INFRASTRUCTURE FOR
21ST CENTURY AUSTRALIAN CITIES
Papers from the ADC Forum National Infrastructure
and Cities Summit | March 2014
JOHN STANLEY AND ANTON ROUX
EVENT PARTNERS
1
CONTENTS
Foreword (Anton Roux)06
List of contributors09
1.
National Infrastructure and Cities Summit: Major Themes and Directions (John Stanley)
12
1.1
Overview of critical issues12
1.2
Context13
1.3 Building better cities: Integrated land use/transport/infrastructure plans
14
1.4 Making the best use of our existing infrastructure
18
1.5
19
Infrastructure, productivity and the scale of our infrastructure deficit
1.6
Financing and funding22
1.7
Governance frameworks26
1.8
Community engagement28
1.9
A ‘Big Idea’28
1.10
Major conclusions29
References31
2.
Australia’s Infrastructure Challenge (Ian Watts)33
2.1
Introduction33
2.2
What is Australia’s infrastructure challenge?34
2.3
How do we increase private sector investment in public infrastructure?
34
2.4
Greater investment by superannuation funds35
2.5
Improving planning and delivery35
2.6
Conclusion36
3.
NSW Infrastructure priorities (Jim Betts)37
3.1
Introduction37
3.2
Ten Propositions38
4.
Plan for a Cleaner Environment: The Coalition Government’s National Environment Policy
(The Hon. Greg Hunt M.P.)41
4.1
Introduction41
4.2
Plan for a Cleaner Environment42
4.3
Deregulation43
4.4
Science and data44
4.5
Conclusion44
References
5.
Australian Infrastructure Needs and Benefits - An Assessment
(Peter Brain, Rose Elphick and Robert Noakes)
45
5.1
5.2
44
Assessing infrastructure needs and benefits
Infrastructure needs and benefits: findings from other studies
45
47
5.3
Infrastructure assets: The historical data48
5.4
Infrastructure shortfall: Estimates based on historical benchmarks
54
5.5
Infrastructure stock shortfall: A regional perspective57
5.6
Infrastructure shortfall: The international perspective58
5.7
The comparability of shortfall estimates59
5.8
Infrastructure needs: A projection to 202559
5.9
Infrastructure benefits: Necessary and sufficient conditions
61
5.10
Infrastructure financing
61
References62
2
6.
Paying our way on infrastructure (Christopher Selth ed.)
63
6.1
Background and acknowledgements (Christopher Selth)63
6.2
Strategic Overview (Christopher Selth)64
6.3
Funding infrastructure (Martin Locke)72
6.4
Funding infrastructure: Tax and availability charges (Jon Hickman) 74
6.5
Financing infrastructure (Robert Nicholson) 76
6.6
Processes for infrastructure delivery (Christopher Selth)81
6.7
Community engagement: a key infrastructure success factor (Katherine Teh-White, Paul McDonald and Peter Cochrane) 90
6.8
Infrastructure opportunities (Scott Ryall)94
6.9
Superannuation fund perspective (Gordon Noble)97
Appendix 1: Working Group Members101
References101
7.
Water and Liveable Cities: The Singapore Story (Khoo Teng Chye)
105
7.1
Introduction105
7.2
Governance is Key106
7.3
Four National Taps106
7.4
Managing Water Demand107
7.5
An Integrated Approach107
7.6
Conclusion109
8.
Five ideas for cities – “let’s get on with it!” (David Singleton)
111
8.1
Introduction112
8.2
So, what can Australia do?112
9.
Adelaide Case Study (Fred Hansen)115
9.1
The need for infrastructure to be transformative115
9.2
Adelaide’s direction116
9.3
Concluding comments117
10.
The Folly of Indifference: Federal Opposition Perspective on infrastructure and cities (Anthony Albanese)
119
10.1
Introduction119
10.2
The Labor Vision120
10.3
Labor’s Vision in Practice120
10.4
The Abbott Government121
10.5
A Better Way121
10.6
Urban Policy121
10.7
Conclusion122
11.
Australia needs a narrative or at the very least a debate on a narrative (Michael Roux)
123
12.
Land use/transport integration: implications for infrastructure in North American and Australian cities
(Robert Cervero)125
12.1
Introduction125
12.2
Thinking sustainability126
12.3
The lead role of land use126
12.4
Public transport126
12.5
Mixed Use128
12.6
Transit Oriented Development129
12.7
Concluding Comments131
3
13.
A Western Australian Perspective (Reece Waldock)133
13.1
Introduction133
13.2
Perth134
13.3
Conclusion136
14.
A Developer’s View on Infrastructure Planning and Key Priorities from a Housing Perspective
(Anthony Boyd)137
14.1
Overview137
14.2
Key Priorities in Infrastructure Development (focus on cities)
138
14.3
Wider priorities with broader focus outside of simply housing development
140
14.4
Conclusion141
Reference141
15.
Peak advocacy group perspectives: Sydney infrastructure (Tim Williams)
143
15.1
Introduction143
15.2
Some context144
15.3
Committee for Sydney priorities144
15.4
Governance145
15.5
Parramatta Rd and WestConnex146
15.6
Concluding comment146
16.
Transport Infrastructure (Chris Lowe and Stephen Davis)
147
16.1
Introduction147
16.2
Methodology147
16.3
Context148
16.4
Attitudinal and Behavioural Change149
16.5
Depoliticising Infrastructure—Liveability and the National Objective
150
16.6
Governance Change151
16.7
Re-thinking Funding152
16.8
Conclusion154
Reference List154
Acknowledgements155
17.
Public Transport Progress and Failure – Keeping up with growth in Australian Cities (Graham Currie)
157
17.1
Introduction157
17.2
Research Context158
17.3
Methodology160
17.4
Results160
17.5
Discussion and Conclusions165
References164
Acknowledgements165
18.
Water for Liveable and Resilient Cities (Rob Skinner)
169
18.1
Problem Statement169
18.2
Resilience of Water Systems170
18.3.
Water for Liveability170
18.4
The Transformational Imperatives171
18.5.
Implications for Further Reforms172
References172
Attachment A: The Millennium Drought172
Attachment B: Western Australia’s Water Forever173
Attachment C: Murray Darling Basin Reforms173
Attachment D: Melbourne’s Water Future initiative174
4
19.
Centralised to De-centralised Energy - What Does it Mean for Australia (David Green and Tim Sonnreich)
177
19.1
A Time of Transformation177
19.2
More competition178
19.3
Lower cost infrastructure178
19.4
More efficient use of resources
179
19.5
Conclusion180
20.
Social Infrastructure (Janet Stanley, Tony Nicholson, Ian Manning)
181
20.1
Overview181
20.2
The nature of social infrastructure182
20.3
Social Trends184
20.4
Issues and challenges: Social infrastructure that needs special attention
185
20.5
Policy solutions189
20.6
Funding social infrastructure191
20.7
Conclusions192
References192
21.
Social infrastructure local case study (Robert Turk)
195
21.1
Opportunities and challenges in Melbourne’s North195
21.2
The critical role of infrastructure196
21.3
State of Infrastructure197
21.4
50 Year Plan199
21.5
Infrastructure financing and funding 204
21.6
Conclusion205
References205
22.
Cities and infrastructure (The Hon Malcolm Turnbull M.P.)
207
22.1
The duality of cities207
22.2
The internet and cities208
22.3
The National Broadband Network208
23.
A Local Government Perspective (Michael Kennedy)210
23.1
Introduction210
23.2
Local government’s role212
23.3
Concluding remarks213
24.
Effective Governance for Australian Cities (Meredith Sussex)
215
24.1
Introduction215
24.2
Governance and the civil society216
24.3
Context for City Governance in Australia in the early 21st Century
216
24.4
Successful Cities217
24.5
Elements of Effective City Governance217
24.6
City Governance Issues for Consideration218
24.7
Directions for change in city governance220
References 221
5
25.
Governance Frameworks for Integration (Terry Moran)223
25.1
Introduction223
25.2
Land use transport integration, infrastructure and our cities
224
25.3
Some elements of the solution224
25.4
Back to the future225
25.5
Conclusion226
References226
26.
Integrated Approaches to City Infrastructure (Roz Hansen and John Stanley)
227
26.1
Context227
26.2
Vision228
26.3
Common principles for cities228
26.4
Greater Adelaide229
26.5
Greater Sydney230
26.6
Melbourne Metropolitan Area231
26.7
Making the best use of our existing infrastructure
232
26.8
Financing and Funding233
26.9
Providing choice and accountability233
References334
27.
Integrated approaches to city infrastructure (Garry Bowditch)
235
27.1
Introduction235
27.2
Vision and governance failures236
27.3
Do we have too much infrastructure?238
28.4
Closing comment238
28.
Summit Take-outs (Lucy Hughes Turnbull AO)
239
6
FOREWORD
ANTON ROUX
Like a number of advanced economies, Australia has been
spending under the broadly used 6 per cent rule of thumb for
adequate infrastructure investment and servicing over many
decades, and in Australia’s case it has been largely in the 3-5
per cent range. From many quarters there are claims of an
infrastructure investment deficit of at least $100bn, with estimates
up to an order of half a trillion dollars. The result is that we are at
a point where the marginal productivity impact of well directed
infrastructure investment is likely to trump the marginal impact of
more general business investment spending.
The culture of infrastructure planning and investment in
Australia – and not only here – tends toward large, singular
projects. There will always be a place for large, visionary projects
but that is not all we need. The focal point of ADC Forum’s
National Infrastructure and Cities Summit 2014, which forms
the basis for this publication, is the recognition that a major
cultural shift is required around the way we conceive and deliver
infrastructure in this country.
The Summit builds upon the functional principles developed
through the prior work of the ADC Cities Summit 2010 and the
subsequent ADC Cities Report: Enhancing Liveability, as well as
the ADC’s 2008 report Infrastructure 21: from Incrementalism to
Transformational Change emerging from that summit, ahead of
the formation of Infrastructure Australia.
Over the last decade, there has been growing recognition
across all sectors of society that adherence to market forces by
themselves will not necessarily usher in the productivity, efficiency
and liveability step-changes demanded by our economy and
society. The reality is that contemporary business practice falls
short of the time dimension required to invest in long-term futures
and build well-designed cities and systems. This does not happen
in a vacuum, but results from a market shaped by short-term
expectations and a regulatory framework and set of policies
created by governments shooting for the next election campaign.
The one feeds off the other.
Infrastructure – both hard and soft – abounds in our lives to
ultimately improve our standard of living, to enable opportunities,
trade, mobility, agency and community. Cities are the major
workhorses of the modern economy, so a focus on them as we
deal with infrastructure should be an obvious consideration as we
focus on the capacity of Australian society to support the types of
decisions and long-term strategic leadership they require.
An implication of Graeme Donald Snooks’ dynamic-strategy
theory is that to postulate a backlog or a deficit in infrastructure
investment requires an implied understanding that there is unmet
strategic demand in the economy. Unfortunately too often, the
case for infrastructure investment has been made oblivious to that
powerful story of demand, and has focused more on the shortterm costs and benefits of the project. In our current
cultural climate, these of course are incomparably easier to
measure and justify.
Why has it been so difficult to communicate this unmet demand?
In part the difficulty arises because the demand factor is, or
should be, strategic. Often, greater strategic considerations
have consequences more than one-step removed from the
immediate benefits and costs. Without an overall strategy or an
understanding of how the pieces fit together, there can be no story
to tell, no strategic narrative.
If the nation is unable to articulate this unmet strategic demand
through a functional narrative formed by integrative strategic
planning, it risks turning a theoretical deficit, and a backlog of
infrastructure projects (which don’t exist and ones that perhaps
should), into a series of financial underperformers and a litany of
strategic failures. As Nobel Laureate Kenneth Arrow adumbrated
in Public Investment, the Rate of Return and Optimal Fiscal Policy,
infrastructure spending does demand measurement against the
criteria of the return on investment, just that the rate of return must
take into account the positive externalities not picked up by the
cost-benefit analyses of prevalent, overly constrained short-term
financial models.
We need to look at cities when we look at infrastructure. Aside
from more remote, critical trade infrastructure, the quality of
infrastructure projects – no matter the size – must be borne
within an overall functional analysis of the system they support,
namely the complex system of living and working which is the
city. Aside from competing spending priorities, arguably one
of the reasons for a long-term lack of infrastructure investment
has been the problematic of justifying massive expenditure on
isolated projects absent the narrative of a requisite connectivity to
liveability, workability, critical relationships and trade enablement.
Infrastructure projects need to be strategic as well as coherent
and integrated within our goalposts for liveability, productivity
and efficiency.
7
Future infrastructure planning must be awake to and engage with
the accelerating pace of technological change. As Professor Steve
Rayner reminds us, sociotechnical lock-in, or path dependency,
has been a feature of infrastructure and city planning ever since
the Romans built their roads, the horse and carts rolled around
Sydney, or the American rail gauges determined in part the
fuselage dimensions of the Space Shuttle booster rockets.
Not all decisions will be linear and sequential, often solutions
will be multimodal. Planners and decision-makers must make
investment decisions on the understanding that decisions now
will affect decisions later, with the goal of building adaptable cities,
knowing that technologies will inevitably become outmoded and
need to be replaced.
Adaptability is something that goes beyond technological
advancement. With the majority of the world’s population living in
or heading towards cities, the forthcoming influx of sheer numbers
can seem overwhelming. I have heard urban professionals wax
lyrically on the wonders of slums in different parts of the world,
almost as if they were a utopia we might all look forward to. I hope
I am not out of turn in thinking that the majority of Australians
would not be altogether too happy to picture a future where cities
were surrounded by shanty towns, regardless of the ingenuity of
their inhabitants, the wonders of the internet and mobile phones,
and whether they functioned as an active part of the economy.
Which brings me to the next point – making assumptions. City
development and infrastructure planning is a thoroughgoing
combat zone of ideas and interests. The nature of the expected
engagement is not always well understood, although because
it affects so many it is a democratic testing ground that rarely
sees engagement elevated above the most granular planning
level. Urban and infrastructure planning and decision making
is something that all citizens have a stake in. Politicians know
this; citizens know this. The broader dialogue on urban futures
in forums such at this ADC National Infrastructure and Cities
Summit 2014, must extend beyond publication to the broader
public domain, the real constituency; not of urban professionals,
business people, politicians, academics and policy makers,
but of citizens.
The lack of clear project pipelines in the past, the lack of an
integration narrative to justify individual projects, the history of
funding expediency, and the cultural issue of semantic unease
between market forces and facilitated strategy, has meant that the
confidence for a political narrative has been lacking and so has
public trust. When cities demand long-term propositions rather
than short-term responses, there is a lack of constructive impetus
arising from undesirable factors such as traffic congestion and
poor access to services.
Often it has come down to who gets trusted to fill in the supply
curve, whether this is government, the public sector, or some
admixture. Depending on the level of public trust in urban
professionals, there may or may not be a significant transfer of
power to an expert planning process. The question will come
down to willingness for engagement, transparency,
and accountability.
During the Summit process, the Finance and Funding Working
Group identified trust and lack of community engagement as one
of the major reasons why infrastructure is not getting funded,
together with responses for dealing with this. One can start to
see the benefits of aligning governance, control and funding.
Even capital (or asset) recycling goes beyond the benefits of
reinvestment to engender trust that public monies directed
towards infrastructure will not simply get redirected as expediency
dictates. Community initiated or supported projects might
be major infrastructure projects, or they might look more like
traditional grassroots efforts such as the New York High Line.
With trust there will be greater support towards planning
processes for good projects – integrated ones, not just big
ones – and better research for what Australian cities need, to
support prosperity. Spatial thinking is the geographical core of
infrastructure and urban planning, but there are more overlays
now. Presented to the Summit was how Singapore not only
considered land use planning and transport corridors as core
geographical processes but also water planning. The new
spatiality will not only be geographical but will encapsulate other
dimensions too within strategic planning. Integration will go
beyond place-making and beyond the spatiality of geography to
include higher dimensional aspects including relationships and
The fact that the urban and infrastructure discourse of which
community. Increasingly, these have been liberated by technology,
urban professionals are always so sure, does not extend and live
in the public domain, means that there is a high level of uncertainty with enterprises that exist beyond geographical boundaries along
and risk when politicians attempt to bring those ideas to the public with knowledge infrastructure, supported by technology, and
realm. Unless there develops a shared responsibility to promulgate the demand pull of good education, research and development.
Developments in energy technology, such as a potential move
the appropriate public discourse through the community, experts
to decentralised energy, are a reminder against the vagaries of
should not remain surprised that some of the eminently rational,
sociotechnical lock-in and how disruptive technology can and
though perhaps counterintuitive or initially threatening ideas, do
not hold traction in the public mind. The irony of non-engagement should affect planning.
is that those ideas should be concepts that the broader public
Technology reshapes how community comes together. New
would have a desire to engage in and support – imagining better
collectives may reform transverse to geographical lines. On the
places for themselves and their children to live in.
other hand, modular city building concepts in some of the new
cities around the world, or the resilient organic spatial forms that
There is always a danger in groupthink – moving beyond which
have developed in places like Tokyo, as in the medieval cities
was one of the reasons the Australian Davos Connection was
of Europe, reinforce the value of neighbourhoods and personal
formed – and urban professionals or any other experts can be as
susceptible to it as any collection of individuals. The real danger is propinquity. In this technological age, what we refer to as
community can vary greatly, and there needs to be a deliberate
not always whether the ideas are good or bad, but whether they
awareness of those citizens who are geographically connected
are in tune with or disconnected from context and reality. If that
and those who are virtually connected, voting with their
reality is the greater public constituency to which politicians must
opinions and influencing mediated culture as community is
answer, then dissociation (wilful or otherwise) will lead to lack of
brought together.
trust and effective marginalisation.
8
Finally, I would like to remark on the interaction between cities
and the environment. Through the Summit we saw the role of
water in urban cooling and in Singapore’s integrated planning.
The environmental impact of cities is extensive. The environmental
movement has traditionally lived in a culture of conservation, and
while there is value in that, there is also value in an engineering
approach, the conviction that humanity can also intervene in a
positive way in the environment because we are part of it, for
good or ill.
There is an environmental revolution underway around the world,
which goes beyond climate change mitigation and its tinkering
with carbon by regulation, derivative instruments, or threatening
growth. It goes beyond mere adaptation too. Outside of cities,
areas of the planet the size of countries, such as the Loess
Plateau in China, are undergoing habitat restoration with the
potential to bring people out of poverty, ensure food security,
and bring the rains. The science suggests that man can assist
fellow man, fellow creatures, farms and forests, to live in harmony
without compromising prosperity.
Within cities, there is scope for innovations such as green walls
and roofs, urban agriculture, and the flourishing of life in urban
environments. We know that biodiversity leads to increased
property prices, better health, and cooler cities. Economic
prosperity can be pursued while the human footprint is optimized
to maximize the extra urban benefits for food production, nature
and our fundamental stock of future capital – fecundity. Perhaps
one day the benefits of the forest will be found within the city
as much as outside of it, and the urban canopy will mimic the
benefits of the wild.
The ADC National Infrastructure and Cities Summit 2014
would not have been possible without the generous support of its
Partners: the NSW Government; RMIT University; The University
of Sydney; Australand; ARUP; the Bus Industry Confederation; the
Smart Infrastructure Facility, University of Wollongong; and ASFA.
The team at ADC Forum worked for several months realising the
program and the summit that set the framework and potential of
this publication. I would like to acknowledge the important work
of the whole team and the contribution of Matt Faubel, Chef
Operating Officer at ADC Forum, who has been instrumental
thoughout the endeavour.
We would also like to acknowledge the outstanding group of
individual contributors, to the speaking program, its working
groups, and this publication. This volume presents the culmination
of a diverse and high level group of specialists operating in
both the infrastructure and cities domains who came together
to share knowledge, experiences, insights and reflections across
the nation.
The Summit and this publication build upon the mission of ADC
Forum in shaping national strategic culture. I hope you enjoy
reading what follows and find this to be a useful resource, not only
for valuable information, but also to inspire action.
ADC Forum aims to support your role in the unceasing shift to a
better future.
ANTON ROUX
Chief Executive Officer
ADC Forum
9
LIST OF CONTRIBUTORS
Anthony Albanese is the Shadow Minister
for Infrastructure, Transport, and Tourism.
He was elected as the Member for
Grayndler in 1996 and, in November 2007,
became the Minister for Infrastructure and
Transport and Leader of the House of
Representatives. In June 2013, he became
Deputy Prime Minister, and Minister for
Broadband, Communications and the
Digital Economy.
Anton Roux is CEO of ADC Forum. A
lawyer by training, he has led development
of ADC leadership program programs and
reports for a number of years, assembling
diverse people and perspectives in to
a vibrant learning community. Anton
previously worked in corporate advisory,
investment, property development and in
commercial and intellectual property law,
with Minter Ellison. He was also involved in
programming the special Federation series
of the Alfred Deakin Lectures and worked
in Davos with the World Economic Forum.
Jim Betts is CEO of Infrastructure NSW,
following five years as the Secretary of the
Victorian Department of Transport and
four years as Victoria’s Director of Public
Transport. His experience spans strategic
transport planning, infrastructure delivery,
and transformational structural reform,
including privatisation, private finance and
regulatory reform. It includes senior roles in
the United Kingdom Government.
Garry Bowditch was appointed the
inaugural CEO of the SMART Infrastructure
Facility at the University of Wollongong in
May 2010. He is an appointed member of
the Australia Pacific Economic Cooperation
Committee, advising regional trade
and investment initiatives in APEC. He
established the boutique consultancy firm
Vmax Consulting.
Anthony Boyd has been with Australand
for 9 years and was appointed General
Manager Operations in June 2011. Earlier
he was General Manager Finance of
the Residential Division. Prior to joining
Australand, he held a number of senior
management positions with John Swire
and Sons, Cathay Pacific in Hong Kong,
and PricewaterhouseCoopers.
Professor Robert Cervero is Director
of the Institute of Urban and Regional
Development and the University of
California Transportation Center, Berkeley.
He has served as an advisor and consultant
on transportation and urban planning
projects in Uruguay, Vietnam, Brazil,
Colombia, China, Saudi Arabia, Korea,
and Australia and conducted professional
training workshops through the World Bank
Institute and for many transport agencies.
He is a recognised world leader in land
use/transport integration.
Peter Cochrane has held senior executive
leadership and governance roles for
nearly 20 years in the public and private
sectors, including 14 years as Director of
National Parks and head of parks Australia.
He has a background in environmental
science, policy and programs. He has an
international reputation in conservation
policy and practice.
Rose Elphick is Managing Director of
RED Strategic Planning and, from 2003 to
2012, she was CEO of the Victorian Freight
and Logistics Council and Manager of
Corporate Strategy at Port of Melbourne.
She has masters degrees in public policy
and social policy.
Professor Graham Currie holds Australia’s
first professorship in public transport. He
has over 30 years experience as a transit
planner and has worked for world leading
Dr. Peter Brain is one of Australia’s best
operators including London Transport.
known economists in the development and Joining the Department of Civil Engineering
application of macroeconomic models.
at Monash University in 2003, Professor
Since co-founding NIEIR in 1984, Dr
Currie is the Chair of Public Transport and
Brain has undertaken over 250 economic
is currently the Director of World Transit
consulting projects. He has been a frequent Research (WTR).
contributor to ADC events.
Stephen Davis is Manager of Planning and
Industry Development at Bus Association
Victoria. He has over 15 years national
experience as a strategic land use and
development planner specialising in the
fields of urban growth area planning,
integrated land use and transport planning,
and transit oriented development.
David Green OBE MBE is the Chief
Executive of the Clean Energy Council.
Serving as founding Chief Executive of
the UK Business Council for Sustainable
Energy and member of the UK Government
advisory committee on energy policy for 10
years. He holds the Award for Outstanding
Contribution to Sustainable Energy made
by the UK Parliamentary Renewable and
Sustainable Energy Group. He Co-founded
the UK national charity Neighbourhood
Energy Action.
Fred Hansen is renowned for his
innovative approach to the provision
of public transport and internationally
recognised in the field of transport and
integrated land use. He was General
Manger of TriMet in Portland Oregon where
he pursued an ambitious and world-leading
public transport strategy for the city,
transforming it into an international model
of a sustainable and integrated system.
Professor Roz Hansen is an urban and
regional planner with more than 30 years
experience working both in Australia and
the Asia Pacific Region. She is a Fellow of
the Planning Institute of Australia; Fellow of
the Victorian Planning and Environmental
Association; Adjunct Professor at Deakin
University, Melbourne since 1995; and is
a recipient of an Australian Government
Centenary Medal.
John Hickman is chair of the Victorian
Coastal Council. He has held CEO level
appointments in universities and with state
and local governments.
10
Greg Hunt is a Liberal member of the
House of Representatives, was elected
as the Federal Member for Flinders in
2001 and is currently Minister for the
Environment. Before entering Parliament,
his work experience included time with
Mallesons Stephen Jaques, McKinsey and
Co and the World Economic Forum.
Dr Michael Kennedy OAM worked the
first half of his professional life in the
transport industry, in rail, in the bus sector,
in shipping, in logistics, and in transport
equipment manufacture. The second half
he has spent as CEO of the Mornington
Peninsula Shire, Victoria, Australia in a
large municipality that has a port, a minor
airport and critically important rail and road
connections.
Professor Khoo Teng Chye is Executive
Director of the Centre for Liveable Cities
at the National University of Singapore. He
has previously held the positions of Chief
Executive, Board Member of Singapore
Public Utilities Board and Chief Executive
Officer/Chief Planner at the Singapore
Urban Redevelopment Authority.
Martin Locke is a partner in Project
Finance at PriceWaterhouseCoopers. He
specialises in PPPs, transport and energy
project financing, structured financing and
debt restructuring. He has over 20 years of
direct banking experience with substantial
international experience and has vast
experience across a wide range of
projects as government adviser and
bid-side adviser.
Chris Lowe has been Executive Director
of the Bus Association Victoria since
2008. Prior to joining BusVic, he was Chief
Operating Officer of the Franchise Council
of Australia, having previously worked in
lodging development for 20 years. As CEO
he increased both international and local
lodging brands presence in Australia. Chris
is also a Director of the Victorian Public
Transport Ombudsman.
Paul McDonald is Managing Director of
Strategic Knowhow, an Australian strategic
advisory firm. He has over 30 years
experience as a senior executive and lead
consultant in the public and private sectors,
including as Executive Director of CEDA
(Sydney), Director General of the NSW
Department of Business and Regional
Development and Director General of the
NSW Department of State Development.
Professor Perez Pascal is currently
the Research Director of the SMART
Infrastructure Facility, University of
Wollongong. He is a specialist of
Integrative Social Simulation, using
Multi-Agent Systems technologies to
explore complex infrastructure systems.
He is a member of the Technical
Committee of the Australian Urban
Research Infrastructure Network (AURIN).
Terry Moran AC was Secretary of the
Department of the Prime Minister and
Cabinet from 2008 to 2011. He is currently
Chair of the Barangaroo Delivery Authority
in NSW, a Senior Adviser to Boston
Consulting Group, and Senior Adviser at
Maddocks Lawyers. He has also been
Secretary of the Department of Premier and
Cabinet for the State of Victoria.
Michael Roux is Founder of ADC Forum.
He is currently a Member of the Presidential
Advisory Council Rwanda; Honorary
Consul-General of Rwanda in Australia;
Member, Asialink Advisory Council;
Founding Chairman, Roux International;
Founder, Australian Davos Connection;
Member, World Economic Forum Alumni
and Member, Yale Center for Environmental
Law & Policy. He has been Chairman,
KPMG Asian Markets, and
Vice-Chairman, Citigroup.
Tony Nicholson is currently Executive
Director of the Brotherhood of St Laurence
in Melbourne. He has dedicated over 30
years to improving conditions of those
living on or close to the edges of society
and brings to the task of leadership at the
Brotherhood a strong record of service
development and innovation, research
and policy analysis and compelling
advocacy on behalf of those
disadvantaged in our community.
Robert Nicholson is a senior partner in
Herbert Smith Freehills Corporate group,
a director of Baker IDI Heart and Diabetes
Institute and chairman of Nucleus Network.
He has over 30 years experience in
commercial law, with a focus on mergers
and acquisitions and capital markets.
He has worked in a range of industries
but particularly energy, infrastructure and
natural resources.
Gordon Noble is the Director of
Investments and Economy at the
Association of Superannuation Funds of
Australia. Gordon is responsible for ASFA’s
investment strategy and stakeholder
relations including relationships with the
Federal Government.
Scott Ryall is Head of Research at CLSA
Australia, a position he has held since
2010. In this role he is responsible for
thematic research as well as covering the
transport and infrastructure sectors. He
has almost 20 years experience in financial
markets. Prior to joining CLSA, he was
European Head of Research for Macquarie.
Christopher Selth was, until recently,
Chief Investment Officer at Five Oceans
Asset Management, an international funds
management business he co-founded
in 2005. Previously Christopher was
an Executive Vice President and Head
of International Equities at BT Funds
Management. He is also Chairman, ADC
Forum Global Issues Group.
David Singleton is the Global Director of
Planning for Arup. He is a board Chairman
and non-executive Director; a respected
thought leader and expert advisor to
governments and global businesses
on resilient leadership and practice,
specialising in infrastructure and climate
change. He is currently Chair of the
Infrastructure Sustainability Council
of Australia.
LIST OF CONTRIBUTORS
Tim Sonnreich is the Strategic Policy
Manager at the Clean Energy Council. He
was previously a senior ministerial adviser
to the former Victorian Premier John
Brumby and has a Masters in Politics from
Monash University.
Katherine Teh-White is founder and
Managing Director of Futureeye. Through
her 20 years’ experience in corporations
and as a consultant she has developed
unique experience in social licence to
operate strategy, policy, organisational
change, communication and engagement.
Professor Robert Skinner is Professorial
She is a former journalist and government
Fellow and Director of Monash University’s
relations/ public policy manager in a
Water for Liveability Centre and also Deputy
resources company.
Chair of the CRC for Water Sensitive Cities.
Rob was Managing Director of Melbourne
Dr Lucy Hughes Turnbull AO is
Water for six years until 2011. Prior to
an urbanist, businesswoman and
joining Melbourne Water Rob was the Chief philanthropist, with longstanding interest
Executive of Kingston Council in Melbourne in cities, and technological and social
innovation. She was the first female Lord
for ten years.
Mayor of the City of Sydney from 2003Dr Janet Stanley is Chief Research
4. She chairs the Committee for Sydney,
Officer at Monash Sustainability Institute,
is Chair of Prima BioMed Limited and a
Monash University. She takes an
director of the Turnbull Foundation and the
interdisciplinary approach to exploring
Grattan Institute.
the interface between social, economic
and environmental sustainability, at the
Robert Turk is the Sustainability Leader
of Arup’s Victorian office and has over 17
policy and community levels. Her previous
years experience in a range of sustainable
experience has included senior positions
development and environmental
at the Brotherhood of St Laurence and
management projects within Australia and
Australian Institute of Family Studies.
the UK. Starting at the Federal Department
Professor John Stanley is Chair of
of Transport and Regional Services in
ADC Forum. He is an Adjunct Professor
Canberra, Robert moved to London
at the Institute of Transport and Logistics
in management of the environmental
Studies in the Business School at University
assessment process for the redevelopment
of Sydney, had 8 years as Deputy Chair
of the St Barts and London Hospitals.
of Australia’s National Road Transport
Malcolm Turnbull is a Liberal member of
Commission and 9 as CEO of Bus
the House of Representatives, was elected
Association Victoria. John is a recipient
as the Federal Member for Wentworth
of an Australian Government Centenary
in 2004 and is currently Minister for
Medal.
Communications and Broadband. In 1987
Meredith Sussex AM is principal of
Mr Turnbull established his own investment
Meredith Sussex and Associates which
banking firm and co-founded OzEmail Ltd.
provides strategic advice to organisations
He later chaired Goldman Sachs & Co’s
on public policy, planning, management
Australian business, becoming a partner of
and governance. During her public
the global firm in 1998.
service career, she was Deputy Secretary
of the Victorian Department of Premier
and Cabinet and Deputy Secretary of
the Victorian Department of Education.
She was also the Executive Director of
the Office of Commonwealth Games,
responsible for the delivery of the
2006 Games.
11
Dr Reece Waldock has been the head
of the Western Australian Government’s
three Transport portfolio agencies since
May 2010, as Director General of the
Department of Transport, Commissioner
for MRWA and Chief Executive Officer
of the PTA. Prior to his public sector
career, Reece held a number of senior
management roles with BHP. Reece is also
a Commissioner of the Western Australian
Planning Commission.
Dr Ian Watt is Secretary of the Department
of Prime Minister and Cabinet, having
previously been Secretary of the
Departments of Defence, Finance and
Deregulation, and Communications,
Information Technology and the Arts. He
is the current chair of the Organisation for
Economic Co-operation and Development’s
Working Party of Senior Budget Officials.
Professor Paul Wellings CBE assumed
the post of Vice-Chancellor of the
University of Wollongong in January 2012,
having been Vice-Chancellor of Lancaster
University from 2002-2011. He has been
Chief of the CSIRO Entomology Division,
head of the the Innovation and Science
Division, Department of Industry, Science
and Resources and Deputy Chief Executive
of CSIRO.
Dr Tim Williams is CEO of the Committee
for Sydney and a Principal with Arup, a
global consultancy firm. In 2010 Tim led
urban regeneration and development in the
UK with his pioneering work in the Thames
Gateway in East London. He served
as special advisor for 5 successive UK
Cabinet Ministers.
12
1. NATIONAL INFRASTRUCTURE
AND CITIES SUMMIT
MAJOR THEMES AND
DIRECTIONS
JOHN STANLEY
1.1 OVERVIEW OF CRITICAL ISSUES
For the vast majority of Australians, the performance of our
cities matters. It is crucial for national productivity and liveability,
becoming increasingly so in the knowledge economy. Yet for
reasons of history, culture, government and governance, amongst
other things, our cities have no voice: they are essentially what Dr
Tim Williams (Chapter 15) describes as ‘orphans’. No-one speaks
for our major cities, an extraordinary situation when they account
for about four-fifths of national economic activity and are, with their
famed liveability, a core part of ‘brand Australia’.
Australia is currently preparing for a significant boost to national
infrastructure investment. Our cities will be major hosts for this
investment, which will see substantial additions to, for example,
road and public transport systems. The best infrastructure
investments for our cities are increasingly recognised as being
those that contribute most to making them great places to live,
work and visit. This is partly about, for example, easing traffic
congestion and reducing crowding on peak public transport
services, issues that matter for urban residents, but it is much
more. It is about creating places where people want to be,
either as residents, workers and/or visitors. The recent focus on
producing integrated land use/transport strategies for our capital
cities is partly a response to this wider agenda.
Seeing infrastructure as a foundation the creation of great places,
rather than as simply functional responses to apparent problems
(be they traffic congestion, crowded public transport, a lack of
affordable housing, lagged provision of community services in
fringe growth suburbs, etc) poses many challenges, such as:
-- how to span regional (city-wide), corridor and neighbourhood
level considerations, and engage the federal government in
this process, to identify visions and goals for our cities as great
places, in a way that will have some longevity (well beyond the
next election). Sydney’s Parramatta Rd corridor is the archetypal
example of these layered considerations. Great cities are able to
achieve this spatial integration in thinking
-- how to align city expenditure responsibilities with revenue raising
capacities, challenges that are compounded by the lack of city
level government in our large cities (Brisbane being closest to
having such government) and our vertical fiscal imbalance
-- how to engage various communities in a genuine and
meaningful way, since no-one else can say what constitutes
‘great places’ and this will vary from community to community.
This diversity is one of the real strengths of our cities
-- how to pay for the infrastructure that is needed to deliver
cities as great places.
ADC Forum strongly supports the goal that COAG set for
Australia’s capital cities in 2009 (COAG 2009, p. 15):
To ensure Australian cities are globally competitive, productive,
sustainable, liveable and socially inclusive
and are well placed to meet future challenges and growth.
The ADC Forum National Infrastructure and Cities Summit, held
in Sydney in March 2014, highlighted five key areas that should
be priorities for policy action if Australia is to improve the
productivity and liveability of its cities, as these outcomes are
impacted by infrastructure:
-- improved integration between urban land use planning, planning
for transport and other urban infrastructure, including better
integrating this with financing/funding arrangements, with a
focus on delivering great cities and great places
-- ‘sweating’ existing assets to ensure that we maximise their
efficient use, as well as significantly increasing the total level of
infrastructure spending
-- implementing financing/funding arrangements that better
support the future development of our cities’ infrastructure
-- providing governance arrangements that are more likely to
deliver desired urban outcomes, on functional and place bases
-- engaging our communities widely and in meaningful ways
on matters that affect people living in and visiting our cities,
including evolving financing and funding arrangements that will
enable people to invest their savings locally as easily as they can
invest nationally or internationally.
The strong growth rates being experienced by our capital cities,
which could see Sydney and Melbourne reach 8 million each by
2060, demand that we progress policy and planning in these
five critical areas, to considerably strengthen the narrative for
1 | NATIONAL INFRASTRUCTURE AND CITIES SUMMIT
Australian cities in terms of productivity, liveability and ‘loveability’.
This chapter summarises Summit discussion and directions on
these issues. More detail on these and other matters is included in
subsequent chapters.
1.2 CONTEXT
In recent years, infrastructure spending in Australia has grown
strongly. Anyone looking at the growth in this spending over the
past 10-15 years could be excused for thinking that we could
hardly need to further increase our rate of infrastructure spending.
However, most economic infrastructure has an effective life that is
much longer than 10-15 years. Australia’s infrastructure spending
performance has been much less encouraging over a 40 year time
frame, which is much closer to normal asset life.
Between about 1985 and 2000, there was a very large relative
fall in the rate of infrastructure investment. Looked at as a
proportion of non-mining, non community services gross product
(NMNCSGP) at factor cost, for example, Australian infrastructure
spending averaged 6.6 per cent from 1971-1988 but fell to an
average of only 4.6 per cent in the 1989-2012 period, being
4.9 per cent in 2013 (Chapter 5). Figure 1.1, courtesy of NIEIR,
shows that transport infrastructure investment (for example) has
had a dramatic decline in relative terms, over a 40-50 year period
(from the 1960s). Thus, while a short to medium term perspective
suggests infrastructure spending growth has been strong, a longer
term perspective, more suited to infrastructure life cycles, is more
problematic and suggestive of possible backlogs. Evidence one
way or the other should be available in terms of the quality of
infrastructure performance.
FIGURE 1.1: TRANSPORT INFRASTRUCTURE INVESTMENT:
PER CENT OF OTHER AUSTRALIAN INVESTMENT
13
surveys.1 The Monocle 2013 Most Liveable Cities Index ratings
included Melbourne (2) and Sydney (9) in their top ten.2 The
Mercer Quality of Living Survey ranked Sydney (10), Melbourne
(17) and Perth (21) in its top 25 in 2012 (but has no Australian
cities in its top 10 in 2014). 3 These ratings are not only affected
by infrastructure but it is an influence. Singapore, which was the
subject of a keynote presentation at the Summit (Chapter 7), also
typically does well on such liveability rankings.
Less encouraging is the growing number of problems confronting
our cities, problems that are (among other things) related to the
condition of various elements of our infrastructure and to the
shape and form of our cities. These problems have generally
been well summarised in various (very valuable) Commonwealth
Government State of Australian Cities reports4 and include,
for example:
-- poor productivity growth performance overall in our cities
-- a growing disparity in the rate of productivity growth between
inner and outer areas, linked to changes in economic structure
-- job, infrastructure and service shortages in many outer urban
growth areas
-- the high and growing costs of traffic congestion5
-- crowded conditions experienced in the peak period on most of
our urban public transport systems
-- high and rising house prices, and associated supply shortages
of new properties for owner occupancy and rental, including
social housing6, with allied problems of affordability
-- high urban greenhouse gas emissions, among the highest per
capita in the world, linked to travel and housing choices and
associated urban structure, as well as to our energy sources for
electricity generation
-- water shortages and the constraints/costs that water availability
in a climate constrained world are already imposing on the
development of some cities
-- rising risks of wildfire, and the associated consequences, at the
edges of our cities, again being accentuated by climate change.
Note: Primary refers to agriculture plus mining.
Source: Cat. no. 5204; NIEIR
With most Australians living in our cities and most national
output coming from these cities, the condition of the nation’s
infrastructure stock should be very apparent in cities. In that
regard, the continued high liveability ratings accorded to our
capital cities is nominally very encouraging. For example, the
Economist Intelligence Unit’s 2013 Global Liveability Survey
includes Melbourne (1), Adelaide (5), Sydney (7) and Perth (9) in
its top ten, Melbourne having been ranked first in the past three
The Institution of Engineers has used consistent assessment
procedures over a number of years, to rate the quality of
Australia’s infrastructure systems, including road, rail and port
systems. Although the report card is not for cities, it provides
a broader high level rating. Table 1.1 sets out the national level
assessments for 1999, 2001, 2005 and 2010, and State level
assessments for 2010. It shows essentially no change in national
road condition overall, with national roads having the highest
rating at C+, State/Territory Roads at C and local roads having
the poorest condition at D+. These relativities are probably
appropriate, given traffic volumes and the significance of the
various road categories, but the levels of the ratings and absence
of any substantial improvement over the past decade suggests a
holding position only on quality. The Institution comments that a C
rating indicates that major improvements are still required.
14
TABLE 1.1: INSTITUTION OF ENGINEERS’ INFRASTRUCTURE REPORT CARD RATINGS
Infrastructure Type
Aust
2010
Aust
2005
Aust
2001
Aust
1999
ACT
2010
NSW
2010
NT
2010
QLD
2010
SA
2010
TAS
2010
VIC
2010
WA
2010
Roads overall
C
C
-
C-
B
C-
C
C-
C-
C-
C+
C+
National roads
C+
C+
C
C
-
B-
B
C-
C
C+
C+
B-
State/Territory roads
C
C
C-
C-
-
D+
C-
C-
C
C
C+
B-
Local roads
D+
C-
D
-
D+
D+
C-
D
D
C-
C-
Rail
D+
C-
D-
D
-
D-
C+
C-
C
F
D
C+
Ports
B
C+
B
D-
F
C
C+
B
B-
B-
C+
B-
Source: https://www.engineersaustralia.org.au/sites/default/files/shado/Infrastructureper cent20Reportper cent20Cards/Australian/2010per
cent20Australianper cent20IRCper cent20Report.pdf. Viewed 20th March 2012.
Rail generally rates on a par, or poorer, than roads. The individual
state/territory level score card commentaries, however, suggest
that metropolitan rail infrastructure is in poorer shape in many
cases than freight rail, especially where the latter serves mining.
Port ratings are also shown in Table 1.1, with ratings generally
being better than both roads and rail. However, state/territory
commentaries suggest that road and rail access to/from ports is
generally a problem in capital cities and is getting worse, as traffic
volumes build (freight volumes through the major capital city ports
have been growing strongly).
If Australia is to sustain its enviable reputation for liveability, which
the ADC 2010 Cities Summit saw as a key part of ‘brand Australia
(ADC 2010), and is to lift its productivity growth rate, then the
quantity and quality of our urban infrastructure must be a priority.
More particularly, our urban infrastructure planning and delivery
systems need to ensure that they maximise their contribution to
the COAG goal cited at the opening of this chapter.
1.3 BUILDING BETTER CITIES: INTEGRATED LAND USE/
TRANSPORT/INFRASTRUCTURE PLANS
Vision
In line with COAG thinking, Australia’s capital cities have generally
identified visions for how they want to develop in coming years.
There is a striking similarity between the components of the high
level vision (or intended outcome) statements for Australia’s capital
cities. For example:
-- Sydney: balanced growth; a liveable city; productivity and
prosperity; a healthy and resilient environment; accessibility and
connectivity (a strong global city, a liveable local city)
-- South East Queensland: strong, green, smart, healthy and fair
-- Perth: liveable, prosperous, accessible, sustainable
and responsible
-- Melbourne: preserve and enhance distinctiveness; ensure
city remains globally connected and competitive; promote
economic/social participation; build strong communities; ensure
environmental resilience
-- Adelaide: healthy, safe, affordable and connected communities;
a strong, diverse and growing economy; thriving natural and
built environment.
These vision statements typically highlight the triple bottom line
elements of economics (productivity, prosperity), environment
and social inclusion that are embedded in the COAG national
objective, with liveability, health and governance outcomes also
specified in some cases. Distinctiveness, which is a key source of
city competitive advantage in the knowledge economy, emerges
at a finer level of detail.
The COAG Capital Cities Strategic Planning Review (COAGRC
2012) noted deficiencies in the integration between land use
planning and transport planning in our capital cities. That criticism
has been addressed to some extent in recent updates of a
number of capital city metropolitan land use/transport strategies/
plans. Jim Betts, CEO of Infrastructure NSW, emphasised to
Summit participants that transport planning must be synonymous
with land use planning today (Chapter 3).
Several speakers at the Summit argued, however, that land use/
transport integration remained an area where much still needs
to be done. Professor Robert Cervero (Chapter 12) made this
observation with respect to both Australia and the US, arguing
strongly that land use needs to drive transport, rather than the
reverse. The key is to be clear about the kinds of cities we want
and then put in place transport systems that will help to drive their
achievement. Cervero underlined that most ‘sustainable cities’ got
this right, going back 20-30 years. Adelaide’s most recent land
use/transport strategy does this well. Melbourne’s draft strategy,
however, appears too heavily based on a set of big transport
projects, not all of which are not firmly embedded within the city’s
emerging land use strategy (Victorian Government 2013).
The latest versions of Australian capital city land use/transport
strategies are increasingly cognisant of the changing structure of
our city economies and are generally shaping their infrastructure
and service strategies to enhance productivity, long term job
prospects and liveability, while better sharing the benefits of
growth across the city. Lifting our national rate of productivity
growth is central to future Australian economic development. With
cities being such a significant part of the national economy, lifting
our urban productivity performance must be a central part of the
productivity challenge. The agglomeration (productivity) benefits
of strong central city areas in the knowledge economy are now
widely recognised and Dr Peter Brain’s Working Group for this
Summit (Chapter 5) has highlighted the growing economic returns
that are available from increased infrastructure investment in our
cities to support agglomeration economies.
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