Analysts say energy projects are taking away funding for housing and road infrastructure. 

Australia’s $41 billion worth of new fossil fuel projects are “gobbling up” the construction supply chain, according to The Australia Institute.

The funds committed to resource and energy infrastructure projects are soaking up construction capacity that could otherwise be used to build essential infrastructure, such as housing and roads, analysts say. 

Treasurer Jim Chalmers is facing calls to cut back infrastructure investment to relieve inflation pressures and ramp up housing construction.

The Australia Institute says cutting back on fossil fuels is an easy first step to address this problem.

The think tank notes that over half of the $77.4 billion in total committed resource and energy infrastructure projects is slated for fossil fuels ($41 billion).

It says government approval of new coal mines or gas expansions takes resources away from the construction of essential infrastructure, with official data showing fossil fuel projects make up 53 per cent of the total funding committed to resource and energy infrastructure.

With the new fossil fuel projects taking up much of the construction supply chain, taxpayer money is helping fund private infrastructure that makes it harder to build public transport and housing.

As an example, in the NT alone, the analysts say the Commonwealth Government is spending $100 million on roads explicitly for the onshore gas industry.

“Every time the government approves new coal mines or gas expansions, it’s allowing projects to suck labour and equipment away from essential infrastructure like houses, roads, and railways,” said Greg Jericho, Chief Economist at the Australia Institute.

“Official government data shows that fossil fuel projects make up over half of all committed resource and energy infrastructure across Australia.

“This equates to $41 billion worth of new fossil fuel projects gobbling up the construction supply chain.

“If the government really wants to unclog the infrastructure pipeline and free up capacity to build housing, it could start by winding back the fossil fuel projects that have bunged it up in the first place.”