This summit is putting the future of our state in the spotlight.
And that’s what infrastructure is about - our future.
Because the kind of future the people of our state can enjoy in 10, 20, 30 years from now will be limited or enabled by the decisions that we make today.
I want to start today by reading from an editorial published 12 months ago entitled “NSW must keep building to ensure a golden future.”
Rather than choosing to “cut back on spending on trains, roads and hospitals to balance the state’s books and adopt a wait-and-see approach” the editorial argued that “investment in infrastructure will sustain the economy and set the city up for success in the post-COVID world.”
That editorial was of course from the Herald
And it came following last year’s Infrastructure Summit.
It acknowledged the significant challenges our government faced in the post-COVID world - particularly the strains on budgets.
Even though it was only 13 months ago - that editorial was written in a very different world.
Virtually no one in Australia was vaccinated against COVID.
There had been no Delta. And no Omicron.
The impact of closing our international borders was yet to be fully felt.
There was no war in Ukraine.
We were still cleaning up the March 2021 floods - and no one knew the devastation that would come a year later.
The unemployment rate in NSW was 5.5% - today it is a full two percentage points lower.
Our nation had a different prime minister.
Our state had a different Premier
And perhaps the most significant of all - the Sydney Morning Herald had a different editor.
So in the 13 months since the Herald argued that NSW must keep building for the future – a lot has changed.
New challenges have emerged.
The budget pressure has increased again – thanks to COVID and the floods.
The steps we took during the pandemic to keep people safe, and keep households and businesses afloat were hugely successful.
But they came with a cost - and we do not take that lightly.
In the post-COVID recovery boom, we have got our state’s unemployment rate down to its lowest in recorded history - and participation is at all-time highs.
But now inflation is rising - and after the emergency low interest rates that helped cushion the impact of COVID, rates are heading north again.
All of these factors are of course relevant to how we choose to face our future.
Some of the most acute challenges relate specifically to the construction sector.
There are supply shortages in critical inputs like steel, bitumen and electrical control equipment.
There is also a major increase in local demand as other states ramp up their infrastructure spending.
For example, demand for rail track in Australia is expected to grow by 250 per cent from 2021 to 2023.
There are widespread skills shortages in the sector.
Infrastructure Australia research estimates that 34 of the 50 occupations relating to public infrastructure development are likely to be in shortage or potentially in shortage.
We’re talking surveyors, geologists, telecommunications cablers, civil engineers, electrical engineers, geotechnical engineers - in fact, just about every kind of construction engineer.
Now some of these challenges are driven by local demand.
Some arise out of global supply chain issues caused by the pandemic or global conflict and trade tensions.
This is new information - these are new inputs - and we must factor them in to our own infrastructure planning in NSW.
They are likely to put upward pressure on costs and make timely delivery a challenge.
So this is a crossroads moment.
If a government was looking for an easy way out - an opportunity to slam the brakes and bring it all to a halt, this is the moment.
In fact, early on in the pandemic, when our very strong budget was under pressure, as treasurer there was a temptation to pull back on some of the projects in our infrastructure pipeline.
But through my rigorous discussion with INSW, stakeholders in the private sector – and I recall a very long, passionate discussion with the Reserve Bank Governor, Phil Lowe – it became clear that as tempting as it was to take a short term approach, we needed to keep focusing on the future.
Because that was what was going to keep people in jobs and drive our economic recovery.
So we stayed the course – and thank goodness we did.
And our choice in this moment is to build our way forward to secure a brighter future for the people of our state.
Building our way forward doesn’t mean throwing caution to the wind.
It means carefully navigating the complex challenges of this moment, and finding a way to keep building, and that necessarily means adapting to the circumstances to get the best results.
So today I want to talk about why building our way forward is the right thing to do, and what building our way forward looks like for the Premier State.
So let’s start with the why - and I’m going to give you three reasons.
The first, is because NSW is the most experienced state for delivering complex mega projects.
And I’m not just talking about Australia.
Because of our reputation for delivering, some years ago, we were invited to, and I was given the opportunity to speak at Stanford University on asset-recycling and infrastructure delivery.
After that, I met with Bill Schuster, the then-head of the US House Committee on Transportation and Infrastructure, to discuss the NSW approach.
Following that meeting, the Committee sent out a delegation of both Republicans and Democrats to learn how we get it done here in NSW.
Make no mistake: NSW is not just a national leader in infrastructure financing and delivery, but a global leader.
And let’s look at the reasons why. In a very short time, we have already delivered so much.
There are the massive rail projects:
- North West Metro
- South West Rail Link
- Inner West Light Rail Extension.
- Sydney and Newcastle Light Rails.
Then there are the mega road projects:
- NorthConnex
- WestConnex - including the M4 East Tunnels and the M8
- The Pacific Highway upgrade, making sure this great road is a dual carriage motorway from Sydney to Queensland.
There are historic hospital projects:
- Blacktown and Mount Druitt
- Royal North Shore
- Maitland
- Stage 1 at Westmead
- Bankstown-Lidcombe Emergency Department
- Wagga Wagga Base
In the last few weeks, I’ve opened both the 14-storey Nepean Hospital and Stage 2 of the Liverpool Hospital.
There are astonishing precinct renewals:
- At Darling Harbour
- At Barangaroo
- At Walsh Bay
- Newcastle City Centre
If I went on, we would be here all day.
176 new and upgraded schools
170 new and upgraded hospital and health facilities.
Roads, museums, cultural facilities, courthouses and correctional institutions.
This is generational transformation in every corner of the state.
And there has been so much already built, we are almost desensitised to it.
But we shouldn’t be.
As the State Infrastructure Strategy says - mega projects are by their very nature expensive, disruptive, contractually complex, and demanding on industry and government.
The Strategy says “Despite best endeavours, [mega-projects] are often a voyage of discovery on in-ground conditions.”
That means project delivery is not always perfect – and it can’t be.
When you think of what we are trying to do – boring tunnels under some of the most densely populated parts of our state – or running a light rail up the middle of a 200 year old city – the complexities and challenges should not be a surprise.
But they cannot be an excuse for stopping.
Our Government refuses to let the perfect be the enemy of progress for the Premier State.
We learn, we raise the bar, and then we raise it again.
And because of that, we have a wealth of experience that puts us at an advantage.
It would be a monumental waste not to put that experience at the service of our people.
Because experience matters.
And our track record shows we can overcome the challenges and we can keep building – to deliver a brighter future for our state.
The second reason NSW should build our way forward is because there’s substantial economic upside in the short term and the long term.
When we build, it creates new jobs, new markets, new centres of activity, new businesses, new opportunities, and new prosperity for our people.
One of the proxies that shows what a difference our mega-projects make is the crane index put out by the RLB.
In the latest index for Australia, almost half of the construction cranes in this country are right here.
382 cranes - or 46.9 per cent.
It’s double the number of those in Victoria.
It’s more than seven times the number of cranes in Los Angeles, which has the most in the USA.
It’s 130 more cranes than in the booming city of Toronto, which is a similar size to Sydney.
And it’s more than double the number in the whole of New Zealand.
Many of these cranes are government projects.
But a large number are not.
They are private sector projects spurred on by the connections and opportunities that our projects are creating.
Our projects increase access, they connect people and regions to jobs, education, and business opportunities.
They cut down travel time.
It’s a bit like irrigation - bringing water to dry fields so that new things can grow.
And now, parts of our state that were starved of opportunity are flourishing like never before.
It’s also important not to forget the economic contribution of our infrastructure program.
In this financial year, public investment is expected to contribute half a percentage point to our state’s economic growth – continuing a trend over the better part of the last decade.
Our infrastructure pipeline has been estimated to support almost 150,000 direct and indirect jobs.
And if you look at a project like the CBD light rail – it has attracted an estimated $6.16 billion in development along the light rail corridor.
We know investing in infrastructure boosts productivity.
And we understand that when we do our job, and build the foundations - the people of NSW have the talent and the drive to take our state to the next level.
Families getting ahead faster. Communities getting a new lease on life right here – today.
And that brings me to the third reason for building our way forward: our children.
We owe it to the next generation to deliver where past governments failed.
Those who oppose major projects without offering any alternative – are selling the same disastrous consequences that brought our state to its knees after the turn of the millennium.
The infamous $30 billion backlog that we were elected to fix.
In politics, you can always drum up support in the short term by promising not to ruffle feathers and kicking tough decisions down the road.
You can be all things to all people for a little while.
But it always catches up with you. And someone always has to fix it.
It will be our children who suffer the consequences if we make the same mistake.
But we won’t.
In a time like this, when there are many complex problems to solve – we can’t put the future of our state on hold, or we will go backwards, and future generations will be starved of opportunity.
We need to keep doing what works.
And if something is not working, we need to find a better way.
We need vision and imagination coupled with pragmatic problem solving.
Our Government has got NSW moving again.
And behind every project we are delivering there is a story of challenges, objections, and opposition that we have overcome to get that result.
That is our responsibility to the next generation.
And that is why, today, even though we have plenty on the go, we are still planning our pipeline, adapting to the circumstances – so that 10 years from today, we can still be delivering.
So what does “building our way forward” actually look like, in light of the new challenges?
Well, there are three main elements.
First is completing the projects already in delivery.
This is the next wave of transformation.
And it is every bit as revolutionary as the wave of projects already completed.
Here we are talking about the Aerotropolis, which will turn our Western City into a new economic engine for our nation.
Last week we announced funding for the $260 million Advanced Manufacturing
Research Facility as part of the Bradfield City Centre - a wellspring of skills and skilled jobs for generations to come.
We’re talking about the new Metro that will connect the airport when it opens, and Metro West, that will double capacity between the Harbour and Parramatta.
The M12 - to connect the airport to the motorway network.
Then there’s the New Powerhouse, also in Parramatta - the largest single cultural investment since the Opera House, and a new cultural centre of gravity in Western Sydney.
There’s the expansion of the Art Gallery of NSW.
More major roads - the final stage of WestConnex
Sydney Gateway
The Great Western Highway upgrades
In our regions, major new hospitals in Tweed and Eurobodalla
And here in Sydney, the next stages of works at Bankstown-Lidcombe Hospital, and the Children’s Hospital at Westmead
Campbelltown Hospital redevelopment
There is infrastructure for our Eastern CBD – completing Metro City and South West
A new stadium at Moore Park,
Building a new Sydney Fish Market.
This is just a snapshot of what is already in delivery.
So the transformation is going to continue in the years ahead.
Project after project will open, and our people will reap the rewards.
The second element of “building our way forward” is focusing on the local.
Now this makes sense for two reasons.
First, it is the natural next step, particularly in those communities where we have already laid the major foundations.
The roads and rail are important, but they are just a means to get you where you want to go.
And what’s even more important is the quality of your destination.
And that’s where local infrastructure can make a big difference.
Good infrastructure has to be diverse.
Talking only about big-picture mega-projects ignores the economically critical and socially fundamental attributes of every strand of the web that we call ‘infrastructure’.
It includes schools, parks, and local roads, not just major roads.
Programs like the $5 billion WestInvest fund are focused on delivering these smallerscale infrastructure projects to improve quality of life at the local level.
That means more green space, more pools, upgrading schools, revitalising main streets, investing in culture, and busting traffic on local roads.
We built the train line, now we’re investing in the destination.
At the end of the day, local communities are where quality of life is built, and we need to invest in local infrastructure so our communities are great places to live.
These smaller projects make sense for a second reason: they match the market conditions.
They create work for small- and mid-tier construction firms, who have more capacity.
They are simpler to deliver, so they aren’t affected by skills shortages.
And they are repeatable, so we can build momentum and get more done faster.
The third element of “building our way forward” is maintaining a bold vision for the future.
We know that the projects we are delivering today are happening because we planned for them 10 years ago.
So we will continue to plan for the next wave too – the projects in our pipeline beyond the ones already in delivery.
There will no doubt need to be adjustments in sequencing and prioritisation – the advice from Infrastructure NSW on that front is clear.
We need to be adaptable to capacity in the market.
And we will also need to make sure that the projects we select are the right projects, at the right time, delivering the best value for the people of our state.
But I want to be very clear: NSW will remain the mega-project capital of Australia.
And that is why today we are committing to the delivery of the next megaproject – Stage 2 of the Parramatta Light Rail.
Stage 1 is now nearing completion.
100 per cent of the track has been laid.
The construction of the first stop started this week.
And passenger services are expected to start next year.
This month’s state budget will for the first time secure funding for Stage 2 of the Light Rail.
This will support construction of the new Wentworth Point Bridge, which is integral to the project – as well as enabling works along the route and connected to the Bridge.
And it will secure full funding for all final stages of planning.
This is our statement of intent – our commitment to the people of our state: this is a government that builds for the long term.
And we are building our way forward.
Conclusion - building the future isn’t easy, but it’s worth it.
So I’m not here to tell you that it’s going to be easy.
In fact, I’m here to tell you the opposite.
It will be hard.
Every bit as difficult as the past 10 years of project delivery have been.
But what I can tell you is that every dollar we have spent – and every obstacle we have encountered has been worth it for what it brings to our state.
Because when you look around NSW today – you see a state that has completely turned around its fortunes in just one decade.
Now is the time to keep going – not to hit the brakes.
Later this morning, Simon Draper from Infrastructure NSW is going to talk about some of the challenges in more detail.
And later today, our Infrastructure Minister Rob Stokes is going to talk more about how we can overcome the challenges.
Because, to keep delivering, we will need to be even better than we have been so far.
Smarter.
More adaptable.
More strategic in problem solving and finding novel solutions.
But we have the experience.
We have the plan.
We have the vision.
And we have the determination to get it done.
We have transformed our state – and we need to keep transforming it.
We are going to build our way forward.