Economic modelling conducted for the Audit projects that GDP will grow by 3.1 per cent per year, increasing from around $1.4 trillion in 2011 to approximately $2.6 trillion in 2031. This growth rate is broadly in line with projections by others, including the Organisation for Economic Cooperation and Development (OECD), and slightly higher than the 2.8 per cent per year used in the 2015 Intergenerational Report. Table 1 shows the projected change in the size of Gross State Product (GSP) between 2011 and 2031.
Table 1: Actual (2011) and projected (2031) real gross state product
| 2011 | 2031 | Average annual growth |
| ($m) in 2011 prices | ($m) in 2011 prices | % |
441,249 | 733,723 | 2.58 | |
Victoria | 312,834 | 550,015 | 2.86 |
Queensland | 267,942 | 522,464 | 3.40 |
South Australia | 89,789 | 138,938 | 2.21 |
Western Australia | 221,852 | 513,007 | 4.28 |
Tasmania | 24,232 | 34,358 | 1.76 |
Northern Territory | 17,449 | 34,833 | 3.52 |
31,323 | 56,194 | 2.97 | |
Australia (GDP) | 1,406,670 | 2,583,531 | 3.09 |
Source: ACIL Allen Consulting (2014a), p. 84
The value-add (economy-wide spending) attributable to infrastructure services is projected to grow roughly proportionate with economic growth to 2031, from $187 billion in 2011 to $377 billion in 2031. Note that this is an estimate of the annual value-add from infrastructure services in those years.
Economic analysis commissioned for the Audit suggests there will be differences in the rate at which the infrastructure sectors grow. Telecommunications, airports, ports, urban transport and gas pipelines are expected to grow faster than GDP. The water, petroleum, electricity and non-urban road and rail sectors will still grow appreciably, but at a rate slower than growth in GDP.28
The nation's economic growth will be affected by both the total size and efficient allocation of investment in economic infrastructure.
Governments and other organisations have identified the benefits of encouraging industries in which Australia has a competitive advantage. For example, the Compete to Prosper: Improving Australia's global competitiveness report commissioned by the Business Council of Australia argues Australia has a comparative advantage in mining, agriculture, education, tourism, food manufacturing, pockets of advanced manufacturing and selected niches in global supply chains.29 Infrastructure decisions can support industries where such a competitive advantage has been identified.
Audit findings 9. The value-add (economy-wide spending) attributable to infrastructure services was estimated to be 13.3 per cent of GDP in 2011. Over 70 per cent of this was attributable to transport. The value-add attributable to infrastructure services is projected to grow roughly proportionate with the economy to 2031. 10. The infrastructure sectors projected to grow faster than GDP are transport, ports, telecommunications, gas pipelines and airports. The sectors projected to grow slower than GDP are water, petroleum, electricity, non-urban roads and non-urban rail. |
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28. ACIL Allen Consulting (2014a)
29. McKinsey Australia (2014), p. 3