Reforms allowing super funds to take over infrastructure assets and provide money for investment in assets such as roads and rail are needed more urgently than ever after a report that predicts a halving in the pace of growth of Australian engineering construction turnover, industry body Ai Group says.
Without further funding to boost infrastructure investment as resources-based investment tapers off, growth in engineering and construction turnover is likely to drop to 5.5 per cent next year from 11.3 per cent last year, the latest Construction Outlook report by Ai Group and the Australian Constructors Association says.
“We’ve got to nail it down now,” Ai Group’s policy director Peter Burn said on Wednesday. “If what we’re going to do is have an expansion in infrastructure spend to make up for that decline in mining-related investment – we’ve not yet seen a decline, but we’ve seen it slow – we need to get something going. It takes a while before the shovels actually start digging.”
The report comes a day after the Industry Super Network, an association of not-for-profit pension funds, said they should be allowed to buy more public infrastructure assets - as seen in Industry Funds Management’s role in leading the $5.1 billion purchase of the 99-year lease on Ports Botany and Kembla in NSW - to increase their already-strong focus on infrastructure assets and to help close the gap on Australia’s estimated $770 billion shortfall in infrastructure.
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