Infrastructure Engineering and Construction businesses face quite a challenge in determining what the industry will look like post COVID-19.
As an industry that is directly exposed to both short and long-term impacts of Government policy, one of the biggest difficulties that regularly shows up is in forecasting the pace at which investment promises translate into projects on the ground. Nowhere is this more prevalent that with much-discussed Regional Development strategies and associated Regional infrastructure investment funds.
I was lucky enough to spend a weekend at Mudgee in Central Western NSW just prior to the advent of travel restrictions. Mudgee, as a town in the middle of wine country is very much geared towards tourism. It did seem apparent though that an increasing number of younger people have committed to making the local area their home.
This shift towards regional growth is occurring counter to what has been a broad trend towards urbanisation and the growth of major cities in Australia and around the world.
As a NSW example of what’s being done to support this shft, various State Government documents such as “A 20-Year Economic Vision for Regional NSW in 2018” and “Making it Happen in the Regions: Regional Development Framework” provide contextual frameworks for what needs to in place to enable sustainable regional development.
More specifically, the concept of Special Activation Precincts offers a coordinated approach to land-use and infrastructure planning, with the aim of creating attractive centres for businesses to establish and grow:
- Parkes in NSW’s Central West was announced in 2018 as the State’s first Special Activation Precinct (SAP), taking advantage of its unique location at the intersection of the ARTC Inland Rail line, the East–West Interstate rail network and the North–South Newell Highway.
- The Wagga Wagga SAP – incorporating Bomen Business Park and the Riverina Intermodal Freight and Logistics hub – is also intended to capitalise on Inland Rail and will focus on advanced manufacturing, agribusiness, and freight and logistics.
- Moree SAP, with road, rail and air transport links including connection to the Port of Newcastle, is intended to take advantage of its location in the middle of the most productive grain region in Australia.
There are of course additional underlying issues to consider.
The following was offered by demographer Bernard Salt at a recent Committee 4 Wagga seminar (as reported by the Daily Advertiser in Sept 2019). The seminar was organised in response to the State government’s 20-year economic vision for regional NSW, which endorsed the city’s growth by 33,000 residents in 19 years.
“There has been significant job growth in Wagga across a number of sectors, but equally there has been job loss in manufacturing, agribusiness and agriculture. Wagga is more than just the local municipality, it is its own territory, it’s the whole Riverina. And when the Riverina does well then Wagga does well … it can’t do that on its own.”
There are 14 cities across Australia with a population greater than 100,000, but under 1 million. Very few, such as Wagga, Albury-Wodonga and Toowoomba in Queensland, are located inland. The commonality between these cities, as identified by Salt, are that they command their own territories and are generally very well-watered. Accordingly, the greatest obstacle in the way of sustainable growth for Wagga is likely to be episodes of drought.
Millennials making the move to a small town typically crave affordable living, enjoying new experiences and being part of a community. Many of these same people hold legitimate fears about themselves and their families finding work. For example, the unemployment rate for those under the age of 25 living in regional Australia can be as high as 25% according to the charity The Brotherhood of St Laurence. This trend is likely to be exacerbated by developing economic circumstances borne of COVID-19 – even taking into consideration the recent and related huge shift in off-site working arrangements.
What’s the relevance of local infrastructure to this conversation? Local Infrastructure construction projects generate jobs for skilled and unskilled workers, with flow-on benefits for local communities. Investment in the right roads and rail improvement projects mitigate traffic congestion, the effects of which those who move around Australia’s metropolitan areas are well familiar. Infrastructure project investments are also a time-honoured way of assisting economies out of Recession.
In NSW as in Qld and Victoria, infrastructure investments programs such as Fixing Country Roads and Fixing Country Rail are well established.
So what’s missing in making this happen?