The Construction and Mining industry has been the solid foundation that has stopped Australia’s economy from totally tanking during COVID19. Our mining exports (and hence taxes collected from the sector) have basically stayed the same throughout, a very significant 57% of our pre-Covid exports. In an uncertain economic future, when it comes to construction (8% of our total GDP) and you are building a house or a road, you will finish what you have started, but might not commence the next project. This has meant that rather than construction revenues falling off a cliff (like tourism and many restaurants), our industry was more likely to see a gradual drop off than a cliff fall.
We’re a tough bunch, and we don’t ask for handouts. But we do need investment dollars. The onus on us is to ensure that we can build lasting infrastructure at affordable prices so that we can be entrusted to construct further nation building assets for the future.
It is therefore very pleasing that the Federal Government has confirmed that a key strategy to get us out of COVID19 is to invest $72 billion in 15 mega projects nationally, as well as $415 million into shovel ready smaller Queensland infrastructure projects (and similar initiatives in other States and Territories).
But perhaps even more encouraging is the support for SME’s (small to medium enterprises), with commitments to ensure payment times are reduced to no more than 30 days to boost cash flow, and that projects are broken up into smaller increments to get better value “without the middle man” by contracting directly with the firms that actually do the work.
Other initiatives, such as reducing the “green tape” delays is also welcome. At the end of 2019, Commonwealth environmental approval decisions took on average 90 days, and now six months later they average 40 days with a target to reduce times by a further 25% to 30 days. The reduction from 90 days to 40 is estimated to have saved our industry over $300 million per year alone – money that can go towards actually constructing something useful. The ultimate objective is “single touch approvals” by streamlining Commonwealth and State processes. We can’t wait…
As always, onwards and upwards!