Bridget McKenzie (Victoria, National Party, Shadow Minister for Infrastructure, Transport and Regional Development) Share this | Link to this | Hansard source

In respect of audit report No. 3 2024-25, Performance audit—Australian government commitment to the Melbourne Suburban Rail Loop East project: Department of Infrastructure, Transport, Regional Development, Communications and the Arts, I move:

That the Senate take note of the document.

This report that was released by the ANAO today was completed at the request of the Liberal and National parties. We asked the ANAO to examine the veracity of the $2.2 billion of Commonwealth taxpayer money—that includes taxpayers from Western Australia, Queensland and Tasmania—heading to Jacinta Allan for Daniel Andrews's pet project, the Suburban Rail Loop, a project that has no cost-benefit analysis, that Victoria's own Auditor-General has serious concerns about and on which Infrastructure Australia has been asking the Victorian government for a business case for over 18 months. Did this stop Catherine King requesting $2.2 billion from the government's ERC—a lazy $2.2 billion to slap down to her political mates down in Victoria for a project that has so many question marks about it?

Everyone in parliament, particularly parties of government, understands that, as you head into the election, there are commitments you make to communities, to states and to different groups in order to get their support. That is what a democracy is all about. But you'd think, given that the Labor Party made such a song and dance about how you should make those commitments and who should be able to receive taxpayer funds from the Commonwealth, they would have put a bit more rigour around it. They didn't.

When this issue was raised time and time again by the Victorian opposition in the Victorian parliament and by us here and in estimates, what did Minister King do? She ran out and announced a merit review. She was going to run this project through a merit review. Everyone, including all the teals, gave a big sigh of relief: 'Thank goodness Catherine King has some integrity. She's going to put this $2.2 billion that looks like it's going to a dodgy project, because it is, and looks like it's being done for political reasons—to give the state Labor Party some Commonwealth government support to win an election in November 2022—through a merit review.' Well, guess what the ANAO report finds? Those who are listening in at home can look on their computers. Pages 22 and 23 show that the minister announced the merit review but didn't complete the merit review. She asked her department to stand down from the merit review once it became clear the project has no merit.

Why is the state Labor government in Victoria pursuing this project, which is being blown out and blown out, which has a dodgy assessment by Victoria's own Auditor-General and which failed to put forward a business case to the government 's own Infrastructure Australia, which Anthony Albanese was spruiking at last night's BCA dinner? Well, mate, don't promise $2.2 billion of Commonwealth taxpayer money on a project that refuses to submit its paperwork. I used to be a teacher. If kids didn't put their homework in, it was because they hadn't done it. They knew they weren't going to pass.

Here we are. I'll just quote from this. The ANAO is absolutely scathing about the response from the minister:

… the minister stated in a media interview that the department would conduct a 'merit review' on all election commitments over $5 million—

including the $2.2 billion for the Suburban Rail Loop. But:

There is no evidence of the approach the department planned to undertake for the merit review …

So this was a bit like what this Prime Minister's fond of doing: coming up with a press release to calm down a political firestorm in the media, only for you to find, when you lift the curtain on his promise, that there are no details. There was no merit review. It was done to quiet the horses. It's actually the Daniel Andrews tactic in politics: you make a statement based on your assumption that, in two months time, the voter will have forgotten what you said. This government is doing exactly the same thing. This is an absolute basket case of a process, and Minister King needs to do something about it.

Jane Hume (Victoria, Liberal Party, Shadow Minister for the Public Service) Share this | Link to this | Hansard source

I too rise to take note of the ANAO's audit of the Australian government's commitment to the Melbourne Suburban Rail Loop East project. There is a sickness in the Victorian Labor Party and a sickness at the federal Labor Party level too. It's a sickness that seems to affect all Labor governments, because all Labor governments right around the country believe that taxpayer money is not your money, not money that you earned and not money that you struggled for; it's their money to do with whatever they choose, no matter how irresponsible that commitment may be.

This sickness is particularly acute when it comes to infrastructure. There is no better example of this than the Melbourne Suburban Rail Loop, the subject of the Auditor-General's report that's been tabled in this chamber today. This report, combined with the report that was previously released by the Victorian Auditor-General, shows irrefutably and so clearly that Labor doesn't understand productivity and doesn't understand using a business case to analyse investment or it doesn't care that it doesn't use those foundational tools of making good decisions that have a fiduciary duty to those whose taxpayer dollars they are spending. It shows that Minister King is just as derelict in her duty to spend taxpayer dollars wisely as her Victorian counterparts, and that is quite a standard, indeed.

Let me go to a couple of the key points that are contained within the report. In August 2022, the Victorian Parliamentary Budget Office released a cost estimate that indicated that the cost to build the Suburban Rail Loop East would be $36.5 billion and the cost to build and operate SRL East and North over 50 years is going to be—wait for it—an eye-watering $200 billion. You'd hope that a government that was willing to commit $200 billion to a project had done a thorough cost-benefit analysis, but in September 2022 the Victorian Auditor-General released an audit report on major transport infrastructure project business cases that considered four Victorian government transport infrastructure business cases, including the Suburban Rail Loop. What did it find? That report stated—and it's quoted in the Commonwealth Auditor-General report—that:

The business case DoT and SRLA—

Department of Transport and Suburban Rail Loop Authority—

provided to the government for the SRL program—

wait for it—

did not support informed investment decisions.

That is an extraordinary revelation.

It went on to say:

The business case only analysed part of the program and did not fully meet DTF's—

the Department of Treasury and Finance—

guidance requirements.

DTF has provided substantial advice to the government on the SRL program since 2019. However, it is yet to complete the assessment of the business case required under its HVHR—

high-value high-risk—

project assurance framework to give the government confidence in its deliverability.

Confidence in its deliverability? We have committed $2.2 billion to this. It also stated that the department 'did not demonstrate the economic rationale for the entire project'. So there's no economic rationale for a $2.2 billion spend and commitment that Anthony Albanese made to his mate Dan Andrews. That's unbelievable.

Furthermore, the department's confirmed that there was no plan to conduct a business case. When questioned, the Victorian auditor was told they had no plans to do so. Even more damning, the Victorian report found that the benefit-cost ratio of the Suburban Rail Loop was 0.51 when calculated in line with the Department of Treasury and Finance's guidelines, but the Victorian government claimed it was one to 1.7. So they have been entirely dishonest. This is a project that the federal government and Catherine King decided to commit $2.2 billion to in the 2022-23 October budget.

The Commonwealth Auditor-General's report states: 'The minister stated in a media interview that the department would conduct a merit review on all election commitments over $5 million and that the projects that don't stack up would not proceed.' There is no evidence of the approach the department planned to undertake for the merit review process across election commitments.

Minister King has failed in her duty here, and the auditor's report could not be clearer. The decision must be made to cancel this project. Cancel this project today. (Time expired)

Sarah Henderson (Victoria, Liberal Party, Shadow Minister for Education) Share this | Link to this | Hansard source

I also rise to take note of the Australian government commitment to the Melbourne Suburban Rail Loop east project report handed down by the Auditor-General. I firstly want to say to the members for Corio, Corangamite, Bendigo and Ballarat—those regional Labor MPs who have sat on their hands and done nothing while $2.2 billion was funnelled into this completely inadequate project in the heart of Melbourne, deserting the regions, deserting our infrastructure needs in regional Victoria—that this is an absolute disgrace. I say that because over three federal budgets not one bit of new funding for any major regional infrastructure project has emerged in the Albanese government's federal budget for regional Victoria. This is yet more confirmation that this inadequate, incompetent Labor government does not care about the regions. All it cares about doing is propping up a really bad Victorian Labor government with dodgy projects—not only undercooked but with no proper business case.

The federal government should not commit funding to the Suburban Rail Loop until this project has been subject to Infrastructure Australia assessment of a full business case. The fact that $2.2 billion was funnelled to this project under circumstances where the Albanese government turned its back on regional Victoria is, as I say, a shocking reflection of Labor's contempt for regional Victorians and, frankly, the regions right across this country. Prime Minister Albanese has gone back on his pre-election commitment that nationally significant projects would be subject to full Infrastructure Australia assessment. Do you know why? He just did a dodgy deal with Dan. That's what this is all about. Daniel Andrews, the former premier, rang him up and said: 'Mate, we need $2.2 billion. Don't worry about anyone else. All those seats in the regions? Forget them. We want you to prop up this project.' As we now see, this is an absolute debacle.

The coalition wrote to the Australian National Audit Office in December 2023 seeking an audit of the Albanese government's decision to commit $2.2 billion towards the Victorian Labor government's Suburban Rail Loop project. The project, as I say, does not have a full business case. The Victorian government has delayed submitting full business case documents to Infrastructure Australia. This is a project mired in smoke and mirrors and deception. Evidence provided to the Senate estimates revealed Infrastructure Australia requested detailed information from the Victorian government more than 18 months ago, with no response. By ensuring proposed amendments to the Infrastructure Australia Act enabling a full inquiry by Infrastructure Australia were withdrawn, the Albanese government has refused to subject the Suburban Rail Loop project to a review. As we have heard, the Victorian ombudsman found the project had blindsided key transport and infrastructure agencies, denying state experts the opportunity to provide impartial policy advice to the government or to assess this project against other infrastructure priorities.

We don't even know how much the Suburban Rail Loop will ultimately cost to build. However, the Victorian Parliamentary Budget Office released an updated cost-to-build assessment in March 2024. This estimate found a $16 billion cost blowout, taking the full Suburban Rail Loop east and north cost to build and operate to an eye-watering $216.7 billion through to 2084. Contrast that with funding for any new projects in Bendigo, in Ballarat, in Corio, in Corangamite: a big fat zero. Over three federal budgets, there has been no funding for any new projects. This is a disgrace. This demonstrates that this government is completely out of its depth and it has no integrity and no transparency. We're now seeing further evidence of it. (Time expired)

Paul Scarr (Queensland, Liberal Party, Shadow Assistant Minister for Multicultural Engagement) Share this | Link to this | Hansard source

I too rise to take note of this damning Auditor-General's report. Whilst I appreciate Senator Henderson's wonderful advocacy for regional Victoria, I want to talk about Queensland's infrastructure needs. My office is based in the Ipswich region in South-East Queensland, which has been crying out for additional infrastructure to accommodate the tens of thousands of new residents who are moving to that area. It's one of the highest growth areas in the whole of Australia—the south-west corridor—crying out for the roads, rail and bridges that the greater Ipswich region needs. Here we have this travesty of $2.2 billion of federal government funds being directed to the mendicant, bankrupt Victorian government for a—is this serious?—$216.7 billion project. This is nonsense. I can hardly believe it. That's unbelievable. And they haven't got a business case. There's no business case.

There's no business case—absolutely no business case at all. I'm going to ignore you, Senator Shoebridge. There is no business case and no confidence in deliverability. Well, how could you come to a conclusion otherwise when you've got a mendicant state government proposing a $216.7 billion project? When they've capped out in terms of revenue- and taxation-raising measures in Victoria and businesses are looking to close up shop and move to Queensland or South Australia, how in goodness's name can they afford $216.7 billion?

Let me tell you what we could do with that $2.2 billion in my state of Queensland in the greater Ipswich region: we could build a second river crossing over the Bremer River, which is absolutely fundamentally needed for Ipswich—and it has been recognised by independent stakeholders as a priority project—so that when floods do occur on the Bremer River there's a second river crossing to enable the people of Ipswich to have connectivity. That's what we could do with far less than $2.2 billion. We could then move to Amberley Air Force base, which has an absolutely disgraceful issue in terms of traffic management. Former Deputy Prime Minister McCormack tried to sort that out with the then state Labor government, but the state Labor government failed to come to the party. It's still a deathtrap. We have thousands of people at Amberley Air Force base, and in peak hour it's just about impossible to safely get to Amberley Air Force base, one of our key Defence installations. We could fix that for the $2.2 billion. We could fix the Mount Crosby interchange as well, which is another deathtrap in the greater Ipswich region. We could fix that for $2.2 billion. We could also progress the Springfield-to-Ipswich public transport corridor, which would provide a loop in terms of the railway or public transport options that would go from Brisbane around to Ipswich and then back to Springfield and to Brisbane. We could do all of that with that $2.2 billion.

This is the opportunity cost. Every single dollar of taxpayers' money is crucial. When you direct $2.2 billion of taxpayers' money to a dodgy—listen to this figure—$216.7 billion project, it's madness. What about the rest of the country? Confidence in deliverability? There could be no confidence in deliverability. So I congratulate Senator Henderson on her advocacy for regional Victoria, but what about Queensland? What about the people of Ipswich, the greater Ipswich region, where they've been taken for granted by the Labor Party for years and years and years? The people of the greater Ipswich region deserve their roads. They deserve their rail. They deserve their bridges.

Yet the Albanese Labor government is directing $2.2 billion—which could be spent in one of the fastest-growing areas in Australia, in the greater Ipswich region—down south. Albo, or, I should say, the Prime Minister, is sending that $2.2 billion down south to Victoria to assist in a $216.7 billion project, where there's no confidence in deliverability—in fact, there's probably confidence that it can't be delivered—and no economic or business case. Madness! Absolute madness! This is unbelievable. It's just staggering. And the Labor government should deeply reflect on this.

I seek leave to continue my remarks later.

Leave granted; debate adjourned.