Australian infrastructure needs customer service reforms: new report

15 September 2016

Australian infrastructure consumers could benefit from greater flexibility and innovation in infrastructure service delivery, according to new research commissioned by the University of Sydney's infrastructure think tank.

This view is supported by new consumer research into how our key infrastructure sectors are percieved, commissioned by the University's John Grill Centre for Project Leadership.

Executive Director of the Better Infrastructure Initiative at the University's John Grill Centre, Garry Bowditch, said industries where customers had greater choice and control were often more innovative and also had a better customer-service focus.

Delivering a new policy outlook paper today at the Infrastructure Dialogue 2016, Mr Bowditch encouraged Australian governments to prioritise the creation of a fully corporatised single main road network, with all roads in each state controlled by one operator to help achieve clear objectives in favour of the customer and community.

"Australian policy makers need to shift their mindset to be more innovative and customer-focused when designing infrastructure and services to avoid the piecemeal approach of previous governments," Mr Bowditch said.

"Customers should be allowed to drive changes in the way assets and networks are governed. Too often infrastructure is controlled by regulators or institutions who are quick to treat innovation and new technology as unnecessarily disruptive. This denies customers and taxpayers better services and superior productivity."

New national survey rates infrastructure experience

A new quantitative online survey of more than 1,000 Australian consumers conducted by Newgate Research nationally in early September for the John Grill Centre supported a number of the findings in the Centre’s latest paper, 'Shifting Australia's Infrastructure Mindset to the long game'.

The survey asked consumers which among 18 categories of infrastructure operators – including passenger transport, schools, hospitals, airports, utilities and roads – were considered the most customer-focused. Those surveyed were asked to rate services they had used in the past 12 months.

Some 87 percent of users rated ride-share company Uber as very or quite customer focused, with private hospitals (86 percent), private schools (83 percent) and airports (75 percent) scoring highly. Public schools and hospitals also fared well (68 percent).

The lowest scores included non-tolled main roads (34 percent), tolled motorways (36 percent), electricity transmission and distributors (41 percent), gas distributors (47 percent) and water/sewerage (48 percent).

"The research also indicated there is a clear momentum towards greater customer service, with those sectors seen as more customer-focused expected by consumers to continue in that direction," Mr Bowditch said.

"The top five sectors seen as becoming yet more customer-focused were private schools, private hospitals, internet/telecommunications, airports and Uber.

"Tellingly, the sectors where there is still scope for customer-oriented reform received lower ratings for their focus on customer service than sectors where greater corporatisation and consolidation has already occurred.

"The research also found that internet and telecommunications providers, where customers have greater choice and flexibility, rated more highly than other utilities."

Short-term mindset is holding Australian infrastructure back

Mr Bowditch said Australia needed to recapture its reforming zeal of the 1980s and 1990s by continuing to corporatise and privatise infrastructure where practicable and where this was directed at driving better consumer benefits.

"Highways England provides an excellent model to guide the reform Australia needs. The model includes long-term funding certainty and customer-focused performance indicators," he said.

"Australia is too focused on short-term technical efficiencies when commissioning projects while ­overlooking the bigger issue of long-term performance through the eyes of customers.

"Australia corporatised much of the energy and water sectors in the late 1980s and early 90s. In the area of land transport we have unfinished reform. We have done this before and we can do it again.

"Community and customer expectations are rising. Static physical infrastructure assets need to evolve into more dynamic service centres that cater for a range of evolving preferences from consumers.

"For example, disruptive technologies such as car sharing or Uber are only just beginning to blur the boundaries between passenger and freight transport provision. These changes have the potential to reduce the capital requirements for new infrastructure that has traditionally accompanied population growth," Mr Bowditch said.

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