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Innovative funding and financing

About innovative funding and financing

As part of its focus on delivering greater value for money for Australians, the Australian Government has moved beyond the Government's traditional role of simply a transport infrastructure provider of funding for new projects to be an active, informed investor.

Over the next ten years, the Government will invest almost $15 billion—or around 20% of its total investment in major transport projects—through innovative financing options, such as concessional loans and equity injections. This approach is helping deliver nation-shaping projects such as the WestConnex road upgrades and the new Western Sydney Airport in Sydney; freight rail upgrades in South Australia; and the Melbourne to Brisbane Inland Freight Rail project, amongst others.

As part of its innovative funding and financing policy, the Government is also undertaking earlier engagement in the development of nationally significant transport infrastructure projects. The Government is also making wider use of more innovative funding and financing structures to deliver its priorities. These structures are helping deliver infrastructure more efficiency, return greater value for investment and provide more opportunities for private sector involvement in projects. The Government considers a range of mechanisms when considering innovative funding and financing, including:

  • Concessional loans
  • guarantees
  • phased grants and availability payments
  • equity injections
  • Value Capture
  • wider application of user charging.

The Department of Infrastructure, Regional Development and Cities continues to be responsible for supporting the Government in this work when considering transport infrastructure projects. To expand the Commonwealth's capacity to undertake detailed financial assessments, the Government has established the Infrastructure and Project Financing Agency (IPFA), which commenced operation on 1 July 2017. IPFA will help the Government identify new financing solutions and provide advice on implementation, including for projects outside the transport sector.