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  • ITS news
  • ITS Australia Statement on Economic Recovery in Australia
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5 May 2020

ITS Australia Statement on Economic Recovery in Australia

ITS Australia

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The 2019 Australian Infrastructure Audit found that the cost of road congestion and public transport crowding in Australia could increase from $19 billion in 2016 to $39.6 billion in 2031 without continued infrastructure investment. Although its root causes vary, it is a widespread problem across multiple corridors in Australian cities.

Throughout the COVID-19 pandemic we are seeing reverse impacts with our road and public transport networks operating at approximately 80% of previous capacity. This is due to the current government restrictions; however, it is unclear about the potential mid-long term impacts as we start to consider the relaxing of business closures and other mitigation strategies.

While the full impacts of the economic slowdown associated with the COVID-19 response will take some time to be quantified, our industry continues to deliver essential services and construction projects and is fully staffed ready to support any stimulus measures.

ITS Australia is extremely supportive of the government’s commitment to delivering vital infrastructure projects. Keeping these projects going has made a real difference to industry in its ability to continue to employ a significant part of the workforce, and to support the readiness of our industry to be available to respond to new projects.

Industry Impacts

A member survey conducted by ITS Australia on COVID-19 related industry impacts reveals that more than 60% of respondents had experienced negative financial impacts and reduced operational levels ranging from 50 – 100%, with an average of 83%.

There have been some impacts related to international supply chains and international expertise for highly technical projects – these challenges are being managed in the short-term and an issue to be closely monitored going forward.

Aviation impacts leading to excessive airfreight costs, around 3 – 4 times pre COVID-19 prices, are challenging local technology manufacturers who supply international markets. While this impact is manageable in the short term, should travel restrictions remain in force in the longer term, this may become a more significant barrier to our local technology exporters.

Our transport operators are playing a valuable role in providing safe transport services to the community, but they are experiencing a significant reduction in patronage and are in discussion with governments regarding appropriate responses - such as potential timetable changes. Ongoing communication regarding the additional hygiene and distancing measures across shared transport will be important to rebuild community confidence in shared and public transport services as the need to travel returns.

Opportunities for technology to minimise negative impacts post COVID-19

Intelligent transport systems (ITS) enable transport operators to get the most out of their transport networks. Sophisticated road safety infrastructure technology improves road safety outcomes, network optimisation projects reduce congestion and transport and road monitoring systems ensure a better response to incidents and disruptions on the transport network. ITS enables transport to be safer, more efficient and effective.

From managed motorway technology on major infrastructure projects to incorporating ITS on our orbital networks, the application of digital networks and technologies enables smarter use of transport infrastructure.

To facilitate this we need to ensure that all new transport projects include smart transport technology infrastructure. This will not only deliver jobs for today while building increased capability and a better understanding of travel movements, but it will also lift the productive capacity of the economy and the workforce over the longer term.

This is an opportunity to further build Australian expertise in increasingly technical and specific technologies. We have local offices of many global ITS industries in Australia. These organisations are pivoting to train up local Australian expertise through their international capability to deliver projects that would more typically involve international expertise. The current context makes this a unique opportunity to build local expertise in a growing international field.

Next steps

Changed work practices will be key in responding to the challenges industry is facing. We note that Highways England have adjusted some commercial terms to help with the challenges of COVID-19. These include a temporary relaxation on some work requirements to allow people to work from home and Highways England’s undertaking to improve the speed of supplier payments.

There are some challenges industry faces that benefit enormously from government commitment to consistent practices, including the continued support for existing projects and prompt payment terms. Any flexibility with contracts related to delivery of transport services to enable response to reduced travel demands would be highly regarded, as would a continuation of existing procurement processes. In the case of delayed procurement, clear direction on the timeline going forward is highly valued by industry. This is both to minimise delays to support consistency of workflow and reducing the likelihood of workers being laid off, and business having to re-hire.

As indicated in Infrastructure Australia’s priority list, many ITS projects have been shown to provide a strong cost-benefit ratio, and both future proof transport projects and provide immediate network benefits.

We strongly support ensuring transport infrastructure projects are delivered with smart and connected technology included, to optimise the efficiency of the massive investment governments are making in these assets.

Funding the Future

With such a massive shock to the economy, our businesses, and communities, there is a very real opportunity to implement positive changes that could only be considered in times of major change.

Considering the wide-reaching economic impacts that are being experienced, we consider that it is timely for governments to consider the opportunity to move to a broader user-pays system for transport services removing some of the burden from the tax-payer to the user. Transport technology developments have ensured that there are many suitable pathways to achieve this change.

Conclusion

As the peak body that represents national and international ITS organisations, we strongly support an approach that works towards harmonisation and cross-jurisdictional considerations.

The establishment of the National Cabinet supporting national collaboration, with the opportunity for state-based jurisdictional differences has been appreciated in the COVID-19 response. Similarly, as we move forward with new projects incorporating technology that will be with us for many years into the future, we would encourage continued national collaboration and harmonisation to avoid disconnects as we move across state borders.

ITS Australia is available to support government deliberations on suitable approaches and to connect governments with industry leaders.

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