AMP Capital argues case on infrastructure

Targeted Federal Government assistance could attract significantly greater levels of private sector development capital towards the development of economic infrastructure, according to AMP Capital.

In a submission filed with the Productivity Commission's infrastructure inquiry, AMP Capital has argued for a change in approach on the part of the Commonwealth on the basis that it is the largest single beneficiary of high value-add economic infrastructure projects.

It said that although state governments had traditionally been the sponsors of new economic infrastructure, it was the Federal Government which was the largest single economic beneficiary.

"Targeted Federal Government assistance could attract significantly greater levels of private sector development capital into the development of economic infrastructure," it said. "Such targeted assistance would create a pipeline of mature projects which would be attractive to institutional investors."

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The AMP Capital submission said that removing impediments to the development of deep secondary infrastructure markets would also assist in attracting institutional investment into Australian infrastructure and that the Federal Government could recycle a large proportion of its invested capital into new projects by accessing such secondary markets.

"Additional private sector investment in economic infrastructure can be achieved without cannibalising current levels of private sector investment in social infrastructure," it said. "This stimulus can be achieved in a manner which is no worse than budget neutral from the federal perspective."