Jun 14, 2011

2011-12 Federal Budget – Consideration in Detail

Subjects: Warrego Highway (Blacksoil Interchange); Ipswich Motorway Upgrade & proposed Goodna bypass; Bruce Highway Upgrade (Section B, Cooroy to Curra); CASA & runway widths; REX & enroute subsidies; Sydney infrastructure; Parramatta to Epping Rail Link

ANTHONY ALBANESE – This year’s infrastructure budget is about setting Australia up to compete and prosper in the 21st century. It is a forward-looking budget. It delivers the next critical stages of work to duplicate the Pacific Highway, with an additional $1 billion in extra investment, subject to some matched funding for a proportion of that with $750 million from the incoming NSW government.

It funds reforms to make Australia a modern, seamless economy, including moving from 23 national regulators down to three, with an estimated benefit for the productive side of the economy of some $30 billion over 20 years. It delivers the National Urban Policy. It extends the smart infrastructure agenda that the National Broadband Network will enable. It continues nation building, particularly in regional Australia, providing funding of $395 million for our first Regional Infrastructure Fund projects and $300 million for early works on the Inland Rail, with $30 million coming online in 2013-14.

It reinstates Bruce Highway projects now that flood reconstruction is underway.

In total, Labor’s investment in regional infrastructure is some $22 billion. The budget also reforms Infrastructure Australia and provides a 40 per cent increase in its funding. It improves the operation of the infrastructure market. It delivers critical private financing reforms to attract up to $25 billion of superannuation and private investment into public infrastructure and it provides certainty for aviation infrastructure and services for remote Australia.

In total, the 2011 Budget provides some $950 million in new and accelerated investment for the Nation Building Program on top of the $395 million for Regional Infrastructure Fund projects. This is a budget that is fiscally responsible. We are able to invest for the future because Labor acted decisively during the global recession. As the world shed 30 million jobs, 740,000 more Australians went to work. This is a budget of which I am particularly proud. It was a fiscally responsible budget, but we were still able to pursue the Government’s nation-building agenda, including bringing forward funding, for example, for the Moreton Bay Rail Link of some $100 million – a major benefit indeed.

So this is a good budget from the Government. We have had a comprehensive approach. The budget builds on the work that has been done by Infrastructure Australia. I note that the incoming NSW government has paid a very high compliment to this government’s agenda by creating Infrastructure NSW, not quite on the model we have – ours is much more independent and at arm’s length from government – but, nonetheless, if imitation is the greatest form of flattery then it is a recognition of the work this government has been doing.

In addition, Infrastructure Australia will establish a new infrastructure financing group, chaired by Jim Murphy of the Commonwealth Treasury. The deputy chair will be Ross Rolfe, and the group will include other senior private sector members.

I spoke earlier today at the CEO Forum, made up of the CEOs of all the major international companies present in Australia, and this Government’s agenda has been extremely well received.

 

WARREGO HIGHWAY (Blacksoil Interchange Upgrade)

In terms of the issues that are raised, to begin with the Blacksoil Interchange, the local Member [Shane Neuman] would be pleased to know that today I signed off on the Commonwealth government contribution to the Blacksoil Interchange. Consider this a press announcement.

It is a very important project, and I did indeed stand there with him during the election campaign. It is indeed a very dangerous piece of road.

 

IPSWICH MOTORWAY UPGRADE & PROPOSED GOODNA BYPASS

With regard to the issues raised by the Shadow Minister [Warren Truss], I must express some surprise at his choice of issues which he raises. He actually raises the Ipswich Motorway, where we have contributed well in excess of $2½ billion over a seven-year period, whereas they just talked about it and nothing actually happened.

As the Member stated, the Goodna bypass option and all sorts of other options were put around, but they did not actually do anything about it. I am very proud of the fact that I not only went to sections of the Ipswich Motorway and turned the first sod but also opened them.

During that period, there were literally thousands of workers inducted onto the site at a time when it was needed – a vital project which this Government is proud of delivering.

 

BRUCE HIGHWAY UPGRADE (Section B, Cooroy to Curra)

Quite rightly, the Member for Wide Bay [Warren Truss] quoted members talking about how bad the Cooroy to Curra section of the Bruce Highway is. Indeed, I will quote the local Member himself, who said:

“I’m always pleased when I turn off … You never feel completely safe on that road.”

He also said, as he has again tonight, that it was rated as the worst piece of highway in Australia. Well, he was the Minister for Transport and Regional Services, it was in his electorate, and nothing happened. It is extraordinary that that statement would be put forward. Work is underway, as he would well know, on the Cooroy to Curra section, but it took a Labor government to deliver it.

He talks about the budget papers. The fact is that, in terms of both these projects, because we are a government that introduced in our 2010 Budget a system of milestone payments according to actual delivery and construction, we are getting efficiencies through the budget. Gone are the days when, on about 14 June, the minister would get the Department in and say, ‘How can we shove money out the door, because our only key performance indicator is the fact that money has been transferred from the Commonwealth to State Governments?’

We are actually delivering efficiencies, better value for taxpayers, and we make no apologies for this.

Is it the idea of the Shadow Minister [Warren Truss] that we should have paid extra money to the contractors even though we have delivered the projects for under what we budgeted for? This is a bizarre logic.

We have used that money to reinstate five flood-proofing projects on the Bruce Highway, because we anticipated that there would be capital shortages and labour shortages as a result of the flood and cyclone in Queensland. We always had the intention. We deferred it but kept the planning going, and we said that if we could we would bring them back on line according to the original schedule. That is exactly what we have done on these projects – something I am very proud of.

 

CASA & RUNWAY WIDTHS

The Shadow Minister [Warren Truss] also raises a number of other questions. With regard to the runway width issue, that is simply not correct. I am advised that CASA is introducing changes to runway widths over time but is working with industry regarding implementation and time lines. I would certainly be happy to work with the Member for Hinkler [Paul Neville] or anyone else on these issues.

 

REX & ENROUTE SUBSIDIES

With regard to the issue of Rex airlines, quite frankly I would commend the comments that have been made publicly by the Shadow Minister’s colleague the Member for Calare, Mr Cobb, in the Western Advocate just last week, in an article titled ‘Rex claims a flight of fancy, says Cobb’.

When talking about the threats to airlines, he said:

“So there is no justification for this action. There is no excuse to shut Bathurst down.”

He said:

“For Rex to say that it is all down to the loss of the federal rebate scheme, I don’t think is right, because they already got rid of the Cobar and Bourke runs very early on [when it was only touted that the scheme would go]. And if they are worried about capacity then look at bringing back the 19-seater.

“All it is is talk. They … really have no issues here.”

Frankly, that is absolutely the right thing to do. Indeed, it is extraordinary that the Shadow Minister [Warren Truss] again tonight has sought to blame the Government, when in fact he said in the Daily Examiner on 17 May:

“The subsidy only amounts to a few dollars a ticket. Airlines will not keep going just because there is a subsidy.”

He said:

“If people don’t use it, it won’t survive even with government subsidies …”

Quite frankly, in terms of the subsidies these are the facts. You people should be standing up against Rex, not playing political games.

The fact is that this is the maximum per claim one-way subsidy for a Sydney-Bathurst return: $11 per plane. The subsidy between Sydney and Moruya is a maximum of $20.25 per plane. The subsidy between Sydney and Taree is a maximum of $22.90. That compares with the price from Sydney to Taree of $129 per person. The subsidy between Griffith and Melbourne is a maximum of $37.92 per plane. And compare this: the cheapest one-way ticket per person between Melbourne and Griffith on Rex is $344 per person.

If you look at the capex of the airlines in Australia, last year there was no more profitable airline in Australia. And if you go to Singapore you can meet with Rex and have a discussion with them about their contribution to the regional airline market. But Rex shut down the Cobar and Bourke routes in 2008 and used the subsidy and the withdrawal in 2012 as the excuse for shutting down the route four years before the subsidy was due to end. Get real!

There is a sucker born every minute, but you do have a responsibility to your electorates to stand up for them and not to stand up for the commercial interests of any sectional interest.

 

SYDNEY INFRASTRUCTURE & PARRAMATTA TO EPPING RAIL LINK

I thank the Member for Bennelong [John Alexander] for his contribution. But now I am not sure if he is for the Parramatta to Epping Rail Link or against it. I know that he put out a leaflet on the day that we announced the Parramatta to Epping Rail Link which said that he supported it and called for it.

I note that the Opposition failed to commit a single cent to this project and I note that the Opposition failed to commit a single cent to any infrastructure project in Sydney whatsoever – not one. I note also that over twelve years the Howard government committed $350 million in total towards Sydney infrastructure – the M7, which was only Commonwealth funding.

Not a single cent went into any rail project and no dollars at all went into other projects.

We have committed and stood by our commitments to $2.08 billion for the Parramatta to Epping Rail Link; $110 million for the F5 duplication; $840 million for the Northern Sydney Freight Line; $150 million for the upgrade of the rail infrastructure at Port Botany; and $300 million to develop the intermodal terminal at Moorebank.

On top of that, we have $30 million for the planning work for the M4 East, available to the State government if they wish to use that funding.

In terms of the budget papers, it is very clear that, as committed, there is $600 million allocated in 2014-15, the first year of our commitment on the Parramatta to Epping Rail Link. Our funding is available. We simply await the State government to confirm that they want this project to proceed.

This is extraordinary. The honourable Member [John Alexander] comes into this Parliament and says he wants this project, while his political party is running a campaign of opposition to this project. I suggest that his questions be directed to the NSW branch of the Liberal Party, because we have allocated the money as we said we would.

This is a Government that fulfils all of its commitments with regard to infrastructure projects. Across the board, every single one of our election commitments is in the budget. It is not my fault the Member for Bennelong [John Alexander] cannot read a budget paper.

It is there in 2014-15: $600 million as agreed in terms of the memorandum of understanding that we had with the NSW government.

The fact is that this project was well received. The Member opposite [John Alexander] said:

“The construction of the Epping]Parramatta Rail Link is set to proceed, which is welcome news for the people of Bennelong.”

The Liberal Member for Mitchell [Alex Hawke] has also supported the project, as have the State Liberal Member for Granville [Tony Issa] and a number of other figures including, of course, the Lord Mayor of Parramatta [John Chedid].

The Member for Bennelong [John Alexander] was present at a speech I gave at Parramatta on 8 March this year about developing Parramatta as Sydney’s second CBD. I believe this is an absolutely vital project. It will finally provide the missing link between Parramatta and Chatswood and will help reduce the journey time between the two points by about 25 minutes. It will also have the bonus of improving capacity on the western line, therefore providing benefits for those people who live to the west of the existing Parramatta line.

We are now investing in urban passenger rail in every mainland capital city. We believe this is vital. What the honourable Member [John Alexander] has to answer is this question: does the Liberal Party support this project? Do they support it? You cannot say one thing as a local member and get away with it over three years, because your party is dead against this vital infrastructure project.

With regard to our commitment, you are right: we should keep our commitments. The State government should also keep theirs.

I commend the appropriation to the House.

[ENDS]