Australia needs strong economic management to unlock the investment required for roads, rail, hospitals and schools needed by Australia’s burgeoning population and to enable businesses throughout the country to reach their full potential to reach its full potential.
The Australian Steel Institute (ASI) supports strong management of the economy. A well-managed economy delivering growth creates an environment that supports investment in much-needed infrastructure, commercial and residential construction, mining and agriculture, and in which a robust, dynamic domestic steel manufacturing base and supply chain can flourish.
Since 1991, the Australian economy has enjoyed an unprecedented 27 years of uninterrupted economic growth. Meanwhile, its population has grown 43% from 17.28 million in 1991 to 25 million in 2018. Australia’s roads, rail, airports, energy infrastructure, hospitals and schools are at, or are approaching, capacity as a result.
Continued investment in infrastructure development is needed by state and Commonwealth governments to keep pace with the needs of Australia’s rapidly growing population. It’s a necessity if Australia is to unlock and increase productivity, nurture an innovation economy and remain competitive in a challenging global marketplace.
Funding for infrastructure is currently at unprecedented levels, but more will be needed to meet the country’s burgeoning population and to stimulate economic growth.
Commsec’s Craig James estimates that the investment in infrastructure taking place currently will be bigger than the mining boom of the last decade. In the year to March 2018, a record $35.8 billion worth of engineering work was done for the public sector. Excluding resources, engineering work yet to be done stands at $44.2 billion, just below record highs. Outstanding road and railway work are both at record highs. (Commsec 2018)
The federal government has committed over $70 billion to infrastructure from 2013–14 to 2020–21 and a further $75 billion in infrastructure funding and financing from 2017–18 to 2026–27.
However, Infrastructure Partnerships Australia says “every state and territory needs to keep the pedal pressed on infrastructure funding to meet the demands of population and economic growth. This will ensure the roads are less congested and that healthcare and education services are available when and where they are needed.” (Infrastructure Partnerships Australia 2018)
Steel is an important component of our advanced manufacturing capability. A vibrant Australian steel industry ensures a secure, flexible and high-quality supply of finished steel for everything from roads and bridges to skyscrapers, hospitals, schools and homes. It also supports the country’s transition to a more diversified, high-value-adding sustainable economy and plays a key role in achieving sustainability targets in both infrastructure and commercial development.
The Australian steel supply chain employs over 100,000 people and generates revenues in the order of $29 billion annually. It has an unusually high multiplier effect – that is, as many as six workers are employed in related industries for each person employed in the steel industry.
An independent and self-sufficient steel supply chain is a vital strategic economic asset.
But just as Australian steel industry is vital to the economy, so too is a strong economy vital to the wellbeing, continued growth and global competitiveness of Australia’s steel industry.
Maximising the share of local steel content in construction means the domestic construction industry and the steel value chain can benefit from nation-building infrastructure development if it receives the funding it needs and deserves.
The ASI advocates policy positions that maximise the potential for local industry to participate in infrastructure investment and optimise the delivery of much-needed infrastructure projects, while abiding with Australia’s international trade obligations.
Towards that end, the ASI supports the following initiatives:
The ASI supports state and Commonwealth government investment in productive infrastructure to lift and drive productivity improvements in the economy
The ASI supports budget and taxation policies that promote national competitiveness and encourage investment in infrastructure, industry, manufacturing, commercial and residential construction and in mining, oil and gas
The ASI supports ‘good debt’ for investment in productive, nation-building infrastructure projects as advocated by Infrastructure Australia and other expert, ‘arm’s length’ advisers, as an opportunity to promote national competitiveness and to create a positive economic environment for private sector investment.