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Coalition Infrastructure Australia plan for better value, greater transparency and long-term planning

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Coalition Infrastructure Australia plan for better value, greater transparency & long-term planning 25th July, 2013

NATIONALS Leader and Shadow Minister for Infrastructure and Transport Warren Truss today announced the Coalition’s plan for Infrastructure Australia at the Infrastructure Partnerships Australia Symposium in Sydney.

“A Coalition government will insist on better value for taxpayer investment in infrastructure and take a flexible approach to leveraging private sector investment on a project-by-project basis,” Mr Truss said today.

“The Coalition will reform Infrastructure Australia to enhance its capability as an independent, transparent and expert advisory body.

“Under a Coalition Government, Infrastructure Australia will be led by a Chief Executive Officer, responsible to the Infrastructure Australia Board. In line with other government boards, the new CEO position will be responsible for delivering the strategic objectives of Infrastructure Australia.

“Infrastructure Australia will be tasked with developing a 15-year pipeline of major infrastructure projects to be revised every five years based on national, state and local infrastructure priorities. That’s about better coordinating long-term projects, better planning and giving greater certainty to investors and the construction sector.

“The Coalition will also task Infrastructure Australia with undertaking a new, evidence-based audit of our infrastructure asset base, to be run in collaboration with the states and territories. This audit will also be revised every five years and will help inform the 15-year pipeline.

“We believe a reformed Infrastructure Australia should take a much more proactive role in identifying the infrastructure priorities our nation needs, with an evidence-based audit being an essential precursor.

“Our 15-year lead time is not only important for private investors and getting projects off the ground, but in keeping on top of the next tranche of investment opportunities to keep Australia’s infrastructure relevant and at the cutting-edge of emerging needs.

“Working hand-in-hand with state and territory governments must be the model if we are to achieve cost-effective integration between processes and priorities.

“The Coalition will require Commonwealth infrastructure expenditure exceeding $100 million to be subject to analysis by Infrastructure Australia to test cost-effectiveness and financial viability.

“This requirement will include dams, telecommunications, hospitals, educational institutions, energy projects and water networks.

“In line with our previous commitments, the Coalition will also require Infrastructure Australia to routinely publish public cost-benefit analyses for all projects being considered for Commonwealth support or investment.

“A key plank of the Coalition’s approach is to maximise private sector investment in infrastructure. After meeting with a large number of private investors, superannuation funds, construction companies and many others with a direct interest in infrastructure, there is no ‘silver bullet’ to unlocking the kind of investment we need.

“It is clear that a one-size-fits-all approach will not successfully bring more projects to market.

“Today I announce that a Coalition Government will create a dedicated Funding and Finance Advisory

Unit within Infrastructure Australia, tasked with evaluating finance options for nationally-significant infrastructure projects and investigate and report on funding models.

“The Coalition intends this Unit to harness expertise to assist a diverse array of projects in coming to market, using models that are tailor-made for the project at hand. Whether it be a significant road or rail upgrade, a greenfield port development or the expansion of a major regional airport, we need to look at the capability of each project to leveraging private sector investment.

“We need to ask how that investment can be best facilitated to deliver the modern infrastructure Australia wants and needs.

“To build on this, the Coalition will also require Infrastructure Australia to work with the private sector to investigate and negotiate innovative funding and financing options with regard to projects that are in the national pipeline.

“Businesses and investors have been telling me and my Coalition colleagues that the cost of doing business in Australia is 20%-40% higher than our major competitors.

“This lack of competitiveness is not limited to transport infrastructure projects, with Business Council of Australia research indicating that resource projects are 40% more costly in Australia than the United States, building hospitals here costs 62% more, schools 26% more and airports a staggering 90% more.

“To this end, the Coalition will require Infrastructure Australia to assess the performance of major projects funded by the Commonwealth to improve processes and delivery models into the future and ensure best practice in infrastructure delivery is achieved.”