18 August 2010
The Federal Coalition released its infrastructure policy yesterday.
The Coalition says that, in government, they will implement a “rigorous” nationwide planning regime in conjunction with state and territory governments and Infrastructure Australia. However, this does not mean uniform town planning laws.
The basis of this system will be “sustainable population projections” developed by a “Productivity and Sustainability Commission” inquiry into the management of Australia’s population. Population projections will be updated in the Budget every year.
Using this information, cities and regions will be tasked to adapt existing, or to develop new, long term plans identifying their infrastructure requirements.
The Coalition says it will ensure that local and state governments develop long-term infrastructure plans that provide consistent opportunities for investment in well-thought through projects. A stable pipeline of projects will “provide certainty” to the construction sector, apparently helping to increase competition and moderate increases in construction costs.
The policy says that plans will identify future requirements for the full spectrum of infrastructure including roads, public transport, water, power, communications and sewerage systems, hospitals, schools, parks and sporting facilities.
Only projects identified within “robust” regional or city plans would be eligible to apply for federal funding assistance.
Also canvassed in the policy are infrastructure bonds linked to tax concessions. Under this plan, a Coalition Government will seek advice about the creation of a new form of infrastructure financing product that will attract household savings through “generous” tax arrangements to lower the costs of financing infrastructure and “ultimately boost Australia’s domestic savings and its productive capacity”.
The total annual cost of the scheme will be capped at $150 million per annum, which the policy estimates will provide sufficient funding to generate financing for up to $20 billion of bonds in two rounds of applications, commencing from 1 July 2011.