Paul Fletcher (Bradfield, Liberal Party, Minister for Urban Infrastructure and Cities) Share this | Hansard source

I rise to speak today on the Appropriation Bill (No. 1) 2018-19, and I welcome the opportunity to speak, yet again, about the Turnbull government's commitment to a once-in-a-generation investment in nation-building infrastructure. I want to make three points. We are seeing an unprecedented level of infrastructure investment led by the Commonwealth government, which is driving economic growth, investment and employment outcomes. Our infrastructure spend reflects key policy priorities of the Turnbull government. I also want to use the opportunity to correct some misleading claims by the shadow minister—misleading claims by the shadow minister are a resource which is not in scarce supply.

The government is maintaining a historically high spend on transport infrastructure of over $8 billion per year over the forward estimates—and more than $75 billion over the next 10 years—and it is doing that in a wide range of ways. If you include payments to support state infrastructure services, if you also include untied local road grants through the financial assistance grants, if you include payments to non-state equities, if you include investments through equity injections and other financing options, and if you include the various commitments the Commonwealth has made, then what we are providing is $8.6 billion in 2018-19, $33.9 billion between 2018-19 and 2021-22, and over $75 billion over the next decade for publicly announced projects, initiatives and commitments and ongoing subprograms including financial assistance grants and maintenance.

Let me remind the House of the extraordinary sweep and scale of the commitments made in the 2018 budget in relation to infrastructure. They include the $3.5 billion Roads of Strategic Importance initiative to lift the productivity of our regional freight and passenger routes, the $1 billion Urban Congestion Initiative, up to $250 million for major project business case development and up to $160 million in additional investment on the Outback Way.

Let's look at the great state of Queensland, where over $5 billion will be invested, including an additional $3.3 billion for Bruce Highway projects, taking our total commitment on the Bruce Highway to $10 billion; and $1 billion for upgrades to the M1 Pacific Motorway between the Gold Coast and Brisbane, on top of the existing projects already underway between Mudgeeraba and Varsity Lakes and, of course, the Gateway merge. We also announced funding for the Beerburrum to Nambour rail upgrade, we announced $300 million for the Brisbane Metro public transport project and we announced funding for the Cunningham Highway from Yamanto to Ebenezer. In New South Wales, there is $1.6 billion for the Coffs Harbour bypass on the Pacific Highway, for Port Botany rail and the new Nowra bridge. In Victoria, we've committed up to $5 billion for the long-awaited Melbourne Airport rail link. Other projects, such as the North East Link, Rowville rail, the duplication and electrification of the Frankston line to Baxter, a Victorian congestion package, regional rail for Geelong and other projects, total some $2.8 billion.

In Western Australia, there is $1.1 billion for further METRONET projects, $944 million for a Perth congestion package and $560 million for the Bunbury Outer Ring Road. In South Australia, there is up to $1.4 billion for future priorities on the North-South Corridor, inclusive of the $177 million we announced for Pym Street to Regency Road. Money for the Gawler rail line electrification and the Joy Baluch Bridge was also included in this year's budget. In Tasmania, there is $461 million for the replacement of the Bridgewater Bridge and $400 million for a Tasmanian roads package under the Roads of Strategic Importance program. In the Northern Territory, there is funding for the Central Arnhem Road upgrade and the Buntine Highway upgrade. In the ACT, there is a Monaro Highway package. So there is a sweeping and impressive range of infrastructure commitments in the 2018 Turnbull government budget.

This forms part of a pattern in which we are seeing strong activity in infrastructure and in construction around Australia. In the December quarter in 2017 the value of public sector engineering work increased by 5.7 per cent to $8.67 billion. We're seeing this being reflected in the aggregate economic outcomes, as the International Monetary Fund observed a couple of months ago in its annual assessment of the Australian economy. Despite, in its words, the economic shocks of the commodity price boom and the mining investment boom ending, infrastructure investment has helped keep the economy performing. It says:

The recovery from these shocks has advanced further in 2017. Aggregate demand has been led by strong public investment growth amid a boost in infrastructure spending …

Recently the Reserve Bank governor, Philip Lowe, had this to say about government spending on transport infrastructure:

Another important part of the investment story recently is strong growth in investment in public infrastructure. The pick-up has been particularly noticeable in spending on transport infrastructure in the eastern states and the pipeline of work to be completed is large. The extra investment is directly creating demand in the economy today and adding to tomorrow's productive capacity.

Deloitte Access Economics in its recent investment monitor assessed the outlook for business investment in Australia as being healthier than it has been for some time and noted that this comes at the same time as 'state and federal governments are spending large amounts of money on project projects'.

The commitments in this budget build on the Turnbull government's existing record levels of investment in infrastructure, recognising that in order for the Australian economy to continue to grow and be competitive infrastructure investment must remain a core focus for the government. The commitments in this budget form a coherent plan for the future of Australia's transport infrastructure. They represent the projects and upgrades that will help shape our cities and define our regions. Let me point, for example, to Western Sydney Airport as an infrastructure project that will have a transformative economic impact. We are delivering infrastructure that communities in Western Sydney and around the nation will benefit from. We've committed to a $5.3 billion equity injection into WSA Co., the government owned company established to build and own Western Sydney Airport. This project will provide much-needed additional aviation capacity for Sydney and for the nation. It will give the people of the rapidly growing Western Sydney area much better and fairer access to air travel, and it will attract businesses and jobs to Western Sydney, where another one million people are expected to be living in 20 years time. During the construction phase it will support tens of thousands of jobs, including over 11,000 anticipated direct and indirect jobs throughout the construction phase, and by 2031 there will be around 28,000 direct and indirect jobs generated by the airport in its operational phase.

Western Sydney Airport forms part of a much broader list of projects being funded around the country, transformational projects like the $16.8 billion WestConnex motorway project in Sydney, which is being supported with a grant of $1.5 billion from the Commonwealth and a concessional loan of $2 billion, and major rail projects like METRONET in Perth and the Melbourne Airport rail link. We have committed $1 billion for projects on the M1 between the Gold Coast and Brisbane. On the Monash freeway and the M80 ring road in Melbourne the combined investment from the Commonwealth is some $1 billion. I've spoken about the funding we've committed for the future on the north-south corridor in Adelaide, but there are three projects underway benefitting from $1.6 billion of funding from the Turnbull government. Our approach to infrastructure reflects and gives effect to key policy priorities of the Turnbull government: driving productivity and efficiency in the Australian economy, maximising the role for investment and capital, and planning for the growth and effective functioning of our cities.

Let me turn, in the time that remains to me, to addressing a number of highly misleading claims that have been made by the shadow minister. We've had the repeated claim that there's no new money for infrastructure. It is a claim he made in his budget night media release and has made subsequently. It is absolutely incorrect. Let me explain once again the accounting treatment here. The Turnbull government made a commitment in last year's budget to invest $75 billion for infrastructure, and we backed up that commitment with the appropriate accounting treatment, in which we provisioned the required amount of money—several billion dollars a year, every year, over 10 years. That's why we call it a 10-year program. What we will then do every year is allocate specific projects against that rolling program, with the expense allocated to specific years. That's why there's no need for individual dollar amounts to be set out in Budget Paper No. 2, because we've already provisioned a total amount for infrastructure in advance. We've committed to investing over $75 billion over 10 years in transport infrastructure investment, including over $33 billion in the forward estimates, 2018-19 to 2021-22.

The shadow minister is evidently so shocked by this prudent and responsible accounting treatment that he resorts to what he knows to be deliberately false and misleading claims that there's no new money. Tell that to the people who will benefit from Bridgewater Bridge in Tasmania, because they now know there's $461 million allocated out of that infrastructure program for the bridge. They also know that Labor, by contrast, is promising a derisory $100 million. Try telling the people of Bunbury that there's no new money when in fact they've been told, quite correctly, that there's $560 million for the Bunbury Outer Ring Road. Try telling the people of Nowra that there's no new money when they've received the news that there's $155 million committed for the Nowra Bridge. Try telling the people of the Gold Coast that there's no new money when they have been pleased to hear that there's $1 billion allocated by the Turnbull government for two projects on the M1: the upgrade from Varsity Lakes to Tugun and the upgrade between Eight Mile Plains and Daisy Hill. This is all part of the Turnbull government's 10-year plan, with our commitments being fully funded and sequenced within the plan. The Australian government has committed to a decade-long pipeline of infrastructure projects focused on driving economic growth, increasing productivity and connectivity and creating new employment opportunities.

Of course, we hear the ludicrous claim from the shadow minister that infrastructure investment is falling. Wrong. Wrong. Wrong. In his budget night media release, he misleadingly quoted just one line of the multiple lines of funding for infrastructure—Commonwealth infrastructure grants to the states. In other words, he completely ignored the substantial amounts of money the Turnbull government is spending in equity and loan investments: $5.3 billion for Western Sydney Airport and $8.4 billion for the Australian Rail Track Corporation for inland rail, a $2 billion concessional loan. There is even the equity injection into the Moorebank Intermodal Terminal, which he should well remember from his own time as minister.

The total amount of investment provided in equity and loans in the budget over the four years of the forward estimates is over $9 billion, which Mr Albanese simply assumes away in a wholly inaccurate and wholly misleading characterisation of the true numbers of infrastructure investment over the next four years. I remind the House of those numbers: 8.6 billion in 2018-19, $8.7 billion in 2019-20, $8.2 billion in 2020-21 and $8.5 billion in 2021-22. I also remind the House of the average spending when the shadow minister was the responsible minister. It wasn't $8 billion; it was just over $6 billion. So the shadow minister is absolutely wrong when he claims that infrastructure investment is falling.

Let me focus just for a moment on the ludicrous claim we heard repeated just a few moments ago that the funding for the Melbourne airport rail link is a sham. The shadow minister criticises us for indicating an interest in providing equity investment in the Melbourne airport rail link. We make no apology for doing that. We are absolutely interested in looking at innovative ways of funding and financing infrastructure and, if there's the prospect of an equity investment, we are certainly interested in looking at that, just as we have funded Western Sydney Airport through an equity investment. We are absolutely interested in looking at innovative ways to approach infrastructure investment, but I just make the point that the shadow minister, in his comments, seems to have missed Budget Paper No. 3, at page 48, which says:

The Commonwealth’s $5 billion investment in the Melbourne Airport Rail Link will be provided as equity or otherwise as agreed—

that's to say 'as agreed with the Victorian state government'—

but consistent with the principles of conservative Budget management, this investment has initially been reported as grant funding.

So his basic premise is completely wrong—the claim that the money is a sham. It's in the budget as a grant.

Of course we are interested in looking at having a partnership with the Victorian government. We've made that very clear. Of course we're interested in looking at equity. But the fundamental proposition from the shadow minister on this point, as on so many others, is fundamentally wrong. The truth is there are unprecedented levels of infrastructure investment to support economic growth and deliver lifestyle benefits and productivity benefits all around Australia.

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