In 2014, the Council of Australian Governments (COAG) agreed the National Partnership Agreement on Asset Recycling (NPA). Asset recycling supports investment in additional infrastructure that will support economic growth and enhance productivity. The objective of the NPA was to unlock funds from existing state-owned assets to invest in additional infrastructure.
In June 2018, a review of the NPA (the Review) was commissioned by the then Commonwealth Treasurer, the Hon Scott Morrison MP, to assess the degree to which the NPA objective and outcomes have been achieved and inform decisions regarding the appropriate treatment following its expiry. The Commonwealth engaged Ernst & Young (EY) to conduct independent consultations with the states and other stakeholders to gain insight into the application and operation of the NPA. EY’s role was to collect information to support the review and provide a report on findings. EY identified a number of findings that go to the structure of the NPA itself, the administration of the NPA and opportunities for improvement. A copy of EY’s report is available for your reference.
The Review found that the NPA was influential in bringing forward assets for divestment. Commonwealth support for transactions meant that a reform package that included additional Commonwealth funding played a role in garnering additional community support. Further, the NPA provided an impetus for government decisions to be made.
By the time the NPA expires on 30 June 2019, the initiative is expected to provide $2.3 billion in funding to the participating jurisdictions and unlocked over $15 billion in additional economic infrastructure. The investment in additional infrastructure supported an increase in economic activity through increased construction activity and employment demand.