Aug 1, 2008

Adress to Infrastructure Partnerships Australia 2008 Conference

Adress to Infrastructure Partnerships Australia 2008 Conference

Friday, 1 August 2008

Four Seasons Hotel, Sydney

The Hon Anthony Albanese MP

Minister for Infrastructure,Transport,

Regional Development and Local Government

Leader of the House

Thanks very much Mark for that warm and generous introduction. It seems like a lot longer than 12 months ago that I stood here as the Shadow Minister for Infrastructure after being introduced by yourself.

I’m pleased to be back here with that one little important word removed from my title; Shadow.

I’m also pleased to be here as Australia’s first Infrastructure Minister. Twelve months ago, I said that a Rudd Labor Government would have an Infrastructure Minister and that we would have an Infrastructure Department – and we did just that in the executive orders.

I said that we’d create a new body, Infrastructure Australia, which would provide for national coordination of infrastructure, and we’ve done just that. One of the first pieces of legislation that we introduced into the Parliament was the Infrastructure Australia legislation.

I said that we’d create a new form of policy development, that Infrastructure Australia wouldn’t be business as usual and that we’d attract the best and brightest from the public and the private sector.

I believe we have done just that in the creation of the Infrastructure Australia Advisory Council, headed by Sir Rod Eddington, with people of quality, such as your chair, Mark Birrell, who has brought in the years of work by IPA directly into the system.

I notice in passing that in the attendance at today’s conference we have direct interaction between IPA and Infrastructure Australia, which is to be encouraged. We want that consultation and engagement with the private sector well beyond the formal members of the council.

We want to involve each and every one of you in infrastructure development and in the policy development that goes to the Cabinet that determines our priorities.

We said we would develop an infrastructure priority list. All the states and territories have now submitted to the audit, and that infrastructure priority list will go to the COAG meeting in March of 2009.

We said that Infrastructure Australia would be a bit different, that it would be an agency separate from the normal way that the Canberra bureaucracy works. And we’ve done just that.

If you to the Deutsche Bank building up the road here you’ll see our Infrastructure Coordinator, Michael Deegan, who is here today, sitting in a brand spanking new office right in the heart of the financial district of Sydney.

This is very important.

It’s important in terms of the message that it sends about the linkages between Infrastructure Australia and the private sector. But it’s important also in terms of accessibility to the people who we want to have input into that process.

We said that there was a need for a new partnership, not just in terms of structure but in terms of reality. And we’ll do that. We will have as one of Infrastructure Australia’s first pieces of work, the harmonisation of guidelines on public-private partnerships.

To go a step further, let’s get some consistency in the way that contracts are written. Let’s remove some of the costs that in the end are being passed on to taxpayers in the form of higher costs of infrastructure development.

Our work has been based upon the commitments that I gave at this Conference last year.

But it’s also been based upon a view that IPA has held since its inception, and that the people in this room have devoted many years to, which is that infrastructure development isn’t something that’s at the fringes, that’s a footnote, that’s an afterthought, without a Commonwealth agency or Minister.

Infrastructure development is at the heart of the Rudd Government’s macro economic policy. We understand that infrastructure development is critical.

Today I want to address where it’s critical to three core government priorities.

Firstly, in terms of our economic development including our export potential. Secondly, in terms of the development of our major cities. And thirdly, in our plans to reduce carbon pollution.

As the constructors here all know, when you’re building something new, you’ve got to get the foundations right.

Infrastructure Australia is our foundation. It is the rock on which other reforms and policies will be built.

That’s why we’ve put such an effort into Infrastructure Australia. And I think that it is a key moving forward because it provides a concrete organisational base for the work that needs to be done.

But of course you’ve always got to put your money where your mouth is. And in the budget, in May, we did just that. We showed that we were fair dinkum.

The Rudd Government delivered an initial allocation of funding for long term infrastructure funds of some $41 billion. This took the form of $10 billion for health infrastructure, $11 billion for education, particularly universities and vocational education and training infrastructure and $20 billion into the Building Australia Fund.

Now there are some things that the Building Australia Fund is not.

What it is not is a business-as-usual fund whereby the states will sit down and tally up we’ve got 20 per cent of the population so we’ll bid for 30 per cent of the funds and end up settling back to 20. It’s not like that.

And I’ll say no to short termism, whether it’s to members of my own Caucus or state premiers or fellow ministers. Because what the Building Australia Fund is there for is to turn around projects which represent nationally significant infrastructure.

And can I say that in the constructive discussions that I’ve had with the states and territories, that’s widely understood.

I know that in Queensland, for example, I’ve had discussions with Andrew and with Anna Bligh and Paul Lucas and Warren Pitt and other ministers about what their priorities are.

In New South Wales I’ve had discussions with Premier Iemma and other key ministers. In South Australia next week, again, I’ve got another discussion on Monday with Mike Rann and Patrick Conlon and Kevin Foley.

They understand that what’s been missing from the agenda is an ability of the Commonwealth to show leadership on nationally significant infrastructure, one that doesn’t take into account electoral considerations.

If you look after your infrastructure, my view is that the politics shall look after itself. Because out there there’s a great recognition of what is required.

What we need to do is to make decisions based upon rigorous analysis and contribution to national productivity. How do we actually make a difference?

There are key areas that Infrastructure Australia has already identified in the submissions that are there from the states and territories.

Much of the infrastructure reform that is required does not involve Commonwealth expenditure. Having a vehicle from the Commonwealth that can drive forward that change will be of great assistance to the states and territories as well as to the private sector.

That brings us to a second theme that I want to bring up today, which is that there is a renewed commitment from the Commonwealth of engagement in our cities.

Advertisements are in today’s paper for positions in the Government’s Major Cities Unit. Once again, it will be based here in the CBD of Sydney. The Major Cities Unit will have a critical role in making recommendations to the Government about issues such as urban congestion.

It simply is unacceptable for the Commonwealth to play the blame game and say that cities are the total responsibility of the States.

The previous Government’s approach was that the Commonwealth had a role in moving freight but not a role in moving people as if the two weren’t linked. This approach doesn’t work.

It doesn’t work also to have a road network that is national, that funds roads to the outskirts of cities, but then ignores the fact that it takes 40 minutes to get the last 10 kilometres to the port to get the goods exported. That doesn’t make sense either.

We need a new relationship that acknowledges that without national leadership in the development of our cities in the most urbanised country on earth then we won’t be able to deliver real solutions to those challenges.

They’re not simple. And they’re not simply a matter of finding additional funding, but they are available. And we’ve had a number of studies and recommendations to governments, such as the Eddington Report in Melbourne, the Sustainable Strategy announced as part of the last South Australian Budget that shows the way forward.

We’re also as part of that, moving towards a national transport policy. Last Friday the Australian Transport Council met in this city. There is still some resistance from elements of the bureaucracy about the need for national systems in many of these areas.

But there is no legitimate argument which says that we shouldn’t have a single national system for the regulation, registration and licensing of heavy vehicles.

There is no argument that says it is acceptable that in 2008 we have eight rail safety regulators and rail safety investigators.

In the European Union they have one, one for the whole of Europe.

But here we haven’t managed to fix those issues. It is absurd that trains stop at borders to change the staffing ratios on those trains. It is absurd that between Casino and Brisbane trains had to stop until recently every 20 kilometres while the driver got out and manually recorded where he was on that rail line.

It is absurd that in the area of maritime, there are different ballast water regulations; different standards for ships; and different standards in terms of skills recognition.

Those are changes that need to be addressed. Those are changes that require the political will to push forward.

But I say on behalf of the Commonwealth, that we are committed to reform. We’re committed to provide financial incentives to reform. We can’t keep coming up with excuses to not move forward on these important infrastructure issues; on these important reforms that would save money and represent important microeconomic reforms.

The National Transport Commission is also doing substantial work on urban congestion; refining its small set of consistent performance indicators across urban transport modes; developing a better understanding of business sector urban transport movements and growth patterns; improving urban congestion modelling; developing guidelines to ensure better integration of transport and land use planning.

We’re going to have pilot studies by the National Transport Commission into inter-modal transport; livestock and grain; oil, gas and coal supply chains, to identify what the regulatory constraints and bottlenecks are.

In partnership with state and territory governments we can have substantial reform.

There is a great deal of good will and determination from the Prime Minister and from each and every one of the premiers and chief ministers. And that’s why COAG is meeting quarterly to advance this reform agenda.

The third issue that I wanted to take the opportunity to talk about today of course ties in with infrastructure, major cities, and indeed a whole of government approach; and that is the challenge of climate change.

The Government has released our Green Paper on the Carbon Pollution Reduction Scheme. This is facilitating discussion prior to the Government’s White Paper and legislation to enable the introduction of the Scheme in 2010.

Business needs certainty and understands that the case for delay is untenable. We have enormous opportunities, as well as challenges, arising from climate change.

Australia has an opportunity to be the centre for the Asia Pacific region in terms of emissions trading.

We know that the Sydney Futures Exchange down the road here did work last century, last century on getting the systems in place to provide that leadership. So I’m quite stunned that some are still mucking around at the edges and haven’t yet heard the message.

The Government has and that’s why we’re consulting in the lead-up to the release of the White Paper. That’s why I welcome the efforts of the IPA in the research work on emissions trading that your organisation has commissioned.

When it comes to infrastructure development, this is the context for the new century that we need to deal with these issues.

This is why the Commonwealth cannot ignore issues such as the way that our cities are planned.

In the last fortnight of Parliament, the Opposition suggested that I had made this startling revelation that transport policy must be a part of the climate change strategy. A statement of fact that I’ve said hundreds of times.

This was seized upon by people who don’t think understand that not just transport policy, but the whole of government, has to be involved in climate change strategy.

An Opposition that is frozen in time, while the world warms around it.

There’s no doubt that this is a difficult challenge.

But we’ve got to have an honest debate and much of it should be above politics, as it is in many countries. Business requires consistency, not just for one term of politics but over a much longer period of time, as adjustment occurs and as we move towards a carbon-constrained economy.

Those three frameworks: economic development led by Infrastructure Australia; major cities policy led by the Major Cities Unit; and adjustment through the Carbon Pollution Reduction Scheme will dominate the infrastructure agenda for the year ahead.

I conclude with this comment. Whatever the differences from time to time that people might have about particular political parties or movements, one of the defining characteristics that the Rudd Government wants to have as our legacy, led by a determined Prime Minister, is a simple epitaph of “they said they’d do it and they did it”.

It’s very simple. But many would argue it is unusual for governments to do that.

In the creation of Infrastructure Australia and the program that we’ve put forward in the last eight months – and in the 12 months since last year’s IPA Conference – I think you’ve seen just that.

You’ve seen a government committed to our infrastructure policy and programs as we outlined to the electorate at the last election. If there is another defining characteristic of that approach, it’s that we’re trying to break down the old politics of government and the private sector being seen as having totally different objectives and occasionally having a chat.

We want a day-to-day dialogue. We recognise that the public sector working hand-in-hand with the private sector to provide that leadership and that way forward is the key to success. It isn’t simply market or planning.

You need markets to drive the change and to drive the reform. And we see markets, whether it’s through emissions trading or whether it’s through infrastructure development, as being absolutely critical.

But the element that was missing 12 months ago that’s here today, and that it is a necessary component, is national leadership. It can only be provided by the Commonwealth Government. Unless you have that the private sector will be frustrated in achieving its objectives.

I look forward to working with you over the next 12 months to achieve our common objectives and to be able to report to you about progress in delivering the Government’s infrastructure agenda.