Western Australi The Aftermath Of The Global Financial Crisis

Globally, economic growth and urbanization are driving a rise in demand for all forms of transport. The demand to move people and freight is exploding as people move to cities and the demand for goods and services grows. Major replacement investment supports current transport capacity. New investment is required to accommodate the growth in transport demand. Combined these are creating an unprecedented demand for infrastructure funds.

At one level, this is a straightforward funding challenge. Faced with this unprecedented demand for transport investment, governments must secure the required funds through greater reliance on private finance.

However, to see it solely, or even mainly, as a finance issue oversimplifies the challenge. The demand

They determine the effectiveness of access to essential location based economic and social needs. These include health services, education, jobs and product markets. Failure to deliver enough transport capacity in a timely and efficient way will potentially compromise access and make it more costly for people. In the limit, failure to get the transport planning right will risk long-term productivity and economic growth.

The emerging shortfall in infrastructure has focused attention on funding requirements and increasing the role private funding. The aftermath of the Global Financial Crisis (GFC) has exacerbated the funding problem. The GFC exposed the underlying weak budget position of many governments and made raising funds more difficult.

Western Australia is no different. Funding for public infrastructure in Western Australia is through various sources including state government taxes, local government property rates, federal grants, user and access charges, other fees and charges, and developer

On the spending side, re-prioritizing projects has meant delaying some major projects such as the MAX light rail. On the funding side, the Government is aiming for greater involvement by the private sector in providing infrastructure. This includes refinancing through asset sales and having greater private sector involvement in building and operating new projects.

However, a coherent approach to financing requires a consistent and comprehensive infrastructure-planning framework, including integrated land use planning and transport planning. This creates the framework for long-term transport and related infrastructure investment decisions. The growth in the private funding of transport and the use of PPP’s in particular, has been criticized for lacking a coherent planning and regulatory framework (Balfour Beatty and Parsons Brinkerhoff 2013), (Infrastructure Finance Working Group 2012) (Stanley