What are the strategies about?
The recently published infrastructure strategies issued by the state and federal independent infrastructure advisory bodies, Infrastructure Victoria and Infrastructure Australia, provide a roadmap for infrastructure reform following broad consultation with industry, academia and government, with some consistent themes. Our First Nations People, climate change and the pandemic all feature heavily in the fundamental principles driving the recommendations, while the need for adaptability and resilience in this time of uncertainty is a common theme.
The Victorian Infrastructure Strategy 2021-2041 (Victorian 30 year strategy) is the second since its establishment in 2015, and provides 94 recommendations, with 53 policy changes and reforms, and 41 infrastructure capital investment projects with a combined total capital cost of $100 billion over 30 years. 90% of the 137 recommendations issued in the last strategy have now been implemented, so we anticipate a similar approach will be adopted by Parliament upon consideration of the current recommendations. (See link to whole report https://www.infrastructurevictoria.com.au/victorias-infrastructure-strategy-2021-2051-home/.)
The 2021 Australian Infrastructure Plan is the second plan issued by Infrastructure Australia, and responds to 180 infrastructure challenges and opportunities identified by the 2019 Australian Infrastructure Audit issued by Infrastructure Australia, and considers the impacts of the COVID-19 pandemic identified in the Infrastructure Beyond COVID-19 Report. The 2021 Plan provides a reform pathway with 29 recommendations with a 15-year roadmap which can respond to anticipated changing trends and potential global shocks and stressors, to build a stronger and more secure Australia. (See link to whole report https://www.infrastructureaustralia.gov.au/publications/2021-australian-infrastructure-plan.)
This article provides a summary of some of the key recommendations for change.
What are some of the key recommendations of the Victorian Infrastructure Strategy?
Given the Victorian Government’s current $80 billion Big Build of road and rail projects already well underway, it is unsurprising that many of the recommendations focus on transport infrastructure, including:
- a transition towards zero emissions vehicles both for consumers and government fleet and freight and preparation for increasingly automated vehicles (Rec. 1, 2, 21);
- augmentation of electricity transmission for renewable energy and resilience (Rec. 3);
- the application of technological advancements to develop a new road management system for priority transport modes, and refinement of public transport capabilities (ie. pricing & ticketing, smart buses, new tram links and rail corridors) to reduce pressure on the transport network (Rec. 24, 41-48 & 57-61);
- improvements to the freight network through investment in the development of ports and intermodal freight terminals (Rec. 63-66);
- continued investment in maintenance and upgrade of regional roads and the redesign of public transport for the regions (Rec. 78, 79 & 83); and
- introduction of a user pays model and full-scale congestion pricing in inner Melbourne and metropolitan freeways to encourage less road usage (Rec. 51, 52, 53).
As to other infrastructure, some of the key projects recommended include:
- (Water) consideration to be had for whether augmentation of water supply is required (ie. by recycled water, seawater desalination, stormwater harvesting, better use of the water grid, progress integrated water cycle management, and an upgrade Victoria’s emergency water network) (Rec. 13, 14, 17);
- (Courts) the construction of contemporary, adaptable multi-jurisdictional court facilities, harnessing digitisation of document management and court systems and procedures in the Melbourne CBD as well as in the North and South, in the next 10 years (Rec. 26);
- (Hospitals) the redevelopment of the Royal Melbourne Hospital, and the upgrade and rebuild of the Alfred and Austin hospitals in the next 10 years; construction of a new Melton hospital and the expansion of Werribee Mercy Hospital in response to increasing demand from Melbourne’s outer northern and western suburbs in the next 30 years; and the establishment of a fund for health innovation (Rec. 25, 56 & 69);
- (Critical infrastructure) an update of legislation to increase the sectors considered as ‘critical infrastructure’ (other than water, energy and transport); legislation to be amended to require building and maintenance resilience in infrastructure, and information sharing for timely and coordinated responses to emergencies (Rec. 20);
- (Homes and buildings) strengthening of enforcement of energy efficiency requirements for new homes, new requirements for all buildings delivering public services to achieve accessibility standards, and rapid renewal of old public housing (Rec. 5, 54, 55); and
- (Waste) transition to a circular economy for waste and recycling, climate change, transport and energy (Rec. 1-3, 13, 28-31).
What are the key recommendations of the 2021 Australian Infrastructure Plan?
The 2021 Australian Infrastructure Plan provides 29 reform recommendations, with a detailed implementation pathway and timeframes for stakeholders with a role in reform (ie. Infrastructure Australia, governments, industry and individuals and the community), and with nearly half of the reforms within government remit.
The Australian Government has flagged an intention to formally respond to the recommendations, and in 2016 this process took 12 months so the expectation is that similar timeframes will apply.
Some of the key recommendations in the 2021 Australian Infrastructure Plan include:
- (place reform) establishing the identity and uniqueness of communities to provide the appropriate infrastructure to unlock their particular potential (Rec. 1.1 & 1.2);
- (sustainability and resilience) building resilience in infrastructure in the face of natural disasters and cyber-attacks (Rec. 2.2);
- (industry productivity and innovation) developing an infrastructure project pipeline to actively track progress of projects, with annual briefings as to expected procurements to occur, and providing a forum to provide feedback on risk (Rec. 3.1);
- (transport) creating robust supply chains and transport options to connect regional and remote Australia (Rec. 4.2); establishing a single national market for electric, connected and autonomous vehicles (Rec. 4.3); effecting transport pricing reforms for a nationally coordinated and multimodal network pricing scheme (Rec. 4.4);
- (energy) educating households and businesses to reduce energy bills (eg through solar panels, electric vehicles, smart meter installation) to drive change in industry (Rec. 5.1 & 5.2);
• (water) integrating the management of water infrastructure throughout the whole water cycle, including establishing a national stormwater management framework, and improving stormwater infrastructure (Rec. 6.2);
- (telecommunications and digital) improving the reliability of telecommunications and the NBN to ensure resilience in the face of emergencies (Rec. 7.1 and 7.2);
- (social infrastructure) investing in a balance of physical and digital social infrastructure, including a transition to digital health service delivery, upgrading of VET facilities, and improving social housing quality (Rec. 8.1); and
- (waste) establishing a nationally consistent waste data strategy, including data collection, recycling and waste levy pricing (Rec. 9.2).
What happens next?
The proposed reforms will be commended to the respective Parliaments for their further consideration. Given the fundamentally important nature of the key recommendations, our Construction and Infrastructure Group (together with the rest industry, no doubt) eagerly anticipates both a timely and comprehensive response, to ensure that these highly worthwhile initiatives (and corresponding projects), can progress to implementation without delay.
How can we help?
Our Construction & Infrastructure Group has a strong commitment to the implementation of the infrastructure industry reforms which underpin many of the key recommendations outlined above. This is because we recognise that – fundamentally – the implementation of those initiatives is critical to not just improving the procurement and delivery of the underlying infrastructure itself, but to achieving vital economic, social, cultural and environmental outcomes. If you would like to explore how the proposed infrastructure reform recommendations could touch your organisation or your projects, we would welcome the opportunity to start a discussion with you.
To underscore our commitment to assisting the infrastructure sector to drive its reform agenda, Marko Misko is currently involved with a timely and exciting initiative, jointly championed by Roads Australia, the Australasian Railway Association and the Infrastructure Sustainability Council, in his capacity as the Roads Australia Sustainability Chapter Chair and Board Member. The initiative aims to reduce climate change in new and existing transport infrastructure. ClimateWorks Australia’s 2020 Reshaping Infrastructure For Net Zero Report estimated that the transport industry contributed to approximately 50% of infrastructure’s total annual construction emissions. The initiative’s focus will be to create and facilitate measures and make policy recommendations in the transport infrastructure space to help Australia achieve net zero emissions by 2050.
Please contact Marko Misko or Toby Mittelman of our Construction and Infrastructure Group with any enquiries.
This article was written by Marko Misko, Partners, Julie Charles, Senior Associate and Kai-Yang Goh, Solicitor.