Infrastructure spending decisions are too important to be left to politicians. We need the infrastructure equivalent of an independent central bank.
We’re now well into budget-drop season, and infrastructure spending is being heavily touted as a key element in our road to recovery. Or, as Michael Pascoe correctly notes, infrastructure spending announcements are being touted but this may not actually mean any more spending.
The economic benefits of any mooted budget increase in infrastructure funding are likely to be undermined by one of the perennial problems of Australian politics: National Party pork-barrelling, favours for mates and rorting.
Total government spending on infrastructure — by all levels of government, not just the Commonwealth — has fallen by around 15% over the past two years, despite major projects going ahead in Sydney and Melbourne. An increase of investment back to 2018 levels would see an additional $15 billion a quarter injected into the economy nationally. That’s the least the government could do in the budget.