Subjects; Infrastructure; proposed F6 toll road; water infrastructure, Badgerys Creek rail.
ALAN JONES: I’ve been wanting to speak to Anthony Albanese because this to me is one bloke in the federal parliament who actually knows about infrastructure. Or put another way, seems to know what he’s talking about.
He grew up in public housing in the inner city suburb of Camperdown. He’s often said he was raised with three great faiths; the Catholic Church, the South Sydney Football Club and the Labor Party.
He made a speech in April which I thought was a significant speech and that’s the reason I’ve been wanting to talk to him and he said, and I quote, if you ask business people to nominate Australia’s biggest economic challenge, you might guess they’d name tax rates or the budget deficit. But you’d be wrong.
According to an Australian Institute of Company Directors survey of 833 directors in July last year, the problem that most worried business people is Australia’s low level of infrastructure investment.
He said that 85 per cent of company directors believe that current levels of infrastructure investment, particularly in regional areas, which is what I liked about the speech, regional areas – think of dams, for god’s sake – were too low and this topped the list of concerns ahead of the budget deficit, the ageing of the population, education and tax reform.
And he made the valid point that the Reserve Bank has made repeated calls for additional investment in railways and roads to generate economic activity and jobs and to take pressure off housing affordability, and you’ve heard me say many times, if we for example had a very fast train that linked Goulburn to here, you could live at Goulburn, buy a house for $300,000, it’d be terribly affordable.
And we don’t have the means of communicating Goulburn with Sydney. Anthony Albanese quoted Australian Bureau of Statistics figures showing public sector infrastructure investment fell by 20 per cent in the Coalition’s first two years in office. Not his figures. Bureau of Statistics.
And he argued that more recent Bureau of Statistics figures, and this was in April, showed that in the 12 quarters in which the Coalition has been in office, total quarterly public sector infrastructure investment has been lower than it was in every single quarter under the previous Labor Government.
And as he says the Northern Australia Infrastructure Fund created two years ago has not funded a single project. And the government’s now proposing to create an Infrastructure Financing Unit which you’ve heard me say on this program is a waste of space within the Department of Prime Minister and Cabinet.
Anthony Albanese says none of this is needed. Infrastructure Australia already exists to assess projects and provide advice on funding models. So we won’t be able to cover all this ground but he’s with me here in the studio. Anthony, good morning. Thank you for your time.
ANTHONY ALBANESE: Very good to be with you, Alan.
JONES: How big an issue is this in terms of the capacity to grow the economy and of course, grow jobs?
ALBANESE: This is an enormous issue. This is front and centre because what infrastructure investment does in the short term is create jobs and economic activity but in the long term it produces a return.
It’s an investment in our nation. It’s an investment in people. It produces increased revenue to government but it also reduces the cost of the private sector of doing business which is why those company directors were almost unanimous in identifying this as the number one issue.
But the tragedy is, its going to get worse, Alan. Because last week the Parliamentary Budget Office, an independent organisation, produced a report that showed on the government’s figures in the recent Budget, over the coming decade, infrastructure investment as a proportion of our national economy, as measured by GDP will fall from 0.4 per cent to 0.2 per cent. Will halve. That will have a devastating impact on our economy.
JONES: Just to interrupt you there. Therefore what people listening to you are saying, what is the role of government as opposed to the private sector in all of this?
ALBANESE: Well the role of government is to show leadership. There is certainly a role for the private sector in providing some finance for projects.
But it’s also the case that if you have a view of infrastructure which the Infrastructure Financing Unit that’s been set up in the Department of Prime Minister and Cabinet has, that it will examine projects that will produce essentially a return to government, then what you’re talking about there is distorting the market so that all you have is investment in toll roads.
Now, just today we find out that there was a report that the NSW Government have sat on which is that if you invest in upgrading the rail line from Wollongong up to Sydney…
JONES: Yes, this is a big story.
ALBANESE: …if you invest in that..
JONES: Much, much cheaper.
ALBANESE: $2 benefit for every dollar that’s invested, but what’s the government looking at? An F6 that will demolish houses, that will go through the Royal National Park, that will put another toll on those roads. A disastrous proposal.
JONES: That’s the next point I was coming to because the Federal Government has announced a stack of projects.
Western Sydney Airport, which I’ll come to in a moment, $5.3 billion. $844 million for the Bruce Highway. $1.6 billion for West Australian infrastructure including road access to the Fiona Stanley Hospital. We go to Western Australia, people are listening to this. $1 billion for Regional Rail in Victoria. A $10 billion National Rail Program, etcetera.
Now, where is the business case? Shouldn’t there be a business case for all of these? You just mentioned the Wollongong to Sydney railway line as opposed to another tollway. Where are the business cases for these projects and how important are they?
ALBANESE: The Government has sidelined Infrastructure Australia. We set up that body under legislation in order to have arms-length advice to government, so that the public could examine documents that showed, if we want to increase the amount of people who can travel from the Illawarra to Sydney, what’s the best way to do it?
Infrastructure Australia’s job was to do business cases on the proposals, to make it transparent, to publish those cases, so that you could see that, this is the cost of building the F6, but this is the alternative of the railway line.
Now, we know that the rail line is what makes sense. We know that because of a leaked document today but that is what Infrastructure Australia’s job was to do.
JONES: Well therefore, let me ask you then about Badgerys Creek and I know you support this airport and everybody does, but here’s an outfit that is 46 kilometres west of Sydney.
You’d need half a million litres of fuel a day. So do we have dozens of tankers on the road, or do we move it by rail, and which rail, do we build a pipeline? Where’s the money for all of this?
To get to Badgerys Creek to the city if you went by taxi it would be 250 bucks. If we have a rail link we’ve got to find two and a bit billion dollars.
Where is the business case, which I haven’t seen, for Badgerys Creek other than we think it’s a great idea to have an airport, but I’m worried that we might have a Montreal on our hands here because as you know they built Mirabel, the second airport there and it became a white elephant.
There are people who say there’s further capacity at Kingsford Smith. How do you answer all those questions about the fact that Badgerys Creek is there, 46 kilometres west of Sydney, we’ve got to get people and fuel to and from?
ALBANESE: We did a joint study when we were in office into the aviation needs of Sydney and what it showed was that Sydney Airport was nearing capacity and that with the amount in which people fly and people would increase substantially.
I mean, I went on my first flight when I was in my twenties, to go down to Canberra when I got a job with Tom Uren. These days my son goes to the local high school here, all of his mates have all been on planes. They’ve all travelled, it’s the local public high school, the world has changed.
the Badgerys Creek Airport isn’t about getting people to the city. It’s about servicing the now-2.2 million people who are listening who live in Western Sydney.
JONES: Now what about fog and fuel? Forget about people, you’ve got to get fuel.
ALBANESE: There needs to be a pipeline of fuel there.
JONES: So where is the business case that says how much would the pipeline cost? I haven’t seen any of these figures.
ALBANESE: Well, that’s why some of those figures were certainly in the joint study that was done between the Commonwealth and the state.
One of the things that’s needed, for example is the public transport linkages. What we’ve advocated is a north-south line for the Macarthur region; connecting up Campbelltown and around that region, up through Badgerys Creek, up to St Marys and then connecting up to the north-west line at Rouse Hill.
One of the reasons why Sydney doesn’t work is that it’s a hub and spoke with the hub in the CBD and with our beautiful geography here, it makes it difficult to get around.
JONES: Always when water is the other side of the CBD, everyone’s got to go back in and come out again.
ALBANESE: Absolutely. Which is why you need that north-south public transport corridor. Not just about the airport. This would make sense even if an airport wasn’t there.
But what the airport is doing is providing a catalyst for jobs with projects like, I’ll give you one Alan. The Science Park.
JONES: I’d love to talk to you about the Science Park, I just want to raise two issues before we go because it’s not everyday we’ve got you here.
Firstly, dams. Now, we’re talking about infrastructure. We’ve been talking about transport here for the last eight minutes. West of the Great Dividing Range if tomorrow 50 per cent of the water was cut off from the Sheraton Hotel, you’d have to reduce 50 per cent of the beds. Water is so critical to regional Australia.
We never harvest it, it rains like hell, floods everywhere, and nothing happens. What’s your proposal for damming some of this water?
ALBANESE: We certainly should be harvesting more of the water, whether it be through major dams or whether it be in smaller projects down to harvesting the rain that falls on our roofs. That can make an enormous difference. It is something that..
JONES: I’m talking about regional areas. If you could guarantee a water supply to people in regional areas you could decentralise the population.
ALBANESE: There’s a few things we need to do to decentralise. One is water. The second is energy. In regional areas that have more space it’s obviously much easier to have solar and other projects.
There’s a fantastic project up in Queensland, the CopperString project, but also of course what you’ve identified of High Speed Rail could transform the way that the east coast works, take pressure off Sydney, Melbourne and Brisbane, deal with housing affordability, it’s a project that ticks all of the boxes.
JONES: And you can’t get anyone to move on it, including Gladys Berejiklian here. We’re running out of time, I wanted to ask you one other thing. Is this Inland Rail freight link between Brisbane and Melbourne, is this designed to support mates?
What are we going to say about the route, is this because I thought the former Deputy Prime Minister John Anderson said in 2015 that revenue generated by this rail line in its first 50 years would not cover the cost of its construction.
ALBANESE: He did certainly say that in a report to this government. And what the government’s done with its obsession with getting things off-budget is say that it can all be funded without any government actual investment.
JONES: But is the route right?
ALBANESE: The route is right that’s been identified, except that it stops short of the Port of Brisbane. Some 38 kilometres short and unless it goes to the port then it doesn’t make sense.
JONES: Look, it’s good to talk to you. I think this is a very, very big issue and so I think we should talk to you again. This bloke knows his stuff but that’s just the tip of the iceberg, what we’ve discussed today. There’s a stack of it. Thank you for your time.
ALBANESE: Great to be with you, Alan.