Mar 12, 2013

Building the infrastructure for tomorrow – Opinion – Earthmover and Civil Contractor

We are a nation with vast distances between our major population centres. That means big infrastructure and transport needs. These needs will only grow as our economy continues to buck international trends and outperform those of almost all comparable nations.

The Gillard Labor Government sees transport and infrastructure as the key to boosting our national productivity which is why have made major changes to the way we plan invest in and build infrastructure.  This began with the creation of Infrastructure Australia in 2008 which was established as a body independent of government to break the nexus between the short term-ism of the political cycle and the long term vision necessary for the infrastructure investment cycle.

When we came to office, we faced a big challenge. Chronic underinvestment in infrastructure had left a serious deficit. The OECD ranked us 20 out of 25 member nations when it came to our investment in public infrastructure as a proportion of national income. Public investment in the nation’s infrastructure had fallen by close to 20 per cent, cutting almost one percentage point off annual growth. More than $2 billion was slashed from the Federal roads budget when the Coalition came to office. Rail investment was virtually zero. Federal investment in urban public transport infrastructure was actually zero. The IT and Innovation Foundation ranked Australia 27th out of 30 countries on average download speed.

Among the major tasks completed by Infrastructure Australia so far have been a national audit of our infrastructure needs and the formulation of a pipeline of priority projects which the Federal Government is funding through our Nation Building Program. In our latest budget we committed funds to the final of 10 projects on IA’s original 2009 Priority List.

At present, we are rolling out the final projects in Nation Building Program One, a $36 billion six year program of major improvements to our national road and rail networks. There has been a doubling of the roads budget. We are rebuilding one-third of the interstate rail freight network. We are committing $7.3 billion towards an urban passenger rail project in every mainland state, with two projects in Queensland. Traditionally the responsibility of the States, this investment in public transport is greater than that of all Commonwealth Government’s combined since Federation.

In order to be internationally competitive we need to create better connectivity between our factories, farms and mines to our cities and ports. That’s why we’ve introduced a National Ports Strategy and the National Land Freight Strategy which set out to create a seamless economy, free of the bottlenecks that inhibit growth. These strategies are a blueprint for better long-term planning and linkages between our ports, intermodal terminals, land freight system and connecting infrastructure.

One of the greatest challenges we face as a nation is improving the productivity, sustainability and liveability of our 18 major cities. Our cities are home to three out of every four Australians and generate 80 per cent of our national wealth. Recognising this, the National Urban Policy was developed, setting out the Government’s agenda and presenting a long-term national framework to guide the future shape of our cities.

This Government recognises that much closer cooperation with the private sector is essential if we are to address the vast infrastructure deficit being faced by Australia. That is why I brought together a team of government and private sector experts – the Infrastructure Financing Working Group – which has provided advice on how to attract greater private sector investment in our national infrastructure projects. The Group addressed three core issues: funding reform, better investment planning and developing more efficient markets. The Working Group’s report has been released and is on IA’s website. It’s recommendations are currently being considered by the Federal Government.

The Australian Government’s recent decision to establish an intermodal terminal at Moorebank is an excellent example of a project that embodies all three of these themes. Moorebank shows how to structure projects that include a user pays model that maximises private sector involvement. Moorebank will demonstrate how Government can better use its existing assets and open up opportunities for private sector investment. The intermodal at Moorebank will remove 3,300 trucks off our roads each day and create $10 billion in economic benefits.

Last May I launched the National Infrastructure Construction Schedule (NICS) which takes another major step towards creating a transparent, competitive and truly national infrastructure market. The NICS (www.nics.gov.au) is a one-stop portal for all upcoming major Government procured infrastructure projects.

It’s the first time this information has been made available in one place. This provides industry and investors with access to a single complete ‘pipeline’ of infrastructure projects worth over $50 million each, bringing transparency and certainty. It also showcases Australian projects to the world, with the goal of enticing overseas constructors to invest in Australia.

The Federal Labor Government has been engaged in the biggest nation building program in our history. We have done this through tough economic times and have not shied away from tough decisions. Our nation building program goes beyond the political, beyond the electoral cycle, because we know quite simply, our economic future depends on it. A strong economy brings opportunities and jobs which in turn creates a more productive, fairer and inclusive Australia. There is still much to be done.