While governments are recalibrating their infrastructure pipeline, Peter Gill of DCWC argues that this presents an opportunity to get the build right.
In the morning before Rail Express speaks with Peter Gill, director for Infrastructure at Donald Cant Watts Corke (DCWC), Victorian Premier Daniel Andrews has just announced a $2.7 billion building blitz, including $328 million for transport infrastructure.
The funding is designed to get Victorians back into work following the coronavirus (COVID-19) pandemic and associated lockdown. However, the package has a different flavour to the state’s so-called Big Build, where billions were allocated to major infrastructure packages. Instead, the funding has been directed towards renewal of sleepers on regional rail lines, tram and train maintenance, and local pier upgrades. In his announcement, Andrews flagged that further announcements would similarly focus on smaller projects that get people into work.
The shift from major infrastructure projects to smaller, distributed works programmes is one that Gill has been watching closely since earlier in 2020.
“There have been a lot of natural disasters, and the result of that is that governments have had to implement smaller infrastructure projects to accommodate the repair of the damage the disasters have caused,” said Gill. “With COVID, the economy has been hit really badly and the primary area for repairing the economy and getting us out of it will be in infrastructure projects.”
Prior to 2020, Andrews and his counterparts in other states had been in the habit of announcing major rail infrastructure programs, delivered by standalone authorities and with budget sizes running to 10 figures and beyond. With the dual shock of the bushfires and COVID-19, Gill see the market shifting somewhat.
“We believe that the government will have to deliver smaller infrastructure projects, not the major ones of 5, 6, or 10 billion dollars, but a lot more smaller infrastructure projects to help the economy, help the tier-2, tier-3 contractors, the subcontract market, the builders, and all of those associated with infrastructure to get this economy out of its current scenario.”
THE ISSUES WITH THE PREVIOUS APPROACH
Gill has been warning government and project authorities for years that the way that they had been approaching cost planning assurance and project management was leading to cost blow-outs and a lack of trust in the infrastructure sector. With a turn to a smaller, more distributed program of works, Gill sees governments as having the opportunity to get things right again.
“The larger projects have much more risk in them, and they take a lot longer to establish the requirements for those projects, and this is where governments are making mistakes. On the major high-risk, high-value infrastructure projects, they have been political footballs in the past and they’re rushing them through the system, not doing the proper geotechnical, site, and community investigation and not getting the price right.”
Instead of going through the proper process, contingency percentages have been added to the project’s cost to make up for gaps that were missed in project scope
or planning, said Gill.
“To accommodate the lack of information that they’ve got, they’re adding a percentage for contingency. Risk is not for missed scope and bad planning, or bad pricing for that matter, risk is to give you more certainty around what you already know. Missing scope or missing pricing are the two areas that they are getting wrong.”
By approving and funding smaller projects, planners have fewer unknowns and there is more chance to get those who have been most affected by the crisis to benefit.
“By getting smaller projects you get much more certainty in the project outcomes because it doesn’t take as long to do those investigations that you require for the major infrastructure projects,” said Gill. “With smaller projects and smaller requirements, you can put more time into it and get greater certainty on scope, budget, and time.
IMPLEMENTING THE SMALL PROJECT PIPELINE
Gill cautions, however, that the major infrastructure projects should not be forgotten about just yet.
“The great thing is we take the lessons learnt from the big projects and apply them to the small projects. We don’t need as much time, so we can put the effort into and provide greater assurance.”
Another benefit of the new project pipeline is the lack of any need for extra labour or expertise from overseas. The relative complexity of the smaller projects can absorb those who are out of work or moving from one job to the next.
“We have enough resources in the country at the moment to accommodate these
big projects,” said Gill. “We have a unique situation where some projects are on hold at the moment and there are tunnel boring machine experts, for example, that can be used on other projects. There are tradesmen from those projects and there are blue collar and professional workers that can be moved to another.”
In addition, as has been shown in the projects that have continued throughout
the pandemic, infrastructure building works can continue with effective social distancing and not lead to outbreaks of infection. While some extra hygiene measures have been put in place, these issues are not insurmountable, said Gill.
“The designers, quantity surveyors, and planners can work from home, they can use platforms to continue those meetings, discuss with clients, and continue that work. What is going to be a challenge is the skilled and trade labourers on site, where they’ll have to have more space requirements for break out spaces, their lunch rooms, cleanliness, hygiene. All of those issues will have to be worked through.”
GOING BACK TO BASICS
While the challenges in delivering a distributed works program may be different from a major infrastructure pipeline, Gill notes that there is an opportunity for
lessons to be learnt. As governments look for projects with value for money, providing a comprehensive understanding of a projects’ costs and risks is critical. DCWC has found bringing together design and cost engineering as one way to provide certainty.
“We wrote a paper last year on integrated quantity surveying teams, where we bring together engineers, planners, schedulers, and project managers, and if we use those integrated teams, we can get greater certainty in project outcomes and costs,” said Gill.
Although the purpose may be just as much about getting people into jobs as it is about “congestion busting”, projects still need to be delivered by a competent, knowledgeable team, preferably with local expertise.
“These projects need to be project managed – designed and scheduled properly – and we need professionals that understand the location of these projects, who understand the ground conditions and the risks associated with building in those areas,” said Gill. “Bring those people into the team to give the best possible advice for those major infrastructure projects, as one company cannot do it on their own, it has to be an integrated team approach. If we have to go externally to find the right people we will do so.”
As attention turns to what is needed to get the economy back up and running now, governments have a little more breathing room on the larger projects which were planned for pre-COVID-19 levels of congestion and patronage. If travel patterns take a bit of time to return to those levels, this means those projects can be looked at comprehensively.
“The government has an advantage here to take the time to really look at the requirements of those major infrastructure projects like the Suburban Rail Loop, the Melbourne Airport Rail Link and stage 2 of the Melbourne Metro,” said Gill. “Stop rushing these big projects, take the time to get the requirements right, use this pandemic as an opportunity to let smaller projects get people back to work.