May 11, 2010

Nation building to expand productive economic capacity

Nation building to expand productive economic capacity

The Hon Anthony Albanese MP

The Minister for Infrastructure, Transport

Regional Development and Local Government

Leader of the House

Member for Grayndler

May 11 2010

The Rudd Government is investing massively in vital economic infrastructure to build up Australia’s economic capacity and face the future with confidence.

This historic nation-building agenda is central to the Government’s plans to revive productivity so we can grow sustainably with low inflation and lift living standards over time.

The 2010-11 Budget builds on the Government’s impressive infrastructure record with major new investments, including a $1 billion investment in rail and our Infrastructure Fund worth more than $5.6 billion over the next decade.

Although our economy is still operating slightly below capacity today, Australia’s unrivalled economic performance through the global recession means we will be dealing with re-emerging capacity constraints sooner than other nations.

The Rudd Government has already delivered the most significant infrastructure package in Australia’s history, with projects spanning the nation.

We are investing some $37 billion in vital economic infrastructure such as road, rail and ports. This includes some $22 billion of investment in rural and regional transport infrastructure.

The 2010-11 Budget continues our unprecedented investment in infrastructure, with significant funding for projects to:

  • Boost rail productivity;
  • Support the growth of aviation;
  • Improve safety standards within the region; and
  • Continue the overhaul of transport regulations.

These measures are part of the Government’s microeconomic reform agenda to create a Seamless National Economy which makes better use of existing infrastructure, boosting productive capacity over time.

Investing in infrastructure to ease bottlenecks

The Rudd Government’s massive investments mean Australia is only now emerging from a decade of neglect of vital infrastructure.

The Rudd Government has doubled investment in roads, quadrupled investment in rail, and commissioned Australia’s first ever National Ports and Freight Strategies.

In the 2010-11 Budget, the Government continues its broad infrastructure agenda.

$5.6 billion Infrastructure Fund

As part of our Tax Plan for our Future, the Government has announced that it will establish a new infrastructure fund to help tackle capacity constraints.

The fund will be worth more than $5.6 billion over ten years, and will make infrastructure spending a permanent feature of Commonwealth and State budgets.

Funding will be distributed in a way which recognises that resource-rich States face large associated infrastructure demands.

Increasing our freight capacity

For Australia to meet its future freight needs, rail must play an integral role. That’s why the Government is investing almost $1 billion in the Australian Rail Track Corporation in the 2010-11 Budget to fund a package of rail projects to boost productivity.

The Government is also progressing planning work on an intermodal terminal precinct at Moorebank to address the critical shortage of intermodal capacity in Sydney which will complement the Government’s other investment in rail.

The terminal would provide an integrated transport solution for the movement of freight to and within the Sydney basin which would boost productivity by reducing business costs, and relieving bottlenecks and urban congestion.

The Moorebank project will now move into the detailed planning and approval phase. The Government will allocate $70.7 million to conduct planning for the relocation of Defence facilities and establish a project office.

National Infrastructure Pipeline

The Rudd Government established Infrastructure Australia to undertake a sweeping national audit of Australia’s infrastructure.

Infrastructure Australia compiled a national priority list to guide investment in major economic infrastructure based on a rigorous evaluation of future needs, and has applied the most rigorous cost-benefit analysis ever used by an Australian government.

We also recognise there is an important role for the private sector in our infrastructure plans. That’s why we’ve asked Infrastructure Australia to continue developing our National Infrastructure Pipeline to give private investors, including superannuation funds, the certainty they need in planning for infrastructure investment in the coming years.

Private infrastructure investors will also benefit from new simplified disclosure for corporate bond issuance, and a tax discount on corporate bond interest income, which will help them access large pools of retail investment funds.

Investment in aviation

The Rudd Government is also providing our aviation safety regulator and security agencies with the extra long-term resources they need to preserve public confidence in the safety and reliability of air travel:

  • An extra $89.9 million over four years for Australia’s independent safety watchdog – the Civil Aviation Safety Authority.
  • $200 million Aviation Security Package including better screening, improved policing at major airports and stronger security requirements at regional airports.

The Government is also making a targeted investment in Australia’s aviation infrastructure:

  • Long-term planning to ensure Sydney, Australia’s major international gateway, continues to be served by world-class aviation infrastructure.
  • $5.9 million over two years to upgrade remote airports.

All of these vital investments in infrastructure are part of the Rudd Government’s plan to strengthen our economy and support sustainable growth with low inflation into the future.