ALC welcomes infrastructure plan

The priorities and recommendations introduced by Infrastructure Australia when it introduced the National Infrastructure Plan have been broadly welcomed by the Australian Logistics Council (ALC). The plan sets out the policy settings Australia needs to deal with the continuing growth in the freight task over the next fifty years.

“ALC shares Infrastructure Australia’s concern that not all major projects in Australia are subject to a full economic assessment,” said Michael Kilgariff, ALC Managing Director. “ALC strongly believes that all major projects should undergo rigorous cost benefit analysis before receiving public funding to test whether they are in Australia’s long term economic interest.

“We also agree with the report’s assessment that a full economic assessment of potential projects will help to ensure the right infrastructure projects are delivered and provide the best value for money. Infrastructure Australia’s proposal to establish a Single National Infrastructure Fund, underpinned by a single assessment and prioritisation, has merit and would undoubtedly lead to better infrastructure decisions being made.

The ALC asserts funding decisions need to be based on supporting projects to achieve positive long-term economic returns, rather than projects which have political appeal but do not have a productivity or efficiency pay-off.

In the light of the impending federal election with both major political parties highlighting infrastructure as a key election issue, the ALC says it is concerned the debate will lose sight of the infrastructure recommendations which prioritise productivity over politics.

“Infrastructure Australia should be the ‘productivity commission’ of infrastructure and should have its role enhanced to play a greater role in scrutinising major projects as well as facilitating greater levels of private sector investment in nationally significant freight logistics infrastructure,” said Kilgariff. “On this second point, I am pleased Infrastructure Australia agrees with ALC’s push to recycle capital for new infrastructure.

“ALC encourages federal and state governments to follow the lead set by the NSW Government and to identify infrastructure assets that could potentially be recycled as a means of unlocking greater levels of private sector investment in infrastructure, particularly from superannuation funds. There are many assets that could be transferred to the private sector, the proceeds from which could fund substantial new logistics infrastructure which is critical to boosting national productivity. ALC also notes Infrastructure Australia’s proposal for greater direct charging of infrastructure to shift a greater commercial focus onto roads.

“ALC has called on both sides of government to consider the development of a National Road Transport Agreement, along the lines of Recommendation 68 of the Henry Review, to bring some surety as to how roads in Australia will be funded and financed on the basis that revenues raised from road users go directly towards road infrastructure and development.”.

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