That infrastructure is a priority for government and business is patently clear. The question now is how to move forward. Whilst prioritisation and political and social issues are important, a key problem is undoubtedly one of funding.
There are various estimates of Australia's infrastructure funding deficit with Infrastructure Partnerships Australia and Citibank putting it at $700 billion. With availability of public sources of capital becoming increasingly constrained over coming decades as the Government’s debt position is expected to tighten – how simple is it to bridge the funding gap?
Could it be as simple as ABCD?
A – Capital Recycling
B – Increased use of User Pays
C – Other financing
D – Use of government debt financing