Apr 26, 2016

Value capture proposals not new

When someone suggests they can obtain something for free, it is always best to check the fine details.

The Government’s leaking of its cities policy today shows how far it is from producing practical solutions to deal with the urban congestion which is acting as a hand brake on productivity growth in this country.

The use of value capture to help fund infrastructure projects is nothing new.

It is a method that was included in the former Labor Government’s funding of the Melbourne Metro and Brisbane’s Cross River Rail project in the 2013 Budget.

But Turnbull-Abbott Government rejected these value capture plans when it took office and cancelled all public transport projects not under contract.

More recently, the Victorian Government’s submission to the Commonwealth on the Melbourne Metro project also incorporated value capture.

But it appears the Turnbull Government has not bothered to examine the submission.

While the Turnbull Government has maintained the Abbott Government’s position of not committing funds to public transport, it has also maintained the Abbott Government’s $3 billon allocation to the East-West Link toll road project, which would return only 45 cents in public benefit for every dollar invested.

Value capture can be used to help fund major infrastructure projects.

But the real test of this Friday’s cities statement from Malcolm Turnbull will be whether it reverses more than $4 billion in Commonwealth cuts to public transport made by Tony Abbott in 2013.

Since ousting Mr Abbott seven months ago, Mr Turnbull has talked a lot about the need to improve the productivity, sustainability and liveability of Australian cities but has done nothing in a concrete sense to address the key issue of urban traffic congestion.

Indeed, the only thing Mr Turnbull has done on urban policy is ride buses and trams as media stunts to get his picture in the newspapers.

Mr Turnbull must move from riding on trains and trams to actually funding trains and trams.

Since the Coalition took office, public sector infrastructure investment has fallen by 20 per cent.

It is time for Mr Turnbull to cut the waffle and actually invest in cities to confront worsening traffic congestion, which Infrastructure Australia has predicted will cost the nation $53 billion by 2031 unless action is taken now.