26.11.2020Infrastructure to underpin the future city of Melbourne and Victoria
Written by: Owen Cooper, Partner, MinterEllison
This week’s budget announcement confirms the significance of our infrastructure industry and the role it will play in the recovery of our state. Not only will it be a factor in recovery, the economic and social impacts will have generational benefits.
The record investment allocated to infrastructure is an increase of 18% from previous estimates. It’s welcome news for an industry that like others has been severely impacted by the challenges of 2020. The investment will help to create confidence and security of both long-term employment and subsequent economic growth.
Delivery of the Melbourne Airport Rail Link, the Suburban Rail Loop, the Big Housing Build, Footscray and Frankston hospitals and many of the short and long-term projects will also create significant challenges. The step change in major spend will require additional experienced human capital. Expertise will need be drawn from all of Victoria and further afield to procure, deliver, operate and maintain these many and varied projects.
From our experience on government projects of a similar scale in Victoria and nationally, we expect to see a continued critical evaluation and re-balance of the relationships and risk allocations between government, contractors, financiers, developers, and technology providers with increased focus on the long-term vision and value of projects without losing an eye on the shorter-term importance of completion dates. We expect the trend of focusing beyond delivery costs to look at whole of life costs over the entire lifecycle of an asset to continue.
Meeting ambitious timelines and increasing capital spend will require similar step change in resourcing and collaboration from all stakeholders. Involving private finance and innovative investor partnerships is an opportunity to reimagine what our city and regions can look like. Combining technology, placemaking and investment skills for the benefit of the wider community is how we’ll continue to grow and prosper across the state.
In a year where we have all learned how to pivot, adapt and reinvent, we are now more at ease in implementing those lessons. We need to ensure that the opportunity that these investments represent are innovative, flexible, resilient and sustainable, both economically and socially.
On the back of this budget, we can look forward to a reinvigorated city that is more connected to our regions and more vibrant than ever.
Sorry Sydney but Melbourne remains the “place to be”!
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