IPA supports the use of a range of financing options, public and private, in meeting the infrastructure needs of the nation. A range of finance options should be pursued, from public sector debt to private sector debt and equity. Any assessment of the scale of investment required to meet Australia’s current and emerging infrastructure needs indicates the size of the task is enormous and that governments need to tap the pool of private sector capital and risk management capability.
Australians have accumulated more than $1.3 trillion dollars of retirement savings, representing one of the largest pools of managed funds in the world. We recognise the inherent ‘win-win’ in creating the markets and commercial frameworks to harness the retirement savings of working Australians’ to finance the next round of economic and social infrastructure projects.
Regulation & Planning
We believe that greater certainty is required in the regulatory frameworks that impact on infrastructure investment. In moving to procure the nation’s next round of projects, Australia’s governments must streamline frameworks to allow, where possible, a whole of government ‘one stop shop’ for infrastructure, including a central procurement agency skilled in all aspects of procurement.
We believe that any enduring partnership must allow for the appropriate transfer of risk between the public and private sectors. In particular, ‘political’ risk inherent to major infrastructure projects and market reforms require significant attention from both government and industry. The long term sustainability of Australia’s infrastructure market will depend on community viewpoint and a recognition and sharing of political risk. Government and industry must together recognise the often inherently controversial nature of major infrastructure projects and partner to reach out to the community about outcomes, cost savings and superior benefits.