Following the official release of Infrastructure Australia’s 2021 Australian Infrastructure Plan today, some of the leading industry associations and peak bodies have welcomed the roadmap, noting it’s now time for action.
The Australian Constructors Association (ACA), which represents leading construction and infrastructure contracting companies, welcomed the roadmap, with CEO Jon Davies saying there has never been a more important time for a plan like this.
“All levels of government are relying on the construction industry to lead the economy forward on the basis that every dollar spent on infrastructure has a $3 kick on to the wider economy—but our industry is broken,” said Mr Davies.
“Construction accounts for almost 25 per cent of all insolvencies in Australia, only 12 per cent of the workforce are women and construction workers are six times more likely to die from suicide than a workplace incident,” he said.
The 2021 Plan provides Australia’s infrastructure sector with a 15-year roadmap to drive economic growth. In doing so, it builds on the 180 infrastructure challenges and opportunities identified in the 2019 Australian Infrastructure Audit.
“The Infrastructure Plan contains good recommendations that, if enacted, would improve industry culture, create increased capacity and capability, and ensure that commercial frameworks are equitable and align the interests of all parties,” Mr Davies said.
“What we need now is for the Federal Government to get more involved.
“As the direct procurer of major projects and as a significant source of funding for jurisdictionally led projects, the Federal Government is best placed to coordinate and incentivise reform—and it needs to do this now.
“We cannot afford to wait 5, 10 or 15 years, the record spend is happening now, companies are going out of business now, people are leaving our industry now.”
Reflecting on the recent report outlining the progress made since the 2016 Australian Infrastructure Plan, Mr Davies said the Australian Constructors Association feared a similar lack of progress in improving productivity and implementing market-based reform would be a huge missed opportunity.
“Carrying with it a 5-10-year timeframe for implementation, one of the key recommendations identified in the plan is to improve industry productivity and value for money,” said Mr Davies.
“Productivity growth of construction over the last 30 years trails that of other significant industries by 25 per cent.
“If we could just halve the gap in productivity growth, we could be constructing an extra $15 billion of infrastructure every year for the same level of expenditure and employ an extra 15,000 people.”
He said ACA welcomed the recommendation to use common and best practice commercial arrangements, standard contract forms and delivery approaches. However, he said the target of a 10-15-year time horizon for 80 per cent of projects over $250 million to use a nationally standard contract suite was too long.
“If we wait even five years to progress this reform action, we will miss the opportunity.”
“Infrastructure Australia has played its part,” Mr Davies said.
“It is now over to the Federal Government to ensure the report doesn’t gather dust on the shelves. The entire industry is ready and waiting to support the government in implementing these reforms.”
Transport industry applauds the reform pathway
Roads Australia (RA) – the peak body for roads within an integrated transport system – has also welcomed the Plan, noting it will help deliver more resilient and sustainable transport infrastructure and services for the community.
“RA is pleased to have actively engaged with IA throughout the development of the Plan to share the transport infrastructure sector’s reform proposals. We’ve also worked with IA to identify opportunities where RA can facilitate the collaboration between all levels of government and industry, which the Plan notes is essential to achieve results,” said RA President Michael Bushby.
“The RA Strategic Plan 2021-2023 groups our policy priorities around the four key themes of resilience, place making, people and data & technology. These themes were identified and endorsed by industry as priority areas of focus – and so it is encouraging to see they are embraced in today’s Plan.”
“This is reflected by the recommendation to establish a quadruple bottom line as a goal for infrastructure investment, so that projects are planned, designed, procured, constructed and operated to maximise economic, environmental, social and governance outcomes.”
“RA especially welcomes some of the key recommendations the Plan makes for the future delivery of integrated transport infrastructure and services. In particular, the focus on harnessing opportunities presented by technology by adopting a ‘digital by default’ approach to engineering and construction will deliver productivity, safety and sustainability benefits for governments, industry and the community.”
“The Plan rightly underscores the growing importance of data and technology in meeting customer expectations. The delivery of demand-responsive transport services through customer driven technologies will be core aspect of our future transport network, as flexible work arrangement alter traditional travel patterns and growth in e-Commerce engenders greater demand for last-mile freight delivery solutions.”
“RA also endorses the Plan’s recommendation that Australia transition to a nationally coordinated, multi-modal transport network pricing regime. This will be essential to make certain the nation has an adequate and sustainable financial base to support the delivery and maintenance of transport infrastructure in the decades ahead, as revenues from traditional fuel taxes and vehicle registrations continue to decline.”
“Embracing a coordinated project pipeline that adopts a mature approach to procurement and risk management as recommended in the Plan will improve our industry’s productivity and viability. Enhanced approaches to procurement will also contribute to better social outcomes, including greater gender diversity in our industry’s workforce.”
“Roads Australia looks forward to working with Infrastructure Australia, governments and industry to progress these and other reforms relating to integrated transport infrastructure set out in the Plan.”
Emphasis on sustainability welcomed
The Infrastructure Sustainability Council, the industry peak body for accelerating sustainability in infrastructure, has applauded the Plan’s emphasis on sustainability and resilience.
“We are very pleased to see sustainability and resilience valued as strategic priorities and called out on page three of the Plan, rather than buried one hundred pages deep. This speaks volumes about Infrastructure Australia’s priorities and the future direction of infrastructure investment in this country,” says Infrastructure Sustainability Council’s Chief Executive Officer, Ainsley Simpson.
“The Plan clearly articulates that sustainability and resilience are among the biggest risks to our nation and are at the core of public value. This makes sustainability and resilience our biggest opportunities and a shared responsibility.”
Ms Simpson says Infrastructure Australia’s direction aligns with the Infrastructure Sustainability Council’s strategic plan, released in July, which seeks to embed sustainability into infrastructure decision-making “by making it easy to compare and improve sustainability performance”.
“We must consistently measure what matters because we know measurement leads to better management – and that in turn attracts investment. Members of the Infrastructure Sustainability Council are committed to measuring what matters and more than $200 billion of investment has been registered with the IS Rating Scheme since 2012.
“Our data confirms that sustainable infrastructure delivers for communities, with projects rated under the IS Rating scheme reducing energy consumption by 68 per cent, for example. We also know that every $1 of investment in an IS-rated project returns up to $2.40 in benefits to Australians – benefits like better health outcomes or human capital development.
“Infrastructure Australia’s Plan emphasises the importance of national harmonisation, sectoral and system-level policy and principles, as well as the importance of collaboration to achieve best practice. The IS Council is behind Infrastructure Australia’s call to collaborate to accelerate, because a problem shared, is a problem solved faster.
“We also applaud Infrastructure Australia’s collaborative spirit during the development of the plan. The result is a testament to the many hours of engagement, input and support from industry.
“We support systemic reform and are pleased to see a Plan that advances infrastructure policy, planning and procurement for a resilient, inclusive and low-emission future,” Ms Simpson concludes.
Related stories:
- Roadmap for reform: Infrastructure Australia releases 2021 Plan
- Infrastructure Australia charts a pathway to infrastructure resilience
- Infrastructure Australia report flags shortage of reform incentives