Shaping the Future: Infrastructure Victoria's Draft 30-Year Strategy
11 April 2025
What you need to know
- The state's independent advisory body, Infrastructure Victoria, has released its third iteration of Victoria’s draft 30-year infrastructure strategy, outlining a long term plan for development and enhancement of the state's infrastructure.
- The strategy includes 43 recommendations and 7 future options for the Victorian Government, addressing current and future needs across housing, energy, transport, health, social infrastructure and the environment.
- The strategy is structured around 6 key objectives: access to housing and jobs, health and safety, a thriving natural environment, Aboriginal self-determination and equal outcomes, climate resilience and a high productivity and circular economy.
- The strategy focuses on prioritising better use of government's $400 billion of existing assets, with only 27 of the 43 draft recommendations requiring capital investment with many of these targeting upgrades or replacement of inefficient infrastructure.
- Priorities outlined in the Strategy are enablers of the economic policies and initiatives described in the Economic Growth Statement released by the Victorian Government in December 2024.
- With limited recommendations for capital investment and ongoing fiscal pressure, partnerships between Government and the private sector will be critical to sustaining infrastructure investment and innovation across Victoria.
- Government will consider the strategy along with public feedback before confirming its response later this year. Government adopted 80% of Infrastructure Victoria’s recommendations from the prior 2021-2025 strategy.
What you can do
- For infrastructure developers and investors, the strategy is an important resource:
- When planning for your long term pipeline and investment opportunities. The strategy, and the government's response, provides one of the best indicators of where government infrastructure investment and policy priorities are likely to be over the coming years and longer term. Aligning to the strategy can result in your products and services being highly attractive to government agencies and/or complementary to government investments.
- When positioning your proposal or tender response to government. The strategy provides a summary of possible government objectives across various infrastructure portfolios. Demonstrating alignment to government's objectives is often a core criteria in tender evaluations, making the strategy a valuable resource in preparing to respond. The strategy also signals where future government investment is likely to be focused and can therefore assist with planning for future opportunities.
- When identifying partners for the delivery of major infrastructure projects. Partners who enable a better alignment with government priorities can elevate your proposal and help you bring a market leading response to government.
- When formulating market-led proposals (MLP) to government. If your organisation holds exclusive real or intellectual property rights that provide the potential to unlock or catalyse government objectives, including infrastructure investment, you may wish to consider an MLP (or unsolicited proposal). For more information on the MLP process refer to our recent article here.
- With limited recommendations for capital investment and ongoing fiscal pressure, partnerships between Government and the private sector will be critical to sustaining infrastructure investment and innovation across Victoria. We encourage our private clients to be proactive in proposing ideas to government and consider non-financial contributions government could make to support your project. We would be pleased to support you in your discussions.
- The draft strategy and its proposed recommendations are open for public feedback until Monday 28 April 2025. Submissions will be reviewed from May 2025 to October 2025 with the final strategy due to be tabled in the Victorian Parliament by late 2025. The Victorian Government must respond to the strategy's recommendations.
- To help government understand what the market considers are the key priorities, you can engage constructively with Infrastructure Victoria by developing a submission in alignment with the key areas raised in the strategy as well as your own business strategy. By staying informed and proactive, entities can effectively navigate and align with the opportunities presented by Victoria's draft strategy and help contribute to the state's long-term growth and sustainability.
Our take on the strategy and its recommendations
We have reviewed the strategy and summarised the 6 key objectives and their recommendations below:
Objective 1: Victorians have good access to housing, jobs, services and opportunities
The recommendations focus on:
- Improving access to housing by investing in new social housing to provide more Victorians on low incomes with access to secure and affordable homes and updating planning schemes to rezone for more homes in cities, ensuring they are close to public transport and open spaces with good access to services. The draft strategy proposes that government funds a 15-year program to build 60,000 social homes (4,000 a year).
- Enhancing public transport and connectivity by:
- increasing services on key tram routes and extending tram lines in established suburbs to support more housing development.
- improving bus services and developing a bus rapid transit network to connect train stations and busy destinations in Melbourne's growth areas.
- and extending metropolitan rail services to Melton and assess the delivery of new train stations at Thornhill Park, Mount Atkinson and Altona North.
- Optimising land use and urban development including building new schools, kindergartens, libraries and pools within the next 5 years.
- Future options identified include choosing a mechanism to mandate more housing that is affordable for low-income households close to public transport, open space and services, as well as phasing out residential stamp duty and phasing in residential land tax.
The focus on building more social housing and rezoning areas near existing infrastructure opens avenues for private developers to engage in public-private partnerships, leveraging government incentives to create affordable housing solutions. The extension and enhancement of public transport networks not only improves connectivity but also stimulates economic activity in the surrounding areas. Overall, these draft recommendations aim to foster a collaborative environment where the private sector can play a critical role in shaping a more connected, accessible and equitable Victoria.
Objective 2: Victorians are healthy and safe
The recommendations focus on:
- Improving access to healthcare and preventative measures emphasising the need for equitable access to healthcare services, particularly for vulnerable groups.
- Enhancing safety and active lifestyles by proposing to make local streets safer by reducing speed limits around areas frequented by children and building protected cycling networks to encourage active travel.
- Upgrading critical infrastructure including major public hospitals such as the Royal Melbourne, Alfred and Austin Hospitals, to meet rising demand.
The draft recommendations in this section focus on improving access to healthcare and preventative measures. The draft strategy notes that in 2022, the Victorian Government committed funding to start redeveloping the Royal Melbourne Hospital. This funding was to build a new facility at Arden and prepare the Parkville site for future upgrades. The government has since announced that the facility at Arden will not go ahead and has not yet provided details on the updated scope of works or timeframe to redevelop Parkville. Infrastructure Victoria recommends that the government consider using private finance to deliver the hospital pipeline through Public Private Partnerships and Ground Lease Models.
Objective 3: Aboriginal people have self-determination and equal outcomes to other Victorians
The recommendations focus on:
- Empowering Aboriginal self-determination in infrastructure planning by involving Aboriginal communities, Traditional Owners and Aboriginal community-controlled organisations (ACCOs) early in the planning, design, delivery and maintenance of infrastructure projects to ensure that each project reflects and respects Aboriginal and Torres Strait Islander culture, needs, and aspirations.
- Improving housing outcomes for Aboriginal Victorians through funding a 15-year program to build at least 300 Aboriginal-owned social homes annually and working with Aboriginal housing providers to develop capacity and provide secure, sustainable tenancies and culturally-appropriate housing solutions.
- Enhancing health and wellbeing infrastructure through funding for ongoing minor works, repairs and capacity building for ACCOs to plan, develop and deliver infrastructure in a self-determined manner.
The draft recommendations under this objective present the unique opportunity to contribute to the empowerment and self-determination of Aboriginal and Torres Strait Islander peoples. By working with Aboriginal community-controlled organisations, we can play a crucial role in the delivery of culturally-appropriate infrastructure projects. This collaboration can lead to the development of innovative housing solutions and health facilities that not only meet the immediate needs of Aboriginal Victorians but also support long-term community wellbeing and economic development. The private sector can look to leverage its expertise in project management, construction and technology to enhance the capacity and capability of Aboriginal housing providers and ACCOs. This approach not only aligns with corporate social responsibility goals but also fosters stronger community relationships and contributes to closing the gap in life outcomes between Aboriginal and non-Aboriginal Victorians.
Objective 4: Victoria has a thriving natural environment
The recommendations focus on:
- Reducing greenhouse gas emissions from infrastructure with emphasis placed on adopting carbon values and measuring carbon in projects to minimise environmental impact. The draft strategy suggests using low-carbon and recycled materials, updating procurement practices, and prioritising non-build and low-build solutions to minimise environmental impact.
- Advancing integrated water management and using more recycled water including determining the costs and benefits of introducing recycled drinking water in Melbourne and Geelong, building a pilot recycled drinking water facility and launching a community education campaign on the need for diverse water sources.
- Better use of government land for open space and greenery, targeting at least 30% tree canopy and shrub cover on public land to deliver social, health and environmental benefits.
By prioritising low-carbon and recycled materials, the construction and manufacturing industries can innovate and lead in green building practices, potentially reducing costs and improving productivity. The emphasis on integrated water management and recycled water usage opens avenues for private entities specialising in water treatment technologies and infrastructure development to collaborate with the government on pilot projects and large-scale implementations. The draft strategy recommends the government prepare and consider business cases to expand water desalination capacity.
Objective 5: Victoria is resilient to climate change and other future risks
The recommendations focus on:
- The urgent need to adapt and invest in infrastructure to withstand extreme weather events and other climate impacts. This includes updating flood management strategies, improving energy efficiency and transitioning to renewable energy sources.
- The necessity of building new renewable energy generation, storage and transmission infrastructure including developing long-duration energy storage solutions and facilitating private sector investment in big batteries to enable a stable and reliable energy supply. The draft strategy recommends fast-tracking key energy projects and coordinating enabling infrastructure, establishing a unified energy transition project pipeline including annual progress assessments, and creating a central energy transition coordinator to align priorities, improve transparency and manage risks.
- Integrated and comprehensive energy planning that includes electrification, renewable gas production, and the gradual phase-out of fossil gas.
The focus on renewable energy targets, energy storage solutions, and climate adaptation measures reveals potential avenues for private investment in green technologies and infrastructure. The strategy provides a comprehensive approach to building climate resilience and transitioning to a sustainable energy future offering a robust framework for private sector involvement and investment.
Objective 6: Victoria has a high productivity and circular economy
The recommendations focus on:
- Enhancing productivity through infrastructure emphasising that investing in infrastructure can significantly boost Victoria's productivity. This includes education and training infrastructure to equip workers with necessary skills, transport infrastructure to facilitate access to jobs and markets, and digital infrastructure to enhance business efficiency and global reach.
- Advocating for a shift from a linear to a circular economy, where products are designed for longer use, and materials are recycled and reused. This approach aims to reduce waste, create jobs and minimise environmental impacts.
- Well-designed, efficiently built and regularly maintained infrastructure highlighting the importance of early planning, integrated land use, and infrastructure planning to reduce costs and improve outcomes.
The Victorian Government has already taken steps towards the transition to a more circular economy, such as using recycled materials in transport infrastructure projects. However, the draft strategy aims to further boost Victoria's sustainable practices, as well as its economic growth, positioning the private sector as a key player in driving both productivity and environmental outcomes. One of the key recommendations in the draft strategy is that each department that owns infrastructure develop a 15 to 20-year sector plan, based on agreed assumptions on population and other factors.
Authors: Lakshmi Logathassan, Executive and Madison Hausler, Infrastructure Advisor.
Want to know more?
- Ashurst's Infrastructure and Places capability brings integrated commercial and project risk advice together with Ashurst's legal expertise to support transformational investments with outstanding community benefits. Our team understands government process and has deep experience across the infrastructure lifecycle. We would be pleased to discuss our insights and advisory services with you.
- Victorian Government MLP Guideline – a new Strategic Development Pathway (28 January 2025)
