Subjects: Inland Rail, Cross River Rail, Western Sydney Airport
BEATTIE: Well let’s move to our first guest, Anthony Albanese. Anthony thank you for joining us.
ALBANESE: Good to be with you both.
BEATTIE: Now Anthony, no one could ever deny your passion about infrastructure, so can we come to the Budget. One of the things that you have been on about for a long time is the Inland Rail and I just want to talk about whether there is a difference between the rhetoric and the delivery. I support this project like you do. I just worry, where are we with the alignment and what are we doing about the link between, to the Port of Brisbane? So tell us what your view about the proposal in the Budget was.
ALBANESE: Well I am a supporter of the Inland Rail Project. We put in Government $900 million into the project; $600 million for fixing the existing alignment, because a lot of this project isn’t new track. It’s just upgrading of old sections and then about 40 per cent is new. So we put $300 million into the Budget for the preservation of the corridor and the early pre-construction work.
My concern now is that the Government has before the Budget set it up with this good debt, bad debt idea, of putting it off-Budget. So they have allocated some $8.3 billion but it is all off Budget and when you look at the actual project it is going to stop at Acacia Ridge. So that leaves about 38 kilometres between there and the Port of Brisbane and it is the most expensive bit because you have to tunnel. So what are you going to do? Put these double-decker trains, get the containers and put them onto trucks and go through the residential streets of the most built up area of Brisbane in order to get to the port? That doesn’t make any sense.
It is a fix over the finances rather than a proper infrastructure planning process and that is what I am concerned about with this project. We do need to get it right and getting it right means that we actually take the freight somewhere and that means taking it to the port.
BEATTIE: Well the point about Acacia Ridge is absolutely right, because as two people who represented this area, we can tell you Anthony that would be incredibly unpopular running those…
NEWMAN: A lot of politics around that.
BEATTIE: You are absolutely right. There would have to be a tunnel. Can I come to the finances of this; I read somewhere that this would take something like 50 years to get the return on the capital investment for this rail line. Is that right?
ALBANESE: Well that’s what John Anderson said in the report to the Government, which is why some of the funding at least surely needed to be on Budget, not pretending this is going to have a rate of return. Now we raised that, to go back a little bit I guess, to put things off-Budget for a Government business enterprise. What needs to be shown is that there will be a return to the Budget. So the National Broadband Network will produce a return to taxpayers, therefore it can be funded off-Budget.
This project, on its own assessment done by Price Waterhouse Coopers, for the Government on behalf of John Anderson and the committee that he chaired, said it wouldn’t produce a return to capital of the capital expenditure for more than 50 years.
And that’s why I think you have this project stopping at Acacia Ridge. Because that decreases the cost of the project by maybe $4 billion, in order to, well at least, because the tunnelling is the most expensive part. And then you have in Senate Estimates, the Department say that in order to make this stack up as an off-Budget project they are going to look at the Australian Rail Track Corporation’s return as a whole.
So effectively the lines are the ARTC, that’s a Government owned entity that will be building the Inland Rail, that currently makse a substantial profit and the main one of that is the Hunter Valley Coal Network, will be used to subsidise the Inland Rail. Now that is just a fiddle, frankly, and I think that with a project like this, which is good, which will take trucks off the road, that will be important for cities like Parkes to be able to expand in Western New South Wales. It will take pressure off the coastal route, there is a range of reasons why this project is good, but for the Government to pretend that it can all be done for free in terms of actual on-Budget expenditure, is frankly a triumph of hope over practical analysis and already I think that it is beginning to unravel.
NEWMAN: Albo, can I go somewhere else if I may, please, and that is Sydney’s new airport, the second airport. We had a great example of what the private sector can do in the last few years in Queensland, between 2011 and 2014, the Wagner family up in Toowoomba managed to build a brand new international airport and they built it a rock bottom price. Have you got any comments to make about the plan and the time frame for the second airport in Sydney?
ALBANESE: The Wellcamp Airport, I have visited that airport, and it is fantastic and it is a great example of the private sector being able to achieve a very good outcome for Toowoomba and the Darling Downs. All of that region will benefit from that airport. The Sydney West Airport is of course something very different. Sydney West Airport is servicing some 2.2 million people right now living in Western Sydney. That will grow over the next couple of decades by another million, so it will largely be servicing both in terms of freight and in terms of, most importantly, passengers, both domestic and international aviation. It will be a substantial airport, and it is an opportunity to create jobs and really drive economic activity, I am a supporter of the airport. The model that has been done is a result of a bad decision frankly by the Howard Government to offer the first right of refusal to the existing owners of Sydney Airport.
NEWMAN: They have knocked that back though haven’t they?
ALBANESE: They knocked it back, they have.
NEWMAN: Isn’t that a good thing?
ALBANESE: Well that was a commercial decision, which they’ve made. The Government under those circumstances probably had no alternative but to proceed by themselves, because no doubt if it had been offered up to other private sector bids you potentially would have had some legal issues raised about whether the offer would have been exactly the same.
As it is now it will get done, and that is the important thing, it will get done. It is important that as it gets done that jobs are created for people in Western Sydney. It’s important that, and I have had discussions with the Government about our proposal which is that for all infrastructure projects where there is Government involved, there needs to be at least 10 per cent of local apprenticeships created. Let’s create the skills and lift the base while we’re building infrastructure and this is an exciting project that needs to be got right. There needs to be public transport there from day one.
NEWMAN: Can I ask you about how the Labor Party would see public transport being provided and how it should be funded in the most appropriate manner?
ALBANESE: Well we think that the North-South Corridor along with all of the councils in Western Sydney, see one of the problems with our major cities, is that everything can go to the CBD, in theory. But in practice with a city like Sydney its great geographical advantages of the Harbour and the rivers, the topography that’s there make it very difficult.
So you need to have transport linkages not just going into the hub and spoke approach but also along North-South Corridor. So a rail line, essentially from Campbelltown and the Mcarthur Region, up through Badgerys Creek Airport, up to near St Marys and connecting with Rouse Hill, will really open up economic development in Western Sydney. Some of the project, no doubt, can be funded by value uplift as a result of the growth that is happening there. Just to give you one example, the Science Park just to the north of the airport will attract some $5 billion of private sector investment for high end jobs including of course an on campus K-12 Science, Technology, Engineering and Maths school, where there is already an MOU with the Catholic Education Office. Now these are the sort of opportunities where the airport will be a catalyst for that investment.
But we need to make sure that we get it right with a rail link, which also then goes through to Leppington and connects up with the South-West Rail. If people want to look at other potential links that are there to Parramatta, or even a High-Speed Rail link, by all means that is worthy of consideration. But the main thing is making sure that people in Western Sydney themselves can benefit from the jobs that will occur from what should be an aerotropolis. It shouldn’t be just a runway and a terminal it should be seen as an enormous opportunity.
BEATTIE: Anthony one of the other areas that is causing a lot of angst in the infrastructure area, particularly in Brisbane is the Cross River Rail link. That seems to be a bit of a mess. Where is it exactly, based on what the Government has promised and what they plan to do?
ALBANESE: A great disappointment in this Budget is the announcement of a so-called $10 billion National Rail Fund, of which there are zero dollars this year, zero dollars next year, zero the year after, and $200 million in four years’ time. I mean that’s a farce. So it was a big announcement with nothing behind it. Malcolm Turnbull likes riding on trains, but he has got to start funding them.
And the Cross River Rail project, as you both know, was approved by Infrastructure Australia in 2012. Myself and Campbell Newman, as the Premier, showed that you could cooperate. We were prepared, as was Campbell Newman’s Government, prepared to put in $715 million respectively, and then we had an availability payment model. There was going to be uplift around Woolloongabba station. It was ready to go, and the thing that stopped it was Tony Abbott, essentially, saying that the Commonwealth wouldn’t fund public transport projects and would withdraw, and he did indeed, withdraw all funding from any project that wasn’t under construction. And I think that was really a lost opportunity.
I must say that the work I did with Campbell on Legacy Way is there for all to see. You can have cooperation across political parties, and that is what people want. That is what we are doing on Sydney West Airport, and the result is that it’s going ahead. What it needed was not just Government but Opposition to be on the same page there. And the Cross River Rail Project, for goodness sake, it would have been creating in the meantime literally thousands of jobs, and it is important, of course, not just for the people of Brisbane, but for the capacity of the network on the Gold Coast, and indeed, on the Sunshine Coast.
BEATTIE: That’s exactly right. Well there you go mate. You would be on side with it?
NEWMAN: Well I guess so.
ALBANESE: We had good discussions. We were ready to go, Campbell.
NEWMAN: Perhaps the problem is now that they are not leasing the assets. But I will move on.
BEATTIE: He’s agreeing with you Anthony.
ALBANESE: We were ready to go.
NEWMAN: Well we were actually. I think the history of it was pretty accurate, yes, pretty accurate.
BEATTIE: Well talking about cities, and coming back…
ALBANESE: I used to get into trouble Campbell, by saying that I was a Labor Party minister who was able to sit down with you cooperatively, but I did that with a range of ministers regardless of their political colour across the country. That really, I actually think that from time to time, that really is what people want to see.
NEWMAN: Well we need a lot more of that now.
BEATTIE: We need a lot more of that. Anthony, the issue about house prices in Sydney, you are the Minister for Cities. It seems to me that if there can be a fast train to places like Wollongong, Newcastle, you can do the same in Melbourne. A lot of people can live there in areas where the housing is a lot cheaper, but work in Sydney. Why aren’t we doing that?
ALBANESE: Exactly, well we did, one of the things that we did in Government was a substantial two-part study. It showed for example that the Sydney to Melbourne benefit cost-ratio was $2.15 benefit for every dollar invested. And part of the reason was exactly what you point to, is the growth in regional development, on the Southern Highlands, Canberra, Newcastle, indeed, from Brisbane. The stations were going to be obviously Gold Coast, but then Lismore, then down through Grafton, Coffs Harbour, Port Macquarie, Taree, Newcastle. Opening up, if you put Newcastle and Canberra under one hour from Sydney’s CBD, guess what? They are fantastic places to live, this city of Canberra, Australia’s largest inland city, the bush capital, has a fantastic lifestyle for families. It took me an hour on Saturday to get from Marrickville to Balmain; it is about eight kilometres on a Saturday morning.
So in terms of opening up that economic development, it absolutely makes sense; its time is here right now. Asia, Europe, Latin America and North America are all doing it, and there’s no reason why Australia shouldn’t be doing it as well. We do live in a vast continent with a relatively small population, but that population is concentrated down the East Coast corridor and we should take advantage of that.
NEWMAN: Can we move off infrastructure just before we finish, and, something I want to put to you, it troubles me greatly, the national debate and the tone of it. Bluntly, I do not hear much about sort of, helping people get ahead under their own steam. We hear a lot about, sort of, welfare payments, we hear a lot about helping people like that. But we don’t seem to have a mantra from the Labor Party or sadly even from the Coalition, now they seem to have abandoned that, about lower taxes, letting people through their own efforts, sort of bring up their families and look after themselves. Frankly the debate now seems about more tax, about hitting people hard, and frankly there is a smaller group who are being the ones who are paying these taxes. And I am not just pointing the finger at the Labor Party, though I think, personally, that has been pretty big in the last few months, but the Coalition seem to have lost that mantra, I think it is one of the reasons that the Liberal Party are in trouble in the polls, do you want to comment on that?
ALBANESE: Look I think you make a valid point, I think governments should always look at ways in which they can facilitate much greater activity by others, by the private sector. That’s one of the things that draws me towards infrastructure in fact, I don’t want to bring it back to that, but you look at whether it is a project like the National Broadband Network; enabling businesses to operate so that you can operate in a regional centre and have the same access to the rest of the country and the world as if you were in the CBD but with much lower cost structures, that’s one of the great enabling factors of the National Broadband Network. I think in terms of transport infrastructure as well, allowing people to get around, is also…
NEWMAN: If I can just jump in that is not what I was asking. I was asking about a culture in Australia where we encourage people to look after themselves, to bring up their own families and not rely on the government. I mean sadly we seem to be losing that.
ALBANESE: Sure and I think that encouraging work; I mean one of the debates that I have heard around, some people in so-called progressive areas, there is a bit of a debate whether people should be just paid an amount and we give up on trying to find people work. That to me is completely the wrong way around. Work is a noble thing. You impart value, to yourself and your community by what you do, and that’s why I see very exciting prospects, like the Science Park that I was talking about, that is not government investment, that is private sector investment by the people, largely driven by the people who run Steggles chooks; who have come here, one of the great Australian success stories, who’ve come here from overseas, now second generation coming through, creating jobs in their local community. They are proud of their Western Sydney origins.
BEATTIE: Anthony can I ask you one final thing before we go because unfortunately time is running out. Look, as a life member of the Labor Party, I am a bit gobsmacked by this debate about the NDIS and the Medicare Levy, because to me that was one of the great achievements of the Gillard Government and it actually brought about equality and dignity to people with disability. I don’t understand why the Labor Party is only putting this one per cent on people over $87,000, because this is going to be a huge problem for the budget. We have got to fund the damn thing from somewhere, and one per cent basically means it is a fair go for everyone, if you are on $50,000 you pay less than someone who is on $90,000. I must admit I do not get it, so maybe you can explain it to me, but I would have thought this was something that we all had a shared responsibility in contributing to the dignity of all Australians regardless of their ability.
ALBANESE: Well on July 1 of course, the so-called temporary deficit levy on people above $180,000 is being removed. And if you do the calculations, if you keep that, but only apply the NDIS levy to those above the $87,000 dollar figure, you of course then make sure that you are not putting an increased burden on lower income earners, and you in fact raise more revenue than the Government’s proposal. That’s the Labor Party proposal, and the argument is one of equity essentially. There is real concern out there that real wages are in decline, that people are already potentially losing their penalty rates; many people on those lower income levels. It was felt that what we should not do is to place a further burden on them, and that what we’ve come up with is a way to raise additional revenue but do it in a way that is more progressive.
BEATTIE: Okay, I appreciate that you’ve got to stick with the team game Anthony, and I respect that. Look anyone who has had a beer named after them like you have deserves respect and courtesy. You and I were in politics, did you have a beer named after you?
NEWMAN: No I have had beers thrown at me probably.
BEATTIE: I was probably throwing them. We couldn’t get a beer named after us Albo.
ALBANESE: One of my proudest moments, I will send you fellows along a bottle each of Albo Ale, there you go.
BEATTIE: We will keep you to that, Albo thank you for being with us tonight and keep up the fight with infrastructure because it is about growing the country, so good luck.
ALBANESE: Yes, terrific to be with you.
BEATTIE: Take care.