WATER SERIES – PART 1 – INFRASTRUCTURE & EXPENDITURE

If COVID19 has taught us anything, it’s the importance of washing your hands, and by extension, the importance of the taps and the vast network of infrastructure that keep our water flowing. However, it didn’t take a pandemic to realise that water is essential to every aspect of life.

The importance of the water industry is reflected in the significant ongoing investment by the Federal and State and Territory Governments to secure Australia’s water future. The establishment of the National Water Grid Authority in late-2019 is the Australian Government’s $3.5bn plan (over 10 years) for water security across Australia through the delivery of, and investment in, dams, weirs, pipelines, water recycling plants and other infrastructure. This commitment to secure Australia’s water future is crucial.

The Federal Government’s commitment to water infrastructure, the immediate and longer-term pressures on Australia’s network and water industry, and the unique challenges faced by Principals and Contractors in the water industry, will form the basis of LPC’s upcoming What’s Up in Water? four-part series.

This series will discuss:

Part 1 – Infrastructure & Expenditure;

Part 2 – Immediate and future challenges in Australia’s water industry; and

Parts 3 & 4 – Key contractual considerations in the delivery of projects in Australia’s water industry.

Infrastructure & Expenditure

The 2021-2022 Federal Budget allocated $258M (including $160M through the National Water Grid Connections pathway, from the National Water Grid Fund) towards the construction of new and augmented water infrastructure projects to, as described by the Deputy Prime Minister, ‘… deliver increased water security, build resilience in our regions, deliver jobs and grow out critical agriculture sector’.

The commitment in the Federal Budget builds on the eight construction projects already completed since the establishment of the National Water Grid Authority in late-2019. Projects being funded by the National Water Grid Authority (in partnerships with State Governments) include:

1. Eurobodalla Southern Storage (New South Wales) – $51.2 million;
2. Werribee Irrigation District Modernisation (Victoria) – $11.0 million;
3. Recycled Water on the Bellarine (Victoria) – $5.5 million;
4. Warwick Recycled Water for Agriculture (Queensland) – $0.5 million; and
5. An additional $7.5 million for Rookwood Weir ($183.6 million in total).

The figure below prepared by the National Water Grid Authority identifies the $1.5bn in funding already committed to more than 20 projects across Australia:

State-based expenditure also includes:

(a) The Queensland Government’s announcement of its support to improve water supply and security across the state by committing $70M over the next 3 years (available via bid) for funding for regional councils to improve their water and sewage systems;

(b) Urban Utilities reporting in its 2019-2020 Annual Report that it had invested $286.3M in new and upgraded infrastructure to improve water and sewage networks; and

(c) Sydney Water has reported that it intends on delivering a capital works program of circa $5.27bn between 2021-2025 (including $2.7bn in the renewal of existing assets).

Water security is essential, and so is the need to continually plan and deliver, new and augmented assets to meet the current and future demands on infrastructure (including the impacts of COVID, Australia’s growing population and aging workforce, and climate change). The planned expenditure and commitments identified in this article, as well as the issues discussed in our upcoming series, are evidence of this.

Lamont Project & Construction Lawyers

Our Team have the industry knowledge and experience to assist both Principals and Contractors in all major projects, including water. If you would like to discuss any matters raised in the above article or the forthcoming series as it relates to your specific circumstances, please contact Lamont Project & Construction Lawyers.

The contents of this article is for information purposes only; it does not discuss every important topic or matter of law, and it is not to be relied upon as legal advice. Specialist advice should be sought regarding your specific circumstances.

Contact: Peter Lamont or Lili Hoelscher

Email: [email protected] or [email protected]

Phone: (07) 3248 8500

Address: Suite 1, Level 1, 349 Coronation Drive, Milton Qld 4064

Postal Address: PO Box 1133, Milton Qld 4064