Jun 18, 2009

Address to BITRE’s 2009 Infrastructure Colloquium

ADDRESS TO BITRE’S 2009 INFRASTRUCTURE COLLOQUIUM

INFRASTRUCTURE FOR THE NATION’S FUTURE

Great Hall, Parliament House, Canberra

18 June 2009

The Hon Anthony Albanese MP

The Minister for Infrastructure, Transport,

Regional Development and Local Government

Leader of the House

Member for Grayndler

It is my pleasure to be here today to welcome you all to the ninth BITRE colloquium.

The theme for this year’s discussions – Infrastructure for the Nation’s Future – is timely.

Indeed, it is a good description of the Government’s response to the global economic recession.

Economic recovery through nation building has been a key part of the Government’s response to the global recession.

And the evidence suggests that our efforts are working.

We are the only OECD country that is not in recession or experiencing negative growth.

Treasury analysis has confirmed that without the Government’s cash stimulus payments, Australia would have entered a recession.

That said, the global recession still has a long way to go.

We must continue to work hard to bring our infrastructure investment online to create jobs and support economic growth.

The currency of this debate gives real relevancy to the discussions you will have over the next 2 days.

Nation Building for Recovery

Let me begin by outlining for you in more detail how the Government views infrastructure as key to the nation’s future.

Since the global recession began, the Government has taken quick and decisive action to lessen the impact on the Australian economy.

We are supporting jobs and boosting national productivity through strategic investment in infrastructure.

Specifically on transport infrastructure, the Budget provided $36 billion over six years, including $8.5 billion in new funding.

Of the 15 new transport projects being funded in the Budget, nine are rail projects in our major cities.

These projects will provide cleaner, greener, faster public transport services.

Less traffic on our roads will help reduce travel times and costs, make our roads safer and lower greenhouse emissions.

In addition, the Government is funding 4 nationally significant road projects on Australia’s key freight and passenger corridor from Melbourne to Cairns – Network 1 – totalling $3.4 billion.

This Budget also allocated $389 million for the first significant Commonwealth investment in our ports.

These funds are essential to expanding our export capacity and giving Australian businesses better access to global markets.

These investments provide the building blocks for our future productivity and prosperity.

Our investment will provide a sustained boost to our economy in the short term.

In the long term, it will enhance the productive capacity of the economy.

In short, we are supporting jobs today by building the infrastructure we need for tomorrow.

The Government’s decisions were guided by Infrastructure Australia’s national priority list – a significant change to the process for making infrastructure investment decisions.

Projects were prioritised by an independent advisory body comprising representatives from the public and private sectors.

They were prioritised on the basis of national priority and their long term benefits to Australia.

This marks the breaking of the nexus between the investment cycle and the electoral cycle.

Our Budget announcements build on our earlier efforts to support the nation’s economy through nation building infrastructure as part of the Government’s December $4.7 billion package for road, rail and education infrastructure and February’s $42 billion Nation Building and Jobs Plan.

The significance of the Government’s contribution to nation building in response to the global recession is highlighted in BITRE’s Australian Transport Statistics Yearbook for 2009, which I am releasing today.

The Yearbook collates historic data on a range of transport infrastructure.

It shows that for the six year period up to 2006-07 total road expenditure by the Commonwealth totalled $16 billion.

In comparison, this Government has committed $28 billion to road investment over six years – the biggest road investment program in our nation’s history.

On top of this, we are spending $7.9 billion over 6 years on passenger and freight rail.

This includes a significant investment in passenger rail infrastructure within our cities – the first ever national government to do so.

All up, we are investing more on rail in the next 12 months than the previous government did in 12 years.

A competitive, safe and reliable network is critical to lifting productivity, curbing the escalating cost of traffic congestion and tackling climate change.

National transport reforms

The Government recognises that infrastructure investment needs to be complemented by real reform.

I am working with my state and territory colleagues, through the Australian Transport Council, to advance regulatory reform to move Australia towards single national transport markets for maritime, rail and heavy vehicles.

At our most recent meeting in May, we agreed to propose to COAG the establishment of a national heavy vehicle regulator with responsibility for regulating all vehicles over 4.5 gross tonnes.

We will also be proposing that the Australian Maritime Safety Authority (AMSA) become the national regulator of all commercial vessels operating in Australian waters.

Further, we have agreed to recommend the creation of a national rail safety regulator, with the Australian Transport Safety Bureau (ATSB) to become the preferred investigator of rail accidents.

These significant reforms will be considered at COAG’s next meeting on 2 July.

Agreement on these reforms followed the finalisation of Regulatory Impact Statements which concluded they were in the nation’s long term economic interest.

In all three areas, the significant differences in regulations between the eight state and territories make it complex and costly for companies that do business across state borders.

Together with the states and territories, the Rudd Labor Government is putting in place a seamless national economy that will lift national productivity and allow transport operators to get products onto supermarkets shelves and exports to market quickly and at the lowest cost.

Investing in Australia’s Cities

The Government’s investment through the Budget in passenger transport reflects our recognition that our cities are key drivers of national productivity.

While Australia’s regions contribute 61 per cent of our export income, we are one of the most urbanised countries on earth.

And our cities are growing.

Our capital cities contribute nearly three-quarters of Australia’s total economic activity.

And, as revealed by BITRE in its latest information sheet, our capital cities generated 65 per cent of net job creation in the five years to 2006, while 15 per cent occurred in the country’s other main cities.

The adequacy of infrastructure in our major cities has a real impact on both the quality of life of their residents and the productivity of our economy.

For example, if trucks carrying produce from the farm gate get stuck in lengthy delays in our cities on the way to port, this impacts on the whole nation’s productivity.

In fact, BITRE estimates the avoidable cost of urban congestion at $10 billion a year, and forecast it will double by 2020 if we do nothing about it.

In recognition of the importance of our cities when it comes to national productivity, last year the Government established the Major Cities Unit.

The Unit, which is co-located with Infrastructure Australia, provides advice to Government on infrastructure and planning issues of relevance to major cities.

Indeed the Unit has provided expert advice on urban issues as part of Infrastructure Australia’s deliberations and contributed to the Transforming our Cities section of the Infrastructure Priority List.

In particular, their focus is on economic productivity, liveability and sustainability.

A key focus of the Unit is on the preparation of a National Urban Policy, which will present a long-term strategic framework for the sustainable development of our cities.

The National Urban Policy centres around a vision for cities that are prosperous, liveable and sustainable.

It will articulate the responsibilities, expectations, strategies and actions required of governments, the private sector and the community to transform our cities.

In the Budget, we announced our first major cities infrastructure initiatives to improve the productivity, liveability and sustainability of our cities.

This included funding of $236 million for the Northbridge rail link in Perth and $61 million for the O-Bahn extension in Adelaide.

Conclusion

In conclusion, the Government has embarked upon an historic nation building agenda to create jobs in the short term and boost national productivity in the long term.

We strongly believe that good, well-planned infrastructure is vital for our nation’s future.

This year’s colloquium provides an excellent opportunity for the exchange of research and ideas on infrastructure investment.

Your discussions over the next two days will seek to draw out new ideas for investing in our nation’s future.

I wish you well and look forward to hearing about the outcome of your discussions.