Transport infrastructure

Matthew James, Science, Technology, Environment and Resources

Key issue 
Australia’s transport infrastructure continues to attract criticism. Several major projects are proposed, but infrastructure decisions continue to be complicated by complex jurisdictional responsibilities, problematic financing arrangements and an overall lack of national coordination.

Infrastructure deficit

As Australia advances into the Asian century, shortcomings in its national transport infrastructure are becoming more apparent in terms of increasing traffic congestion, antiquated public transport networks, inadequate airport facilities and general shipping delays and restrictions. Each on their own can prove troublesome, but when combined they can reduce productivity and affect Australia’s national reputation and living standards.

Reinforcing the idea of an infrastructure deficit, in June 2013, the advisory body Infrastructure Australia (IA) produced the National Infrastructure Plan (NIP) which stated clearly that, despite progress, much remains to be done:

Most notably, transport infrastructure construction has increased two and a half times, with over $22 billion in engineering and construction activity occurring in 2009–10 … Nonetheless, we still face a significant infrastructure deficit, estimated at around $300 billion.

These are not new issues and the infrastructure backlog has been evident for much of the past decade and in global rankings. Engineers Australia’s Australian Infrastructure Report Card 2010 found that notwithstanding significant expenditures over the previous five years, standards had not improved largely due to the enormous backlog of projects.

Candidate projects

However, the wish list of projects that IA has on its books does not necessarily reflect those championed by state governments, political parties and various interest groups. Before the election, both major political parties committed funds to various proposals such as urban motorway schemes and metropolitan rail projects. Local priorities can vary from strategic national choices.

For instance, the ALP favoured the Melbourne Metro urban rail tunnel project over the East-West Link road tunnel championed by the Coalition. However, it was reported that the coalition parties did not support funding for urban rail projects over regional projects, such as the inland rail scheme. The Greens supported greater urban rail spending, high-speed rail and a funding shift that prioritises sustainable transport infrastructure, such as public and active transport and freight rail.

However, a second Sydney airport and an east coast high speed rail network were not listed as candidate projects by IA. Following the August 2013 release of the High Speed Rail Advisory Group’s report, the ALP committed to preserving the property right of way for the tracks that would be required in the future. The Coalition stated that it would make a decision on the site for a new Sydney airport in its first term of government.

The federal Labor Government claimed that over the six years to 2013–14, it committed $36 billion to Australia's transport infrastructure. Given the considerable time often required to prepare for the construction of particularly large projects, much of this funding was provided in the budget forward estimates. The 2013–14 Budget allocated almost $24 billion to infrastructure spending, including funds for large projects, such as the Sydney F3 to M2 motorway link, the Brisbane Cross River Rail project and the Melbourne Metro rail expansion. All of these projects will take years to complete.

Integrated infrastructure

The choice of infrastructure projects is not a straightforward matter and the IA’s NIP notes the effects of multiple competing interests:

Australia has nearly 600 different local, state and territory Governments that, together with the Australian Government, fund and plan infrastructure. Through this multitude of players, our infrastructure development is slow and delivery risks are high, which constrains our productivity and makes our projects less attractive for potential investors.

The NIP urges integrated infrastructure planning across all levels of government.

In May 2013, the Urban Coalition (UC), a coalition of various sustainability and development organisations, separately proposed an Urban Infrastructure Fund. The UC recommended the establishment of a new federal government department for cities and urban development and strengthening IA’s role.

Meanwhile, through IA, the National Infrastructure Construction Schedule (NICS) established the first national government infrastructure listing of committed projects as a collaborative effort between the Australian, state and territory governments and local governments. The NICS provides information on major infrastructure projects committed by governments across the country in an online database.

Financial issues

When it comes to project costs and construction times, Australia’s best efforts seem high when compared to similar projects overseas. The IA’s NIP states:

Another recent comparison shows per kilometre costs for Australian road, heavy and light rail projects toward the upper end of similar projects in developed countries around the world. Poor project governance in Australia is one major reason why projects fail to meet their timeframes, budgets and quality objectives.

Financial solutions to the infrastructure backlog are being studied, both locally and by the Organisation for Economic Co-operation and Development. An Infrastructure Finance Working Group (IFWG) was tasked with investigating ways to improve the capacity of Australian governments to invest in infrastructure projects. There has also been a reported policy push for the office of financial management to examine an Infrastructure Partnership Bonds Scheme to encourage private investment in infrastructure projects.

Nonetheless, there are likely to be jurisdictional complexities that hamper infrastructure funding. Under the Australian Constitution, the Commonwealth has some powers in respect of transport, but responsibilities and funding for the various transport modes and key infrastructure facilities are shared between all three levels of government.

The Coalition’s infrastructure policy proposes the strengthening of IA to develop a 15-year overview list of major projects. This would be revised every five years, along with audit and evaluation responsibilities. The policy also suggests the creation of a funding and advisory unit to investigate financing options.

Engineers Australia has released a request that Australia’s political leaders move away from picking out projects just before an election:

To achieve the best outcomes for all Australians from the limited funding available, our long term infrastructure planning decisions should be made in a transparent manner unaffected by election cycles.

With the election over, the new Parliament will need to grapple with new thinking and a wider vision in this arena for the sake of Australia’s future. Challenges will continue when it comes to the difficult task of selecting, prioritising and paying for infrastructure.

Further reading

R Dossor, ‘Roads and rails’, Budget Review 2013–14, Research paper, 3, 2012–13, Parliamentary Library, Canberra, 2013.

M James, ‘Motorways for the masses’, FlagPost weblog, 6 March 2013.

M James, ‘Of airports and high speed trains’, FlagPost weblog, 11 April 2013.

Infrastructure Australia (IA), National infrastructure plan, IA, Canberra, June 2013.

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