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COVID-19 Accelerates Structural Shifts For The Industry, Infrastructure Australia’s Report Findings
The Infrastructure Australia Covid-19 report has found that the Australian infrastructure sector responded well to the challenges of COVID-19, while the pandemic accelerated structural trends such as digitisation, more local and regional infrastructure use, as well as service innovations and adaptations.
The response of the sector to the health and economic impacts of the pandemic highlight the relative resilience of Australia’s infrastructure networks. However, lockdowns, social distancing and work-from-home measures have impacted project delivery, created new trends and reversed others.
The findings are part of a new report, Infrastructure beyond COVID-19: A national study on the impacts of the pandemic on Australia, developed by Infrastructure Australia in collaboration with L.E.K Consulting.
Requested by the Australian Government in the 2020–21 Federal Budget to supplement work already underway on the 2021 Australian Infrastructure Plan, the report highlights sweeping changes in the way Australians use critical infrastructure – across the transport, telecommunications, digital, energy, water, waste, and social infrastructure sectors.
Infrastructure Australia Chief Executive Romilly Madew said: “This report establishes a baseline to help us understand how COVID-19 has changed the way we use infrastructure, and which of these changes could have lasting impacts on how we plan, fund and deliver the services we all rely on.
“COVID-19 has put a pause on the traditional driver of infrastructure, Net Overseas Migration, however the pace of change in the sector has generally increased, with new emerging trends.
“The pandemic put Australia’s infrastructure to the test. However, this report found that compared to other OECD countries, our infrastructure networks are relatively resilient, our service providers are adaptable and our communities are responsive to change.
“Across sectors, we found that Australia’s governments and infrastructure providers navigated dramatic changes to community behaviour and network requirements, and rapidly adjusted their service provision.
“The continuation of infrastructure construction across major projects was a key source of economic activity and employment during the pandemic, and ensured we took advantage of the three-year pause in population growth.
“Public transport providers moved quickly to support social distancing and hygiene measures, latent broadband capacity was released to cope with a surge in demand, and hospital infrastructure was repurposed to deliver 4600 new ICU beds. Importantly, customers, providers, employees and staff were also adaptable to change.
“COVID-19 has demonstrated that there is an opportunity to make better use of what we have. This is a trend that both governments and industry should harness as we consider the infrastructure investment and reform responses that will best support Australia’s long-term economic recovery.”
Infrastructure beyond COVID-19 identifies new challenges and opportunities to build on the evidence base of the 2019 Australian Infrastructure Audit and will inform the recommendations in the 2021 Australian Infrastructure Plan – a major reform document that will provide a roadmap for the infrastructure sector to support recovery from the impacts of the pandemic.
“Due for release next year, the 2021 Australian Infrastructure Plan will outline a detailed reform and implementation pathway to help government and industry deliver flexible and resilient infrastructure services that better respond to our changing and diverse community needs,” Ms Madew said.
In response to the impacts of COVID-19, Infrastructure Australia and the Bureau of Infrastructure and Transport Research Economics (BITRE) have coordinated the COVID-19 Transport Demand Modelling Cross-jurisdiction Roundtable to facilitate the exchange of ideas, techniques and tools for considering COVID-19 impacts in travel demand models.
The Roundtable will consider the structural impacts on travel demand within Australia, affecting population and demographic trends, travel demand and travel behaviour across all jurisdictions.
Key trends in Infrastructure beyond COVID-19
The report notes that health concerns continue to impact people’s willingness to use public transport and attend other crowded spaces. This change is likely to endure at least for as long as social distancing is required and in advance of a vaccine being widely available in Australia.
“We estimate that around 4 million employees have been working from home since March 2020, representing 30% of the total workforce, with a third of those workers wishing to remain remote. This accelerated trend has led to widespread office vacancies, greater strain on the broadband network, greater energy and water consumption in residential areas and increased local activity, including local traffic congestion and demand for greenspace,” Ms Madew said.
“In a reversal to the earlier trend of increasing public transport use, patronage in most cities fell to 10–30% of normal levels in the initial lockdown and settled at a ‘new norm’ of 60–70% of pre-COVID-19 levels. Traffic levels rebounded quickly, along with an uplift in second-hand car purchases, potentially indicating that higher car mode share may persist for some time.
“Australians accelerated their move to online retail channels and digital services, resulting in a substantial uplift in online sales and increased broadband network congestion. The pandemic drove a 100% growth in monthly online retail, five times the annual growth recorded in 2019 – resulting in similar growth in parcel delivery and micro-freight.
“COVID-19 accelerated the longstanding decentralisation trend in electricity, with more energy produced and consumed in households. However, uncertainty caused by the pandemic has seen a slowing in investment in large-scale renewable generation and some delayed maintenance works.
“A major reversal in the long-term trend of lower per-capita waste generation also occurred, with a 20% increase in municipal waste, caused by more people working and staying at home. High levels of food delivery and online shopping have generated sizeable increases in paper and plastic packaging waste and single-use waste, placing additional pressure on a sector already adapting to China’s recent waste import bans,” said Ms Madew.
Some regional communities are seeing a boom in tourism and population growth, as people remain within their state, the report found.
“An acceleration of regionalisation has also occurred, with Australian households seizing the opportunity to move away from dense, metro areas. This has resulted in a 200% increase in net migration from capital cities to regional areas. This caused an immediate increase in capital city rental vacancies, while demand increased in regional and coastal towns.
“The longevity of these changes is uncertain, however the impacts are likely to persist for some time as Australians continue to seek more affordable housing outside of the inner metro areas. If this trend continues, we could see reduced demand for urban transport and increased pressure on broadband networks in regional centres,” Ms Madew said.
ENDS
Wednesday 16th December 2020 – Media Release
View the Media Release here
Source: © Infrastructure Australia 2020.
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