Chief Minister Andrew Barr says the budget will set a more realistic forward pipeline of projects. Photo: Michelle Kroll.
The ACT Government has been forced to scale back its ambitious infrastructure pipeline, deferring and staging projects to save $700 million over the next four years so it can prioritise housing and the Northside Hospital.
One of the hardest-hit areas is Casey in North Gungahlin, which will have to wait longer for its promised new Emergency Services Station, Health Centre and indoor sports facility. But other projects, such as the Taylor playing fields and tennis centre, will proceed.
The Kingston Arts Precinct will now be staged over a number of years, although land will be released in the next four to six weeks for the multi-storey carpark and artist housing.
Chief Minister Andrew Barr told Region a combination of the ACT’s fiscal situation, the current war-induced fuel and supply chain issues, and the market’s inability to deliver all of the projects in the pipeline within their current timeframes had prompted the government to review the infrastructure program.
Mr Barr said Wednesday’s budget would now set a more realistic forward pipeline and current projects would be completed before starting new ones.
“There’s no point budgeting for and borrowing money for projects that will not be able to be built in that timeframe,” he said.
Asked whether the ACT had bitten off more than it could chew, Mr Barr said the intent at the time was to support the economy through a difficult period during and after COVID, and to ensure that there was a strong pipeline.
But the government had to adjust to its own financial circumstances and the market’s limitations.
“So those projects will still go ahead; we just can’t start them this year,” Mr Barr said.
“But people can expect that, over the two budgets that remain in this term, we will proceed with those projects. It’s just we can’t do them all at once.”
Mr Barr remained unrepentant about the cost of and borrowing for the COVID-era infrastructure pipeline, saying it kept the ACT out of recession and interest rates were unlikely to be that low again in our lifetimes.
“So I think in the end, it was the right time to borrow and the right sorts of infrastructure to invest in,” he said.
Mr Barr said once the payment for light rail Stage 2A was made in 2027-28, the infrastructure program would settle down at a level well below a billion dollars a year, with a greater focus on renewing ageing assets.
This infrastructure revision did not include light stage 2B but last Tuesday, Mr Barr said the Northside Hospital would be the biggest infrastructure project this decade, indicating that the next light rail stage would not start before 2030.
He said on Friday that the government would not be fast-tracking the project, and any procurement before the 2028 election was unlikely unless the approval and design phases were expedited.
“You’d never say never in this world, but I would much rather underpromise and overdeliver than set an unrealistic timeframe,” he said.
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Mr Barr said the government was yet to decide whether it would be delivered as a Public Private Partnership similar to Stage 1 or as a design-and-construct project.
But a PPP required all of the approvals to be in place before procurement.
The new aquatic centre in Commonwealth Park was also not affected.
“The timing of that is obviously subject to getting the final design sorted and the works approval from the National Capital Authority,” Mr Barr said.
“So there’s a process underway there, but no, there’s not a fiscal implication for that project.”