Most people think of roads, brides, ports or power stations. But that is just part of the story. It is also schools, universities and hospitals, playgrounds and parks, libraries and sports stadia. In other words, infrastructure is the skeleton that supports the economic, social and environmental body of our communities.
To understand the value that infrastructure whether social or economic delivers to the community, in the past economists have taken a quite narrow approach to a Benefit Cost Assessment (BCA). Benefits are typically limited to any direct revenues resulting from the investment think of library fees or train fares plus the initial economic multiplier', or flow-on, impacts associated with the construction stage.
Looking at social infrastructure in such a narrow way, it can be difficult at times to make a case for the investment.
Better investment decisions will likely be made by taking a more holistic approach that accurately captures the economic, environmental and social value of the infrastructure for all stakeholders.
As an example, consider a regional sports stadium. This stadium will potentially draw crowds to demonstration matches from visiting recognised teams. It may even have a facility with rooms that can be rented out for functions and perhaps a cafe.Benefits to communities
But the real value of the facility may well come in other, less obvious, ways. For example, the NSW Department of Sport and Recreation highlights that "participation in sport and physical activity delivers benefits beyond improvements in physical and mental health, with evidence that communities as a whole are strengthened. Healthy, harmonious communities have strong social connections and links, and exhibit a high level of inclusion, co-operation and participation across all community groups.
If the local government can, together with sporting clubs, deliver after school sports programmes for kids, they can potentially improve the health of a generation and perhaps enable parents to work outside school hours.
Urbis recently assessed the economic and social potential of a new sports ground in Western Sydney. The 500-seat stadium and sporting facility is in an area of high cultural diversity, lower than average socio-economic well-being and high incidence of obesity and diabetes. Sport can play a very significant role in the region. Here are some of the benefits assessed: