Collectively, governments around the world spend billions of dollars every year to plan, design, develop and deliver essential infrastructure. The Organisation for Economic Co-operation and Development’s (OECD) figures for spending on roads alone in seven of the world’s largest economies between 1995 and 2013 comes to nearly US$3.5 trillion and while that figure is substantial, it’s a fraction of the likely investment required to maintain current and future infrastructure across all categories.
It is widely acknowledged that the spending required to renew and maintain current infrastructure is likely to dwarf what’s planned for new projects. A few examples make this case graphically:
The American Water Works Association estimates that the US needs to spend over US$1 trillion over the next 25 years just to replace water mains.
The UK is planning to spend £425B (US$600 billion) on economic and social infrastructure projects between 2016 & 2021.*
The city of Halifax, Nova Scotia, Canada, estimates that its 2,000km of water and sewer pipes will need C$2.6 billion (US$2.02 billion) investment for repair and replacement.
In the two years between 2009 and 2011, US states collectively invested US$20 billion on new roads and more than US$50 billion on maintaining and repairing existing ones.
Governments around the world are already spending very large sums on multiple projects –and are under pressure to deliver more. Demands are coming from citizens who want improved roads, schools, hospitals, public transport, etc. However, meeting those needs with government budgets already under significant pressure is likely to be extremely challenging unless new approaches to delivery can be developed and implemented.
Infrastructure supports competitiveness by making production faster and simpler and helping information to flow and people to travel. It’s the supporting fabric for all economic development—from educating the workforce to maintaining the parks and recreation facilities where people enjoy their leisure time. A growing body of empirical research confirms that improved access to infrastructure contributes to higher indicators of societal wellbeing*.
The Gauteng Department of Infrastructure Development (GDID) works with Accenture to drive more effective infrastructure delivery and support citizens’ social and economic wellbeing.
The Gauteng Department of Infrastructure Development (GDID) builds infrastructure for the departments of Health and Education, including acquiring and disposing of assets on their behalf. GDID also maintains facilities for Social Development, Agriculture, Roads and Public Transport, among other departments—serving as custodian for all of the province’s immovable assets.
With Gauteng as South Africa’s economic powerhouse, GDID’s work is immense. At any given time, the Department is managing 13,000+ assets and overseeing 500+ infrastructure projects. The scale and complexity far exceed the limits of a manual approach to project management.Learn more
The Brazilian government’s ambitious plans for growth center on its Growth Acceleration Program (PAC). As part of the PAC, Brazil needs to extend and improve its transportation infrastructure with an investment of US$70 billion in relevant capital projects over the next five years. As the national department reporting to Brazil’s Transportation Ministry, DNIT is responsible for the Federal Transportation System administration, maintenance, improvement, expansion and operation. Recognizing that its management capabilities needed to be improved to support a project portfolio of this scale, DNIT sought a third-party partner to help design, implement, manage and govern a new program for managing its project portfolio.
After 24 months into the project, DNIT has a complete set of processes, tools, reports and governance mechanisms that improve DNIT’s delivery capabilities.
Other governments need urgently to reconsider their own approaches to infrastructure in order to deliver the building blocks of their future competitiveness and citizens’ wellbeing. By taking a new approach, they have an opportunity to fix the deficiencies that they face today and significantly increase the positive impact of their spending. Without prompt action and transformation, the risks of under delivering will continue to rise. But with new approaches, it should be possible to reimagine the art of the possible and deliver infrastructure that meets the changing needs of citizens, and the demands of increasingly tough budgetary constraints.
Global Public Service Administration and Regulatory Lead
Global and South Africa Public Infrastructure Development Lead
Managing Director, Federal Government, Brazil
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