"Ai Group supports the commitment to concentrate public support for infrastructure on rigorously evaluated and high benefit projects as detailed in the Review of the Infrastructure Investment Program and the Government's recent Infrastructure Policy Statement," Innes Willox, Chief Executive of the national employer association Ai Group said today.
"In view of the combination of cost overruns, capacity constraints, the limits to public sector borrowing and insufficient rigor in the evaluation of projects, the infrastructure pipeline had become unsustainable and resources were being directed to sub-optimal projects.
"We have a growing and aging population; a need to lift national efficiency and productivity; and a need to invest in major transformations and to fortify against the likelihood of increasingly severe weather events and reduce emissions towards the national targets. Prioritising limited resources on the leading priorities is critical to achieving these objectives.
"Although there may be questions regarding aspects of the methodology of the Government's reprioritisation, it is nevertheless a necessary and decisive improvement that offers the potential to further reduce cost pressures and to set out a more attainable pipeline. The biggest potential obstacle is federal coordination with the infrastructure plans of the states and territories and we urge all governments across the federation, in supporting the recommendations of the Review, to adopt a similar approach and to commit to transparent, rigorous and ongoing audit and review.
"While the reprioritisation is a critical step towards the objectives sought, further efforts are also required. These include securing the skilled workforce and a coordinated boost to the capacity of the building and construction supply chains required to deliver not only the infrastructure pipeline but also the accelerated development of our housing supply.
"Further effort is also required in developing optimum allocation of financial and operational risk between the parties with responsibilities for the ultimate delivery of infrastructure projects," Mr Willox said.
Tony Melville – 0419 190 347