Feb 17, 2015

Infrastructure Australia passes a without a leader

A year after Infrastructure Australia head Michael Deegan stepped aside, hapless Infrastructure Minister Warren Truss has failed to appoint a successor to this critical role.

Mr Deegan – a highly regarded public servant – finished work early in February, 2014. He was later snapped up by the South Australian Government to head its Planning, Transport and Infrastructure Department.

It is extraordinary that more than 12 months later there is still no head of Infrastructure Australia, which Labor created in 2008 to independently assess the relative merit of big infrastructure proposals competing for public funding.

The body is critical in ensuring that governments do not throw money at dud projects for political reasons but fund projects on the basis of which have the greatest capacity to boost economic productivity and create jobs.

While Mr Truss has dithered over appointing a new head of Infrastructure Australia, Tony Abbott has recklessly ignored accountability by funding a range of new road projects without cost-benefit analysis – a direct breach of his explicit election promises.

Just last week Australian National Audit Office said it would examine the circumstances surrounding the Abbott Government’s $3 billion commitment to Victoria’s East-West Link road project, which included a $1.5 billion advance payment handed over in June.

The grant came in the absence of cost-benefit analysis.

But documents have since emerged discrediting the East-West proposal, which would have returned a paltry 45 cents in public benefit for every dollar invested.

Mr Truss appears to be running dead on appointing a new head of Infrastructure Australia because he knows Mr Abbott’s recklessness would not stand up to fearless independent scrutiny.

Prior to the election, Mr Abbott also promised to reappoint the Chairman of the Infrastructure Australia board, Sir Rod Eddington, a promise which has also been broken.

Public money is scarce and should not be invested in projects without rigorous checks to ensure they represent value for money.

Mr Abbott vowed before he was elected that he would adhere to proper processes, but in office has trampled on accountability, with the compliant Mr Truss happy to go along for the ride.

Australians deserve better from this government than a fast-and-loose approach to infrastructure spending.