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Infrastructure Policy Watch: impact of Covid-19 behaviour change and Australian Budget boost

18 May 2021

- NIC reviews the impact of Covid-19 behavioural change on infrastructure use 
- Australia increases infrastructure investment but worries around capacity to deliver

Infrastructure Policy Watch: impact of Covid-19 behaviour change and Australian Budget boost

In this fortnightly blog, ICE's Director of Policy Chris Richards looks at developing policy landscape for infrastructure, what decisions mean, and their implications, so that infrastructure professionals can play their part in shaping the discussion.

UK Commission publishes assessment of how Covid-19 will impact infrastructure use

The National Infrastructure Commission (NIC) has published a new assessment of how behaviour change brought by Covid-19 will impact infrastructure networks as part of its prep work ahead of the second National Infrastructure Assessment.

The NIC’s findings are that it's too early to assume that Covid-19 behaviour change will lead to completely different patterns of infrastructure use, even if these changes remain in place. The commission recommends using realistic scenarios and planning responses to the range of possibilities these scenarios present to manage uncertainty. They also suggest a more ‘adaptive’ approach to longer-term project commitments and using data to understand how changes are unfolding.

In analysing sectors, the commission expects digital, energy, waste and water to have a narrow band of scenarios, while transport (particularly public transport) has a broader range of potential outcomes from behaviour change with the report noting:

“Public transport is disproportionally impacted because the size and physical nature of the network, as well as user pricing (i.e. fares), are geared towards peak rather than average demand.”

Other notable findings include:

  • The potential impacts of behaviour change on infrastructure demand are likely to be less significant than changes from other trends over the past 30 years, such as the doubling of rail journeys over that period.
  • Higher uptake of homeworking would also affect private transport (even if the greatest impact is on public transport), this is because overall most commuters use a car.
  • Permanent uptake of homeworking could make a difference to where people live and work towards suburban and rural areas.

ICE’s view

The findings from the NIC’s report reinforce ICE’s Covid-19 and the implications for infrastructure systems study from August 2019. Long-term drivers such as net-zero and achieving the Sustainable Development Goals (SDGs) should remain at the heart of infrastructure planning in the UK as these have not changed.

We also recommended using scenarios for future forecasting and greater investment in the digitalisation of assets to support the flexible use and development of infrastructure systems in the future.

2021 Australian Federal Budget highlights the challenge of getting projects delivered 

Like other countries (we’ve looked at plans in the USSouth Africa and India), infrastructure investment featured in the 2021 Australian Federal Budget to boost the economy as part of the recovery from the Covid-19 pandemic. 

Some 15.2bn Australian dollars (AUD) over 10 years was announced for new road and rail projects, which would take the total investment for infrastructure to 110bn AUD over the same period.

The new funding would help advance 15 early-stage investment opportunities from the 2021 Infrastructure Priority List produced by Infrastructure Australia, which was developed with Covid-19 recovery in mind.

However, despite the ambition, the Budget was challenged by other political parties who highlighted the challenge of underspending with analysis showing despite the 15.2bn AUD commitment to projects, the infrastructure budget has increased by only 10bn AUD.

As countries ramp up their investment spend, they will all come up against the capacity to deliver. Investment pipelines take time to come to fruition, and there's a lot that needs to be done through infrastructure investment to develop economies, decarbonise and support sustainable growth.

ICE’s view

Countries need to turn to newer models of delivery to ensure ambition becomes a reality, including using more enterprise-based delivery models such as Project 13 (which is being used in Australia by Sydney Water) and a shift to more outcomes-based procurement. Covid-19 and the new normal for infrastructure systems White Paper last year provided detail on why these should be adopted.

In case you missed it...

Check back in a fortnight for the next edition of the ICE's Infrastructure Policy Watch. You can also sign up to ICE Informs to get a monthly digest of the latest policy activities from ICE, including calls for evidence to support our ongoing advice to policymakers.

  • Chris Richards, director of policy at Institution of Civil Engineers