The Tasmanian government is hoping to unlock millions of dollars of private investment in property development and civil and commercial construction through a new fund set to provide one-off relief for infrastructure costs on significant dollar value building projects.
Announcing the launch of the Major Development Infrastructure Assistance Fund at the Tasmania Chamber of Commerce and Industry Jobs Forum earlier this month, State Premier Lara Giddings said the government would provide grants of between $100,000 and $1 million to encourage developers to bring forward projects that have the potential to generate immediate and ongoing economic activity.
Open to projects involving an overall capital expenditure of at least $2 million, the grants are designed to provide up to 50 per cent of the costs of infrastructure such as electricity networks, waste and water networks, roads, rail, wharves and gas networks on new developments.
Giddings says the new measures, which come on top of the $30,000 incentive program for first home builders and recent payroll tax relief, were part of the government’s plan to stimulate the island state’s economy.
“Following close consultation with the construction industry, the State Government is taking direct action to create jobs and investment,” she said in a statement. “By supporting major developers in this way we will bring forward significant projects that have the potential to generate immediate and ongoing economic activity.”
Despite having picked up over the last quarter, Tasmania’s economy is no larger now than it was two years ago.
This, plus an absence of any significant population growth and a dearth of large scale developments on the immediate horizon apart from the NBN and the $900 million ParanVille Housing and Education Development in Hobart, is feeding through into subdued levels of building activity. As a result, the construction sector has lost almost a quarter of its workforce since employment numbers peaked at 22,000 in the three months to August 2011 (ABS figures) at the height of the Building Education Revolution.
Applicants for the new grants will have to demonstrate that work on their project will commence by June 30, 2014 and that their development is of a nature which will facilitate ongoing employment generation beyond its construction phase, Giddings says.