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3.3 Align social infrastructure with better service delivery

All Victorians need education and health services during their lives, and many will need social housing, hospitals and emergency services. Efficient justice services help keep the community safe and ensure people are treated fairly. Largely government funded, Victoria’s social services are especially important in helping to address disadvantage, and foster healthy, safe and inclusive communities. This includes helping achieve social policy goals, such as self-determination and Closing the Gap for Aboriginal Victorians. Social services require infrastructure: buildings, spaces and other assets that connect people to service providers, in person and increasingly online.1 This helps Victorians attain better education, health, social identity, inclusion and community cohesion, directly impacting people’s wellbeing.2

But insufficient, poorly targeted, or ageing facilities can hinder access to timely, quality services. Social infrastructure enables services that meet multiple community needs. Integrating these can help achieve better outcomes, although doing so can make planning and asset management more complex.3 The quality and accessibility of different types of social infrastructure varies, including in different places and for different groups of people. The Victorian Government has the lead responsibility for planning, regulating, funding and operating the state’s largest and most expensive social infrastructure assets, including schools, hospitals, social housing stock and correctional facilities. It shares funding responsibilities for social services and infrastructure with the Australian Government and local councils.

Victoria’s social services are especially important in helping to foster healthy, safe and inclusive communities and good, targeted social infrastructure enables services that meet multiple community needs

A growing and increasingly diverse Victoria needs more social infrastructure

Victoria’s social infrastructure needs to grow and change with its people. Drivers of demand differ across sectors,4 with the most significant long-term factors including population growth, changing demographics, and evolving community expectations.

Social infrastructure also needs to be able to meet fluctuating and sometimes large surges in demand from unexpected developments and emergencies, as clearly demonstrated during the COVID-19 pandemic.5

The way Victorians use infrastructure to deliver services itself will need to continually change and adapt, a fact underlined by the sweeping reforms recommended by Royal Commissions into the state mental health and national aged care systems. Appropriately located, well-designed and flexible social infrastructure can help meet spikes in demand, support the most vulnerable and disadvantaged, and promote fairness and opportunity for all Victorians.

Demand for infrastructure is growing across social services. Victoria will need many thousands of new social housing dwellings each year to meet demand.6

Demand for hospital inpatient services could grow by over 80% by 2042.7 More people are seeking mental health assistance, with mental illness disproportionately affecting young people, people experiencing disadvantage, residents of remote areas, Aboriginal Victorians, people from non-English speaking backgrounds, and people who are lesbian, gay, bisexual, transgender, intersex and queer (LGBTIQ+).8 These groups have different and specifc needs, and social infrastructure needs to respond to these diverse needs. Managing demand on infrastructure and making the most from existing assets means building new infrastructure only when an identified need exists. The sheer scale of projected demand for many social services means more infrastructure will be needed, combined with innovations in service delivery and upgrades to existing assets. Access to social infrastructure is particularly challenging for fast-growing communities in outer suburbs of Melbourne as these usually have few or no existing facilities.9 The next section of this strategy (section 3.4) discusses priorities for these new growth areas in more detail.

Short-term, reactive approaches are inefficient and unsustainable

Best practice social services often focus on prevention and early intervention that strengthens individual and community resilience and pre-empts people reaching crisis.10,11,12 This is usually more equitable, effective and cheaper than allowing problems to get worse, requiring more complex and expensive services. Investing in infrastructure that supports early interventions can similarly reduce the complexity of new infrastructure or can delay the need for new facilities.

In health, outreach programs, primary services, rehabilitation and day services can divert patients from expensive specialist and acute care, while integrated health infrastructure can support earlier, consistent support for patients through the physical health, mental health and aged care systems. For example, community hospitals that provide ‘everyday’ services can meet some early intervention needs, reducing burdens on acute care.13

Similarly, early childhood services and schools can improve the life chances of students and help people to have productive, healthy lives.14 Social housing can reduce people’s reliance on more costly services in the long run.15 Total Victorian Government expenditure growth in social services has outpaced population growth, highlighting the pressure to keep spending sustainable and efficient. But social infrastructure planning and funding approaches are often reactive and short term. ‘Just in time’ approaches can generate a ‘lumpy’ investment profile, and make long-term infrastructure planning difficult. Service providers often respond by adopting short-term responses, focusing on crisis management and meeting acute need. This can result in a siloed approach that makes joint planning challenging and reactive, and which produces expensive infrastructure projects that struggle to meet long-term service needs.16

Aligning service planning and infrastructure supports early intervention

New infrastructure can take years to plan, design, pass regulatory approvals and be built. This renders it relatively slow to react to rapid changes in demand. It also means infrastructure planning and design is best when it is flexible, with the capacity to help manage spikes in demand, including from social or legislative changes or from natural disasters, economic recession or pandemics.

Decision-makers need to plan now for future needs, not just those experienced today, and be informed by evidence-based service planning. Identifying long-term service needs, and then aligning infrastructure planning – and funding – with those needs, can generate better value for taxpayers and better services.

Evidence-based service planning should inform priority investments, including projections of infrastructure demand, and aim to address people’s needs as early, quickly and inexpensively as possible.

Regular reviews of demand projections and service planning would allow these to reflect the best current data, including innovation and research, project evaluations and developments in best practice. Critically, service planning should be done before infrastructure planning. Social infrastructure usually has a long lifespan, meaning it can struggle to adapt to technological change and service delivery developments. Inflexible facilities risk becoming prematurely redundant, unable to provide modern, safe services. Victoria needs social infrastructure that can be easily maintained, upgraded and expanded over time. Delivering new buildings that are flexible and multipurpose where possible, and with technological foundations that are easily updated, will enable faster and less expensive upgrades. Planning and design can consider the potential for new infrastructure to be built to enable expansion and shared use by co-located or integrated services.

Case Study: Planning school infrastructure for growing communities

The Department of Education and Training (DET) uses projections of demand to better understand future service need. Service planning helps to identify the most appropriate infrastructure responses for different areas, the amount of funding required, and the efficient sequencing of investment. This approach informed $3 billion in new funding in 2020 for school upgrades and new schools, plus the previous $1.8 billion investment in 2019 to build 100 new schools by 2026.17

DET’s projections, service planning and relatively consistent funding allow it to use a mixture of measures to manage and respond to increasing demand for schools. These measures go beyond building new infrastructure, and include expansions, upgrades and modernisations – sometimes using relocatable or modular buildings – and policy approaches to manage demand, such as the application or amendment of school zones.18

Of the 100 new schools the Victorian Government is planning to deliver from 2019 to 2026, approximately three quarters are in, or proposed to be in, metropolitan growth area councils. Of these 100 schools, 25 have already been delivered and 13 more growth area schools will be constructed by 2023–24.19 Funds have also been allocated to purchase land for more schools in five growth area municipalities. To inform its service planning and confirm appropriate sites for new schools, DET works with the Victorian Planning Authority and other government agencies to prepare Precinct Structure Plans (PSPs). PSP processes also help secure funding from Growth Area Infrastructure Contributions levied from developers.20

Importantly, DET provides transparency of its project pipeline via a website.21 This provides parents, school managers, government agencies and the broader public with better, more timely information relevant to their decisions and greater awareness of how investment is being prioritised. It also provides the opportunity for more collaborative planning with local government to deliver education and community hubs on school sites.

Effective social infrastructure is adaptable and targeted to communities

Successful new social infrastructure works for the people it supports, with few ‘one size fits all’ approaches working effectively in all of Victoria’s diverse communities. Infrastructure planning and delivery should account for local community needs, including its demographics, existing infrastructure capabilities, and the community’s capacity to use and operate new infrastructure. Local, collaborative approaches can help communities deliver local solutions to community needs by bringing government, service delivery organisations, local people, community organisations, and businesses together.22

Where appropriate, government agencies can benefit from working with each other, local government and service users to co-design and deliver adaptable infrastructure that delivers better outcomes for local residents.

Local knowledge, community engagement and cooperation with service users can also make infrastructure more fit for purpose and reduce risks of potential problems.23The National Agreement on Closing the Gap recognises the importance of local partnerships between government and Aboriginal representatives to improve the provision of essential services to Aboriginal communities.24 Aboriginal community ownership and control of social infrastructure delivers quality services, and demonstrates better outcomes are achieved when Aboriginal people have a genuine say in the design and delivery of services that affect them.25 Aboriginal self-determination should be embedded in service planning,26 with communities empowered to plan, own and operate infrastructure that delivers culturally appropriate services.27, 28

Transparent priorities reflect the best possible evidence

Clear priorities and targets can help drive long-term planning and funding beyond annual budget cycles. They can also promote innovative and more efficient approaches to service delivery, in some cases reducing the quantity of infrastructure required or deferring the need for new assets.

Using demand projections and best practice service delivery models to inform planning will help Victoria transition from a ‘just in time’ approach of one-off investments to a long-term social infrastructure program that provides required services in an appropriate, systematic and sustainable way. Priorities and targets are most useful when they are transparent and supported by detail on supporting infrastructure programs.

Transparency supports better planning, certainty and efficiency across Victoria’s social service systems. Better visibility across government agencies and with other stakeholders can identify opportunities to share infrastructure that delivers better outcomes for service users and promote more integrated land use and infrastructure planning. Public, long-term infrastructure planning would also promote more transparent, streamlined and effective procurement practices, saving taxpayers’ money and delivering projects with fewer disruptions to services. The needs of Victorians will continue to evolve, driven by changing demographics, social expectations, technology, and developments in best practice service and infrastructure delivery. Social infrastructure must continue to evolve too.

Recommendations to better support services with infrastructure

Infrastructure Victoria makes the following recommendations to support better long-term alignment between service and infrastructure planning. These reflect the need to adopt a more proactive, long term and transparent approach to new social infrastructure to support Victorians with timely, modern and high quality services. Publishing long-term infrastructure plans for priority sectors (see recommendation 32), embracing innovative ways to connect people to services (see section 1.4) and upgrading and renewing existing assets to meet changing needs (see section 2.4) will help to meet this goal. Infrastructure Victoria has recommended specific responses to the social infrastructure needs of new growth areas (see section 3.4) and Victoria’s regions (see sections 4.2 and 4.3).

Recommendation 67: Co-design an Aboriginal community-controlled infrastructure plan

In the next year, start a co-design process with Aboriginal Victorians to develop a plan to guide investment in Aboriginal community-controlled infrastructure to meet current and future social, economic and cultural needs.

Victoria’s Aboriginal population is projected to grow more than twice as fast as the general population in the decade to 2028.29 The Aboriginal population’s age and geographic distribution is different from other Victorians,30 and Aboriginal people experience disadvantage at a higher rate on almost all indicators.31 This means the service needs of Aboriginal Victorians will likely expand rapidly, in different places, and require a similarly rapid expansion of supporting infrastructure.

The Victorian Government has made self-determination the cornerstone of its Aboriginal policy.32 It has formally legislated a Treaty process between the Victorian Government and Victoria’s First Peoples,33 and committed to supporting self- determination in decision-making in the National Agreement on Closing the Gap.34 Applied to infrastructure, self-determination empowers Aboriginal communities to own, design and control infrastructure for their social, economic and cultural needs. Aboriginal community-controlled organisations adopt holistic approaches to delivering services and infrastructure, incorporating cultural safety, flexibility, diverse services, prevention, promotion, advocacy and the empowerment of individuals, families and community.35 However, historical dispossession and a lack of recognition means they have had limited opportunities to acquire infrastructure,36 which has left many existing facilities insufficient and not fit for purpose. The Victorian Government has taken steps to bolster Aboriginal community-controlled organisations’ ownership of infrastructure. It transferred ownership of 1448 social housing properties to Aboriginal Housing Victoria,37 allowed the removal of restrictive `first mortgages’ on property owned by Aboriginal organisations,38 and established and partially extended an Aboriginal Community Infrastructure Fund.39

It has also committed to working with Aboriginal community-controlled health organisations to deliver more culturally appropriate mental health and wellbeing services.40 However, there is currently no overarching needs analysis or strategy to guide infrastructure investment. Current funding supports individual Aboriginal organisations to develop business cases on a project-by-project basis.41 The Victorian Government should start co-designing an Aboriginal community-controlled infrastructure plan collaboratively with Aboriginal Victorians in the next year. The plan should identify current and future infrastructure needs, appropriate locations for facilities and delivery of services, and suitable funding, design and procurement approaches (potentially informed by Infrastructure Victoria’s regional and metropolitan infrastructure needs profiles).42 It can include more accurate data and information about the living circumstances of Aboriginal people,43 build in co-governance and accountability mechanisms,44 and align with budget processes.45

This plan should acknowledge and be informed by the Victorian Treaty process,46 reflect self-determination principles and priorities in the National Agreement on Closing the Gap, and the Victorian Aboriginal Affairs Framework. It can build upon existing plans, agreements, and reports for specific sectors, including for health,47 mental health,48 family violence,49 education,50 children and families,51 justice,52 economic development,53 and housing and homelessness.54 The co-design process will require a strong governance structure. In designing this, the Victorian Government could consider incorporating examples from existing governance structures, consider the relationship with the First Nations People’s Assembly, and include diverse representation, including from Aboriginal community-controlled organisations, peak bodies, Traditional Owner groups, and drawing upon the lived experience of Aboriginal people.

In co-designing the plan, consideration can be given to how it might account for the many different infrastructure sectors, and its emphasis on different locations in Melbourne and regional Victoria. It may be that the preferred approach is to plan region by region, such as in the Loddon Campaspe and Mallee regions,55 or by focusing on priority sectors first, in an iterative manner. The plan could be expanded to include other diverse priority infrastructure such as integrated facilities, sporting infrastructure, and facilities that protect the heritage, learning and practising of traditional language and culture. It could also recognise economic and cultural tourism opportunities (see recommendation 82).

Case Study.

Murray Valley Aboriginal Cooperative, Robinvale

The Murray Valley Aboriginal Cooperative operates an integrated facility providing diverse programs for Aboriginal people in Robinvale including childcare, kindergarten, health and medical services, wellbeing services, housing and aged care. Focusing on self- determination, empowerment and resilience, the Cooperative encourages the involvement of the Aboriginal and wider community to promote understanding of the challenges facing indigenous people in the region.56

Wunggurrwil Dhurrung Centre, Wyndham Vale

The Wunggurrwil Dhurrung Centre will provide a dedicated space for the Aboriginal community to strengthen community and cultural development. People will learn about culture just by being in the building. It will also facilitate improved coordination and delivery of services and programs. The Integrated Family Centre will provide early years and family support to local families, including family and early intervention services for vulnerable groups. It will include community spaces, kindergarten rooms, maternal child health consulting rooms, office space, and consulting rooms to cater for the growing needs of the Wyndham community.57

The co-located Wyndham Aboriginal Community Centre, Koling Wada-Ngal, provides an inclusive space for Aboriginal people managed by a community-led committee. The purpose of the centre is to strengthen community and cultural development and facilitate improved coordination and delivery of services and programs for the Aboriginal community in Wyndham.

Recommendation 68: Set targets to grow social housing

In the next year, set a transparent statewide social housing growth target to reach and maintain at least the national average of 4.5 social housing dwellings for every 100 households by 2031.

Social housing infrastructure meets a basic need of low-income Victorians for secure, affordable and appropriate housing, which the private market is not supplying.58 Homelessness in Victoria increased by more than 40% in the decade to 2016, reaching about 25,000 on any given night.59 Low-income households in rental stress has grown by nearly 60% in the decade to 2018, to more than 140,000.60 Only 11.4% of new Victorian rentals are affordable to someone receiving Centrelink benefits.61 Aboriginal Victorians experience worse housing outcomes than other Victorians on multiple indicators.

Social housing is effective at preventing homelessness62 and its income-linked rents prevent housing stress. Social housing, like other infrastructure, needs long lead times for careful design, planning, regulatory approvals, and procurement. Delivering social housing at scale requires a rolling construction program planned over several years. Like other infrastructure spending, social housing can have stimulatory economic effects, especially for the residential construction sector.

We estimate Victoria had 3.2 social housing dwellings for every 100 households in June 2020,63 compared with the national average of 4.4.64 The Victorian Government commits to developing a 10 year strategy for social and affordable housing and made a significant investment in social housing as part of its $5.3 billion Big Housing Build program, including more than 9300 new social housing dwellings.65 In the past, Victorian capital expenditure on social housing was less than 60% of the national average.66 The Australian Government has compounded the problem by steadily reducing real funding per capita over time.67

All estimates, including our own,68 indicate more social housing is required to meet Victoria’s needs. Estimates vary from 1700 each year – just to keep pace with population growth69 – to 8300 annually to cover all evident need.70 Reaching a statewide provision rate of 4.5 social housing properties for every 100 households by 2031 would require around 4900 extra properties each year, or as little as 3900 with lower population growth.71 More homes should be provided to meet demand in accessible locations which provide residents ready access to the health, social and economic support and services they need.72

The Victorian Government should publicly set long-term targets for social housing growth beyond the Big Housing Build program. The targets should be broken down to identify provision for Aboriginal people and other applicant groups on the Victorian Housing register. Targets should clearly define Victorian Government expectations, drive longer-term planning involving local government and partnering organisations, provide funding certainty beyond annual budget cycles, help maintain accountability for results, and consider needs of specific groups, such as Aboriginal Victorians.

Public debate has often been distracted by complex financing mechanisms for social housing, which merely change the funding profile, or at best achieve marginal cost reductions. However, one study suggests direct government capital investment could reduce social housing costs by up to 24% compared with offering operating subsidies.73

The cost of this recommendation depends on the target, location and timing, the funding or financing mechanism, and population growth. Investing in new social housing can also provide new facilities for existing tenants to be relocated to while existing social housing assets are undergoing renewal (see recommendation 55).

Recommendation 69: Build new hospital capacity

In the next five years, reserve land for future hospital sites. Over 30 years, build new public hospital capacity to meet Victoria’s future needs, especially increases in demand from Melbourne’s rapidly growing outer northern and western suburbs.

Every day, Victoria’s public hospitals provide acute emergency and critical care, outpatient services and longer stay support. Large specialist facilities in metropolitan Melbourne provide highly specialised trauma and other services statewide. Hospitals also provide unique capabilities during major disasters or other contingencies, as demonstrated by their central role in responding to the COVID 19 pandemic.

Demand for hospital services continues to grow, driven by population growth and an ageing population, and increasing prevalence of complex and chronic conditions.74 Almost 20% more inpatient services were delivered in 2018–19 than five years earlier,75 and projections indicate demand for inpatient services could grow another 80% by 2042.76 Melbourne is likely to generate most of the new demand, and as Figure 23 shows, the rapidly growing outer suburbs and new growth areas will generate the greatest share of this demand.77

Meeting this demand could require more hospital capacity equivalent to hundreds of extra beds every year.78 Promoting prevention, early intervention and better models of care (recommendation 25) and the proactive upgrade and renewal of ageing facilities (recommendation 56) can moderate some demand, but significant investment in new hospital infrastructure will still be required.

The Victorian Government will need to increase hospital capacity across much of the state, by expanding existing sites as well as delivering new hospitals with transport access for those areas most in need. Within five years, and informed by service planning, it should publish a public plan for health infrastructure that sets out priorities, sequencing, and locations (recommendation 32). This plan needs to address the pressing need to provide more services to Melbourne’s outer north and west,79 building on existing commitments to a new Melton hospital and the expansion of Werribee Mercy Hospital.80

When building and upgrading hospitals, the Victorian Government should plan and deliver well designed infrastructure that can be easily maintained, upgraded and expanded, and which meets modern standards for accessibility, energy efficiency and sustainability. This would allow facilities to be readily adapted to changing need, technology and best practice to deliver modern, safe and improved care. Progressive modernisation and upgrades will also support hospital efficiency, slowing the need for new builds. Preserving options such as larger footprints or the ability to build extra wings or storeys could support future upgrades and result in fewer interruptions to services.81

Delivering hospital infrastructure is expensive and time-consuming, particularly when it involves building new facilities. The new 504-bed hospital in Footscray, for example, is expected to cost $1.5 billion.82 Upgrades can be faster and more cost effective, and capacity could be increased through improving and expanding assets at existing sites where this is possible and appropriate. However, new hospitals will still be necessary. Forward planning can secure land early, potentially reducing costs, and present opportunities for collaboration between government and industry.

Figure 23: Demand for hospital services will grow fastest in Melbourne’s outer suburbs and growth areas. The diagram shows the share of projected new hospital inpatient service demand growth by urban area83 from 2018–19 to 2041–42.

Figure 23 Demand for hospital services will grow fastest in MelbourneOCOs outer suburbs and growth areas 300dpi 1
Source: Infrastructure Victoria analysis of Department of Health and Human Services, Inpatient Projection Model 2018

Recommendation 70: Deliver infrastructure for a more responsive and integrated mental health system

In the next year, establish a dedicated infrastructure fund to support more responsive and integrated mental health and wellbeing services, consistent with the recommendations of the Royal Commission into Victoria’s Mental Health System.

The Royal Commission into Victoria’s Mental Health System is a catalyst for generational reform. It delivered a blueprint for a profound redesign of a ‘depleted and broken’ and ‘overly complex, fragmented and inconsistent’ system,84 and the Victorian Government committed to implementing all of its recommendations.85 Peak bodies, health services and the community are providing considerable support for change.86

Around 20% of Victorians experience mental illness each year, and almost 50% experience a mental illness during their lifetimes.87 Over 200,000 Victorians live with severe mental illness,88 and more than twice as many die from suicide than in road accidents.89 Demand has overtaken all types of care provision.90 Publicly funded, community-based specialist services respond to less than a third of estimated need, and almost 100,000 Victorians cannot access the specialist care they require.91 Under-investment, inadequate planning, and stigma means the system reacts to crises rather than preventing them.92 Young people, regional Victorians, Aboriginal people, those who are LGBTIQ+, and people living with poor physical health, homelessness, disability or substance dependence can find it particularly hard to access care.93 Poor mental health is estimated to cost Victoria $14 billion a year.94

The Royal Commission envisions a mental health system providing more community- based services and better quality hospital and residential care.95 Alongside implementing sweeping changes to service planning, governance, and workforces, the Victorian Government must invest in infrastructure that supports safe and effective services. More and different types of fit for purpose facilities are needed, including for inpatient, acute and emergency care, and residential rehabilitation. Ageing infrastructure should be replaced or updated,96 and innovative alternatives to hospital treatment better supported.97

The Victorian Government has committed to a new levy to support reform to Victoria’s mental health system98 and begun to deliver recommendations to fast-track more mental health beds, new mental health services, innovative residential services, design work for a new Victorian Collaborative Centre for Mental Health and Wellbeing, and better support for young and Aboriginal people.99

These commitments includes least 100 more mental health beds;100 more ‘hospital in the home’ and community rehabilitation services;101 more services for adults, older adults, children and youths that operate with extended hours and in a variety of settings;102 technology upgrades to support digital services and information sharing;103 new ‘safe spaces’ and crisis respite facilities;104 gender-based separation in facilities;105 and major upgrades to the Thomas Embling Hospital.106 The Victorian Government should now establish a dedicated fund for further mental health infrastructure required to fulfill the Royal Commission’s recommendations.

Infrastructure investment must align with service planning for maximum integration and effectiveness. The Royal Commission recommended a new statewide mental health and wellbeing service plan from late 2022 to 2023.107 In this plan, the Victorian Government should consider future priorities across the spectrum of care and set out the infrastructure investment required to deliver them. It should also foster innovative design and models of service delivery, better connect and align mental health and related services to support people with complex needs, and be informed by further research and evaluations of new programs over time.

Recommendation 71: Plan and consistently deliver corrections and youth justice infrastructure while managing demand with policy settings

Plan and consistently deliver corrections and youth justice infrastructure while managing demand. By 2023, undertake long-term corrections and youth justice infrastructure planning, alongside policy measures that reduce short-term volatility and demand. In the next 15 years, consistently deliver a program of corrections and youth justice infrastructure projects to meet long-term demand.

Victoria’s prison population has grown rapidly, driving greater demand for corrections infrastructure. Prisoner numbers increased by 33% from 2014 to 2019,108 driven by an increase in people on remand,109 population growth, and sentencing and parole reforms.110 While the COVID-19 pandemic reduced demand, it did so only temporarily and has also caused delays in sentencing that mean many people on remand are spending more time in custody awaiting their day in court.111

Building infrastructure is not the only way to address demand for correctional and youth justice facilities. Any investment must be considered alongside policy changes that can reduce long-term demand, avoid short-term volatility, deliver treatment (including for mental illness), and help address the over-representation of Aboriginal Victorians in custody. Best- practice early intervention and prevention programs, in and outside of corrections facilities, can divert some demand by reducing the likelihood of offending. A history of irregular, ‘just in time’ funding makes it challenging to plan for the long-term or respond rapidly to capacity shortfalls driven by changes in policy and practice. In 2019, the Victorian Government announced $1.4 billion in funding to accommodate 1600 extra prisoners112 to ease short-term infrastructure pressures but this will be exhausted by 2023. Unreliable capital funding also contributes to a growing maintenance burden,113 affects the efficiency of prison services,114 and contributes to high costs.115 The yearly cost to fund each Victorian prisoner rose by over 25% from 2011 to 2017,116 and annual prison running costs have tripled since 2009.117

When caught short, the system has historically relied on adding extra permanent beds to existing facilities, or resorting to temporary beds and double bunks. These measures can be cheaper up front, but their long term use can contravene standards and risk health, safety and rehabilitation outcomes.118 Prisons can only accommodate so many extra prisoners and remain effective.119 In some cases, capacity has been pushed beyond the maximum utilisation rate of 95%. This results in overcrowding, an increase in serious prison incidents, a reduction in specialised services to vulnerable cohorts, less flexibility to move prisoners, and diversion of police resources to oversee prisoners in police cells.120

The Victorian Government needs a more considered, long-term approach to planning for corrections and youth justice infrastructure. By 2023, its planning should be informed by projections of long-term demand, including scenarios under alternative policy settings that would allow government to consider options for policy reform and infrastructure responses. Investment should align with long-term demand under desired policy settings, and aim to maintain facility capacity below 95%. The annual capital budget can vary drastically; for example from $70 million in 2017–18 to $970 million in 2021–22.121 More consistent capital funding would support a long-term program of projects that meets demand in a more sustainable way, promoting more robust and cost effective procurement and resulting in fewer disruptions. Reviews of funding and priorities every three to five years would allow updates to reflect developments, including changes to projected demand and policy settings.

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