cost-effective, customer-responsive services
  • Australia’s energy and transport sectors should deliver emissions reductions in line with international commitments
  • Building on the Energy White Paper, governments should work with the private sector to develop a cohesive strategy for supporting a transition to a lower emissions electricity generation sector at lowest cost to users and taxpayers
  • Australia’s light and heavy vehicles should keep pace with global best practice efficiency and emissions standards
  • Where this has not already begun, state, territory and local governments should demonstrate integration of active transport strategies through transport and land-use planning
  • Infrastructure owners and operators should develop and maintain strategies to improve the resilience of infrastructure, and minimise the costs of mitigating risks by considering resilience within whole-of-life cost projections
  • Renewable energy should replace diesel generation in remote communities wherever it is affordable and efficient to do so
  • Governments should make the use of Building Information Modelling (BIM) mandatory for the design of large-scale complex infrastructure projects

See the full plan and recommendations

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  1. The headline apportions too much credence to one meagre recommendation regarding the use of BIM. For an “innovation government” the single recommendation in the document (10.4) regarding BIM is vague and non-specific with no commitment to associated investment or real leadership. The heavy focus on transport of many sorts and to a far lesser extent water, energy and communications in the document fails to outline how the government will address the overdue need for real innovation in the construction sector. Real innovation in an industry that employs 12% of the workforce could deliver the productivity gains the government espouses as overdue. The Infrastructure Australia Report fails the “innovation” test.