Economic reform of Australia's road sector, a report from Juturna Consulting

Publication Date
01 February 2012

This paper, prepared for Infrastructure Australia by Juturna Consulting in 2012, suggests some broad principles for effective and efficient structural reform of Australia's road sector.

It argues that Australia's roads are seen primarily as ‘public good’ social infrastructure, with economic or commercial purposes as secondary uses. The road system currently shows aspects of monopoly. This discourages significant private initiatives to invest in roads and contributes to low transparency and reporting about the cost and condition of the infrastructure. However, once the ‘public good’ concept is overcome, third party access seekers can fund targeted, timely and efficient freight improvements to the road network, thereby reducing the burden on taxpayers for such improvements.

Economic infrastructure reforms of the 1990s are pointed to not only as potential models for road reform but also as proof of the many benefits that road reform could bring.

The paper uses three road sector case studies to demonstrate the significant economic, safety and environmental inefficiencies and lost opportunities that result from accepting the status quo in the road sector. It proposes a number of principles to guide reform and outlines several structures and reform requirements that follow from the principles.