Speech to the Tourism & Transport Infrastructure (TFF) Leaders’ Summit
September 17 2008
Main Committee Room
The Hon Anthony Albanese MP
Minister for Infrastructure, Transport,
Regional Development and Local Government
Leader of the House
Federal Member for Grayndler
It’s a pleasure to be here to discuss a topic I feel very passionate about – infrastructure.
And as leaders in your field, I know you share my passion.
Like you, the new government recognises that the extent of a nation’s physical infrastructure in large part determines the quality of life enjoyed by its citizens, as well as the productivity of its industries and the overall performance of its economy.
That said we don’t underestimate the challenge that is before us.
There is no doubt that we have inherited a legacy of neglect – the product of more than a decade of under-investment in the nation’s economic infrastructure: its roads; its railways; its ports and airports; its telecommunication networks; and its energy and water utilities.
In fact, out-dated, poorly-planned and inadequate infrastructure is estimated to be knocking almost a percentage point off Australia’s annual economic growth – that’s billions of dollars a year in lost prosperity.
In a practical sense, the current state of the nation’s infrastructure is undermining the ability of our major cities to work effectively and putting at risk Australia’s reputation as a reliable trading partner.
What’s more, the failure to fix the nation’s infrastructure has not been because Australia has lacked the means to do so.
We all know that over the past decade record revenues have been flowing into the Treasury from the resources boom.
While the enormity of the task is significant, our mission is clear: overtime to eliminate the infrastructure ‘deficit’ we inherited and to modernise the nation’s economic infrastructure in anticipation of future needs.
Australian Transport Compact…
But before I get to the details of what the Government is doing in response to the infrastructure deficit, let me first turn to your discussion paper, Australian Transport Compact.
There a couple of general observations I would like to make.
The paper focuses on passenger transport but I would make the point that it is difficult to separate passenger from freight transport simply because so much of the infrastructure is shared.
You can’t have a strategy for moving people without a strategy for moving freight.
Let me provide a couple of examples.
If we can provide better rail access to and from ports then road congestion around the ports – particularly the major city ports – will be reduced.
The same applies to interstate road use – improve rail and coastal shipping services and you reduce pressure on our national road network
Looking at some of the specifics in your paper, I think you will agree that the Government is taking action in many of the areas that you have recommended.
We are developing a coordinated national plan to address urban congestion.
We have a strategic plan for moving Australia to a low carbon economy – through not only the proposed Carbon Pollution Reduction Scheme, but also our nation building infrastructure agenda.
We have set up Infrastructure Australia to look at regulatory impediments to efficient provision of infrastructure and develop an infrastructure priority list.
Through the Australian Transport Council, we are working to establish a National Road Safety Council and achieve harmonisation in rail, road and shipping, consistent with a seamless national economy.
On specific transport infrastructure projects, we have the processes well underway to identify projects of national significance.
In addition, we provided $75 million in the budget to undertake feasibility work on those that clearly warrant closer examination.
These include the East-West rail link in Melbourne, the Western Metro in Sydney, the airport-city rail link in Perth, and the Bruce Highway in Queensland.
It would be premature to commit now to funding specific projects without the benefit of Infrastructure Australia’s advice.
But this early investment indicates the kinds of projects that the government considers to be worthy of further investigation.
In just nine months…
Let me now elaborate on the action the Government has taken in its first nine months, which I am sure you will agree has many parallels with the actions the TTF recommends in the Compact.
By now, everyone in this room should be aware that prior to last year’s election Labor committed to revolutionising the way Australia plans, finances and builds our nation’s economic infrastructure.
We are now moving quickly to enact this reform agenda.
In just nine months we have appointed the nation’s first ever Federal infrastructure minister; created an infrastructure department within the Commonwealth bureaucracy; and assembled a high calibre, independent advisory body: Infrastructure Australia.
If Infrastructure Australia is the way, the Building Australia Fund is the means.
An initial $20 billion contribution will be sourced from budget surpluses – money that will be used to build new and modernise existing transport and communication infrastructure.
This is one of the reasons why the government is determined to defend current and future surpluses.
Every time the opposition and other Senators vote against one of our Budget measures, they are reducing the amount of money that will be available to invest in much needed infrastructure.
In short, since coming to Office we’ve replaced Federal indifference and inaction on infrastructure with national leadership and the means to deliver real projects; we’ve restored infrastructure policy to the heart of national economic management.
New institutional arrangements…
No one should underestimate the significance of either Infrastructure Australia or the Building Australia Fund – they represent an entirely new approach to the way we plan and finance infrastructure.
Importantly, these institutional arrangements will go a long way to separating infrastructure investment decisions from the short term pressures of the electoral cycle.
In particular, Infrastructure Australia – which brings together all three tiers of government and the private sector to take a long term look at Australia’s current and future infrastructure needs – will give the community confidence that their taxes are funding projects of merit.
Through the development and maintenance of a National Priority List, Infrastructure Australia will identify the projects that they believe offer the greatest benefit to national productivity.
It will also advise governments on the regulatory reforms to give private investors the long term certainty they need to invest in infrastructure projects, including nationally consistent guidelines for public-private partnerships.
Our approach is a simple one: to create the environment for market based solutions, while being prepared to show government leadership when required.
National Transport Policy…
One area of infrastructure in urgent need of this approach – as you have identified – is transport: our roads, railways, airports, ports and of course, mass transit systems.
Here the Government wants to achieve the simple but elusive goal of any successful transport system: to move goods and people from ‘A’ to ‘B’ quickly and at lowest cost.
Ultimately, the state of the nation’s transport infrastructure influences the prices Australians pay at the supermarket, the competitiveness of our exporting industries and the level of urban congestion.
For these reasons, the Rudd Labor Government is currently working with states and territories to finalise the biggest road and rail funding program in the nation’s history – more than $26 billion over six years targeted at the most urgent sections of the national network.
And this money is in addition to funds allocated from the Building Australia Fund.
But building a twenty first century transport system is about more than just bitumen and sleepers.
The laws that regulate those that use our roads, railways and waterways also warrant thorough examination, with a view to removing complexity and bureaucratic duplication.
In fact, the Productivity Commission found that improvements to the efficiency of the road freight transport industry alone, including more streamlined regulation, could deliver as much as $2.4 billion to national income.
Many of the constraints on the current transport system are the legacy of different jurisdictional approaches to transport regulation.
In the case of Australia with its population of just 21 million people, one consistent set of transport regulations makes commonsense.
The constitutional compromises of our founding fathers are today harming our modern economy: higher prices; higher business costs; fewer export dollars.
Let me give you some examples of where reform is needed – areas that have been left on the shelf for many years.
Australia has seven rail safety regulators, three rail safety investigators and different rules in every state.
The European Union and the United States each have one.
There are more than 50 pieces of legislation and subordinate legislative instruments pertaining to maritime safety along with eight independent maritime safety agencies.
What’s more, states do not automatically recognise maritime qualifications granted in another state and different standards for commercial boat building apply across jurisdictions.
These historical hangovers are why the Rudd Labor Government is so committed to working with the states and territories to develop a single national transport system.
Already this year the nation’s transport ministers have met three times – with a further meeting scheduled for November.
The focus of these meetings has been on advancing real and far reaching reforms
In fact at our last meeting, the nation’s transport ministers agreed to recommend to COAG that it progress a number of policy initiatives to move Australia towards a truly national transport framework. These include a single national system for heavy vehicle regulation, registration and driver licensing; a national system for maritime safety regulation; and the establishment of a National Road Safety Council.
Separately, transport ministers will be continuing work on a proposal for a national rail safety regulator and investigator.
As a sign of the importance that the Government places on this work, we have allocated $4.5 million to meet the costs of the detailed work involved in accurately assessing the implications of proposed changes on industry.
This work will involve a thorough investigation of the costs, benefits and possible options for reform, providing a clear path for advancing these long overdue reforms.
The work we are undertaking with the states and territories, under the COAG umbrella, is helping to break down the ‘blame game’ which has afflicted our federation for far too long.
In closing today, I would like to again make the point that our country is facing very real pressures on its infrastructure capacity.
Pressures that must be addressed as a matter of priority.
In just 9 months, the Rudd Labor Government has taken decisive action to set in train the processes required to address these capacity constraints.
But much more will need to be done over the coming months and years.
Although leadership from the Commonwealth is important, government alone cannot address these problems.
As you have identified, the involvement of all levels of government and industry is critical.
The TTF has made an important contribution to discussions on the best way forward.
I encourage you to continue that involvement.