Nov 24, 2014

Private memebers’ business – East West Link

Mr ALBANESE (Grayndler) (10:52): American diplomat and thinker Benjamin Franklin once made an astute observation about the nature of advice. ‘Wise men don’t need advice,’ Franklin said, ‘and fools won’t take it.’ When it comes to investing in infrastructure, the Prime Minister, like Franklin’s fool, won’t take advice. The Prime Minister is investing a total of $3 billion in the East West Link road project in Melbourne. This is precisely the same amount that was cut from the Melbourne Metro project. This is in spite of the expert advice from Infrastructure Australia and Victoria’s planning and traffic experts that the Melbourne Metro is a higher priority. The expert advice is that the metro will deliver more public benefit for the investment, improving the reach, quality and frequency of public transport services in Melbourne. It would take thousands of cars off the roads. It would improve commuting times for train users. It is necessary work if other new lines, such as a link to the airport, are to be possible. It would make more room for people who continue to use the city’s roads.

But the Prime Minister has his own ideas. He outlined those ideas in his 2009 political manifesto Battlelines, in which he wrote:

Mostly, there just aren’t enough people wanting to go from a particular place to a particular destination at a particular time to justify any vehicle larger than a car, and cars need roads …

This loopy view explains why, upon taking office, the Prime Minister cancelled all Commonwealth investment in public transport projects right across the nation. Whilst the Treasurer believes that poor people do not drive too far, the Prime Minister believes that people do not use public transport. This kind of weird ideology, this complete ignorance of the daily lives of millions of everyday Australians who rely on public transport, is the policy context of the motion before us. Of course, the political context is Saturday’s Victorian election. The motion’s mover seeks to boost the political stocks of her Liberal Party colleagues, who are in real trouble leading up to Saturday’s election.

The truth is that both projects, in terms of roads and rail, seek to address traffic congestion. I believe you need to invest in roads, but you need to invest in rail also—not one or the other but both—and you need to direct the priorities based upon Infrastructure Australia’s advice. It is why we allocated more investment in public transport than all other Commonwealth governments combined since federation.

Importantly, Infrastructure Australia was created to give advice based upon cost-benefit analyses which are published. Why is it that the East West Link cost-benefit analysis is still not published and still not available, in spite of the fact that $1½ billion has already been forwarded? In its 2013 Infrastructure Priority List, the Melbourne Metro and the upgrade of the M80 road were right at the top. The East West Link is further down the list, with potential, but the cost-benefit analysis had not been completed. The former Labor government took this advice and allocated money for the M80 upgrade and for the Melbourne Metro. The Victorian government initially backed the Metro and in 2012 spent $118,000 of public funds to produce a video simulating a journey on the new train line, as was published by The Age last week. The federal government had already invested $40 million on the planning. The Metro was ready to go, recommended by Infrastructure Australia, so the Abbott government cut $3 billion from the budget. The next stage of the M80 upgrade is ready to go, with all planning completed, positive BCR, over $1 billion already invested to improve productivity on this ring road. It was recommended by Infrastructure Australia. So the Abbott government cut $500 million from the budget. Then there is the project that is part of the Managed Motorways program, to the east of Melbourne. This use of smart infrastructure has the highest ever benefit-cost ratio of any project recommended by Infrastructure Australia. The Monash Freeway section between Warrigal Road and Clyde Road has a benefit-cost ratio of 5.2—$5.20 return on every dollar invested. So what did the government do? The Abbott government cut $68.6 million from the budget. The Napthine government now also champions the East West Link, but it was revealed in The Age last week that the Victorian government’s senior traffic planners wanted to stick with the Metro. Instead, they have an alternative plan that does not even pass through the Melbourne CBD.

Ignoring expert advice is bad enough, but the Prime Minister’s actions also breach one of his fundamental election promises. Just days before the federal election the Prime Minister told the National Press Club:

I have given a commitment that we won’t spend more than more than $100 million on any single infrastructure project without a published cost-benefit analysis.

Well, there is no published cost-benefit analysis and as recently as 20 October the head of Infrastructure Australia, John Fitzgerald, told the Senate budget estimates committee hearing:

We are still in the process of assessing that project. We have not formed a final view on that.

I have got news for Mr Fitzgerald—the government does not care what Infrastructure Australia thinks about this project. It has already handed over $1½ billion, including $1 billion for stage 2 of the project, which will not start until 2016 at the earliest. This is at the same time that the government is demanding widows, invalid pensioners, students and average mums and dads do their bit for the so-called budget emergency that they talk about. But they have a billion dollars to hand over years in advance of this project, in spite of the clear commitment that was given by the assistant minister that there would be a milestone payments. He said:

That we’re hitting milestones, that we’re only making payments to states when they actually deliver the milestones, that they’re not getting money in their bank account prior to milestones being delivered

Yet, $1½ billion is in their bank account—earning interest; not creating jobs, not doing anything to build infrastructure, just sitting in a bank account earning interest.

Our cities are under siege from worsening traffic congestion. You do not need to be a Rhodes scholar to know that the roads alone are not the solution. Public transport is part of the solution, and here is a good example— construction of the Regional Rail Link began in 2010. The project will untangle freight and passenger lines connecting the Melbourne CBD to Ballarat, Bendigo and Geelong. It will provide an extra 54,000 commuter seats a day. It is the biggest single Commonwealth investment in public transport in the nation’s history, with more than 15,000 workers involved so far. The Regional Rail Link will take 45,000 cars off the road during peak periods and save the state’s economy $300 million per year. Best of all, it is ahead of time and under budget.

What was the incoming coalition government’s response in Victoria to this project? They stopped it. They paused the project when they came into office and tried to renegotiate for funding to go to other projects. They said that this was a project that was over budget—not true. They did that by refusing to take into account the contingency reserve that were factored in for this vital project for Melbourne and for Victoria. Eventually, after spending months criticising it, attempting to negotiate with the federal government, it went ahead—but it went ahead in spite of the Victorian government. And in spite of the fact that they said this was a wasteful project, they have not missed a photo opportunity. They do not invite the federal members who were responsible for getting the funds for this project or the local state members, but state ministers have been turning up at these openings of new stations such as West Footscray. There are other stations in the Werribee region that are ready to be opened but the state government now pretends that this is their project—nothing could be further from the truth.

The fact is that, if our nation wants an effective, properly integrated transport system that delivers productivity gains for the entire economy, the Commonwealth must invest in public transport. If we want to liberate long-suffering Australians in drive-in, drive-out suburbs, the Commonwealth must invest in public transport. If we want to reduce carbon emissions, the Commonwealth must invest in public transport. We need an infrastructure strategy that is about integrated transport in our cities and in our regions, and that is the way forward.