August 2023

Consult Australia’s recommendations for a rolling pipeline

How Consult Australia untangles the trickiest policy knots

As the Australian Government puts the $120 billion infrastructure pipeline under the microscope, Consult Australia’s submission is crystal clear. “Pipeline transparency and certainty are critical to the sustainability and success of Consult Australia members,” says Kristy Eulenstein.

The Infrastructure Investment Program (IIP) Review, announced in the May Federal Budget, is assessing more than 738 projects for value and significance. 

The review panel will also develop recommendations to transition the IIP to a sustainable 10-year rolling pipeline that targets appropriately costed, nationally significant infrastructure projects.

Kristy, Consult Australia’s Head of Policy and Government Relations, notes that pipeline transparency and certainty are critical to the sustainability and success of infrastructure delivery.

But Consult Australia members already face a high level of uncertainty, she notes, point to the recent Capacity Crunch report and the collapse of many prominent construction businesses. 

“The IIP Review has heightened market uncertainty. Our members are telling us the review impacts more than just the projects under scrutiny. Without transparency and certainty, businesses cannot have confidence to invest in the future, cannot conduct appropriate workforce planning, or deliver the productivity benefits our nation needs,” she says.

Pipeline uncertainty impacts businesses of all sizes, including the subconsultants who provide specialist services on these projects.

“The impact of pipeline uncertainty on the design phase and designers is very different to the impact at the ‘shovel ready’ stage of a project or on constructors. We know it is often very difficult for our members to suddenly redeploy project teams to other projects – and near impossible to get them back to the original project if it is restarted.”

Consult Australia’s submission makes several recommendations to support reform of the IIP and to ensure a sustainable, transparent 10-year rolling pipeline:

1. Get it right from the start: Stronger engagement with industry at the earliest stages of projects will improve project outcomes, identify efficiencies and manage risks in scope, cost, timeframes or scheduling against broader pipeline delivery.

2. Look beyond capital spend: Infrastructure investment decisions by governments should be centred on how the project will deliver whole-of-life value. Infrastructure announcements and projects are politically charged, with overly ambitious costings and programming designed to meet political will rather than industry capacity to deliver. A more pragmatic ‘go slow to go fast’ approach would see more involvement of industry earlier.

3. Spread project types: The Australian Government should consider whether it is appropriate to break up mega projects into smaller projects to engage smaller businesses and deliver sector-wide productivity.

4. Publish public pipelines: While some agencies and infrastructure bodies publish pipelines, they are not always complete or sufficiently detailed. Agency-by-agency or state-by-state approaches do not allow industry to view all opportunities in an easy, digestible way. A smarter pipeline of projects will enhance sector-wide productivity, create a dynamic workforce and increase regional participation.

5. Embrace a business case-led approach: Focus on the broader economic and social benefits of infrastructure projects leads naturally to governments following robust governance and decision-making processes to inform infrastructure investment decisions. Importantly, these processes should be consistent across jurisdictions and transparent.

6. Re-imburse bid costs: Consult Australia supports the Australian Constructors Association’s call for re-imbursement of bid costs. While removing politics from infrastructure planning and delivery is necessary, it is difficult on industry. A comprehensive reimbursement regime is required to compensate consultants and contractors if a project is cancelled or deferred.

We have made many of these recommendations in thought leadership reports, budget submissions, productivity reviews and election priority documents over many years,” Kristy notes.

 

“The Australian Government’s funding for state and territory infrastructure projects will not diminish as infrastructure projects continue to grow in complexity and scale. We need smarter ways to plan, fund, procure, design, and deliver new projects.

 

“Consult Australia is focused on solution and will continue to work with all governments to ensure reforms are co-designed with industry for the benefit of the community.”

 

Download Consult Australia’s submission to the Infrastructure Investment Program Review.

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Consult Australia’s recommendations for a rolling pipeline