Mar 13, 2014

The Folly of Indifference – Address to the ADC National Infrastructure and Cities Summit

It’s great to be here today to address your conference at the Sydney Cricket Ground, the site of so many famous cricketing battles over the decades.

And of course South Sydney’s last grand final victory way back in 1971, where my Mum braved the Hill to take me to what is one of my fondest childhood memories.

I was just a little fellow and I have a very strong memory of being literally tossed in the air by fellow Bunnies fans as we beat St George by 16 points to 10.

It’s also humbling to be speaking in the Steve Waugh room.

I’m not sure he if he barracks for the Bunnies but, but I have to admit I am a huge Steve Waugh fan.

I’ve always admired his tenacity and focus.

He is a great role model for anyone, including a person like me, whose battles take place in the arena of ideas, rather than on a cricket pitch.

THE LABOR VISION

It is fitting that we are sitting in a huge public sporting facility as we discuss urban policy and infrastructure planning. 

This ground has stood here since the middle of the 19th century – close to the centre of Australia’s largest city.

Imagine the amount of work that has been done over the decades to balance the development of the SCG with the needs of its surrounding community and the development needs of Sydney as a whole.

Imagine also how authorities have had to tackle issues like the efficient movement of people to and from the ground and the provision of infrastructure like water, sewerage and power.

Effective planning of our cities is critical, particularly in Australia, which is among the most-urbanised nations on the planet.

Cities need to be efficient, not just because they are home to millions of people, but also because they are home to industry and jobs.

If cities work well – if people and goods can move around them with ease – their efficiency fuels growth in economic productivity which in turn creates jobs and prosperity.

But if cities are congested and inefficient, stagnation is the result.

Today I want to outline Labor’s vision about the role of the Commonwealth in infrastructure planning and delivery.

I’ve had a serious interest in this critical policy area for most of my professional life.

Indeed, my first job in politics was working for the great Labor reformer Tom Uren, whose nation-building achievements fit squarely within the great Labor tradition.

Careful decision making about our cities can extract huge benefits for the community – not just in terms of urban amenity, but also when it comes to the economy.

The question in dispute in 2014 appears to be this: which level of government holds the key to unlock these benefits.

I accept that councils and state governments are the main players with responsibility for transport, utilities and town planning.

However, I also understand that in a market economy, where developers, planners and regulators all act on different impulses, the Commonwealth must provide leadership on urban policy and infrastructure.

Without that leadership, we sell our nation short; we deny it the full value of potential productivity gains and, in doing that, we reduce our ability to turn those gains into new jobs.

My view: the Commonwealth must lead the process by providing national leadership and by establishing a framework for sensible decision-making.

While final decisions are obviously the province of elected representatives, without an impartial evidence base to guide them, we open the door to bad decisions made on the basis of political considerations, rather than on the basis of the national interest.

The Commonwealth can also lead on investing in infrastructure – helping states and councils to fund the big, game-changing projects that optimise urban productivity.

I see infrastructure development as a joint responsibility of all levels of government – a partnership in the national interest.

Traditionally, Coalition governments have taken a different view. They tend to take a hands-off approach to urban policy, disavowing any leadership role and generally leaving investment to other levels of government.

These two approaches could not be more different and the difference will become more and more marked in coming months. 

LABOR’S VISION IN PRACTICE 

When Labor took office in 2007, we set about turning our vision into reality.

As the responsible minister, I used as my touchstone Labor’s history of nation building.

Nation building is not just a political slogan. It has been Labor’s aspiration across the decades.

Think about projects like Andrew Fisher’s trans-national railway, Chifley’s Snowy River Scheme or, in the future, high-speed rail down the nation’s east coast.

We think long-term.

One of my first actions after taking office in 2007 was to ask the officials who were reporting to me to introduce me to their urban planners.

I was keen to engage the bureaucracy’s finest minds.

I was stunned by the response.

It turned out the Commonwealth had no urban planners – not one.

That’s why we created the Major Cities Unit to drive urban policy within the new Department of Infrastructure and engage with other levels of government.

We were also anxious to have industry input, so we appointed the Urban Policy Forum, composed of industry experts, to provide independent advice.

But our most-profound reform was the creation of Infrastructure Australia to build a genuine framework around infrastructure investment.

Infrastructure Australia was deliberately designed as an independent research organisation tasked with working with states to audit the nation’s infrastructure needs and rank them according to their potential to boost national productivity.

IA’s brief was to collect evidence and ignore extraneous factors such as the political interests of the government of the day.

Crucially, IA’s findings were published so that the public could engage with the process.

In this way citizens, in possession of the same advice as had been given to the government, could make their own judgements about whether governments were nation building or pork barrelling.

In other words, we attempted to decouple the infrastructure planning process, which is necessarily long, from the political process, which works to shorter-term deadlines.

The ultimate vision was for IA to deliver a pipeline of major infrastructure investment projects which both sides of politics could embrace over multiple electoral terms.

Infrastructure Australia later produced a priority list of 15 major projects across the country.

The government funded them all.

Here are a few figures that tell the story of the former government’s efforts to address the infrastructure deficit we inherited:

  • When we took office, national spending on roads, railways and public transport was worth the equivalent of $132 per capita. When we left the figure was $225 per capita.
  • When Labor took office Australia was 20th among 25 OECD nations in terms of infrastructure spending at a proportion of GDP. Australia now tops this list.
  • We doubled the roads budget to $46.5 billion, allowing us to build or upgrade 7,500km of roads.
  • We rebuilt 4000km of railway track. As a result, by 2016, the average rail transit time between Brisbane and Melbourne will be seven hours shorter than it was in 2005. The journey from our nation’s east coast to its west coast will have been reduced by nine hours.
  • Because of this investment Woolworths is now moving much of its produce on the nation’s railway tracks, taking trucks off the road and reducing carbon emissions.
  • Labor also committed $13.6 billion to congestion-busting urban passenger rail projects around the country – more than all previous commonwealth governments put together.

Like all governments, we made our share of mistakes.

But on infrastructure, I remain very proud of our record.

THE ABBOTT GOVERNMENT 

I don’t want to get too political today. An audience like this has heard it all before when it comes to political brawls.

But I want to describe the emerging Coalition Government’s approach because I believe the radical differences between it and Labor’s approach will have serious negative implications for our cities.

The Coalition’s world view is that infrastructure is about regional roads and railway lines and that urban policy is a matter for other levels of government.

The Prime Minister has made clear, for example, that he does not believe in investing in urban rail.

That’s why we can expect that the first Abbott Budget, to be brought down in May, will slash literally billions of dollars that Labor allocated for major public transport projects.

When Mr Abbott announced his first ministry, it was immediately obvious to me there that no-one was responsible for urban policy.

The closest you get is the Minister for Environment, Greg Hunt, who addressed this meeting earlier today.

One of the incoming Coalition government’s first acts was to abolish the Major Cities Unit.

The result: once again we will have no planners in Canberra.

The Urban Policy Forum has not been convened since the election and is not expected to meet again.

The result: No planning sector perspective is being presented to government.

Perhaps you are starting to pick up on a theme here: the government is systematically winding back the previous government’s infrastructure reforms.

Where this trend becomes truly concerning is the Government’s plans for Infrastructure Australia.

Legislation now before the Senate will bring what was designed to be an independent adviser well and truly under the yoke of executive government.

The Infrastructure Australia Amendment Bill (2013) will give the minister the power to dictate IA’s research agenda.

The minister will have the power to exclude entire classes of infrastructure, such as public transport, from its considerations.

If you are serious about obtaining the best results, you can’t exclude some options simply because you have entrenched views about the roles of different levels of government.

The legislation also gives the minister the power to restrict publication of Infrastructure Australia’s research findings.

That is the very antithesis of transparency.

The Infrastructure Australia Amendment Bill 2013 is bad legislation.

Don’t take my word for it.

The Business Council of Australia, in a submission to a Senate committee inquiry into the changes, insists that IA should be unrestricted in its ability to evaluate all high-value infrastructure projects.

The submission says and I quote:

It is unclear why there should be a need for a power to carve out ‘classes of projects’. 

Good planning should prioritise any infrastructure projects of the highest economic and social value and not differentiate by project class.

The BCA also opposes ministerial powers to ban publication of IA research findings, arguing that (and again I quote): 

Publication of evaluations should be the norm except where there is a justifiable reason not to do so. 

Major submissions agree, including those from the Urban Development Institute of Australia, Infrastructure Partnerships Australia and, most significantly, the submission from Infrastructure Australia itself. 

Let me return to the approaching Federal Budget which I expect will take a razor to urban infrastructure spending.

Before last year’s election, Labor negotiated with state governments joint funding arrangements for billions of dollars’ worth of investment in urban rail projects including:

  • Brisbane’s Cross River Rail project.
  • The Melbourne Metro;
  • Adelaide’s Tonsley Park public transport project.
  • Perth’s airport rail project and light rail proposals.

Instead, the current government will fund two major road projects judged by Infrastructure Australia to be of less potential to enhance productivity than the public transport projects that are about to be scrapped.

These are the East-West Link and Melbourne and Sydney’s WestConnex project.

IA has yet to see full and final business cases for either of these projects, despite the Coalition’s election promise to conduct a full cost-benefit analysis for any project worth more than $100 million.

A BETTER WAY 

An exclusive focus on roads and an indifference to urban passenger rail will not ease congestion.

I want to make clear here that Labor has no ideological opposition to building roads. Our funding record proves that.

But if we are serious about efficiency in our cities, surely we invest scarce taxpayer dollars on whichever mode of transport provides the greatest productivity return.

We need to be modal blind, if you like.

We need to deliver a fully integrated transport system – one that plays no favourites and aims for efficiency and cost-effectiveness.

It makes no sense for our cities to have better roads if the planning for those roads happens in a silo and is not integrated with other transport modes.

If we work together, we harness all available expertise. And if we drop the arbitrary ideology, we can achieve better outcomes for everyone.

URBAN POLICY 

While transport is a critical element of urban policy, it’s only part of the leadership equation.

The Commonwealth should also work with states on urban planning and building design as well as in doing what we can to preserve community amenity as we constantly strive to remake our cities.

We need to work with states to ensure that housing density is increased around existing public transport corridors.

And to preserve equity, the Commonwealth needs to take a role in providing public housing options along the same corridors, rather than just dumping it on the edge of town where there are no services.

The Commonwealth has a role to play in helping states ensure that housing development on city fringes is conducted in an orderly manner and that services like sewerage and water, as well as community infrastructure, keep up with the spread of development.

Such issues require Commonwealth engagement with other levels of government.

The 2013 edition of the State of the Cities reported a strong trend toward growth in technology-related, high-paying jobs in our inner city areas.

But it also found that despite this jobs growth in urban areas, population growth was focused on the edge of cities.

That’s a challenge for policy makers to address by working together to amend planning rules to encourage greater population density closer to employment growth hot spots in cities.

More broadly, the Commonwealth needs to engage on what it can do to create jobs in the suburbs.

In Sydney, we seem to be headed in this direction with the Government continuing Labor’s push toward the development of a second Sydney airport.

A second airport will drive growth in high-value jobs in the transport and logistics sector as well as indirect jobs in the service and tourism sectors.

The infrastructure development required by a second airport will have major benefit for other industry development in the region.

This comes with the development of the Moorebank Intermodal terminal that will create thousands of jobs in construction as well as thousands of ongoing jobs.

We know this will happen because we have seen in before.

Government investment in the Westmead Hospital’s research precinct has created significant jobs growth in Parramatta and has resulted in a large number of local residents being engaged in medical research and science.

These are examples of what the Commonwealth can do if it chooses to be engaged in urban policy:

  • If it chooses to work with other governments, the private sector and local communities themselves.

Such an approach is vital if we want our cities to be dynamic and productive, rather than just random collections of pockets of advantage and disadvantage.

As urban economist and urban policy thinker Edward Glaeser has said and I quote: The best cities … provide pathways for those who start with less to end with more.

You can’t secure such outcomes if the commonwealth says such issues are none of its business.

CONCLUSION 

Infrastructure and urban planning in this nation is at the cross roads.

This is not the time for a u-turn.

The Coalition took office with the benefit of Infrastructure Australia to provide an evidence base for non-political decision making so that it could invest in the right projects at the right time in a way that would maximize community benefit.

It also inherited skilled planning expertise in the Major Cities Unit and the Urban Policy Forum to gather views from the sector.

And it inherited a Budget in which major infrastructure projects, including congestion-busting railway projects in our cities, had been developed, negotiated and funded.

Less than six months later, the government has sacked its own experts, sidelined its industry advisers and is in the process of politicizing Infrastructure Australia and stripping the Budget of funding for projects which would truly transform many of our cities.

It does not have to be like this.

Orderly planning and efficient use of public money ought to be a bi-partisan goal.

But it requires leadership.

Throughout recent decades effective delivery of urban policy has been an on-again, off-again affair.

Progressive governments want to be involved in cities.

Urban policy is the engine room of productivity growth.

We know that if cities are productive, sustainable and liveable, the whole nation prospers.

I believe there is community support for this approach.

At a gathering of this kind it is appropriate to conclude with a reference to where I began this address – our current location.

Those who worship individualism and argue “there is no such thing as society’’ have got it dead wrong.

The experience of those who come to the SCG, whether to cheer the Aussies, the Swans, South Sydney – or even to be part of the Barmy Army, are cheering for more than themselves.

They are affirming their identity, their history and their community.

Cities are extraordinary gatherings of people and in the past decade became home to most of the world’s population.

They work only if there is a sense of community.

And we can only create a sense of community if we get the planning and infrastructure right.

That can only happen if governments are prepared to show vision and leadership.

Thanks for your attention.

END

 

Contact Anthony

(02) 9564 3588 Electorate Office

Email: A.Albanese.MP@aph.gov.au

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