An aerial view of roadworks on Haly Street, Kingaroy late last year … heavy rainfall in the October-December quarter slowed construction and high inflation further increased costs (Photo: SBRC)

April 28, 2022

South Burnett Regional Council is putting an extra $900,000 towards the Kingaroy Transformation Project to compensate for inflation, supply shortages and delays caused by heavy Spring rains.

At Wednesday’s general meeting, councillors were told that since the KTP’s estimates were drawn up 18 months ago, costs in the construction industry had risen by between 7 and 16 per cent.

Council staff said this inflation was being caused by a combination of government stimulus and heavy activity in the building and infrastructure sectors, combined with supply issues caused by COVID-19.

They said the project had also been affected by recent wet weather, which led to the region being disaster-declared three times between October and December last year.

This was a peak construction period and more than 500mm of rain in that quarter required the project to adapt its construction methods to remain on schedule.

Officers said in most circumstances, the impact of these market and weather conditions could increase total project costs by between $1.5 million to $2 million.

However, due to current efficiencies and acceleration of the KTP program, they anticipated the increase could be held to $900,000, which was about 6.4 per cent of the Council’s KTP budget.

The estimated cost of the KTP was originally projected to be $8 million in 2017.

But after the Federal Government’s Building Better Regions Fund agreed to contribute $4.5 million towards it and other adjustments, the budget expanded to $13.9 million in late November 2020.

Councillors voted to approve the latest increase using part of the funds from the Council’s 2022-23 infrastructure budget.

Landscaping, lighting and footpath surfacing is expected to begin soon.

Footnote: On Wednesday, the Australian Bureau Of Statistics reported Australia’s annual inflation rate was currently running at 5.1 per cent – the largest increase since the introduction of the GST in 2000. They also reported that inflation on residential building costs was estimated to be 27 per cent over the same period.

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