Challenges and opportunities in regional infrastructure investment

Publication Date
17 March 2021

Opening remarks

Thank you to the Regional Australia Institute for inviting me to take part in today’s event. I begin by acknowledging the Traditional Custodians of the ACT, the Ngunnawal people. I acknowledge and respect their continuing culture and the contribution they make to the life of this city and this region. It is wonderful to join such a diverse, cross-sector group of panellists today as we consider some of the challenges and opportunities around regional infrastructure investment.

Infrastructure Australia has long acknowledged the infrastructure service quality gaps in regional and remote communities. This is something governments at all levels – and organisations like the Regional Australia Institute – have been working to address for many years.

At the same time, the existing trend of regionalisation has accelerated during the COVID-19 pandemic – with Australian households seizing the opportunity to move away from densely populated metro areas. This has resulted in a 200% increase in net migration from capital cities to regional areas.

Whether this shift is sustained remains to be seen, however for it to stick, we need to think strategically about the infrastructure needs of our regions. For many Australians, to see a future for themselves outside our major cities, they must also see that these places will offer high-quality services. Gaps in service delivery between major cities and our regional areas are a major barrier to the regionalisation agenda.

Gaps in service delivery between major cities and our regional areas are a major barrier

Before I talk about some of the work Infrastructure Australia is doing to address this – I want to emphasise something that I know many of you here today already appreciate – which is that regional Australia is an incredibly diverse place.

Each of Australia’s regions is unique, and so too are their infrastructure needs. The challenges for smaller cities and regional centres like Geelong and the Sunshine Coast are quite distinct from Australia’s small towns and remote communities.

Our smaller cities and regional centres offer a wonderful lifestyle that makes them highly attractive places to live and work – and I speak from experience.

In 1994 my husband and I moved to Lake George, not too far from here, where we took up the family winery and established a restaurant called GrapeFoodWine. We had 400 acres including the Cullerin Escarpment, of this 50 acres under vine, and our restaurant was awarded the best winery restaurant in Australia of the year in the early 2000s. We also hosted large outdoor concerts with Opera Australia, the Fireside Festival and A Day on the Green. 

So I fully appreciate the beauty and challenges of the land, as well as the community and sense of belonging that makes the tree change so attractive to many Australians – particularly in the wake of COVID-19.

Importantly, our smaller cities and regional centres have capacity to grow. And as working remotely becomes more common and the hybrid model becomes the norm, there is a great opportunity for infrastructure investment to drive economic growth in these areas.

This will in turn take pressure off infrastructure in cities like Sydney, Melbourne, Brisbane and Perth – where road congestion is now above pre-COVID levels.  As well as people moving from major cities, we know people from surrounding regions are re-locating to these regional growth centres because they want to access better infrastructure.

Over recent years, many regional centres have become increasingly important to their surrounding regions as service hubs. This hub-and-spoke model will help many regional centres to service their surrounding areas in coming years. So there is a significant opportunity for infrastructure investment to: 

  • Support this regionalisation trend and ensure that it sticks –  and
  • Ensure that satellite cities and regional centres remain competitive and provide adequate opportunities for work and education to support a growing population.

Service quality gaps – Small towns, rural and remote areas

Australia’s small towns, rural and remote areas face very different infrastructure opportunities and challenges. High construction costs are a major challenge, sometimes compounded by:

  • Vast distances with low population density
  • Limited local workforces, and
  • Significant challenges of attracting workers to remote projects.
  • Exposure to extreme climate and weather events, including drought, bushfire and flood, also bring considerable resilience risks.
  • And rural and remote areas can be more vulnerable to the risks of natural hazards, requiring greater investment to protect or maintain these assets.

Many of our small towns, rural and remote communities also rely single assets and networks, with limited choice for users and increased likelihood of redundancy or asset failure. At the same time, communities and businesses in these areas are also more reliant on available infrastructure for their productivity and wellbeing. There are opportunities to share resources, skills and facilities between these communities, and between smaller communities and larger metropolitan centres, to:

  • Reduce costs
  • Improve access and
  • Co-ordinate infrastructure delivery more effectively.

Improved infrastructure access can assist these communities to more successfully meet economic challenges, build resilience and improve quality of life, especially in Aboriginal and Torres Strait Islander communities.

2021 Infrastructure Priority List

With these challenges in mind – supporting economic growth in regional areas was a key focus of the 2021 Infrastructure Priority List, which Infrastructure Australia published just a few weeks ago. More than half of the investment opportunities on the 2021 Priority List benefit our regional communities.

This is something we are proud of – while also acknowledging that infrastructure deficits exist in many regional communities. Maintaining the Priority List is one of Infrastructure Australia’s key responsibilities as the nation’s independent infrastructure adviser. To develop the list, we draw on our own independent research and submissions from state and territory governments, industry and the community. This collaborative approach enables us to better understand local challenges, and ensure our advice responds to changing community needs.

It is about highlighting the infrastructure investments we need in the near, medium and long-term. The 2021 Priority List puts a strong focus on service quality for regional infrastructure, including investment in telecommunications transmission capacity to improve speed and reliability of the internet regional areas. Digital connectivity will become more important as the economy adjusts to the economic impacts of COVID-19, particularly for regional and remote communities. There is a lack of competition to provide transmission to some regional centres with lower populations. This impacts both the value for money, capacity and quality of the transmission lines, which in turn inhibits fast and reliable internet connection.  Potential investments to address this challenge include:

  • increasing shared use of the existing transmission network
  • upgrading existing regional networks to allow faster digital connections
  • investing in new transmission networks.

We are also calling for additional investment to support digital health services in regional and remote Australia. Australians living in regional and remote areas experience worse health outcomes and access to health services than Australians in major cities. Enabling digital health technologies in regional and remote areas of Australia can improve equity of access and outcomes, reduce costs associated with delivering health care and reduce avoidable hospitalisations.

COVID has exacerbated this challenge. By November of last year, more than 3.2 million regional and remote Australians had accessed telehealth services. That’s a rise from .04% of all Medicare schedule services to 35%. Potential options to address the initiative include enabling digital health in regional hubs to improve the accessibility of health services for Australians living in regional and remote areas. This would require the upgrade of existing facilities and training for health workforce, as well as suitable telecommunications infrastructure.

Identifying regional strengths and gaps

In addition to the work we do in developing the Infrastructure Priority List, we are also working on a separate project to identify regional infrastructure strengths and gaps to support the identification of the national infrastructure solution and reform pipeline.  

This is a project the Australian Government tasked us with, through additional funding in the October Budget. In close collaboration with the 47 regional RDAs, this project will help us to identify opportunities to support regional communities. It will also enable us to make the case for infrastructure investment or reform that can be addressed at regional, state or national levels. Importantly, this project is designed to bring a national perspective to the diverse infrastructure needs facing Australia’s regions.

To ensure we get a full picture we will draw on existing state, territory and local infrastructure and regional development strategies, complementing their analysis with industry submissions and local consultation. These prioritised regional gaps may not always be nationally-significant, however our aim is that our analysis will put a spotlight on the types of investments or reforms that should be pursued.

Where regions are experiencing similar or consistent challenges, this process could identify opportunities to work in partnership to develop common solutions or a shared approach.

Concluding remarks

For regional Australia, digital connectivity and access to services has a major role to play in driving sustained growth. Across our work program, we are trying to draw focus on the need for equitable service delivery and investments that will delivery affordable and quality infrastructure services for all Australians – regardless of where they live.

I look forward to engaging with all of you, our valued stakeholders across government, industry and the community, as Infrastructure Australia continues this important work. Thank you, I look forward to answering your questions during the panel discussion.