Infrastructure Australia presents the result of its assessment process in the National Infrastructure Pipeline, which forms part of its annual report to the Council of Australian Governments.
Infrastructure Australia believes that reforms to ensure existing infrastructure is better used should be a top priority for Australia, as such reforms have the potential to offer significant economic, social and environmental benefits at lower financial and other costs than investment in new capacity. As a result, the pipeline includes new capacity investments and a series of better use measures and regulatory/pricing reform recommendations which are developed through national strategy work led by Infrastructure Australia.
The pipeline is split into four distinct categories to provide greater transparency as to the potential of the initiatives and their stage of development. It should be noted that any initiative that has been submitted to Infrastructure Australia, but which does not appear on the pipeline, has been assessed as not addressing a nationally significant issue or problem and/or not meeting Infrastructure Australia's strategic priorities.
The four Pipeline categories are:
Early stage. Initiatives in this category address a nationally significant issue or problem, but the identification or development of the right solution is at an early stage. For example, the solution itself is at an early stage of development (for instance the location is not finalised or capital costs not yet estimated); or other potential solutions haven't yet been considered.
Real potential. Initiatives in this category clearly address a nationally significant issue or problem to be addressed and there has been a considerable amount of analysis of potential solutions. However, development work is still underway and the analysis is ongoing - for example a robust economic appraisal has not been completed.
Threshold. Initiatives in this category have strong strategic and economic merit, and are only not ready to proceed due to a small number of outstanding issues. For instance, integration of the proposal into the wider network might require further planning; a final comprehensive business case was not yet complete, or the delivery strategy is incomplete. Initiatives in this category are, as the category name suggests, on the threshold of being ready to proceed, subject to the condition that the outstanding issues are resolved.
Ready to proceed. This category contains initiatives that meet all of Infrastructure Australia's criteria, i.e. they make a strong contribution to strategic policy goals, are supported by a methodologically robust cost-benefit analysis that suggests the benefits will considerably outweigh the costs, and have a robust delivery plan in place. Infrastructure Australia will provide advice on the relative priority of initiatives within the 'ready to proceed' category on the basis of their assessment across the Reform and Investment Framework.
Information on the criteria applied to each of the four pipeline categories is summarised in Table 2.
Table 2: National Infrastructure Pipeline - Criteria Applied to Initiatives
| Pipeline Category | Criteria Applied |
| Early Stage | • Fits one of Infrastructure Australia's seven themes for action. • Nationally significant issue or problem identified. Substantial evidence presented that the problem addressed is nationally significant. Detailed study of solutions is not a requirement at this stage but some initial analysis of the potential solutions should be present. Templates 1 to 6 to be filled out. |
| Real Potential | • Fits one of Infrastructure Australia's seven themes for action. • Nationally significant issue or problem identified. • Considerable amount of development work undertaken, demonstrating a clear and positive contribution to Australia's policy goals and economic benefits. Comprehensive analysis of different options presented, but further work is required to identify or develop evidence to support a 'lead option'. Templates 1 to 7 to be filled out. |
| Threshold | • Fits one of Infrastructure Australia's seven themes for action. • Nationally significant issue or problem identified. • Extensive amount of development work undertaken, demonstrating a clear and positive contribution to Australia's policy goals, economic benefits and robust delivery mechanism. Infrastructure Australia or proponent has identified a small number of specific issues to be addressed with the 'lead option'. Template 1 to 7 to be filled out. |
| Ready to Proceed | • Fits one of Infrastructure Australia's seven themes for action. • Nationally significant issue or problem identified. • Makes a clear and positive clear and positive contribution to Australia's policy goals. • Demonstrates long term national benefits (economic benefit- cost ratio significantly above 1:1). • Robust delivery mechanism. Template 1 to 7 to be filled out. |
Proponents should clearly state in their submissions which pipeline category they believe their initiative(s) most appropriately fits, given the range and depth of planning development to which the proposal has been subject (see Proposal Summary table template). Of course, Infrastructure Australia will make its own assessment in this regard taking into account the factors outlined above.
Public or private funding?
The Pipeline is therefore an assessment of the intrinsic merits of a proposal, and is designed to advise governments, the sector and the public as to the nation's infrastructure priorities. This does not necessarily mean that Infrastructure Australia believes that a proposal should receive public funding support. Indeed, in many cases proposals will be readily fundable through user charges (e.g. energy capacity investments, water networks) based on the operation of private companies or public utilities in a (often regulated) market. Infrastructure Australia will indicate, on a case by case basis, whether it believes public funding is required in order to ensure a national infrastructure priority goes ahead.
In addition, Infrastructure Australia will make recommendations to Government in relation to initiatives it would support being considered for planning and/initiative development work (including design). Infrastructure Australia proposes to base its assessment in this regard upon:
(1) the scale and urgency of the problem/challenge that has been identified; and
(2) the scope for development and application of complementary reform initiatives.