CEDA Queensland

02 July 2019

Opening remarks

Good afternoon everyone, thank you Clint for that warm introduction, and to CEDA for inviting me to speak here today.

I want to begin by acknowledging all our distinguished guests from across government, industry and the community.

And importantly too, acknowledge the traditional custodians of the land in which we meet here today, and pay my respects to the elders, past and present, of all Australia’s Aboriginal and Torres Strait Islander peoples.

For those who aren’t familiar with us, Infrastructure Australia was established to drive better infrastructure outcomes for all Australians.

We have two core functions:

    • The first is to evaluate business cases for nationally-significant investment proposals seeking more than $100 million in Commonwealth funding and
    • The second is to set the agenda on the long-term opportunities for infrastructure reform that will improve living standards and national productivity.  

It’s always a pleasure to take part in a CEDA event, and even more so today, alongside Infrastructure Australia’s new Chief Executive Romilly Madew, for her first speaking engagement in our great state of Queensland.

Romilly commenced as Chief Executive in April, at an incredibly important time for our organisation, and I would argue – an important time for the country more broadly.

In a challenging economic climate, the independent advice we provide on opportunities for infrastructure investment and reform is more important than ever.

Recently, we have seen the Reserve Bank Governor underline the importance of infrastructure investment, project selection and infrastructure governance.

And the Prime Minister too, has repeatedly highlighted how critical infrastructure will be in growing the economy, off the back of the committed $100 billion spend over next ten years.

Added to this, Australia is facing a moment of unique uncertainty when it comes to our future infrastructure planning.

We are facing a changing climate, a re-ordering of the world economy, and a reshaping of global institutions and norms.

Closer to home, our population is growing and changing, the structure of the economy is shifting, and rapid technology change is fundamentally reshaping our day-to-day lives.

This will have significant implications for how we plan, build and deliver infrastructure.

Crucially, preparing for these changes requires more than just keeping pace with demand.

To deliver high-quality, world-class infrastructure around the country, we need to be smarter in our decision-making and remain one step ahead of emerging challenges.

To guide this decision-making and forward planning, Infrastructure Australia is about to release our next major report – the 2019 Australian Infrastructure Audit.

The Australian Infrastructure Audit is our strategic assessment of the most important challenges and opportunities facing infrastructure over the next 15 years and beyond.

It provides a ‘big picture’ view of Australia’s future infrastructure needs – across sectors and across jurisdictions.

Romilly will talk in detail about what you can expect from the 2019 Audit, including its focus on community-centred outcomes and measuring efficiency, capacity and capability in the infrastructure sector.

But to begin today’s session, I want to talk about Infrastructure Australia’s work in maintaining the Infrastructure Priority List – including the three new Queensland projects we have just added, today, as Priority Projects.

I also want to talk about our role in supporting better business case development, and how this drives better performance across infrastructure planning and service delivery.

About the Infrastructure Priority List

There’s no doubt that infrastructure investment and reform is needed to drive economic and productivity growth, but we cannot forget the importance of good project selection.

In a rapidly changing environment, selecting the right infrastructure projects is a complex task – but a critical one if we are to deliver better infrastructure outcomes for all Australians.

The Priority List is an independently-developed list of nationally-significant proposals that address critical gaps in our nation’s infrastructure.

It is underpinned by a rigorous assessment process, which enables us to provide a high quality selection of potential investments for governments at all levels to choose form.

Today, I am pleased to announce that more than $2 billion worth of planned upgrades to the Bruce Highway and M1 Pacific Motorway have been given the green light by Infrastructure Australia, after the business cases were approved by the Board.

These are:

  • The Bruce Highway – Cairns Southern Access Corridor – Stage 3: Edmonton to Gordonvale and
  • Two sections of the M1 Pacific Motorway – Eight Mile Plains to Daisy Hill and Varsity Lakes to Tugun

All three proposals are now identified on the Priority List as Priority Projects.  

Responding to the challenges of growth and capacity constraints on Queensland’s infrastructure networks is a common theme across all these projects, with improving travel times and road safety a particular focus as congestion increases on our key freight and passenger routes.

For example, the Bruce Highway proposal aims to ease capacity constraints by creating a four-lane highway between Edmonton and Gordonvale.

This section of the Bruce Highway will cater for significant population growth in Cairns, particularly in the southern suburbs.

These suburbs are expected to be home to an additional 40,000 people by 2036, a growth rate of about 3% each year.

This is the only remaining large scale developable land in the region and is therefore expected to cater for the bulk of Cairns’ population growth into the future.

However, along this stretch of the Bruce Highway, drivers already experience significant delays during morning and evening peaks, as well as a high crash rate.

Between 2007 and 2012, 79 crashes were reported along this section.

This is almost double the rate reported on similar roads across Queensland.   

M1 Pacific Motorway

Similarly, the M1 Eight Mile Plains to Daisy Hill upgrade looks to improve one of the busiest sections of the motorway.

150, 000 vehicles travel on this section of the M1 each day and this will grow to over 200,000 by 2041, driven by population growth in Southeast Queensland.

With a proposal to widen an 8.5km northbound section of the motorway and improve local busways, the project is expected to help accommodate 25% more traffic and relieve congestion in this area for the next 15–20 years.

The project also supports active transport through the provision of an extended cycleway. Investing in active transport, that it well integrated with new and existing assets, is an increasingly important consideration for governments at all levels as we look to deliver vibrant, liveable cities.

Still on the M1, the Varsity Lakes to Tugun project proposes to improve a congested section of the motorway that connects northern NSW and the Gold Coast.

This responds to the increased traffic volumes on the corridor, which are causing a high number of accidents and worsening travel times – impacting on local residents travelling to work as well as tourists, tour operators and freight vehicles.

Widening the motorway in both directions along this section will address congestion, and support the Gold Coast’s economic development.

Of course, each of the new Priority Projects we have added to the Priority List today will have substantial and enduring economic benefits for both Queensland, and the national economy.

And we do have a number of evaluations still underway that seek to progress the staged upgrade of the Bruce Highway – a key part of the National Land Transport Network with strategic significance for a growing and changing Australia.

I look forward to sharing the results of those assessments with you all in coming months.

Business case improvement

Before I finish today, I want to talk about the important role Infrastructure Australia has played in championing best practice in the infrastructure sector, particularly when it comes to business case development and project selection.

We are uniquely placed to shape the standard of business cases for major projects, and this is an important and ongoing focus for our organisation.

Since 2018, we have hosted Business Case Improvement workshops across the country, attended by more than 300 project proponents, government officials and their advisors.

Most recently, the Project Advisory team, along with Romilly, hosted one of these workshops in Townsville.

Through this process, we have seen some improvement in the quality of business cases that are being submitted to Infrastructure Australia.

We have been pleased to see the Queensland Government submit a large number of business cases to Infrastructure Australia for assessment in recent months, and look forward to seeing more of the early-stage proposals from the Priority List progress through our assessment process.

But for all Australia’s state and territories, there is still significant room for improvement when it comes to the development of business cases for major infrastructure projects.

For instance, we want to see a greater focus on strategic alignment, and a thorough assessment of all the available options to solve an identified infrastructure problem.

There should be a shortlist of potential solutions, in order to weigh and measure to project with the best outcomes and the lowest cost.

This includes exploring innovative and non-infrastructure solutions, where there are real strategic alternatives available. 

Likewise, it is important for proponents to outline not only the economic consequences of the problem, but also, the effects that missing the opportunity would bring about.

When this is not done well, decision-makers cannot fully grasp how well a proposal would address an identified infrastructure gap or opportunity.

We also want to see more business cases measure not only the cost of the problem and the value of the opportunity, but how this will change over time.

Better business case development enables greater transparency around infrastructure decision-making.

It drives better performance across infrastructure planning and project selection, ensuring that major infrastructure investments support our economic growth and deliver better services for our growing communities.

Concluding remarks

With challenging economic conditions ahead, Infrastructure Australia remains focused on ensuring governments at all levels have a selection of high quality proposals to choose from.

Our assessment process has one clear aim – to ensure that public infrastructure funds are spent where they are needed most.

Well-developed business cases, supported by early project development studies are vital to achieve this, and ensure the right infrastructure solution is always selected.

We look forward to working closely with our stakeholders in the room here today to improve the quality of business cases and address the infrastructure challenges ahead.