As 2016 draws to a close, it's time to look back on what has been a pivotal year in the push for better infrastructure decision-making and delivery in Australia.
The Australian Government has committed to progressing a series of vital reforms and investments recommended in Infrastructure Australia’s landmark 15-year Australian Infrastructure Plan, which will ultimately deliver better services for infrastructure users around the country.
This includes road market reforms aimed at moving toward a fairer and more sustainable system of funding our roads, and increased investment in planning and project development work to bring forward business cases for the projects now listed on the Infrastructure Priority List.
The government has also committed to working with state and territory governments to drive investment in technologies that make better use of existing infrastructure, and gave its in-principle support to making Australian government funding contingent on agreeing to post-completion reviews of major infrastructure projects.
The Australian Infrastructure Plan
Infrastructure Australia (IA) provides independent research and advice to governments and the community on the projects and reforms Australia needs to fill today’s infrastructure gaps and meet the challenges of the future.
In February 2016, IA released the Australian Infrastructure Plan alongside a refreshed Infrastructure Priority List.
The plan set the nation’s long-term infrastructure reform agenda, while the list provided a prioritised list of nationally-significant investments for all levels of governments to choose from.
Developed following a long engagement process, the plan is a reform and investment road map which aims to deliver effective and affordable energy, telecommunications, water and transport services for all Australians.
Taking the 2015 Australian Infrastructure Audit as the evidence base, IA consulted with more than 500 stakeholders in every state and territory, and received more than 100 formal submissions from governments, peak bodies and the private sector.
The Plan’s 78 recommendations were comprehensive and long-term, and included fundamental changes to the way we plan, invest in, deliver and use our infrastructure.
Some of the recommendations were challenging, but IA was pleased to see how the plan prompted valuable debate about the future of Australia’s infrastructure and our willingness as a nation to undertake much-needed reforms and investments.
The government’s response
On November 24, 2016, the federal government delivered its response to the Australian Infrastructure Plan, supporting 69 of the Plan’s 78 recommendations.
Key recommendations from the Plan supported in the Government’s statement include:
- Commissioning a study, led by an eminent Australian, on the potential improvements and impacts of road market reform
- A commitment to develop a National Freight and Supply Chain Strategy to identify the network constraints and gaps and much needed investments to overcome these challenges
- Using government incentive payments to drive infrastructure reform at the state and territory level
- Examining opportunities to streamline the public funding streams for infrastructure, to deliver greater efficiency and reduce overlap
- Increased investment in planning and project development work to bring forward business cases for the projects now listed on the Infrastructure Priority List
- A greater focus on metropolitan rail in our capital cities by working with state governments to develop urban rail plans for Australia’s five major cities.
Undoubtedly, the government’s response endorses the Australian Infrastructure Plan as the nation’s long-term infrastructure reform agenda.
It is an important first step on the journey toward infrastructure reform, charting a clear pathway to addressing some of the more challenging opportunities for reform that will ultimately lead to better service delivery.
The government’s commitment to progressing the important issue of road market reform is particularly significant, and will help ensure that we can sustainably fund our road networks now and into the future.
As outlined in the plan, the current funding model to build and maintain Australian roads is broken – it is inefficient, unsustainable and unfair.
Road users do not currently receive price signals to minimise their impact on other users and the broader network. The result is a network which is chronically congested for portions of the day, but with excess capacity across most of the 24-hour cycle.
That’s why IA advocated for fuel excise and registration fees to be abolished, and road users to only be charged for what they use.
IA was also very pleased to see the government support its recommendation to make federal funding contingent on the delivery of post-completion reviews of major infrastructure projects.
Post-completion reviews are vital to assess the project delivery against initial expectations, and provide important lessons for governments, community and industry regarding what worked and what did not.
This information is best identified by robust post-completion reviews, which evaluate the delivery and operational outcomes of a project with the evidence that was used to support its selection.
Critically, these processes should be transparent to the public. Making project data and analysis publicly available, including the publication of a project business case, exposes government processes to scrutiny, allowing assumptions to be tested and lessons to be identified and shared.
Progressing nationally-significant infrastructure projects
Alongside the reform agenda outlined in the plan, the government’s response also re-affirmed Infrastructure Australia’s mandate to progress nationally-significant projects.
Infrastructure Australia’s work on business case assessments and adding more projects to the Infrastructure Priority List is only just beginning. The organisation has assessed 17 business cases this year and has another 18 already under assessment for next year.
Significant progress has been made, but there is more to be done. IA will continue to provide robust, independent advice on how the reforms and projects recommended in the plan and Infrastructure Priority List should be progressed.
The year ahead for Infrastructure Australia
The coming year will be an exciting year for IA. In addition to progressing its policy and research program to support the implementation of the Plan’s diverse recommendations, the organisation will also continue its focus on improving project selection through a rigorous process for assessing business cases for major infrastructure projects.
In particular, IA will be refining our business case assessment framework in collaboration with our federal, state and territory colleagues to ensure that it remains fit for purpose and best practice.
Infrastructure Australia’s focus is on action that delivers long-term outcomes for infrastructure users. In co-operation with all levels of Australian governments and industry, the organisation will keep working to support better infrastructure decision-making and delivery in Australia.