Victoria has been the second most affected Covid-19 hit state in Australia, accounting for 1,567 of the 7,060 cases as of 18 May. In order to contain the Covid-19 spread, the state government announced a state of emergency for four weeks, starting from 16 March, but this has been extended twice, with the latest extension to 31 May. As per the federal government announcements, all non-essential businesses have been shut down during the emergency period.
Victoria is a key construction market in Australia, with the state accounting for 27% of the country’s total construction output in 2019. The construction industry is the state’s fifth largest industry, with 89,000 businesses and nearly 240,000 employees. In view of the importance of the construction industry, the stage three restrictions in Victoria to shut all non-essential businesses and services have not been applied to the building and construction sector. Work on construction sites across the state have continued amid the emergency, and the premier, Daniel Andrews, has assured that necessary health and safety measures are being taken to protect workers.
To ensure continuity of operations in Victoria’s building and development industry amid the Covid-19 pandemic, the Andrews’ government has set up a dedicated task force that will investigate the short, mid and long term planning and investment opportunities in the industry. It will review the existing major building and development projects and ensure workers’ safety during the pandemic, and also provide real-time advice to government on issues impacting the industry. It will also oversee fast-tracking of planning approvals that have been delayed due to the pandemic.
In order to counter the economic impact and to boost employment, on 18 May, the state government announced a Building Works package comprising ‘shovel ready’ construction projects worth A$2.7bn. The package is expected to generate 3,700 construction jobs directly, while also generating and sustaining thousands of indirect jobs. The projects include investments in affordable housing, education infrastructure, tourism infrastructure, transport network and small projects such as sports facilities and local environmental upgrades.
The Building Works package includes A$500m ($330m) for building 168 new homes and refurbishing 23,000 public housing units. Work on the refurbishment project is expected to be started immediately, with the rest of the projects expected to start within three to six months.
With a total funding of A$1.18bn ($780m), the major part of the package is meant for the education infrastructure sector. Of this, A$438.6m will be utilised for building ten new schools expected to be opened by 2022 and catering to 7,000 students. A further A$388.8m will be used for the modernisation of 57 schools across the state. An allocation of A$130m has been provided under the Established Areas Program to increase capacity in nine metropolitan schools and A$114.5m for the purchasing and refurbishing of relocatable schools.
Of the remaining package, A$382m has been earmarked for enhancing tourism infrastructure, while A$100m has been allocated for upgrading institutional buildings such as State Emergency Service and Country Fire Authority stations, accommodation for people with disabilities and for aged care and mental health facilities. A further A$328m has been set aside for transport infrastructure repairs and refurbishment.
Earlier in April, on 24 April, the Andrews’ government had fast tracked four major buildings projects worth A$4.45bn, including the A$2.0bn Southbank by Beulah development, and the A$1.5bn Charter Hall’s office project.