Chapter 3: Infrastructure—Continued
Detailed report on performance
The following report is against the headings from the applicable output from the 2011–12 PBS.
a) Infrastructure policy initiatives
International engagement on infrastructure
The Department seeks to contribute to a consistent and effective whole-of-government approach to foreign direct investment promotion, attraction, facilitation and retention in Australia's infrastructure construction industry.
The Department works with Austrade in relation to foreign direct investment in the Australian infrastructure construction industry. This work will be underpinned by an Agency Partnership Agreement between Austrade and the Department, which will drive long-term growth and productivity in the Australian economy.
On 10 April 2012, the Australian and Chinese governments signed a Memorandum of Understanding (MOU) to strengthen cooperation on delivering infrastructure for both nations. The MOU will mean closer cooperation on project planning, exchanging information on investment opportunities and technical expertise, training and education, joint conferences, as well as joint infrastructure projects.
The Department participates in the Australia-Japan Public Private Infrastructure Policy Dialogue, a joint sub-group under the auspices of the Australia-Japan Business Cooperation Committee. The inaugural and second dialogues took place in March and October 2011 in Tokyo. The Department will host the third dialogue in Canberra in October 2012.
The Department developed governance frameworks for the $6billion Regional Infrastructure Fund (RIF). Four initial Regional Infrastructure Planning projects were approved during the year. The RIF will invest the proceeds of the resurgent resource boom to address urgent infrastructure needs, while supporting the mining industry, boosting export capacity and developing and growing regional economies.
The Department provided advice to the Australian Government on the development of the broad framework for the next phase of the Nation Building Program (NB2), which is due to start on 1 July 2014. The main objective is to lift Australia's productivity through nationally significant land transport infrastructure. NB2, announced in the May 2012 Budget, will be structured through four cornerstone themes: moving freight, connecting people, safety, and innovation.
b) Infrastructure funding
The Department provided policy advice on infrastructure financing issues and future financing measures. A major element of this advice was to support the Infrastructure Finance Working Group, an expert advisory panel established to advise Infrastructure Australia on infrastructure finance policy issues. This culminated in the Infrastructure Finance and Funding Reform report published in April 2012, following public and industry consultation on an issues paper released in July 2011. This report recognised the need for greater infrastructure investment to ensure strong national productivity and economic growth. It recommended that the Infrastructure Australia Council consider infrastructure financing and funding reform.
In order to address issues raised by the Council of Australian Governments (COAG) Infrastructure Working Group surrounding patronage forecasting, the Bureau of Infrastructure, Transport and Regional Economics undertook a literature review of international experiences in toll road forecasts, commissioned consultants to examine case studies of selected toll road projects in Australia and held a Patronage Forecasting Symposium. In April 2012, a public consultation process on this work was completed. International expert Dr Robert Bain was also commissioned to investigate how international toll road concession authorities encourage more accurate bidding from potential operators. His findings were delivered in May 2012.
Contributing to these infrastructure financing policy outcomes were the development and delivery of the National Infrastructure Construction Schedule (NICS), the release of the second Infrastructure Planning and Delivery: Best Practice Case Studies booklet, and the review of design and construct practices for infrastructure procurement and delivery. These are covered in more detail under the performance report for the Council of Australian Governments (COAG) Infrastructure Working Group in this chapter.
Case Study—National Infrastructure Construction Schedule
The Minister for Infrastructure and Transport, the Hon Anthony Albanese MP, launched an innovative website, the National Infrastructure Construction Schedule (NICS) in May 2012 to showcase large infrastructure projects.
The projects are generally over $50 million for larger states and the Australian Government, with smaller states and local government listing some projects under this threshold. NICS is a collaboration with states, territories, local councils and industry. It complements the Infrastructure Australia National Priority List (which is also on NICS) by reporting what governments in Australia have committed to build.
Projects on NICS will be followed to completion while new commitments will be added as they occur, particularly around Budget time. NICS includes a separate section outlining planning and feasibility studies to let industry know of possible opportunities before governments are committed to fund construction.
NICS is part of the Australian Government's infrastructure funding and financing reform program. It is designed to deliver the following benefits:
- giving potential investors the certainty they need to invest in infrastructure by focusing on infrastructure projects proceeding to market
- allowing jurisdictions to even out peaks and troughs of procurement and create a sustainable infrastructure market by showing a national picture of the infrastructure ‘pipeline’, and
- giving the marketplace valuable information on company performance by information on awarded contracts. Construction industry subcontractors gain knowledge that may help them grow, and industry planning is helped, by clearly showing the national pipeline of government works.
Since its launch, the site has had over 675,000 hits, attracting Australian and international interest. NICS can be accessed at www.nics.gov.au.
c) Raising the standard of land transport infrastructure
In 2011–12, work began on 34 land transport infrastructure projects, including projects managed under the investment and off-network programs. Work was completed on 39 land transport infrastructure projects, 28 road and 11 rail, as shown in Tables 3.4 and 3.5.
Table 3.4 Details of road infrastructure projects completed in 2011–12
|New South Wales||Hume Highway—Tarcutta Bypass|
|Hume Highway—Woomargama Bypass|
|Hume Highway—F5 Widening—Brooks Road, Ingleburn to Narellan Road Campbelltown|
|Pacific Highway—Ballina Bypass|
|Pacific Highway—Glenugie Upgrade|
|Barton Highway—Gounyan Curves|
|Queensland||Kirkwood Road—Stage 2 (Benaraby Road to Glenlyon Road)|
|Ipswich Motorway—Dinmore to Goodna|
|Ipswich Motorway—Darra to Rocklea Planning|
|Beatty to Balham Road Intersections Upgrade|
|Douglas Arterial Duplications|
|Bruce Highway—New Isis River Bridge|
|Bruce Highway—Nambour Pavement Reconstruction|
|Remote Community Access Road Upgrades in Cape York—Lockhart River Community Access Road|
|Yeppen Flood Plain Study|
|Victoria||Geelong Ring Road 4A (Anglesea Road Overpass)|
|Calder Freeway—Kinds Road Interchange|
|Western Australia||Great Eastern and Roe Highways Interchange|
|Hepburn Avenue Stage 2 Extension—Beechboro Road North to Marshall Road|
|South Australia||Sturt Highway—Carrara Hill Road Accelerating/Overtaking Lane|
|Dukes Highway Upgrade—Phase 2 Roadside Rest Areas|
|Dukes Highway Upgrade—Overtaking Lanes|
|South Road—North–South Corridor Development Plan|
|Bagdad Bypass and Bridgewater Bridge Replacement Planning|
|Northern Territory||Tiger Brennan Drive Extension|
|Improved Flood Immunity, Road Safety and Productivity on Northern Territory Highways—New High Level Bridge over the Cullen River|
|NT Community, Beef and Mining Package—Buntine Highway|
Table 3.5 Details of rail infrastructure projects completed in 2011–12
|New South Wales||Port Botany Rail Line Upgrade (Stage 1)|
|Northern Sydney Freight Corridor (Scoping Phase)|
|Northern Sydney Freight Corridor (Hexham Freight Loop)|
|Maldon to Dombarton Rail Link Feasibility Study|
|Hunter Valley Ulan Line Passing Loops and Duplication|
|Picton, Glenlee and Menangle Park Double Track Passing Loops|
|Broken Hill to Parkes Concrete Resleepering Project|
|Queensland||Brisbane Cross River Rail—Detailed Feasibility and Planning Study|
|Victoria||Rail Upgrades at Geelong Port|
|Altona Intermodal Terminal|
|Cross-jurisdiction||Melbourne to Junee Passing Loop|
High Speed Rail Study
The report from phase one of the high-speed rail (HSR) network study was released on 4August 2011. The work undertaken in phase one identified corridors and station locations and potential patronage, as well as an indicative cost estimate to build an HSR network in today's dollars.
The second phase of the study is scheduled for completion at the end of 2012. Phase two is determining the recommended route alignment, refining cost estimates, passenger and revenue forecasts, assessing financial and economic viability and providing options for staging, financing and governance.
Did you know?
As of 2012, Australia's rail network consists of 33,299 route-kilometres. 338 route-kilometres have opened since 2009, with 234 route-kilometres currently under construction.
Source: TrainLine 1, Tables 2 & 3.
Case Study—Moorebank Intermodal Terminal
Transport infrastructure improvements in Sydney are vital to achieving a long-term vision for a fast and reliable, highly capable national freight rail network. Over $2 billion has been invested in the Sydney rail freight network through Australian Government funding of the Northern Sydney Freight Corridor and Port Botany upgrades and the Australian Rail Track Corporation's investment in the Southern Sydney Freight Line.
The Department's Nation Building-Infrastructure Investment Division has been a key driver of these significant improvements. The Department is working closely with the Moorebank Project Office in the Department of Finance and Deregulation to encourage private-sector delivery of a major intermodal terminal at Moorebank in Sydney.
The Moorebank Intermodal Terminal project will provide a ‘port shuttle’ between Port Botany and the south west of Sydney, as well as warehousing and interstate freight capacity at a later stage. The port shuttle, expected to begin operation in 2017, will have capacity for 1.2 million containers, vastly improving efficiency and productivity while relieving congestion of Sydney's roads. When operational, the interstate capacity for 500,000 containers will take pressure off regional roads and build on the Government's $4.8 billion investment in the interstate rail network.
To accommodate the project, the Australian Government will fund relocation of the Moorebank Defence units to make a 220-hectare site available. A government business enterprise will be established to launch the project and optimise private sector involvement. Private-sector partners will be selected by tender to design, build and operate the intermodal terminal.
Total benefits have been estimated at $10 billion. They include:
- about 3,300 fewer trucks on Sydney's roads every day from 2020
- faster freight times and reduced business costs
- reduced fuel use and diesel emissions
- about 1,650 full-time jobs to construct the port shuttle terminal and 975 to construct the interstate capacity, and
- about 1,700 jobs in the region once the facility and associated warehouses are open.
Projects like Moorebank will link Australia's freight networks and ports, drive productivity, improve logistics industries, and create long-term efficiencies that will benefit cities and economies. It demonstrates the Australian Government's determination to invest strategically in infrastructure.
d) Remedial road projects to improve safety and productivity
Black Spot Projects
Black Spot Projects improve the safety of road sites which have been identified as high-risk areas for serious crashes. The program has reduced the risk of crashes through measures such as traffic lights, roundabouts, signage, and edge sealing at dangerous sites on roads around Australia. Most funding goes to treat sites with at least three accidents involving casualties over a five-year period and that can demonstrate a robust benefit to cost ratio of at least 2:1.
In 2011–12, the Department continued to work with state and territory agencies to ensure that the program was administered efficiently and cost-effectively.
The number of Black Spot Projects approved varies each year depending on the cost of the individual projects. In 2011–12, 152 Black Spot Projects were completed and 139 were underway. The total payment to Black Spot Projects in 2011–12 was $65.2 million.
Heavy Vehicle Safety and Productivity
Through the Nation Building Heavy Vehicle Safety and Productivity program, the safety of the drivers of heavy vehicles is targeted through fatigue management and road enhancement projects, such as rest areas and bridge upgrades. A total of 236 projects have been approved for delivery over the life of the program and 207 of these have been completed. The total payment made to Heavy Vehicle Safety and Productivity projects in 2011–12 was $22.3 million.