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Navigating the Road Ahead: Top 5 Risks and Opportunities in Queensland’s Infrastructure Sector
As Queensland embarks on a transformative phase of infrastructure development, highlighted by projects linked to renewable energy, transport, and major events such as the 2032 Brisbane Olympic and Paralympic Games, the road to successful delivery is fraught with challenges and opportunities.
Civil Project Partners’ Ryan O’Neill has taken a look at the numbers within the 2024 Queensland Major Projects Pipeline Report (QMPPR) to highlight the five most significant risks and opportunities that will shape the infrastructure landscape, with a particular focus on costs, project schedules, and resource management.
“There is a lot of good news contained within the 2024 Queensland Major Projects Pipeline Report, but any pipeline of this magnitude and complexity will not be without its challenges when it comes to funding, approvals, costs, procurement, delivery, and supply of people and resources.”
“Around 20% of the pipeline’s growth or $2.4bn can be linked to cost adjustments and increases, reflecting the change in the economy and the data we track in the Civil Project Partner’s Construction Materials Shopping Basket. Therefore, across the next 10 years, how we develop business cases, cost projects, and create schedules will be vitally important to ensure that we deliver the infrastructure that the state needs at a price Queenslanders can afford and are willing to pay.”
“As specialists in the planning, costing, scheduling, and constructability of major projects, it’s vital that we manage and mitigate project risks to avoid cost and time blowouts and to gain trust from the public that we can deliver major projects in line with their expectations,” said Ryan.
Here are Ryan’s top 5 risks and opportunities identified by the 2024 Queensland Major Projects Pipeline Report.
- Rising Costs and Inflationary Pressures
Risk: Cost escalation remains a primary concern, driven by a combination of domestic factors such as labour and material shortages. Although international cost pressures have eased, the engineering construction price index rose by 4% in 2023/24, following a record spike in 2022/23.
Opportunity: Addressing cost issues through productivity gains and innovative project management practices is key. By streamlining procurement processes, embracing collaborative contracting models, and leveraging digital tools, the sector can mitigate cost risks while enhancing project delivery.
- Labour and Skills Shortages
Risk: The demand for skilled labour is outstripping supply, particularly in regions where major projects are concentrated. This labour shortage poses risks to project schedules and costs, as it can lead to delays and increased reliance on higher-cost labour sources.
Opportunity: Investing in workforce development, including training and upskilling initiatives, presents a major opportunity. By fostering partnerships with education providers and creating clear career pathways, the industry can attract and retain talent. Additionally, leveraging apprenticeship and traineeship programs offers long-term solutions to the labour gap.
- Complex Project Approvals and Regulatory Environment
Risk: Lengthy and complex approval processes, including environmental regulations, can delay project timelines significantly. For example, extended reviews related to the Environment Protection and Biodiversity Conservation Act have already impacted critical projects.
Opportunity: Streamlining regulatory approvals through industry-government collaboration can accelerate project timelines and reduce uncertainty. By engaging early with regulators, aligning requirements, and leveraging pre-existing frameworks, projects can transition from planning to execution more efficiently.
- Balancing Mega Projects with Sector-Wide Engagement
Risk: The growing dominance of “mega projects” valued at over $1 billion poses challenges for smaller contractors, potentially sidelining them from participating in Queensland’s infrastructure boom. This trend can limit the sector’s capacity and exacerbate resource constraints.
Opportunity: Breaking down large projects into smaller packages and incorporating collaborative commercial arrangements can engage a broader spectrum of contractors. This ensures the entire industry benefits from Queensland’s infrastructure pipeline, fostering sustainability and resilience.
- Funding Uncertainty for Major Projects
Risk: Approximately 40% of the major project pipeline remains unfunded, presenting a significant risk to project viability and overall investment confidence. This is particularly pronounced in sectors like mining and heavy industry.
Opportunity: Engaging private sector partners and exploring innovative financing models, such as public-private partnerships (PPPs), can bridge funding gaps. The public sector can also play a pivotal role by providing funding certainty and streamlining mechanisms to ensure timely investment flows.
Seizing the Future Through Collaboration
“Navigating these risks and seizing the associated opportunities requires a coordinated effort across the infrastructure sector, driven by collaborative approaches and contracts,” said Ryan.
“By proactively addressing cost management, regulatory hurdles, and workforce challenges, Queensland can maximize the potential of its major project pipeline, but it will be a challenging process; there is significant investment being made, and we have to ensure we are equipped to support key projects, not just in metropolitan Brisbane and SE Queensland, but across the entire state.”
“This is going to require collaboration between industry stakeholders, government, and the community to ensure timely, efficient, and cost-effective project delivery—ultimately paving the way for a resilient and prosperous infrastructure future.”
“It’s an exciting time for investment in Queensland, and we are excited to be part of the future of infrastructure across the state,” said Ryan.