New Australian Bureau of Statistics figures identifying the biggest decline in engineering construction activity on record have again highlighted the need for increased infrastructure investment in next month’s Budget.
ABS figures for the year to December 31 last year show engineering construction activity declined by 19.7 per cent over its level in 2015 – the biggest annual fall on record (see graph below).
It followed declines of 13 per cent in 2015, 9.6 per cent in 2014 and 1.3 per cent in 2013. For the first time on record, activity declined over four consecutive years.
The ABS figures cover the value of work done building or upgrading infrastructure such as roads, bridges, railways, harbours, water storage and supply, sewage and drainage, electricity generation and distribution and telecommunications.
Since taking office the Coalition has cut infrastructure investment while pretending otherwise by re-announcing old projects devised and funded by the previous Labor Government.
Previous ABS figures established that total public sector infrastructure investment declined by 20 per cent in the Coalition’s first two years in office.
They also confirmed that for every one of the Coalition’s 12 quarters in office, total public sector infrastructure investment was lower than it was during every quarter under the former Labor Government after its first Budget in 2008.
The Coalition cuts have come at the very time when the Government should have lifted investment to sustain economic activity in the face of the decline of the investment stage of the mining boom.
Indeed, Reserve Bank Governor Philip Lowe has made repeated calls for increased transport infrastructure investment in recent months.
After four years of cuts and spin, it is time for the Government to listen to the experts and lift infrastructure investment.
It should start by investing in urban rail projects, which Mr Lowe said just last week would ease pressure on housing affordability.