South East Queensland Infrastructure Plan and Program 2008-2026

By David Lester and Christopher Keane.

Key Points:
An estimated $107 billion of Government investment in infrastructure projects until 2026 presents significant opportunities for the private sector to assist with the delivery of these projects

In 2005 the Queensland State Government produced plans to address the sustainable management of growth and change in the South East Queensland ("SEQ") region.

• The SEQ Regional Plan 2005-2026 defines the regional land use pattern and desired regional outcomes, and is the basis on which priorities for infrastructure investment across SEQ are established. A formal review of the SEQ Regional Plan is currently underway, with the release of the draft expected later in 2008.
• The SEQ Infrastructure Plan and Program 2005-2026 was released in 2005 to support the SEQ Regional Plan. It outlines the Government’s infrastructure priorities and represents an unprecedented long-term commitment to capital works in SEQ. The plan is updated annually to reflect and align with the latest planning and budget commitments (we looked at the first update in our August 2006 edition).

Infrastructure plan update

The release of the SEQ Infrastructure Plan and Program 2008-2026 comes three years after the initial release and marks the first major review of the plan. The update has integrated input from local government and industry to reflect new priorities and emerging issues in the region. The key changes in this update are:

• inclusion of 60 new projects;
• some re-sequencing of the program based on analysing the progress and effectiveness of the plan so far and taking into account the implications of other emerging issues such as increased construction costs and the drought; and
• updating of project costs to reflect costs in 2008 dollars and based on more contemporary information about some projects.

Significant infrastructure investment

The updated plan identifies an estimated $107 billion of Government investment in infrastructure projects until 2026. This includes $83.5 billion in road, rail and public transport projects, $12 billion in social and community infrastructure, $8 billion in water infrastructure and $3.5 billion on energy. For each project the updated plan provides the estimated investment, an estimate category (pre-project, concept, pre-market, market or completed project cost) and the delivery timeframe.

The first three years of delivery under the plan have seen expenditure of more than $8.5 billion. The plan highlights a number of significant projects, including the three outlined below which demonstrate some of the different delivery models that are being used to procure projects under the plan:

• the Airport Link road tunnel is currently being delivered as one of Australia’s largest road tunnel public private partnerships, with construction expected to commence in 2008;
• the Gateway Upgrade Project, which is currently the largest road and bridge infrastructure project in Queensland’s history, is being delivered by a private sector partner under a design, construction and maintenance contract, with construction underway; and
• the Inner Northern Busway has been completed ahead of time and budget under an alliance contract with the private sector.

The updated plan sees the program mature from its establishment phase that featured a significant period of gear-up by both industry and government, into a stabilisation phase of steady and sustained delivery of infrastructure over the term of the plan.

Funding and delivering infrastructure

The planning and delivery of the SEQ Infrastructure Plan and Program is co-ordinated by the Department of Infrastructure and Planning. That department receives support from the SEQ Infrastructure Industry Taskforce, which is a joint Government, industry and union taskforce that is designed to develop closer working relationships and ensure the smooth delivery of the plan.

Options for funding and delivering projects in the plan are (or will be) evaluated, where appropriate, through the Queensland Government’s Value for Money Framework and Project Assurance Framework. This evaluation can lead to implementation of Queensland’s Public Private Partnerships policy if appropriate.

Contributions for funding projects come from all three levels of Government, with various projects having a subregional, regional or national interest. This includes federal funding through the AusLink program for transport projects and the Australian Water Fund for water projects.

Conclusion

The SEQ Infrastructure Plan and Program has undergone its first major review since it was released in 2005. The updated plan presents the stabilisation phase, which will see the steady and sustained delivery of infrastructure over the life of the plan, with an estimated $107 billion of government investment until 2026. Following the success it has had delivering projects during the first three years of the plan, the Queensland Government is likely to seek to continue to deliver these projects in partnership with the private sector.

For further information, please contact David Lester.