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Executive summary
By any measure, Australia’s cities are facing significant infrastructure challenges, with considerable flow-on impacts for their productivity, liveability and sustainability.

The cost of these impacts extend well beyond city boundaries; after all, Australia’s major cities employ 70 per cent of the national workforce and contribute close to 80 per cent of Gross Domestic Product (GDP).

As well as contributing to a relative decline in national productivity, capacity shortfalls in Australia’s major cities are impacting our global competitiveness. In the past decade, Australia has fallen from the fifth most competitive economy in the world to the twentieth, with infrastructure constraints cited by the World Economic Forum as a key motivator for Australia’s relative decline.

Real improvements in the functioning of Australia’s major cities will require greater clarity of responsibilities and required actions, as well as greater transparency of performance over time. Tasking the Productivity Commission with the development of tangible performance benchmarks for cities at both a sector (i.e. transport, water, electricity, waste) and city-wide (i.e. liveability, sustainability) level is a critical first step to achieving these goals. Aside from ensuring a robust and transparent assessment of performance, this would place Australia’s cities firmly at the centre of the drive for national productivity growth.

Solutions also lie with smarter, more integrated and more efficient approaches to the way infrastructure is conceived, funded and regulated.

The seamless integration of land-use and infrastructure planning will be fundamental in ensuring that Australia brings forward the right projects, in the right places – and delivers them at the right time. Greater integration will also provide for Treasuries and central agencies to better play facilitative roles, ensuring that project requirements are linked to budget processes. This will give procuring agencies, business and the community a higher degree of transparency about how, where and when particular projects will be delivered.This report is principally focused on Australia’s major capital cities; however it also provides important learnings for Australia’s smaller but fast growing regional centres, which are increasingly competing against the established urban centres as places to live and do business.

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