{{image2-a:r-w:200}}Consult Australia’s paper Infrastructure funding: the good, the bad and the extremely unhelpful has urged the government to embrace debt, recycle assets and develop new policies to moderate the extremes of the boom-bust cycle that have characterised Australia’s infrastructure investment up until now.
Consult Australia represents the bulk of Australia’s 49,000 built environment consulting firms.
“Infrastructure provision has lagged [behind] population growth in Australia for more than three decades, [so] it is important to realise that any investment in infrastructure must be focused on the medium to longer term, rather than merely a short term boost to the economy,” Consult Australia chief executive Megan Motto said in the paper.
“With low borrowing costs and a triple-A credit rating, Australia is well placed to deliver the productivity enhancing infrastructure we so desperately need. It is critical that we capitalise on this once in a generation opportunity, support local industry and invest in productivity for the medium- and long-term [future].”
Recommendations
Although the paper specifically provided the government with recommendations, the report also touched on the need for a bipartisan approach to public infrastructure investment, listing it as one of the key priorities.
The additional key recommendations were as follows:
• Overcome institutional resistance.
• Recycle capital to release funds for new infrastructure investment.
• Create new markets for private investment.
{{image3-a:r-w:200}}A few highlights from the report included non-residential construction work in NSW totalling $36.3 billion, and as of the end of 2016, ongoing work on roads and highways worth $18 billion, an increase of 66 per cent when compared to the previous year.
This paper comes on the heels of a separate report by Consult Australia that details how government investment in infrastructure will help mitigate against the impact of stalled construction.
The Consult Australia Economic Forecast 2017 report, released 4 May, said that whilst the share of work relating to heavy industry dropped last year below the previous decade’s average, work on roads and highways increased, therefore ‘softening’ the impact.
Motto summed up the association’s uncertainties on the necessity on infrastructure reforms, stating, “The simple fact is that there is just not enough funding available under current Commonwealth and State government arrangements.”
“Despite the challenges, there is no shortage of opportunities to better leverage government funding of infrastructure through the development of policy levers that facilitate greater private sector investment.”
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