David Coleman (Banks, Liberal Party) Share this | Hansard source

It is great to have the opportunity to speak about infrastructure in this House, as it is such an important economic driver for our nation. Before getting into the detail of the bill and the very clear contrast between the government and the truly appalling record of those opposite in the infrastructure space when government, I want to reflect for a moment on why infrastructure is so important. One of the distinguishing characteristics of infrastructure is that it is an economic gift that keeps on giving, because when you build infrastructure—whether it is a road, a bridge or other important infrastructure—you build it once and 20, 30, 40 or 50 years down the track it is still delivering those productivity benefits to the economy. It therefore makes sense for government to take a very forward-leaning approach when it comes to infrastructure.

This bill is in line with a suite of different initiatives by the government in relation to infrastructure. I would highlight at the macro level the legislation in relation to the states. It encourages states to recycle assets and to invest in productive infrastructure by giving them a 15 per cent financial incentive. That is really important, because often an infrastructure project might be on the borderline as to whether or not it goes ahead from an economic basis. With the federal government providing that 15 per cent bonus to the states when they recycle assets for the purpose of creating new infrastructure, that will tip numerous projects over the edge and that will mean more than $50 billion of incremental infrastructure will be generated through that incentive to the states. That is a very important initiative.

I do want to contrast the direction we are going in infrastructure with that of the previous government, because you really cannot talk about infrastructure in this country without talking about the largest infrastructure project that has been conceived in recent years. Labor's NBN is the biggest example of grotesque mismanagement of infrastructure. We must always remind people of the extraordinary incompetence and mismanagement that was involved here. This matters because the NBN was not some small project done by a local council or a suburban progress association. The level of discipline and rigour that went into thinking around the NBN would put suburban progress associations to shame. There would be a call for the president of the progress association to resign if they had similar planning to what Labor did with the NBN. This was very, very bad.

We started out with a notion that the NBN was going to cost about $10 billion: $4.7 billion was going to be put in by taxpayers and the private sector was going to stump up with the remaining $5 billion or so. What actually happened was because there actually had not been any substantive planning in relation to the NBN, what the likely returns would be or how the $10 billion would be recouped, there was not a lot of interest in co-investing alongside the federal government. Around the same time, it became increasingly apparent to the previous government that $10 billion was not going to quite cut it. We saw this spectacle of the previous Minister for Communications, Senator Conroy, chasing the Prime Minister, Mr Rudd, around the country and trying to deliver the bad news that, 'We have got it all wrong. $10 billion is not going to be enough. We don't know how much it will be. We just know that $10 billion is not the right number.'

Peter Hartcher described those weighty conversations like this:

In those first airborne conversations, the Prime Minister barely hesitated. He decided that, if the private sector was unable to build the system, the Government would.

On fibre to the premise, there was notion that every single home in the country had to have fibre directly to it even if it had already had perfectly good cable running to the front door. On this, Peter Hartcher says:

Rudd instantly saw the attraction of this option. The big drawback? The cost. It would cost much more than the $10 billion or so for the original proposal.

Then there is my favourite line from Peter Hartcher's chronicling of that unfortunate period in our history. After committing to the project, in this discussion:

Next came the detail work.

So they went, 'We are going to do it. We are going to build the fibre to the premise, even though we do not actually need it. We will commit to doing that and then we are going to subsequently work out how much it might cost.' The number they ended up with was about $40 billion. That was also massively wrong. Really, it is about $70 billion, based on the independent analysis that was conducted late last year. $6.5 billion was spent prior to the election to cover three per cent of the population. It was just an absolute management disgrace. When public policy schools conduct case studies in the future of how not to govern and how not to purport to manage a project, this will be in the honours course. That is because it is an absolute disgrace. That is characteristic of Labor's approach to infrastructure.

I come from New South Wales, and we are a state that has been crying out for infrastructure for so long. We had 16 years of Labor inadequacy. They talked about the Parramatta-Epping Rail Link, which must have been announced four or five times, about the North West Rail Link and about lots of road projects. There were lots of announcements for the news on Sundays—always on Sundays—but they were never followed up. In New South Wales, we became a little cynical, as a people, about infrastructure projects. It has taken the leadership of the coalition government under the Premier, Mike Baird, to really get things going. That is where the federal government and its contributions have become so important.

The WestConnex is a fantastic infrastructure project and will be of huge benefit to people in my electorate. It duplicates a road called the M5 East, which runs towards the airport in inner south-western Sydney. That road is two lanes in and two lanes out; it is just not enough. It needs to be duplicated, and it will be. It will be duplicated not only because of the leadership of the state government but also because of the absolutely critical contribution of the federal government. The federal government made a straight cash contribution of $1.5 billion and provided a $2 billion concessional loan, which basically meant that the state was able to pull that project forward substantially.

My friend and colleague in St George, the member for Barton, the Treasurer, Premier Baird and I were at Beverly Hills in the electorate of Barton the other day while the first geotechnical work was getting underway on the M5 East duplication. This is not just an announcement; this is actually happening. The M5 East will be duplicated. It will happen in the next five years and engineers estimate that it will save someone driving from Beverly Hills in my electorate to the city in peak hour about 25 minutes. That is enormous. It is a massive productivity benefit. It is also of great benefit for family life, of course, because less time on the roads means more time at home with families, and that is very important.

The other important infrastructure project in Western Sydney is the second airport. I am 40 years old and for my entire life people have been talking about building an airport in Western Sydney. I think that most people on both sides of the House know in their heart of hearts that it needs to happen. It took this Prime Minister to actually have the guts to do it.

With the important local contributions of the member for Lindsay and the member for Macarthur in making sure that that project is structured in the ideal fashion, it will be built, and there will be huge road improvements in Western Sydney. We will see the upgrade of Elizabeth Drive, Bringelly Road, Northern Road and all those roads around Western Sydney near the airport. These are huge infrastructure upgrades, and they will be delivered prior to the airport being completed. So there will be an infrastructure benefit in the very near future. That is what we need, because we need infrastructure to grow the economy. We do not need talk about infrastructure, and we do not people simply saying that they support infrastructure; we need people to actually build infrastructure. That is what this government is doing.

Returning to the Infrastructure Australia Amendment (Cost Benefit Analysis and Other Measures) Bill 2014, the bill will see that Infrastructure Australia will conduct a cost-benefit analysis on projects receiving Commonwealth funding of $100 million or more. It will also require Infrastructure Australia to develop a 15-year list of priorities, and that is a very worthy endeavour because that is what we need as a nation. We need to take a step back. Instead of deciding priorities on an ad hoc, case-by-case basis, we need to strategically, thoughtfully, methodically go through and say, 'What are the infrastructure priorities?' I know what those priorities are in my part of the country, and WestConnex to the M5 East is absolutely top of the list. There are other priorities all around the country and Infrastructure Australia will work through those in an orderly fashion and ensure that we have a strong infrastructure plan going forward.

As a nation, we need to get shovels on the ground, to get the cranes into position and to create infrastructure. I have an anecdote about someone in my electorate who said to me the other day that he is absolutely sick and tired of sitting in traffic on the M5 East every day going into work. He said that it used to take him about half an hour to 35 minutes to get into the city, and it now frequently takes him an hour. When that road was created, it was frankly inadequate for the purpose at the time, and it has become less and less adequate over time. I am very pleased that in advocating the importance of the M5 East duplication to members of the government we have had success in securing that important funding of $1.5 billion in cash and the $2 billion concessional loan to the state government, because both of those things are required.

We must not allow a return to the days of infrastructure as some sort of political plaything. We cannot go back to the days of people committing tens of billions of dollars on the back of an envelope. We must have an orderly approach in this area.

The second airport initiative will create tens of thousands of jobs during the construction phase. Importantly, when the airport is completed, we estimate that Australia's GDP will increase by about $24 billion. That sounds a bit abstract; you might ask, 'What will it mean if GDP goes up by $24 billion?'

Basically it means we get more stuff done. We get more goods into Sydney in a more timely fashion and we get the flow of people into our city more quickly. We have huge opportunities in freight. Sydney Airport is quite constrained in what it can do with air freight. Bringing more freight into the Western Sydney airport will be a great opportunity. A lot of people in Western Sydney may not have to drive a long way to work, as the airport will create a substantial hub. There will be industrial development in the vicinity of the airport. New roads are going to slash travel times in the area around Badgerys Creek. We will see substantial productivity benefits.

The bill is a sensible approach to adding to our already very strong record in infrastructure development. It is a massive contrast with Labor's appalling mismanagement, principally through the NBN. I commend the bill to the House.

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