Mr ALBANESE (Grayndler—Leader of the House, Minister for Infrastructure and Transport and Minister for Regional Development and Local Government) (11:22): I want to take the opportunity to speak briefly on these amendments and on the legislation, because they do provide important reform to infrastructure, including the new tax-loss incentive to major infrastructure projects introduced by schedule 2 of this bill. By removing tax disincentives this reform will support up to $25 billion in new private sector infrastructure spending. This important reform is yet another milestone in federal Labor’s ambitious infrastructure agenda. We are delivering record funding for infrastructure investment, but we recognise that we need to mobilise private capital as well as direct government expenditure.
I congratulate the minister on this initiative, which arises from an announcement that we made in the 2012 budget and arises from the sort of work that the Infrastructure Australia Finance Working Group, chaired by Jim Murphy from Treasury, has done. We, of course, have funded all of the 15 projects deemed ready to proceed on the Infrastructure Australia National Priority List. Building on this, the Infrastructure Coordinator will designate projects eligible for the tax concession. To be eligible, projects need to be assessed as ready to proceed on the priority project list.
The tax-loss incentive also compliments our recent budget announcement for the transformational public transport projects—the Melbourne Metro and Brisbane Cross River Rail. Both of these projects have been identified as priority projects of national significance. They are critical in addressing capacity constraints and congestion in our major cities and will enhance productivity growth. They also are projects on a scale that requires private sector contributions. Therefore, we are taking a new, innovative approach which is structured around an availability payment model to attract private sector investment. The tax-loss incentive will also encourage private sector investment for such projects by preserving the value of infrastructure project losses over time and exempting these losses from utilisation tests that normally apply.
This reform will support major transport projects that transform our cities and make our international gateways more competitive. This is an important piece of legislation. I commend the legislation as well as the amendments to the House. It is important that we continue to invest in both road and rail infrastructure in addressing congestion issues in our cities. Our approach is about delivering reforms that complement our nation building investment program, such as this tax-loss incentive.
Leader of the Australian Labor Party, MP for Grayndler, Rabbitohs Life Member. Authorised by Anthony Albanese, ALP, Canberra.