Why do we need to research Infrastructure?

Infrastructure significantly affects the daily lives of all Victorians. Infrastructure is essential to health and wellbeing, and education. It also influences how people commute to work or school, communicate with one another and power homes. Infrastructure is essential to support the growth of communities and is important in protecting the environment.

We want to research infrastructure matters so we can help find ways to get more out of infrastructure in Victoria. This includes better ways to develop or assess infrastructure proposals, and how to fund or finance them.

 

What are we researching?

Our research program is currently focusing on three key areas:

  • improving how the impacts of infrastructure proposals are measured, particularly at the development and assessment stages of projects
  • policy and reform issues relating to infrastructure
  • new funding approaches.

The topics we are looking at are:

1. Improving how we measure the impact of infrastructure including the use of cost benefit analysis:

  • Valuing more economic, social and environmental impacts in monetary terms where feasible.
  • Real options, which is an approach to addressing risk and uncertainty in project planning and delivery by including the right, but not the obligation, to undertake certain activities, or existing or changing project pathways once uncertainties materialise.
  • Establishing whether benefit cost analysis captures the ‘network effects’ that arise from one project that affects other assets.
  • Reference class forecasting, which involves using data from completed similar projects to improve the assessment of a proposed project's benefit and costs.
  • Establishing whether cost benefit analysis captures the 'network effects' that arise from one project that affects other assets.

2. Policy and reform issues relating to infrastructure:

  • Transport network pricing, including a review of road pricing options to manage congestion and complementary measures to address equity and public transport impacts.

3. New funding approaches, including:

  • Value capture, such as levies or taxes that seek contributions from those who indirectly benefit from government planning decisions or infrastructure investment.

 

How will we work?

We are conducting our research independently. To make sure our research is useful and we capture the best ideas from here and overseas we will consult and work with many different stakeholders. This includes, but is not limited to:

  • Victorian government departments and agencies
  • other state and national governments
  • independent infrastructure bodies
  • national and international experts and practitioners
  • private sector and industry
  • think tanks, academics and other non-government or research organisations.

Depending on the topic, we may partner with various experts or organisations. We will also publish public consultation papers so we can seek the community's views and feedback as we undertake our research.

We will acknowledge everyone’s contribution and publish our research, discussion and consultation papers so that everybody benefits. 

 

What’s our plan?

    Our plan for the first half of 2017 is to publish:

    • a discussion paper on real options challenges and opportunities for Victoria
    • a further paper on transport network pricing
    • an initial report on valuing more economic, social and environmental impacts.

    Our plan for the second half of 2017 is to publish:

    • a public consultation paper on reference class forecasting
    • a public consultation paper on network effects
    • a CBA tool and user guide on valuing more economic, social and environmental impacts

    We will update our plan if timelines change as we investigate and explore these issues.

     

    What have we done so far?

    Valuing more economic, social and environmental impacts

    Infrastructure Victoria has released a paper in a series of work on valuing more economic, social and environmental impacts. This paper outlines how government can improve its assessment and appraisal of infrastructure proposals when making investment decisions by monetising more economic, social and environmental impacts.

    Stakeholder and community feedback is an important part of our research on monetising economic, social and environmental impacts of infrastructure projects, programs and policies. The first phase of consultation on this paper has closed. Infrastructure Victoria will continue to progress this project throughout 2017. For more information contact enquires@infrastructurevictoria.com.au.

    Monetising more economic, social and environment impacts paper (5.8MB)

    Transport network pricing

    Infrastructure Victoria has released the first in a series of papers on transport network pricing. Our paper, The road ahead, outlines the problems with the current approach to transport network pricing in Victoria, and the benefits and limitations of introducing a new pricing regime to reduce congestion and make the most efficient use of the state’s transport network. Our initial analysis focuses on road pricing regimes in metropolitan Melbourne as a first step towards proposing a comprehensive transport network pricing regime that includes roads and public transport.

    Stakeholder and community feedback is an important part of our research on monetising economic, social and environmental impacts of infrastructure projects, programs and policies. The first phase of consultation on this paper has closed. Infrastructure Victoria will continue to progress this project throughout 2017. For more information contact enquires@infrastructurevictoria.com.au.

    Transport network pricing paper (PDF 5.5MB)

    Value capture policy paper

    Infrastructure Victoria has released the policy paper Value capture – options, challenges and opportunities for Victoria.

    The paper aims to build community awareness and understanding of the concept of value capture and provide practical next steps for implementation.

    The paper looks at several value capture mechanisms including developer contributions, betterment levies, major beneficiary contributions and property development, asset sales or leases. The value capture mechanisms are modelled on six infrastructure project scenarios to illustrate how they could be applied to different sectors such as transport, health, housing and education.

    Value capture policy paper (PDF 2.38MB)

    Ernst & Young technical appendix for value capture (PDF 2MB)

    Funding and financing

    As part of the development of Victoria’s 30 year infrastructure strategy, we released a paper on infrastructure funding and financing. This paper explains the different types of funding and financing mechanisms that could be used to support our infrastructure priorities, and outlines the advantages, limitations and implementation considerations for each funding and financing mechanism. This formed part of our public consultation in 2016 on All things considered, which set out the options for Victoria's 30-year infrastructure strategy.

    Funding and financing draft additional information paper (PDF 1MB)

     

    How can you get involved?

    We want to consider as many views as possible as we undertake our research. If you’d like to know more about Infrastructure Victoria’s research program please contact enquiries@infrastructurevictoria.com.au