Critical fix needed for state’s major hospital infrastructure

Infrastructure Victoria Chief Executive Dr Jonathan Spear said: “The Alfred, Royal Melbourne and Austin hospitals have needed renewal for nearly a decade. They provide the highest level of complex and specialised healthcare for Victorians.” 

“Critical maintenance issues and deteriorating and aged facilities can compromise the delivery of safe, high-quality patient care,” he said.  

“Immediate government action is required to redevelop our major tertiary hospitals so they can continue to deliver the high-quality health services Victorians expect and meet the needs of our growing and ageing population.” 

Victoria’s infrastructure strategy 2025–2055, released today, finds challenges with infrastructure have led the Alfred to close wards and reschedule procedures. Its operating theatres urgently need replacing. The Austin Hospital is unable to use some of its facilities, reducing access. Many assets at the Royal Melbourne’s Parkville and Royal Park campuses are past their useful life. 

The 30-year infrastructure strategy makes 45 recommendations to the Victorian Government across sectors including transport, health, housing, energy, social infrastructure and the environment. It also identifies 8 future options for the government to consider. New evidence and analysis, together with stakeholder and community feedback, have directly informed updates to the strategy. 

The 30-year strategy notes the government has not yet provided details on the updated scope of works or timeframe to redevelop the Royal Melbourne Hospital at Parkville. It has announced funding to upgrade the Austin Hospital’s emergency department and to help maintain fire safety, electrical infrastructure and in-patient care at the Alfred Hospital.   

“Recent government investments address some immediate needs, but these hospitals still require urgent capital works,” Dr Spear said. “Now is the time for investment in our critical hospital infrastructure.” 

The Victorian Government should announce the scope and timeframes to redevelop the Royal Melbourne Hospital’s facilities in Parkville. It should replace the Alfred Hospital’s operating theatres and announce the scope, timing and funding to further redevelop the Alfred and Austin hospitals. 

It should start construction on all 3 hospitals in the next 5 years and complete them by 2035, at an estimated cost of up to $8 billion. 

Dr Spear said wider use of digital technologies such as Victoria’s Virtual Emergency Department and electronic medical record systems could improve patient care and ease pressure on hospital infrastructure. 

"There’s a big opportunity to lift the role of digital health in our healthcare system,” he said. “Virtual care means more patients can see and talk to a doctor from their homes when they prefer. This reduces demand on our hospital emergency departments.” 

The infrastructure strategy recommends the government invest in statewide virtual care and a medical image sharing system over the next 5 years. 

“A statewide medical image sharing system can improve care, reduce unnecessary tests and save costs for hospitals and patients,” Dr Spear said. Other states have already introduced similar systems. 

More investment in community health infrastructure needed  

The 30-year strategy also recommends government invest in community health infrastructure, including in outer suburbs and regional areas, as a priority over the next 5 years. 

Community health services provide primary and preventive healthcare targeted to Victorians who are experiencing disadvantage, and who have few options to access these services. This can include vital dental services, mental health services and support for people to manage ongoing chronic conditions like type 2 diabetes. 

“Community health organisations can help keep the most vulnerable Victorians healthier and out of hospital,” Dr Spear said. 

“In 2023–24 there were 546,000 emergency department visits in Victoria that could have been avoided if they were managed in the primary care or community health sectors. This could save our health system around half a billion dollars every year.”  

By partnering with the Australian Government and other organisations, along with smarter use of existing government land, the Victorian Government can implement the strategy’s 45 recommendations at a cost of around $60 billion. 

“These recommendations offer practical, evidence-based advice on the projects, policies and reforms most critical to Victoria’s growth and resilience over the next 3 decades,” Dr Spear said.  

“They lay out how the Victorian Government can reduce the costs of providing infrastructure over the next 3 decades and generate over $166 billion worth of benefits for Victorians.” 

Infrastructure Victoria is required to develop and update Victoria’s 30-year infrastructure strategy every 3 to 5 years. This is the second strategy update since Infrastructure Victoria was created 10 years ago. 

Victoria’s infrastructure strategy 2025–2055 will be tabled in the Victorian Parliament this week to inform the policies of all parties. The Victorian Government is required to respond to the strategy recommendations within 12 months. 

Media enquiries 
 
Mandy Frostick mandy.frostick@infrastructurevictoria.com.au Ph: 0419 546 245 
Madeleine Brennan madeleine.brennan@infrastructurevictoria.com.au Ph: 0402 715 577 

Victoria’s infrastructure strategy 2025–2055 recommends: 

Recommendation 18: Invest in maintenance, upgrades and expansions of community health facilities  

• Develop and fund 5-year priorities for Victorian Government investment in community health facilities. 

• We estimate that this recommendation will cost $150 million to $300 million, with funding committed and works started within 5 years. 

• This would increase funding from 0.3% to between 1.5% and 3% of the $2 billion the government spends on average each year on health infrastructure. 
  
  

Recommendation 20: Invest in digital healthcare  

• Expand digital healthcare to improve access to quality care and ease demand on public hospitals. Deliver a statewide medical image sharing system and a statewide virtual care¹ service that remotely monitors suitable patients at home. 

• We estimate that expanding digital healthcare will cost $100 million to $200 million over 5 years. This is in addition to existing hospital funding. 
  
  

Recommendation 21: Fix critical public hospital infrastructure  

• Redevelop the Alfred, Austin and Royal Melbourne hospitals.  

See also:

Recommendation 19: Build more residential alcohol and other drug treatment facilities 

• Build residential rehabilitation and withdrawal facilities to meet the demand for alcohol and other drug treatment. 
  
  

Recommendation 24: Fund better health and wellbeing infrastructure for First Peoples  

• Fund and start health and wellbeing infrastructure projects identified by Aboriginal Community Controlled Organisations (ACCOs).

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