Good morning everyone. Thank you Loulou for that warm welcome, and to Danny Broad and the team at ARA for inviting me to speak here today about Australia’s’ future infrastructure challenges, and the role light rail might play in meeting those challenges.
For those of you who are not familiar with what we do, Infrastructure Australia provides independent, evidence-based advice to governments, and a ‘big picture’ view of Australia’s infrastructure needs – across sectors and jurisdictions.
It is particularly timely to be here this morning, as we have just released a new edition of the Infrastructure Priority List.
Intended to guide the next 15 years of Australian infrastructure investment, the Infrastructure Priority List is a credible pipeline of nationally significant proposals for governments at all levels to choose from.
I’m pleased to share that the 2019 Priority List is also the largest, most comprehensive and most diverse list of investments we have identified in our decade-long history.
This is because the Priority List is maturing and moving into a new phase, and this has enabled us to look at opportunities, across a range of different sectors, to improve infrastructure for all Australians.
This year, we have identified 121 nationally significant proposals across transport, energy, water, communications, housing and education, and a record $58 billion pipeline of projects that have already received the Infrastructure Australia tick of approval.
Beyond highlighting the breadth of our future infrastructure challenges, the Priority List aims to ensure that public funds are directed towards projects that will deliver the best outcomes for Australia’s growing communities.
It’s about making sure that our infrastructure funds are spent where they are needed most.
This is increasingly important as we plan to accommodate a bigger Australia.
Because as our cities and regions grow, their infrastructure needs are changing.
As Australia’s population surpasses 25 million, we must ensure we can cater for growth while maintaining liveability and quality of life.
My remarks today will focus on the need to improve long-term planning and project selection to address these challenges, and the role light rail can potentially play in accommodating increasing levels of demand.
Australia’s growth challenges
Over the next 30 years, Australia will grow by an additional 10 million people.
Despite potential growing pains, this growth is a good thing. It provides Australia with an opportunity to: boost our productivity, strengthen our labour market, and enhance the diversity of our communities.
As our population grows, Australia is becoming increasingly urbanised and so is our economy.
In 2016–17, our four largest cities contributed over 60% of our national GDP, and this is expected to increase.
This is reinforced by the fact that three-quarters of our population growth is occurring in our four largest cities – Sydney, Melbourne, Brisbane and Perth.
For this reason, Australia’s long-term prosperity is increasingly linked to the performance of our cities. But to maximise the economic opportunities of population growth, we need to ensure our cities are places where people want to live.
With Australia’s long-term prosperity increasingly linked to the performance of our major cities, attracting and retaining businesses and skilled workers will be key.
To do that, our cities must operate efficiently and remain “liveable” as they grow.
In other words, we need well-planned cities, where the location of jobs, homes and their supporting infrastructure networks are coordinated to maximise accessibility and liveability.
The challenges for smaller cities are somewhat different.
While our major capitals are undergoing an urban transformation to higher density, our smaller cities face different challenges in retaining population growth and building up local industries
Smaller cities will contribute around one tenth of Australia's forecast population growth over the next 30 years.
Some regions, such as the Central Coast, Geelong, Toowoomba, the Gold and Sunshine Coasts will grow strongly, in part because of their role as satellite cities for their neighbours.
Others, such as Wollongong, are forecast to grow more slowly, and in these instances, infrastructure investment has an important role to play in enabling economic growth.
In particular, there is an opportunity for smaller cities to capture their share of the national population by differentiating themselves from our larger cities in terms of industry makeup, way-of-life and urban form.
Newcastle’s recent CBD revitalisation is a key success story in this regard, which I understand Andrew Fletcher from Keolis Downer provided some interesting insights into yesterday.
A new start-up and technology industry cluster has emerged, supported by Newcastle Light Rail and a redesigned bus network. The revitalisation has changed the character of the city, breaking with the industrial past and defining a new identity – anchored by investment in a multi-modal public transport network.
Improving long-term planning
A big part of delivering liveable cities and regions, is making sure we’re delivering the right infrastructure to support growth, at the right time.
Planning must remain a priority so governments can better prepare for shifts in demand, identify emerging issues and direct investment towards projects that deliver the best outcomes for the community.
Strategic planning also allows us make better use of multi-modal journeys as a means of coping with increased demand, particularly in our fast-growing cities.
Historically, there has been a natural tendency for transport planning to be focused on individual modes or projects.
Often we see a focus on rail, light rail, metro, busways or motorways, rather than a whole of network approach in which each mode plays its proper role in the broader transport task.
For public transport to be an effective option for the customer, transport integration is key and we have made significant progress in multimodal trip planning over the past few years.
Infrastructure planning frameworks are increasingly taking into account for the roles of each mode in an integrated transport network, and it’s important that this continues.
Encouraging people to transfer between services is a crucial part of this.
In developing light rail projects, for instance, we need to consider rail’s ability to interact with bus and heavy rail services.
That means prioritising the user experience when designing transport interchanges.
Good transport integration includes signage, passenger amenities, places for people to park their bikes and sheltered pathways.
Governments should also make interchanging easy by coordinating services at interchanges, increasing frequencies and making sure fares are integrated.
I’m sure many of you have experienced these kinds of interchanges, where the intersection between a light rail and heavy rail stop has been seamless, to deliver an integrated and high-quality customer experience
Long-term strategic infrastructure planning must also be supported by a robust process for selecting projects that deliver the best outcomes for the community.
The Infrastructure Priority List, which I mentioned earlier, plays an important role here.
Infrastructure Australia has a rigorous assessment process for adding projects to the Infrastructure Priority List. This involves assessing the individual costs and benefits of a project, challenging their veracity and subjecting them to stress testing.
Assessing a business case in this way allows us to better understand the strategic fit, economic impact and deliverability of a project. This enables us to provide a high quality selection of nationally significant infrastructure solutions for all levels of government to choose from.
At its heart, Infrastructure Australia’s assessment process is simply about directing funding towards projects that address gaps and opportunities.
Where gaps develop or there are opportunities for rapid enhancement, it is critical we select the projects that can make the most positive contribution – for lowest cost.
Opportunities for light rail
Public transport is one of the most significant themes of the 2019 Priority List, reflecting the demands of a growing population.
In particular, the Priority List highlights the need to prioritise projects that build capacity along key transport corridors in our inner cities, while also making better use of existing assets.
For those that aren’t familiar with how the Priority List works, it lists both Projects and Initiatives.
Projects are advanced proposals that have a fully developed business case that has been positively assessed by the independent Infrastructure Australia board.
Initiatives, on the other hand, are proposals that have been identified to potentially address a nationally-significant problem, but require further development to determine if they are the best course of action.
Generally, an infrastructure solution or a particular problem should be identified as an initiative first.
Then the detailed business case work including problem definition and options analysis should be completed and then assessed by the Infrastructure Australia Board.
Although we certainly wouldn’t want to pre-empt the results of an options analysis, there are a number of initiatives identified on the Priority List where light rail could be investigated as a potential solution – or as part of an integrated transport response).
For example, in facilitating public transport access to Fishermans Bend, here in Melbourne, or in Sydney, improving public transport access to the Parramatta CBD.
As with all the initiatives identified in the Priority List, our focus at this stage is on defining the problem, with the next step being for proponents to develop a range of solutions to address it.
What is clear, is that rail has a unique role to play in our future as part of an integrated transport network, and may be a viable way for us to accommodate high – and growing – levels of demand.
We recognise that, as our cities grow, there will be an increasing role for rapid transit in truly integrated transport systems. Rapid transit has many forms – from simpler, lower cost solutions to more complex, higher capacity and higher cost solutions.
There is also a blurring of the historical line between buses and rail, with new technologies like trackless trams and guided buses being deployed in some cities.
Choosing the appropriate mode and the scale of infrastructure response will depend on the problem to be solved (or opportunity to be realised).
Light rail and rapid transit more broadly, has an important place in the modal hierarchy – but in addressing an infrastructure gap or opportunity, we need to maintain our focus on choosing the right mode for the job.
Light rail counteracts many of the limitations implicit in bus and heavy rail transit. Bus routes have the breadth of coverage, but not the speed or ridership capacity for longer commutes.
Conversely, heavy rail has the capacity and speed, but lacks finesse in terms of its route coverage.
Light rail acts as a nice intermediary between the two – both literally and in terms of its benefits.
It also presents a number of opportunities such as the potential for land use changes around stations, facilitating urban realm improvements and place-making – all of which are increasingly important in the liveability of our cities as they grow.
However, when it comes to public infrastructure investment, it’s important that we have a rigorous, evidence-based process in place to guide project selection.
We also need to make sure we are learning from past experiences.
With a number of light rail projects around the country nearing completion, there is an important opportunity to create a stronger evidence-base with regards to rapid transit projects.
Post-completion reviews are vital to assess a project’s delivery against initial expectations, and provide important lessons for governments, industry and the community regarding what worked and what did not.
Despite broad agreement on the merits of undertaking post-completion reviews of projects, these reviews are still rarely undertaken and published for major public infrastructure. However, to extract the most value from our infrastructure investments, Australia’s governments must commit to, develop and release post-completion reviews. In particular, we want to see delivery dates for staged reviews confirmed at the outset of a project and released at set intervals following project delivery. Reviews should measure whether the economic case for a project established in its business case has been realised over time, assess whether the project was delivered on time and on budget, and whether unforeseen risks emerged and were successfully managed.
This will help ensure we extract the greatest value from our infrastructure spending.
2019 Australian Infrastructure Audit
Before I conclude today, I went to speak briefly about Infrastructure Australia’s forthcoming release – the 2019 Australian Infrastructure Audit.
This updated Audit fits into the broader agenda of Infrastructure Australia to strengthen the evidence base for future infrastructure decision making.
The Australian Infrastructure Audit is an independent, comprehensive review of Australia’s infrastructure and our future needs.
It will strategically assess the drivers of future infrastructure demand, particularly population and economic growth, and identifies challenges and opportunities for our infrastructure networks.
This update to the Australian Infrastructure Audit will be followed by the Australian Infrastructure Plan, which will set out a 15-year rolling infrastructure plan and reform priorities to meet these challenges and opportunities.
The 2019 Audit focuses on outcomes for users in terms of access, quality and affordability.
Our analysis will also consider of the differences in infrastructure provision and challenges based on geography, including in our fast growing cities, small cities and regional towns, rural and remote areas, and regions in transition.
And importantly too, the findings of the 2019 Audit will inform our work in developing the Infrastructure Priority List, and our analysis of the nationally significant investments Australia needs to meet its infrastructure challenges.
By way of conclusion today, I want to emphasis again the importance of good infrastructure planning to address the challenges of growth.
It is inevitable that Australia will undergo a significant transformation in coming decades.
Light rail will have an important role to play in the broader transport network, and presents a unique opportunity to build a robust evidence base to support the delivery of rapid transit projects.
Ensuring that our infrastructure investments are guided by long-term, strategic planning and a robust process for selecting projects means we will be better placed to respond to changes in infrastructure demand.
Ultimately, we want to ensure that projects adequately address today’s infrastructure gaps and set up our cities and regions to meet the challenges of the future. Thank you.