By source of funds

Completed projects

For the 83 completed projects, the RIDF contribution of $134 million dollars has been matched by almost $273 million from other sources, including the private sector, local Government, other government departments and agencies. This equates to a leverage of $2.03 for every RIDF dollar spent. Refer to Table 5-1 following.

Of total project funding secured by completed projects, around one third or 33 per cent of project costs were derived from RIDF, with the private sector and Other Government

contributing 21 per cent and 31 per cent respectively. Local government provided 15 per cent of all project funds.

Table 5-1, Direct leverage from RIDF funding for completed projects.

Funding source Actual funds ($m) Percentage (%) RIDF $134.3 33% Local Government $59.5 15% Other Government $84.8 21% Private sector $128.4 31% Total Funding $407.0 100%

Incomplete projects and projects under negotiation

For approved projects currently under construction or in the contract negotiation stage, almost $186 million has been committed from the Fund for 80 projects. These projects leverage an additional $517.3 million from other sources. Refer to Table 5-2. Thus, for every dollar of RIDF committed to incomplete projects and projects under negotiation, an additional $2.79 has been sourced from other parties.

Of total costs for incomplete projects and projects in negotiation, 46 per cent has been committed from the private sector, with RIDF and Other Government (State and Commonwealth) contributions comprising 26 per cent and 25 per cent of project costs respectively. Local government has committed only 3 per cent to these projects.

Compared to completed projects, incomplete/in negotiation infrastructure projects achieve a far higher level of private sector investment. In addition, these projects achieved a greater overall value of direct leverage from all project partners. This result is largely a reflection of:

 the nature of projects in this category, with over half being commercially focussed energy and utilities and transport projects, compared to only one third of completed projects

 the large scale cost and commercial nature of a number of these projects, which could not be delivered by government, particularly local government, and other not-for-profit

organisations alone.

Table 5-2, Direct leverage from RIDF funding for incomplete projects and projects under negotiation.

Funding source Actual funds ($m) Percentage (%) RIDF $185.4 26% Local Government $23.0 3% Other Government $172.7 25% Private sector $321.6 46% Total Funding $702.7 100%

All projects committed by RIDF

The overall RIDF commitment of $320 million for 163 projects has been matched with commitments of $790 million from local and Other Governments and the private sector. This equates to a direct leverage ratio (from other sources) of $2.47 for every dollar committed by RIDF.

The largest proportion (41 per cent) of project costs has been committed from the private sector, with RIDF and Other Government committing 29 per cent and 23 per cent respectively. Local Government contributions represent only 7 per cent of total leverage. See Table 5-3 following.

Table 5-3, Direct leverage from RIDF funding for all projects.

Funding source Actual funds ($m) Percentage (%) RIDF $319.7 29% Local Government $82.5 7% Other Government $257.5 23% Private sector $450.0 41% Total Funding $1,109.7 100%

Direct Leverage 31

5.2.2.

By region

Completed projects

Figure 5-1 summarises by regional location the level of contribution directly leveraged by complete projects from sources other than RIDF.

Figure 5-1, Direct leverage for completed projects by region ($ million).

$0 $20 $40 $60 $80 $100 $120 $140 Barwon South West

Gippsland Grampians Hume Loddon Mallee All Regions

RIDF funding Local Government funding Other government funding Private sector funding

The Hume region has been the most successful region in leveraging funding from other sources. RIDF funding constitutes only 18 per cent of completed projects, with the largest proportion (38 per cent) of funding being sourced from other Victorian government agencies. This result is primarily driven by the large capital investment by the Victorian Government towards the Lake Eildon Dam Improvement project.

In contrast, completed projects in the Grampians region have been most dependent upon RIDF funding, with only 48 per cent of project costs funded from other sources. Loddon Mallee and projects spanning multiple regions closely follow, both with 51 per cent of project costs leveraged from other sources.

Of all the regions, Gippsland was able to attract the largest proportion of private sector funding for completed projects (37 per cent), with Grampians and Hume securing 34 per cent of project costs from the private sector, and Barwon South West 33 per cent. In Gippsland, this was largely attributable to tourism and energy and utilities projects, while in Barwon South West, Grampians and Hume private sector investment focused on industry development projects. The total capital investment, thus far, into each region varies significantly, with investment ranging from $23.5 million in the Grampians to $118 million in Barwon South West. However, on a per capita basis, Hume has been able to leverage the greatest amount of investment ($450 per person), followed by Barwon South West ($328 per person). Refer to Figure 5-2. This may be attributable to the existing transport infrastructure and high population densities in these regions.

Figure 5-2, Direct leverage for completed projects by size per regional capita ($ per person). $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500

Barwon South West Gippsland Grampians Hume Loddon Mallee

RIDF funding Local Government funding Other government funding Private sector funding

Incomplete projects and projects under negotiation

Figure 5-3 summarises by regional location the level of contribution directly leveraged by incomplete and in negotiation projects from sources other than RIDF.

Figure 5-3, Direct leverage for incomplete projects and projects under negotiation by region ($ million).

$0 $50 $100 $150 $200 $250 $300

Barwon South West Gippsland Grampians Hume Loddon Mallee All Regions

Direct Leverage 33

Hume and Barwon South West have been able to leverage the highest proportion of capital costs from sources other than RIDF for projects that are incomplete and under negotiation (86 and 80 per cent respectively). The success of the Hume region to do so has largely been driven by industry development, education and energy and utilities projects, with private sector funding contributing 74 per cent of project costs.

In Barwon South West projects focused on industry development, education and tourism have leveraged the most funding. Like Hume, it too has attracted a large proportion (80 per cent) of private sector investment.

In contrast, Gippsland has attracted the majority of funding support from other Government entities.

Incomplete and under negotiation projects in the Loddon Mallee and Grampians are most dependent upon RIDF funding, with RIDF contributing 52 per cent of capital costs to infrastructure projects in both these regions. RIDF also contributes half (50 per cent) of the capital costs to projects spanning multiple regions.

Interestingly, incomplete and under negotiation projects in Gippsland leverage the most

investment on a per capita basis (over $1000 per Gippsland resident). Refer to Figure 5-4. That is, the investment impact to Gippsland residents from RIDF incomplete and under negotiation projects is larger than other Victorian regions. Hume and Barwon South West have been able to leverage over $750 and $360 per resident respectively.

Figure 5-4, Direct leverage from incomplete projects and projects under construction per regional capita ($ per person). $0 $200 $400 $600 $800 $1,000 $1,200

Barwon South West Gippsland Grampians Hume Loddon Mallee

RIDF funding Local Government funding Other government funding Private sector funding

All projects committed by RIDF

Figure 5-5 summarises by regional location the level of contribution directly leveraged for all RIDF supported projects.

Figure 5-5, Direct leverage for all RIDF projects by region ($ million). $0 $50 $100 $150 $200 $250 $300 $350

Barwon South West Gippsland Grampians Hume Loddon Mallee All Regions

RIDF funding Local Government funding Other government funding Private sector funding

Overall, Hume has been able to leverage the largest proportion (86 per cent) of funding from sources other than RIDF, followed by Barwon South West (75 per cent) and Gippsland (72 per cent). The Loddon Mallee and Grampians are the most reliant on RIDF support with external contributions accounting for 49 and 48 per cent respectively.

The ability for Hume to attract investment from other sources has largely been due to projects focused on industry development and energy and utilities. Leverage in Barwon South West, in contrast, has been most successful for industry development projects, whereas in Gippsland energy and utilities projects leveraged the greatest proportion from other sources.

Accounting for the population in each region, Hume and Gippsland have both attracted roughly $1200 of capital investment per resident from RIDF supported projects. Refer to Figure 5-6.

Direct Leverage 35 Figure 5-6, Direct leverage for all projects per regional capita ($ per person).

$0 $200 $400 $600 $800 $1,000 $1,200 $1,400

Barwon South West Gippsland Grampians Hume Loddon Mallee

RIDF funding Local Government funding Other government funding Private sector funding