On 19 May 2015, the Queensland Government introduced the much anticipated Building Queensland Bill 2015 in response to their election promise to provide well-directed investment in infrastructure to create significant economic benefit in the form of increased productivity, job creation, training and skilling opportunities.
The Bill provides for the creation of "Building Queensland", which is tasked with paving the way for a whole-of-government approach to infrastructure planning, investment and prioritisation, so as to best serve Queensland's future infrastructure needs.
What is "Building Queensland"?
The Bill provides for the establishment of Building Queensland as an independent statutory body.
The Government had a number of options available to it in establishing Building Queensland. For example, it could have been established as part of a department (like Projects Queensland), a Government Owned Corporation or an incorporated entity under the Corporations Act.
The key advantage of this adopted model is that there is considerable scope in terms of the powers that are given to Building Queensland. However, it will be governed by a regulatory framework that may provide less flexibility than using, for example, a Corporations Act company.
It is intended that Building Queensland will provide increased rigour, accountability, transparency, and efficiency during the development of Queensland infrastructure projects.
A key consideration of the Bill is the independence between Building Queensland and Government, with Building Queensland administered by a board of management, consisting of eight members with fixed terms. It is intended that, along with the chairperson, there will be four part-time members and three permanent board members being the chief executives from Premier and Cabinet, Treasury and Infrastructure, Local Government and Planning.
The Bill imposes conditions on a board member's appointment, and a person will be disqualified from becoming a board member where they are employed by, or are a contractor of, Building Queensland. The interim chief executive officer for Building Queensland is David Quinn, former head of Projects Queensland.
Functions and powers
The Bill describes that Building Queensland will be responsible for a range of functions, including the:
- development of a transparent framework for the assessment of a project;
- evaluation of proposals for the investment in, or enhancements to, infrastructure;
- publishing of information and promoting public awareness; and
- developing and maintaining an infrastructure pipeline document that records proposals or projects in order of priority.
Building Queensland will also be empowered to provide independent expert advice about a range of infrastructure topics, including:
- the State's current and future needs and priorities relating to infrastructure;
- improvements to the use of infrastructure;
- emerging national and international trends in policies about infrastructure; and
- policy, pricing and regulatory issues.
Notwithstanding the broad powers available to it described above, we understand that a key role of Building Queensland, in addition to the provision of strategic advice, will be in the preparation and development of business cases for significant infrastructure projects. The threshold values outlined in the Bill are:
Expected capital cost of project or net present value of financial commitment
Function of Building Queensland
< $50 million
Building Queensland will have no involvement, and it is expected that Government agencies will take responsibility.
≥ $50 million to < $100 million
Building Queensland will assist in the preparation of business cases.
≥ $100 million
Building Queensland will lead the preparation of business cases.
What won't it do?
While the Bill also provides Building Queensland with the power to lead the procurement or delivery of a particular infrastructure project on the direction of the Minister, we understand that it is proposed that this will be done by the relevant department and, in the case of PPP procurement, Queensland Treasury.
We also understand that Building Queensland will not have a role in the initial assessment of unsolicited proposals. These will continue to be assessed, at least initially, by Treasury, the Department of Premier and Cabinet and/or the relevant agency.
Where to now?
The Government is seeking submissions on the Bill by 24 June 2015. Its expectation is that the Bill will be in place by November 2015.
While it remains to be seen how the broad powers granted to Building Queensland will be applied and utilised in practice, the theory of empowering an independent body dedicated exclusively to the assessment and development of Queensland infrastructure projects is to be applauded.
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