Driving the changes
Gov’t looks to super for intrastructure
THE Federal Infrastructure Minister says the government is looking at ways to encourage superannuation funds to invest in infrastructure projects.
That is because the Federal Government won’t be able to fund Australia’s infrastructure needs without help from the private sector, Anthony Albanese says.
He also said carbon pricing will drive productivity growth by encouraging investment in renewable and smart technology, which will play a major role in improving vehicle movements and r el i eving bottl enecks on roads and rail around the country.
The minister said tapping into Australia’s superannuation funds was one answer to the funding challenge.
‘‘ One of the things we are looking at is how you encourage s uperannuation i nto fixed infrastructure developments,’’ he said yesterday.
‘‘ Part of it is about making sure there is a deeper pipeline of projects available.
‘‘ We are also engaging with them about various financing options that could promote some incentive for them to do so.’’
The minister said that in the wake of the global financial crisis, there was interest among super annuation funds to diversify away from equities.
‘‘Infrastructure invest - ments are attractive because they provide a certain return over a longer term, rather than the equities market, which is far less certain as we’ve found in recent times,’’ he said.
‘‘ It is an attractive form of investment and I think there is a natural fit between superannuation, which is about long term, secure returns . . . and infrastructure, which is long term as well.’’
Mr Albanese said pricing carbon would encourage de- velopment of greener infrastructure by improving ‘‘ the price of relatively low emitting infrastructure ( compared) with higher emitting infrastructure’’.
Carbon pricing would ‘‘ improve i nce ntivestous e smart infrastructure, which in the long term will reduce the economic cost of that infrastructure.
‘‘ In the medium term, let alone the long term, there are considerable savings for government,’’ Mr Albanese said.
‘‘ You can avoid the need for adding lanes if you actually use the infrastructure more efficiently, and it is a lot easier to do it up front than retrofit it.’’
Smart infrastructure uses technology to manage traffic movements and cut congestion, improve network capacity and productivity.
It is being trialled with the Australian Rail Track Corporation, where it is expected to allow more intense timetabling, improve transit times and safety.
The Minister said smart technology would become a requirement on government backed infrastructure.
WAY OF FUTURE: Anthony Albanese addresses an infrastructure and investment conference in Melbourne yesterday