The infrastructure industry is facing a number of systemic challenges. The major issues include: low productivity; high market volatility (driven by difficult-to-predict and rapid changes in investment); a high contractor failure rate; and a reduced ability to source materials, plant or equipment.
These are compounded by escalating input costs, cultural issues, and cost and schedule overruns.
These are not project issues. They are symptoms of systemic portfolio-wide challenges that present themselves on individual projects.7 While they are diverse, the majority can be allayed by having a more stable, predictable and dependable infrastructure pipeline and portfolio of works. 8
To achieve this, a cultural shift is needed in government approaches so infrastructure is seen as a system instead of hundreds of individual and siloed projects and contracts.
Governments must approach infrastructure delivery as an interconnected system. The infrastructure pipeline of work must be managed actively to optimise a portfolio of projects drawing on the same workforce, organisations and resources.9
Governments can mature the current project-to-project or contract-to-contract approach through better sequencing of works, which will strengthen market confidence and increase the desirability of the sector.
The impacts of the COVID-19 pandemic present a unique opportunity to do this. As highlighted in the Place chapter of the 2021 Plan, population growth has paused in major cities. At the same time, there is a push for wider economic recovery through infrastructure, with increasing calls to improve the speed of projects to market.
Following the impacts of the pandemic, and the withdrawal of stimulus investment, the availability of public funding for infrastructure is likely to be lower. It will therefore be critical to embrace reform in order to enhance productivity. Increasing the sector's productivity will be critical to ensure we can continue to see the necessary levels of new and refreshed infrastructure to support economic growth and quality of life.
" Following the impacts of the pandemic, and the withdrawal of stimulus investment, the availability of public funding for infrastructure is likely to be lower. It will therefore be critical to embrace reform in order to enhance productivity. "
Moving to a better coordinated program of activity may require a degree of administration, however will deliver a more productive and cost-efficient infrastructure sector overall.10