A 15-year roadmap for infrastructure development in Australia has opened the way for a substantial influx of private capital into the nation’s amenities and forthcoming public works.
Published on 17 February, the first Australian Infrastructure Plan recommends sell-offs across the broad range of the country’s services, largely to end what it cites as long-running conflicts of interests, whereby public bodies have both managed and regulated many of the facilities.
“With the right incentive and regulatory structures,” says the report, “infrastructure markets can deliver a better deal for customers. In some sectors, Australia has established a good balance and developed the right structures to deliver efficient and responsive services. In others, there is work to be done to achieve the right funding mix and market structure.”
In the energy field, for example, public-sector monopolies “have been separated into corporatised generation, network and retail components, a number of which are now in private ownership”.
However, the report notes: “Despite this success, reform of the energy sector is incomplete. Substantial sections remain in public ownership and regulatory frameworks need to be refined to meet emerging challenges. Electricity generation, network and retail businesses still in public ownership should be transferred to private ownership as soon as practicable.”
The report makes similar recommendations for water, transport and telecommunications services, and adds that Australia’s public National Broadband Network Company should be sold off.
“To achieve this,” it says, “the Australian government should commission a scoping study to define a pathway to privatise an appropriately-structured National Broadband Network into an efficiently-regulated market.”
Infrastructure Australia (IA) – the government-backed but independent body that compiled the report and will now steer the recommendations to fruition – also presented a “reinvigorated” Infrastructure Priority List of projects and initiatives that should be addressed with particular speed.
Designed to reflect a consensus of state and territory governments, the list urges the prompt development of:
IA chairman Mark Birrell said: “The Priority List is ultimately a platform for better infrastructure decisions – it provides rigorous, independent advice to governments and the public on the infrastructure investments Australia needs.”
On the 15-year plan as a whole, Birrell commented: “Some of the ideas will be tough to progress, but let that all be part of an open public dialogue about the infrastructure people want, the outcomes it should deliver and the best ways to plan and pay for it.”
He added: “By completing the major reforms to infrastructure markets the average Australian household will be almost $3,000 better off every year. The public policy changes and major projects in the 15-year plan, once delivered, will drive our nation's prosperity and maintain our quality of life.”