Feb 2, 2016

Auditors slam East-West Link

Parliament today heard scathing criticism of the Turnbull Government’s funding of Melbourne’s discredited East-West Link toll road with the tabling of an Auditor General’s report confirming the flawed project was funded against departmental advice and without proper process.

The report found that in 2014 the Government allocated $3 billion to the East-West Link without seeing a proper cost-benefit analysis or seeking input from the independent Infrastructure Australia, which is designed to advise the Government on value for money in major infrastructure projects.

The funding allocation included a $1.5 billion advance payment to the Victorian Government which was paid in June, 2014, against the advice of the Department of Infrastructure and Regional Development, which told the Government it should release funding based on actual progress in the project.

The money has since been sitting unused in a Victorian Government bank account, earning nearly $49 million in interest up until the end of October last year.

The payment came just months after the Coalition promised in the 2013 election campaign it would not fund infrastructure projects worth more than $100 million without the publication of a proper cost-benefit analysis.

The audit report report said: “Neither stage of the East West Link project had proceeded fully through the processes that have been established to assess the merits of nationally significant infrastructure investments prior to the decisions of government to approve $3 billion in Commonwealth funding and to pay $1.5 billion of that funding in 2013-14.’’

The Government funded the East-West payment by cancelling investment in projects like the Melbourne Metro, the M80 upgrade and the Managed Motorways program – all of which had been assessed and backed by Infrastructure Australia.

After Labor’s Daniel Andrews won the 2014 state election promising to scrap the East-West Link and instead fund the Metro, documents emerged showing a business case had been prepared but showed the project would return a pathetic 45 cents for every dollar invested.

The East West debacle stands as an emblem for the Government’s poor performance on infrastructure.

The Australian Bureau of Statistics revealed last month that public infrastructure investment has plunged by 20 per cent since the Government took office.

The Government’s nation building record is so bad that Malcolm Turnbull now plans to cut investment even further to fund an $18 million advertising campaign to mislead Australians about its performance.