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Smoother infrastructure planning needed to avoid 'traumatic' booms and busts

Jenny Wiggins
Jenny WigginsInfrastructure reporter
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Infrastructure and resources projects need smoother planning from both government and the private sector, to avoid booms and busts, says the incoming chief executive of UK consultancy group RPS, John Douglas.

"Sydney is very, very hot at the moment but Western Australia is not," Mr Douglas told The Australian Financial Review. "One of the reasons you're seeing increasingly transnational and international firms is that we all need to move people around."

It was "incumbent" on companies to help manage peaks and troughs by moving people from place to place, but governments also needed to ensure there was "a steady stream of projects", such as the surge in infrastructure work now underway in Sydney, he said.

John Douglas, formerly head of Coffey International, will take over as chief executive of RPS. Michel O'Sullivan

​"As an Australian engineer, I would have liked to have seen that follow more closely on from the mining boom – there were unfortunately people who lost jobs and who are now being rehired but it's been a traumatic process."

Mr Douglas, who was previously CEO of engineering group Coffey International for five years and restructured the business before it was acquired by Tetra Tech in early 2016, will run one of Coffey's competitors, RPS, after being hired as its new CEO.

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Mr Douglas starts at RPS in June and will succeed the current CEO, Alan Hearne, when he retires at the end of August after more than 30 years at the helm.

RPS, which has £594.5 million in annual revenues and £56 million in annual operating profits, derives about 20 per cent of its segment profits from Australia. Of its 5000 staff globally, around 1000 are based in Australia.

Historically, RPS has focused on oil and gas projects, providing services such as environmental reviews, planning surveys and project management.

But the company has done a "very credible job" of refocusing its expertise on infrastructure projects, partially through acquisitions, and now faces a growth challenge rather than a restructuring challenge, Mr Douglas said.

RPS bought Canberra-based Point Project Management in 2014 and acquired Sydney-based Everything Infrastructure Group in 2015.

RPS has worked on several big Australian infrastructure projects including the new Sydney Metro and the new Western Sydney Airport as well as Perth's Elizabeth Quay.

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Mr Douglas, who did a year of law study at the University of Sydney after leaving Coffey, said he would like to continue expanding the Australian business and that RPS investors, who are mostly based in the UK, expected ongoing growth from the company.

"It's a really fascinating time to run a global business because the UK is redefining its relationship with Europe because of Brexit and the other really interesting question that will be played out in the next few years is that we've seen really significant regime change in America," he said.

North America has traditionally been RPS's fastest source of growth but Australia contributed a bigger proportion of profits than North America in 2016.

Mr Douglas is also keen to ensure RPS, an acronym that came from the name Rural Planning Services, becomes more well-known.

"I think it's a bit of a quiet achiever, its reach extends its recognition," he said. "Being a quiet achiever is a great thing but I think we can probably get more leverage off the brand."

Jenny Wiggins writes on business, specialising in infrastructure and transport. Connect with Jenny on Twitter. Email Jenny at jwiggins@afr.com

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