Victoria

Strong VIC infrastructure investment can benefit all

victoria rural infrastructure housing building stock image

“Ai Group welcomes and supports the commitments to building much-needed infrastructure being shown by all parties in 2018’s Victorian State Election. Strong growth in business activity, employment and population is occurring across Melbourne and many regions of Victoria. This benefits everyone in our communities, but it must be supported by better public infrastructure for transport, IT, education, health and the built environment,” Ai Group’s Victoria Head, Tim Piper, said.

“The announcement by the Victorian Government that, if re-elected, it will continue to invest in the State’s economic and social infrastructure and the commitment by the Liberal National Party to invest in the State’s infrastructure are important commitments to improving productivity, amenity and living standards in Victoria.

“Ai Group has been calling for just such an increase in investment in much-needed infrastructure in Victoria for some time. Our public infrastructure must keep pace with economic and population growth, in order to maintain community wellbeing and foster sustainable and inclusive growth that can benefit everyone.

“Of course, all such investments should be rigorously and independently assessed and prioritised so that Victorians get the greatest possible benefit from a program of additional investment.

“This is particularly the case where infrastructure investment is financed by public-sector borrowing. We owe it to future generations not only to build the best infrastructure but also to ensure it is financed responsibly and sustainably.

“Long-life infrastructure assets that pass muster and will genuinely enhance our productivity and wellbeing can be funded through government debt without jeopardising the State’s credit rating. They are not akin to debt-funding for recurrent or general government spending or for ill-considered projects. For suitable projects, the RBA continues to maintain Australia’s cash rate at record lows and wholesale debt funding costs are relatively low, so now is an excellent time to take on more debt for worthwhile public infrastructure that can add to our future prosperity.

“That said, for many projects, asset recycling as proposed by the Opposition, public-private partnerships or other funding options will also be viable and in many cases preferable.

“Victoria has clearly reached a point where our beloved house needs further repairs and an extension, to accommodate our growing family. We welcome this Government’s willingness to take on a bigger mortgage now, in order to ensure future generations will be able live and work in a comfortable and sustainable environment,” Mr Piper said.

Source: Ai Group