ICE green paper: how can infrastructure delivery productivity in Australia be improved?

Stagnant productivity growth is a longstanding issue facing infrastructure delivery in Australia.

Despite many initiatives to address it, the situation hasn’t improved. In the last year, construction productivity and market capacity were made a national cabinet priority.

The Australian government also cut 50 projects from its Infrastructure Investment Program.

The decision followed an independent strategic review, which found that the 10-year program developed by the former coalition government was undeliverable.

While the pressures on infrastructure delivery in Australia are particularly acute, it’s not alone in facing these challenges.

The impacts of rising costs and diminishing workforces are felt globally – but can only be overcome through a focus on greater productivity.

Improving how infrastructure is designed, built and operated is required to meet the needs of society without exhausting finite resources.

Recommendations for discussion

This ICE policy and research programme is exploring what needs to happen to improve the quality of outcomes (i.e. effectiveness) and reduce waste (i.e. efficiency) in Australia’s infrastructure delivery.

Given the longstanding nature of Australia’s low infrastructure productivity issues, this problem has received a great deal of analysis in recent years.

There’s no single route to tackling it.

In this green paper, the ICE recommends an additional focus on three areas in particular to raise infrastructure delivery productivity in Australia:

• Establishing a shared and comprehensive understanding of what productivity is in the context of infrastructure delivery, including considering broader social, economic and environmental outcomes.
• Applying a robust project assessment process nationally to ensure that project selection is aligned to clearly articulated long-term infrastructure goals – to achieve an infrastructure pipeline that is stable, sustainable and supports Australia’s vision for the future.
• Introducing standardised collaborative contracts to better mitigate and more fairly distribute project risk, improving the conditions for productivity.

Call for evidence

We invite policymakers, infrastructure professionals, civil engineers and other experts involved in improving infrastructure delivery to respond to the ideas set out in this green paper, and in particular the questions below.

This consultation runs until 9 August 2024. Responses may be submitted by emailing [email protected].

Questions

Understanding and defining the crisis of infrastructure delivery productivity in Australia

• Question 1: Are there more effective outcome measures for the infrastructure delivery sector than labour productivity or Multifactor productivity (MFP)?
• Question 2: How can social, economic and environmental outcomes be considered alongside economic measures for a more holistic understanding of infrastructure delivery?

Assessment and pipelines

• Question 3: How can infrastructure projects be consistently subject to robust, transparent, independent assessment against long-term infrastructure goals?
• Question 4: Is Australia’s national vision for infrastructure clearly articulated? Is its vision reflected in its infrastructure pipeline?
• Question 5: Are government decision-makers adequately held to account for infrastructure project selection? If not, can this reasonably be achieved?

Introducing standardised collaborative contracts

• Question 6: Do government and industry have the capacity to correctly deliver and administer collaborative contracts? If not, how should this be achieved?

When responding, please include your name and whether you’re responding individually or on behalf of an organisation or group.

Please provide evidence or case studies to support your response. All responses will be treated confidentially, and respondents will not be published.

The findings from responses to this paper, alongside further evidence gathering, will be formed into a policy paper with recommendations which will be published later this year.