No-one willing to call out the State Infrastructure Plan for what it is

Tuesday 15 March, 2016 | By: Default Admin | Tags: State Infrastructure Plan, State Election, Palaszczuk Government

CCIQ has welcomed the Palaszczuk Government first State Infrastructure Plan (SIP) describing it as a modest but realistic commitment to funding the State’s future infrastructure requirements.

This is a major milestone for the State Government and will provide clarity around the Government’s infrastructure priorities and vision to grow the State. The centrepiece is a new $500 million State Infrastructure Fund anticipated to support more than 1000 jobs.

However CCIQ is concerned that the SIP has failed to address that as a percentage of the economy State Government infrastructure spending has halved since 2007-08 which is clearly having implications for the cascaded economic benefit across the economy.

The State Government must urgently boost infrastructure investment back to at least 4.25 per cent of GSP which is the average for the last ten years.  It currently stands at 2.6 per cent and is projected to fall to 2 per cent across the forward estimates. This cannot be allowed to occur.

State Government infrastructure spending across the next fours years will sum to $35 billion and compares to $40 billion under the LNP and $58 billion under the Bligh Government.

public sector graphic

There is no point having a rolls-royce infrastructure wish list without the means to fund it.

But CCIQ’s concern is that in the short term the engineering, building and construction industry is continuing to shed jobs and in the longer term we are under-investing in our future economy’s infrastructure requirement.

There is widespread recognition among the business community of the important role played by infrastructure in sustaining Queensland’s economic growth.  An investment in infrastructure represents an investment in the future prosperity of our proud state.

The SIP highlights that there is a significant gap between the infrastructure that the State can afford and the infrastructure that the State requires. For example Infrastructure Australia estimates that if the inadequate transport networks in Queensland are not addressed the macroeconomic cost will total $9 billion by 2031. 

Queensland cannot afford this under-investment in infrastructure as other states particularly NSW move rapidly forward with securing future long-term projects.

The $500 million State Infrastructure Fund will be invested in seven road and rail upgrades:

  • Ipswich Motorway Upgrade, Stage 1 Darra to Rocklea
  • Pacific Motorway-Gateway Motorway Merge Upgrade (southbound lanes)
  • North Coast Line Capacity Improvement Project
  • Dawson Highway (Gladstone – Biloela) timber bridge replacement package
  • Rockhampton Road Train Access, Stage 1
  • Kawana and Nicklin Way – Sunshine Coast University Hospital intersection upgrades package
  • Riverway Drive duplication, Townsville (Gollogly Lane – Allambie Lane).

While the dollar outlay is modest there are some significant reforms to the way Queensland plans, prioritises and invests in infrastructure.

The SIP includes the establishment of Building Queensland as an independent infrastructure advisor to government and Market Led Proposals to encourage new private sector investment.

At the same time the State Government has called on the Turnbull Government to provide further funding for infrastructure projects like the Ipswich Motorway, the Pacific Motorway and the North Queensland Stadium as well as a funding commitment to Cross River Rail.

There is no question that the forthcoming Federal Election will place further infrastructure funding on the table but the State Government has its own options if bold enough.  For example the long term leasing or sale of aging infrastructure would provide billions of dollars in new proceeds to Government whilst avoiding the costly maintenance of them.

It is hard to see any future Federal Government feeling overly generous when other State Governments such as NSW, Victoria and Western Australia are all embracing asset recycling yet our State Government has an ideological aversion to this sound option.

However until we come to our senses the expeditious roll out of the modest Queensland Infrastructure Plan is the single best way to get this State moving.

A significant amount of investment is required in Queensland’s infrastructure and our strongest advice to the Palaszczuk Government is getting going on the roll out the State’s Infrastructure Plan. 

 

 

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