UDIA (VIC)

The Urban Development Institute of Australia (Victoria) has used Australia Day to focus on the need to provide an investment vehicle to fund Australia's urgently needed infrastructure for education, health and transport needs for growth area councils.

Tony De Domenico Executive Director UDIA Victoria

Tony De Domenico, Executive Director, UDIA (VIC) said, "The introduction of Australian Infrastructure Bonds could assist Governments catch up with the demand for infrastructure being driven by Australia's increasing population, especially in the rapidly expanding growth areas of Melbourne and regional cities.

"There is an urgent need to break the nexus between first home buyers funding infrastructure costs upfront to deal with the emerging housing affordability problem which is locking many first home buyers out of the market".

"In the past decade the upfront costs for infrastructure have increasingly been added to the entry price of first home buyers into the market, who are now also facing a double hurdle with substantial increases in water, energy and local government charges".

"Figures released by Charter Keck Cramer show in 2011, taxes and charges across the three levels of Government on an average block of land in Victoria costing $199,000 was $46,200".

Mr. De Domenico said the introduction of ten year Government Guaranteed Infrastructure Bonds could provide a safe and productive investment choice for investors with a positive outcome for the community, helping to fund such urgently needed projects such as a second east west crossing in Melbourne and public transport.

"In simple terms a combination of prudent borrowing combined with the choice of infrastructure projects to create productivity and attract private investment at a time when low interest rates can be locked in for ten years, is a major opportunity for positive political action which could save hundreds of millions of dollars on future projects."

Mr. De Domenico said it is not only the Governments' job to stimulate the economy by funding, creating a more productive system to bring land to market and help make housing affordable, but it also requires the private sector to develop new innovative and affordable housing choices.

"In Victoria the development industry directly employs around 310,000 full time employees, contributes around 12 per cent of the state's gross domestic product and contributes $4.6 billion in taxes to all tiers of government."

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