2012 ANNUAL REPORT

The road network continues to play a vital role in the State's economic prosperity. It provides positive outcomes that assist to improve people's quality of life. It also provides greater access to community services as the basis for creating a strong foundation into the future.

We have a significant part to play in helping industry and Government to unlock the potential economic and social benefits arising from the continuing strong resources economy. However, in seeking to meet community expectations and deliver government outcomes there will always be challenges to overcome and opportunities to capture and benefit from. The following provides a snapshot of some of those captured opportunities from the last 12 months and looks ahead into what our immediate future might hold.

Economic

As an organisation we need to ensure that we continue to be well placed in order to achieve the delivery of more than $5.5 billion in services over the next four years including, $1.7 billion of capital works and distributing $760 million in grants to Local Government. With our Portfolio Partners, Local Government and other agencies we will be working to deliver a range of significant major projects across the State.

Whilst major capital projects form a large part of the budget, it is imperative that we achieve the best value and outcomes from the equally important smaller initiatives on our program, especially in rural areas. In addition, we need to ensure that the objectives identified in our Integrated Service Arrangements are achieved as almost $1.4 billion is invested over the next four years in maintaining the road asset. Whilst we are still seeking to understand the full implications of the Carbon Tax it is apparent that it will have an impact in terms of costs associated with management of the network and the delivery of our projects.

Social

Western Australia now has the fastest growing population in Australia with the most recent figures showing an increase of 2.6% to almost two and a half million people. The latest projections show that the State's population will reach three million people before 2026; these new figures are around 400,000 higher than previous projections made just five years ago. Our task is to serve the needs of a growing population while addressing the impacts this has on meeting land use and access needs of individuals, the community and business.

Responding to this significant change in our communities and meeting both new and additional needs of road users as a result of that change is a growing challenge. The State's vehicle fleet continues to grow at the fastest rate in Australia. In less than a decade, there will be a 30% increase in kilometres travelled. In response to this increasing urban congestion, the Transport Portfolio will need to work together to maintain the quality of life and meet the access needs of individuals and the community. This will be occurring in an environment where growth in the freight sector is expected to almost double from 2008 levels by 2030.

We have a clear and important responsibility in contributing to the solutions that will address these growing concerns. It will be a great challenge to provide services that will enable the community to make more informed travel decisions as well as to achieve a better integration of transport modes to improve productivity, efficiency and safety. We will be strongly supporting a transport system that supports shared access including walking, cycling, public transport and use of all forms
of vehicles.

Environmental

Our natural environment is a valuable asset that is subject to many pressures, including the loss and degradation of native vegetation which is seen as a long-term issue. Developing and managing an extensive road network creates such pressure but is also an opportunity to make gains in biodiversity, the efficient use of natural resources and reductions in carbon-based emissions. In addressing environmental challenges, a key focus will be on continuing the development of our people to be more effective in fulfilling their environmental responsibilities and endeavours. We will be seeking
more consistent outcomes in land rehabilitation, roadside habitat preservation, and reducing carbon emission intensity across our business.

In terms of climate change, we are proactively looking to manage the road asset and its use in a way that seeks to reduce the significant contributions that transport makes to carbon emissions and the resultant impact that has on communities, the economy and the environment. Climate change is predicted to have a significant impact on transportation, therefore affecting the way we plan, design, construct, operate and maintain our infrastructure. Decisions taken today related to the redesign and retrofitting of existing infrastructure, or the location and design of new infrastructure, will affect how well our network is able to adapt to climate change into the future.

Looking Ahead

This year marks the end of our current Strategic Plan, 2k12, and significant effort is going into the development of our next Strategic Plan, 2020. We have decided to build our Plan on the highly successful scenario-based planning approach, previously used. We will take all challenges and opportunities into account as we work with our stakeholders and partners to deliver integrated transport solutions through enhanced road services aimed at improving the travel wellbeing of all Western Australians.