About the Budget Monitor

Background

Infrastructure Partnerships Australia’s Australian Infrastructure Budget Monitor 2025-26 (Budget Monitor) measures infrastructure funding commitments by jurisdictions for the current Budget year and forward estimates (FY2025-26 to FY2028-29). This report collates information from the latest Budget papers from Federal, state and territory governments to provide insights into their infrastructure investment programs beyond the headline figures. The purpose of the Budget Monitor is to inform the community, industry and researchers about historical and projected public infrastructure investment in Australia. It allows readers to compare and evaluate the commitments by governments to building infrastructure.

Methodology

Budget Monitor rankings are made using a cumulative ranking approach for each state based on relative performance across four metrics of equal weight. These metrics are derived from forecast and historic general government expenditure allocations to infrastructure and population figures provided by the Australian Bureau of Statistics. The Budget Monitor does not seek to assess the prudence of project-level investments, rather, it is a measure of the quantum and trend of infrastructure spending in public budgets. This approach is taken as the Budget Monitor seeks to assess the importance of infrastructure relative to total expenditure, not the quality of expenditure.

Infrastructure funding figures are primarily drawn from budget-reported allocations of general government expenditure to infrastructure. Where unavailable, purchases of non-financial assets and finance leases (e.g. PPP payments) serve as proxies. This approach ensures consistency across varying budgetary practices and normalises for economic and geographic differences, providing a robust comparison of the strength of each jurisdiction’s infrastructure program.

Total general government sector expenditure – expenses plus net acquisitions of non-financial assets – is used as the baseline for assessing the total proportion of expenditure allocated to infrastructure.

General government expenditure excludes spending by government-owned business enterprises or public corporations, such as utilities or ports, which are required to recoup investment and operational costs through own source revenue such as utility bills. This approach isolates taxpayer-funded decisions and excludes expenditure from user-pays or equity-financed projects, which are not paid for by taxpayers. As a result, figures may diverge from government media releases, but they better capture the fiscal choices directly attributable to public budgets.

Budget figures from the Federal, Australian Capital Territory (ACT) and Northern Territory (NT) Governments are assessed in the Budget Monitor but excluded from rankings. The Federal Government primarily funds state and territory infrastructure projects. As such it is not formally included in the rankings. The Budgets of the ACT and NT are excluded from the rankings due to the functional differences between the governments and economies of territories and states. Territory governments are much smaller than state governments and have fundamentally different rules for collecting revenue and spending capital, which make direct comparisons potentially unfair for territory budgets. We include analysis of all three budgets in the report to provide a comprehensive overview of all funding commitments.

The four metrics used to make the overall Budget Monitor rankings are:

Share – General government expenditure to infrastructure over four years

This metric is the base measure for the Budget Monitor methodology and measures a jurisdiction’s proportion of general government expenditure allocated to infrastructure over the four-year budget period. This metric is designed to measure infrastructure’s importance relative to total expenditure between FY2025–26 and FY2028–29. Measuring expenditure in this way enables comparison of large and small jurisdictions.

Spread – Delta between four-year Share and previous decade Share

This metric measures the delta between the Share of general government expenditure allocated to infrastructure over the next four years, and the Share average of the previous decade. Complementing the Stability metric, the Spread metric is designed to assess whether a jurisdiction’s infrastructure profile is exceeding its long-term trend, looking beyond the infrastructure cycle to reward long-term uplift in expenditure.

Stability – Infrastructure expenditure rate of change

Infrastructure investment is typically cyclical, with large individual interventions not required every year to uphold service provision. Consequently, infrastructure allocations often oscillate up and down. However, infrastructure markets which limit the scale of these oscillations create the foundations to enable long-term productivity and efficiency gains.

To assess the Stability of a jurisdiction’s infrastructure profile, this metric assesses the skew of the current Budget’s infrastructure allocation against the previous four years of actual expenditure. This ‘Inverse Absolute’ measure seeks to account for the cyclical reality of infrastructure investment, with ‘Boom-and-Bust’ approaches finishing at the bottom of the rankings and steady movements up or down rewarded in the rankings.

Service – Percentage change in per capita funding

The supply and demand of infrastructure is ultimately governed by a simple equation of service delivery commitments and population changes. The Service metric acknowledges this equation assessing the percentage change in per capita funding – total infrastructure funding divided by total population – between the previous budget’s four-year allocation and this budget’s allocation. The jurisdiction which increases its per capita infrastructure the most is rewarded with the highest rank.

Each state is ranked on its performance on each metric from first to sixth. These are then combined to calculate an overall rank, with the lowest aggregate rank awarded the top position in the overall Budget Monitor ranks. All four metrics are provided equal weight in this calculation. Where two jurisdictions are tied in the overall rank, their respective performance in the Share metric is used as a tiebreaker.

Together as a composite rank, these metrics reward jurisdictions which make infrastructure allocations that emphasise fiscal sustainability and improve service delivery in the short and long term. Jurisdictions who make large abrupt movements in their infrastructure allocations and who do not seek to improve service delivery are penalised.

Figure 1: 2025-26 Australian Infrastructure Budget Monitor Rankings

Source: Infrastructure Partnerships Australia analysis of 2025-26 Budgets

Key Insights

1st Place: Queensland

Source: Infrastructure Partnerships Australia analysis of the 2025-26 Queensland Budget

With the challenges of a rapidly growing population and the 2032 Brisbane Olympic and Paralympic Games on the horizon, the new Queensland Government has continued the state’s infrastructure rise for the fourth-year running. Queensland’s general government expenditure allocated to infrastructure has now risen to 15.9 per cent, up 1.7 percentage points from the 2024-25 budget allocation, moving the State’s Share rank from fourth to second.

This four-year allocation is 4.3 per cent above the decade-long average of 11.6 per cent and represents the jurisdiction with the most expansionary infrastructure profile in this 2025-26 Budget Season. This expansion has seen Queensland finish first in the Service metric with a 29 per cent increase in per capita funding growth, 24 percentage points more than the next best jurisdiction, South Australia. Per capita funding has now increased 65 per cent in Queensland since the 2022-23 Budget.

A 20.5 per cent increase on last year’s four-year allocation has had a negative impact on the Stability metric, with the State finishing fifth. Infrastructure funding has now increased by $29.1 billion or 69 per cent since the 2022-23 Budget.

With such a strong pipeline, the Queensland Government will need to carefully manage its budget to ensure capital gets out the door and projects with hard deadlines are delivered on time.

2nd Place: New South Wales

Source: Infrastructure Partnerships Australia analysis of the 2025-26 New South Wales Budget

The boom that has underwritten the last 13 years of infrastructure funding in Australia’s largest jurisdiction is now drawing to a measured close, with this Budget allocating $86 billion to infrastructure, $470 million lower than last year’s in nominal terms and $2.2 billion lower in real terms.

A robust pipeline of mega-projects under delivery such as Sydney Metro West, Western Harbour Tunnel, and the Coffs Harbour Bypass continue to provide ballast to the State’s infrastructure allocation. The State’s four-year allocation to infrastructure is equivalent to 15.3 per cent of general government expenditure, achieving a Share rank of third, one position lower than last year, when 16 per cent of general government expenditure was allocated to infrastructure.

The declining share of infrastructure expenditure aligns with the long-term goal of the Minns Government to reduce infrastructure expenditure to two per cent of Gross State Product. The policy, first announced in the 2023-24 NSW Budget, initially aimed to reach this target by FY2026-27, has now been extended to FY2028-29. This steady approach to managing decline sees the state rank first in Stability.

NSW’s four-year allocation is now 1.3 percentage points below the previous decade average of 16.6 per cent, resulting in a ranking of fourth in the Spread metric.

3rd Place: Victoria

Source: Infrastructure Partnerships Australia analysis of the 2025-26 Victorian Budget

For the fifth year in a row Victoria has finished first in the Share metric, allocating $71.6 billion to infrastructure over the next four years, equivalent to 16.1 per cent of general government expenditure. However, this allocation is a far cry from the $107.4 billion (in real terms), or 24 per cent of general government expenditure allocated in the 2021-22 Budget.

Despite ranking first in the Share metric, the bulk of infrastructure funding over the next four years is tail funding or previously unfunded cost overruns for major projects under delivery, and expected to be complete in this Budget period, including North East Link, Melbourne Metro Tunnel and the West Gate Tunnel. New projects in this Budget were headlined by a $2.2 billion reallocation of existing funding to the Sunshine Superhub.

In real terms, infrastructure funding in Victoria over the next four years is forecast to be $18.4 billion less than the previous four years. This precipitous contraction in infrastructure allocations has seen Victoria ranked fourth in Stability ahead of only the rapidly expanding Queensland and South Australia.

Victoria’s performance in metrics assessing the cyclical position of jurisdictions demonstrates the downside risks associated with making rapid changes to infrastructure funding. Future infrastructure funding decisions in Victoria are now seriously limited by the State’s fiscal capacity, and are likely to lead to further falls in the Budget Monitor rankings.

4th Place: South Australia

Source: Infrastructure Partnerships Australia analysis of the 2025-26 South Australia Budget

South Australia is currently in the early stages of an expansionary period, with two very large projects in the Torrens to Darlington and the New Women’s and Children’s Hospital expected to reach peak mobilisation this budget period. Allocations to these two projects see the state’s four-year allocation rise to $21.6 billion, equivalent to 15.2 per cent of general government expenditure, and 3.6 per cent above the decade average, resulting in a Share rank of fourth and a Spread rank of second.

This rapid expansion means that South Australia finishes last for Stability, with the next four years of infrastructure spending differing more from the previous four years of allocations than in any other Australian jurisdiction.

Despite increasing rapidly, this expansion follows a period of subdued investment in infrastructure, meaning the State only finishes with a Share rank of fourth. With the contracting Victoria and NSW only slightly above South Australia in the rankings, it is likely that the State will climb higher in the Share metric and consequently in the overall rankings in future editions of the Budget Monitor.

5th Place: Tasmania

Source: Infrastructure Partnerships Australia analysis of the 2025-26 Tasmanian Budget

Political instability in Tasmania led to an interim Budget being handed down in November, following the Tasmanian election in July, and after the Budget handed down in May and supporting Appropriations Bills were not passed prior to the prorogation of the previous Parliament. This Interim Budget allocated just $3.4 billion to infrastructure over the four years to FY2028-29, a 13 per cent decrease on last year’s allocation, and resulting in a Share rank of fifth.

This funding reduction sees Tasmania’s infrastructure funding drop 1.4 per cent below the long-term average, equating to a rank of fifth in the Spread metric.

Per capita funding in Tasmania decreased 11.4 per cent compared to last year’s infrastructure allocation from $6,800 to $6,000 resulting in a Service rank of sixth. Tasmania has the second lowest per capita funding of any jurisdiction.

6th Place: Western Australia

Source: Infrastructure Partnerships Australia analysis of the 2025-26 Western Australia Budget

The Government of Western Australian allocated just 7.4 per cent of general government expenditure to infrastructure this year, a 1.4 percentage point decrease on the 2024-25 Budget allocation and 1.4 percentage points below the State’s 10-year average, resulting in Western Australia finishing last in both the Share and Spread metrics.

WA has achieved a Stability score of -5.8. Against a backdrop of other rapidly expanding and rapidly contracting markets, WA has managed to slide into second position in the metric.

WA is ranked fifth in the Service metric, with per capita funding falling 10.4 per cent to $4,700, the lowest per capita infrastructure funding of any jurisdiction.

Federal Government

Source: Infrastructure Partnerships Australia analysis of the 2025-26 Federal Government Budget

The 2025-26 Federal Budget allocated general government infrastructure funding of $60.7 billion over the four years to FY2028-29, equivalent to a Share measure of 1.8 per cent. This is $118 million more than last year’s Budget and represents a real decline of $493 million.

The 2025-26 Budget’s four-year spend equates to a narrow Spread measure of 0.1 per cent above the long-term trend of 1.7 per cent of general government expenditure.

Of the Federal Government’s infrastructure allocations, Queensland will receive the greatest share, with $16 billion allocated over the next four years, while NSW will receive $14.2 billion and Victoria $13.6 billion.

The breakdown of how funding has been allocated to the states and territories is shown in Figure 2.

Figure 2: Federal Budget infrastructure allocations by jurisdiction and asset class

Source: Infrastructure Partnerships Australia analysis of the 2025-26 Federal Budget

Australian Capital Territory

Source: Infrastructure Partnerships Australia analysis of the 2025-26 Australian Capital Territory Budget

Overall infrastructure funding in the ACT remains steady this year, with an infrastructure allocation of 11.7 per cent of general government expenditure. The ACT’s stable approach sees a contractionary Spread measurement of just -0.21 per cent.

This Budget moved funding for the ACT Light Rail Stage Two out of the forward estimates period – a further delay after last year’s Budget expected most funding to hit the balance sheet in FY2027-28. This minimum two-year delay for the Territory’s biggest project has seen per capita funding in the state slide down 9.5 per cent from $11,400 to $10,300.

Despite these variations in the forward estimates, the ACT’s infrastructure allocation to FY2028-29 is skewed by only 5.9 per cent compared to the previous four years of expenditure.

Northern Territory

Source: Infrastructure Partnerships Australia analysis of the 2025-26 Northern Territory Budget

The Northern Territory’s infrastructure profile is benefited by a small, dispersed population that requires consistent levels of infrastructure funding and few large and distortionary investments. The 2025-26 Budget four-year allocation to infrastructure is skewed by just 2.1 per cent to the forecast budget period.

This steady profile has led to a Spread between infrastructure funding for the four years to FY2028-29 of just 0.35 per cent higher than the previous decade.

The Northern Territory has the highest per capita funding of any jurisdiction in Australia at $20,200 per person. This is 1.8 per cent lower than last year’s allocation of $20,600 per person.