THE Business Council of Australia
(BCA) has warned the nation's unprecedented pipeline of investment is at
risk because of high costs and low productivity.
In a new report, the council says state and federal governments
must recognise the investment is not assured, and half of the $921
billion lined up for resources, energy and economic infrastructure
investment projects is yet to be locked in.
``We have got to be very careful that we don't take these projects, both in infrastructure and in resources, for granted,'' BCA president Tony Shepherd said.
``The bottom line is we can see a pipeline here of close to a trillion dollars ... (but) in the resources sector we are 40 per cent more expensive than the equivalent in the US gulf region.
``That is a hell amount of money that is sacrificed in terms of extra costs.''
``We have got to be very careful that we don't take these projects, both in infrastructure and in resources, for granted,'' BCA president Tony Shepherd said.
``The bottom line is we can see a pipeline here of close to a trillion dollars ... (but) in the resources sector we are 40 per cent more expensive than the equivalent in the US gulf region.
``That is a hell amount of money that is sacrificed in terms of extra costs.''
This could mean less money for subsequent investment and lower tax revenue impacting the whole community.
Worse still, some offshore oil and gas projects are as much as 200 per cent more expensive than global benchmarks, while in various infrastructure projects are also considerably more costly than elsewhere.
The report, released today, will also be presented to the Prime Minister Julia Gillard's Economic Forum in Brisbane next week.
The BCA, which represents the bosses of the nation's top 100 companies, recommends the government ask the Productivity Commission to conduct a comprehensive inquiry into the factors driving major project costs and their delivery.
Mr Shepherd said new imposts like the mining and carbon taxes will impact on the competitive nature of business and should be taken into account.
BCA believes the starting price for the carbon tax, and the base price once the fixed period is over, are too high.
The study found that by 2013, about 30 per cent of all economic activity will depend on the success of capital investments, making Australia the investment-intensive economy within the Organisation for Economic Cooperation and Development.
Private investment makes up 71 per cent of the entire investment pipeline.
Mining, oil and gas projects make up 45 per cent of project value, 31 per cent in transport, and six per cent in both education, health and community services, and utilities and electricity generation.
But it says that if Australia cannot deliver the pipeline more efficiently, its standard of living will reduce.
BCA acknowledges that some action has been taken by the Council of Australian Governments by the streamlining of environmental assessments and approvals, the boost to skilled migration services and skills training, and the introduction of Enterprise Migration Agreements.
``But what is clear is that all governments must recognise the pipeline of investment is not assured and must stay focused on taking a proactive approach to making the economy more competitive,'' Mr Shepherd said.
Worse still, some offshore oil and gas projects are as much as 200 per cent more expensive than global benchmarks, while in various infrastructure projects are also considerably more costly than elsewhere.
The report, released today, will also be presented to the Prime Minister Julia Gillard's Economic Forum in Brisbane next week.
The BCA, which represents the bosses of the nation's top 100 companies, recommends the government ask the Productivity Commission to conduct a comprehensive inquiry into the factors driving major project costs and their delivery.
Mr Shepherd said new imposts like the mining and carbon taxes will impact on the competitive nature of business and should be taken into account.
BCA believes the starting price for the carbon tax, and the base price once the fixed period is over, are too high.
The study found that by 2013, about 30 per cent of all economic activity will depend on the success of capital investments, making Australia the investment-intensive economy within the Organisation for Economic Cooperation and Development.
Private investment makes up 71 per cent of the entire investment pipeline.
Mining, oil and gas projects make up 45 per cent of project value, 31 per cent in transport, and six per cent in both education, health and community services, and utilities and electricity generation.
But it says that if Australia cannot deliver the pipeline more efficiently, its standard of living will reduce.
BCA acknowledges that some action has been taken by the Council of Australian Governments by the streamlining of environmental assessments and approvals, the boost to skilled migration services and skills training, and the introduction of Enterprise Migration Agreements.
``But what is clear is that all governments must recognise the pipeline of investment is not assured and must stay focused on taking a proactive approach to making the economy more competitive,'' Mr Shepherd said.
