Dec 18, 2014

Auditor General must probe Abbott’s East-West fiasco

Today I have written to the Auditor General calling for an investigation into Tony Abbott’s allocation of $3 billion for the proposed East-West Link Road in Melbourne without a scrap of evidence as to whether it presented value for public money.

Documents released in Melbourne earlier this week show there was no business case for the former Napthine Government’s proposed toll road.

The documents show the Napthine Government made a conscious decision to keep the business case from Infrastructure Australia because it showed only 45 cents’ economic benefit for every dollar invested and that the project would take 56 years to pay off.

The Tories have produced their own version of don’t ask, don’t tell.

The Napthine Government chose not to tell Infrastructure Australia about the facts.

And the Abbott Government chose not to ask.

It funded the project anyway. No checks. No rigour.

Mr Abbott should be condemned for his contempt for proper process and his ill-discipline in handling public money.

Just days before last year’s election Mr Abbott told the National Press Club he would not release any commonwealth money to states for major infrastructure projects without first seeing a published cost-benefit analysis.

His promise was meaningless given his funding of the East-West Link as well as Sydney’s Westconnex road project, which has also not been the subject of published cost-benefit analysis.

Today I am asking the Office of Audit to examine the circumstances surrounding Mr Abbott’s failure to have the project reviewed by Infrastructure Australia and his decision to give the Napthine Government a $1.5 billion advance payment in this year’s federal Budget, including $1 billion for Stage II of the project, which was not even slated for construction before 2016.

While Mr Abbott said before last year’s election he wanted to be remembered for infrastructure delivery, 2014 has been a year of dismal failure in this critical area of government activity.

Mr Abbott’s record is littered with broken promises, dud investment decisions and the collapse of proper process created by the former Labor Government to ensure that public money is invested in projects that will boost economic productivity and create jobs.

Other landmarks in Mr Abbott’s year of infrastructure failure include:

  • Scrapping billions of dollars allocated for investment in public transport;
  • Failing to deliver additional infrastructure investment in his 2014 Budget, with the handful of new projects in the Budget funded by his ill-considered public transport cuts;
  • Attempting to conceal his inaction by incessantly re-announcing projects funded by the former Labor Government;
  • Stripping councils of nearly $1 billion for road building and maintenance through his freeze on indexation of Financial Assistance Grants;
  • Failing to deliver new investment in freight rail for the first time since 2006 and falling behind in the delivery of the critical Inland Rail project linking Brisbane and Melbourne; and
  • Removing all funding for High Speed Rail.

Mr Abbott should use his upcoming Christmas break to go back to the drawing board on infrastructure.

He could start by honouring his own promises and basing investment decisions upon the national interest, rather than politics.