The productive capacity of Australia’s economy in the future will be driven by both human and physical capital. That is why infrastructure is critical our future prosperity.

Simply boosting investment in infrastructure expands our economic opportunities. In the same way a company invests in its capital stock to underpin future growth, Australia needs to invest in the stock of physical capital to underpin future prosperity, boost productivity and improve our competitiveness.

Australia’s infrastructure problem is significant. Our country has a well-established infrastructure deficit, with the economic cost of underinvestment, on Infrastructure Australia’s estimates, reaching $53 billion a year by 2031.

Labor recognised this challenge and in government implemented a reform agenda to boost investment in infrastructure, placing it at the core of our economic agenda. But there remain significant challenges and fundamental market failures in getting new infrastructure projects developed and financed by the market.

Well-targeted investment in infrastructure - whether by the private or public sector - creates jobs now, and increases our jobs capacity in the future. By expanding the productive capacity of the economy it also grows the revenue base for future Budget revenue.

Investment in transport, energy, communications and water infrastructure is also vital to the productivity growth that is so vital to our future prosperity.