Malcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | Hansard source

I assume that what the honourable member is talking about is the concept which we certainly embrace in terms of being an element that must come into the financing of infrastructure. The concept of value capture, by which we mean that where new infrastructure—and this is typically linear transport infrastructure: rail, light rail, heavy rail, or indeed potentially a road, but it is particularly applicable to rail—adds value to property and enables it, for example, to be rezoned so that you can get greater density around a transport stop, a rail station and so forth, then some of that value can be captured as part of the overall deal to ensure that that contributes to the cost of the infrastructure. The alternative is simply to finance all of the infrastructure out of the public purse. The reality is, as honourable members know, and the honourable member for Grayndler knows this as well as any of us, I would imagine, if not more so, that the way infrastructure, and particularly urban rail, is financed around the world, and has been financed historically, is by accessing some of the additional value that is created in real estate. That is how the MTR in Hong Kong is financed, for example. That may apply in cases where the railway company owns some land, is granted land or acquires land which it can then redevelop. It may be part of a deal between the private sector, state and local government and, indeed, the federal government. But the federal government has no ability to levy any sort of betterment levy or tax of this kind, as you know.

I will give an example that is close to the honourable member's heart—the Gold Coast Light Rail. The City of Gold Coast council made a substantial contribution, in terms of its budget, to the Gold Coast Light Rail. It did so, as the mayor openly acknowledges, because of the uplift in rates—the increase in value in the land and the properties contiguous to the rail line—gave him additional revenue. The fact of the matter is that this is an important element in the debate, and the alternative is having less infrastructure and higher taxes.

What the honourable member has to recognise is that what we are seeking to do is have, as I have said: jobs and growth and a sustainable tax system, ensuring that we can fund all our commitments and bring the budget back to balance. That is what Australians expect: responsibility.

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