Jul 18, 2018

Speech to the Inland Rail Conference – Getting Inland Rail Right – Parkes – Wednesday, 18 July 2018

Let me start by congratulating the Australasian Railway Association and the Australian Logistics Council for staging this important conference.

With day-to-day politics dominating the media, it’s always a good idea to take time out for serious consideration of policy issues that bear upon the national interest.

When we are talking about construction of a 1700km freight rail line servicing some of our nation’s most-important agricultural precincts, the national interest looms large.

Inland Rail will become one of the nation’s most important pieces of infrastructure.

It will still be in use a century from now.

That means we need to get it right.

That’s why as the Federal Minister I commissioned the comprehensive study into the project. The Labor Government subsequently invested $600 million in upgrading the existing tracks that will form part of the route and allocated a further $300 million in the 2013 Budget to progress the project.

Today I reconfirm Labor’s support for this classic nation building project.

It’s the sort of infrastructure that will drive development by improving access to reliable freight transport, particularly for primary producers.

Quicker passage of goods to port reduces costs, which will make our producers more competitive and give them greater resources to invest in increased production.

The productivity gains will fuel job creation and economic growth in communities that are crying out for economic stimulus.

Nowhere is this more the case than right here in Parkes, which is set to become Australia’s most important inland logistics hub, given that it is where the East-West route will meet Inland Rail.

However, as is the case with all major infrastructure projects, it’s important to get the details right.

Governments like to make big announcements.

But what is more important is ensuring the projects that they announce are viable, properly financed and subject to achievable deadlines.

That’s where Labor has some issues with Inland Rail.

For a start, the project is behind schedule.

According to a Coalition media statement from 28 August, 2013, construction of Inland Rail was meant to commence within three years: by the middle of 2016.

Two years on from the expiry of that deadline, the final route alignment has still not been finalised and environmental approvals have not been sought, let alone given.

We also have no details of the public-private partnership that will deliver the most challenging part of the project – the section through the Great Dividing Range in South East Queensland.

There is also the fact that the project does not go to the Port of Brisbane.

It stops 38km away, at Acacia Ridge.

It was only in this year’s Budget that the Commonwealth turned its attention to this problem by jointly funding a $1.5 million study with the Queensland Government.

That was a good decision, if somewhat late in the process.

Of course, it also doesn’t go to the Port of Melbourne.

Just because it’s called Inland Rail, that shouldn’t be taken so literally that it doesn’t go to a port.

Other issues about the route, including the section between Narromine and Narrabri, must also be resolved to ensure it maximises the benefit of the project, while minimising any negative impact on the communities which will be affected.

FINANCING

Most worryingly, doubt remains about the Government’s plan to finance Inland Rail via an $8.4 billion off-budget equity investment into the Australian Rail Track Corporation.

The problem here is that for a project to be financed off-budget, it must be able to make a return to the Budget.

That is, a commercial rate of return on capital investment as well as on operating and maintenance expenses.

But, as was clear from the 2015 implementation study into the project, conducted by former Deputy Prime Minister John Anderson, Inland Rail’s revenues will not cover its capital cost over 50 years of operation.

It is clear from Senate Estimates that the Government is considering ARTC’s overall revenue, including the profitable Hunter Valley Coal Network, rather than this project itself, to avoid any investment contributing to the Budget bottom line.

Of course, it is also the case that the long-term lease arrangements between the ARTC and both the Victorian and NSW Governments have not been finalised, which is essential for Inland Rail to have the certainty the project needs.

I’m not the only one to have made these observations about uncertainty over financing.

Yet the Government has been reluctant to even discuss the issue.

That uncertainty must be resolved.

We need greater transparency over planning and an honest conversation about the project and how much grant funding the Government expects will be required to make it a reality.

We all know that Inland Rail isn’t going to build itself.

It’s important that all of us – elected representatives, industry and, most importantly, the community – are fully informed upfront about the real financing profile.

RAIL RENAISSANCE

Of course there is nothing new about rail being seen as a driver of economic development.

This has been a critical element in industrialisation and modern history.

From bridging the Australian continent, opening up the American West and, more recently, driving economic development of our Asian neighbours, rail has been history’s greatest facilitator of progress.

In the 21st century, even though it has more competitors in the transport sphere, rail keeps rolling on.

Indeed, it is having something of a renaissance.

Across the globe, urban rail and high speed rail are being rolled out as nations and cities modernise their transport systems to bring them up to task for the 21st century.

Here in Australia, states are investing in projects like the Melbourne Metro, Brisbane’s Cross River Rail and Perth’s METRONET and planning is under way for Western Sydney Rail and the Melbourne Airport Rail Project.

When you add Inland Rail and High Speed Rail to the equation, it is clear that this nation is going to invest many billions of dollars on rail in coming decades.

To serve the national interest, we must maximise the involvement of Australian industry in these projects.

In coming years we will lay thousands of kilometres of track and will require vast amounts of rolling stock.

That’s a huge challenge.

But if we are smart, we will turn the challenge into an opportunity by planning now to give Australian companies a piece of the action.

We should be using Australian standard steel.

And rather than buying the new rolling stock offshore, we should build it here.

If we approach this challenge properly, we can use the coming revolution in rail to re-energise Australian manufacturing.

We can train thousands of young Australians so they have skills fit for the 21st century, not just in rail, but across a range of advanced manufacturing applications.

That’s why a Labor Government will implement a National Rail Plan.

Our plan includes establishment of an Office of National Rail Industry Co-ordination to undertake a national audit of the adequacy, capacity and condition of passenger trains nationally.

The Office will work with states to develop train priority plans, including a proposed delivery schedule for the next 10 years to iron out peaks and troughs in procurement.

Labor will also reinstate the Rail Supplier Advocate, abolished in 2013, to help small and medium-sized businesses get their foot in the door for government contracts.

LABOR’S RECORD

Labor’s National Rail Plan builds our long-standing support for rail and its place in driving productivity and economic growth.

The former Labor Government rebuilt 4000km of the interstate freight rail network.

We began the process of separating freight and passenger lines in Sydney and Adelaide and put in place the arrangements for development of the Moorebank Intermodal Terminal.

On public transport, we invested more in urban rail than all other Commonwealth governments combined since Federation.

The biggest public transport investment from any Federal Government was our contribution to Victoria’s Regional Rail Link which untangled suburban and regional passenger rail lines in Melbourne, to the benefit of Ballarat, Bendigo and Geelong.

CONCLUSION

Once again, thanks for inviting me to this conference. I have come to Parkes today to recommit Labor’s support for Inland Rail. I do so with because I believe in its potential to serve the public interest for decades to come. I hope that future generations will look back at decision makers of our time and thank us for our vision.

However, for their sake, it’s this simple: We must get this project right.

 

Contact Anthony

(02) 9564 3588 Electorate Office

Email: [email protected]

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