Tony Zappia (Makin, Australian Labor Party, Shadow Parliamentary Secretary for Manufacturing) Share this | Hansard source

I welcome the opportunity to speak on the Land Transport Infrastructure Amendment Bill 2014 and to support the amendments moved by the shadow minister for infrastructure.

The Howard government was well remembered for its regional rorts. The Howard government minister at the centre of much of those rorting allegations is the very same minister who now oversees this legislation. At the time he made decisions about where money was to be spent, which projects were given the go-ahead and which projects were rejected. Having billions of dollars at your disposal to spend gives one considerable power. Therefore, not surprisingly, what we see in this bill is a transfer of decision making and with it a transfer of power from Infrastructure Australia to the minister.

Now why would you do that when there is no evidence, whatsoever, that the existing arrangements are flawed or problematic? Why even have an independent body like Infrastructure Australia if they are stripped of their authority? The value of an independent body comprised of a cross-section of skilled people is, in fact, to ensure that government funds are expended efficiently, wisely, in a justifiable priority and free of political interference. It was to stop the political interference and the rorting that the independent Infrastructure Australia was created. I suspect that this issue is not just about power but also that the changes are being made for other reasons. Those other reasons were to enable the Abbott government to deliver on election promises that they know did not stack up and which they know an independent body like Infrastructure Australia would not give priority to and, therefore, would very likely not be recommended for funding by that body.

I refer to projects like the South Road at Darlington project in Adelaide. The project was promised by the Abbott government in the lead-up to the 2013 election to shore up the vote of the member for Boothby. It is a major piece of infrastructure but, as worthy as it may be and as needed as it is, it is not Adelaide's highest priority infrastructure project. In fact, an alternative project for the very same road is considered a much higher priority project by the South Australian government's department of infrastructure and—I strongly believe—by the South Road commuting public. I refer to the alternative project of widening South road between Torrens Road and the River Torrens. What is more, a cost-benefit analysis of the two projects—that is, the South Road at Darlington upgrade and the South Road Torrens Road to River Torrens widening—shows that the return on the Torrens to Torrens widening is $2.40 for every dollar expended; compared with a return of 66c for every dollar spent on the Darlington project. That is why an independent body like Infrastructure Australia is unlikely to recommend the project, and it explains why the minister, through this legislation, seeks to and needs to sideline Infrastructure Australia. The Abbott government knows that it would otherwise be embarrassed in terms of the priority it gives its projects, because they are based not on merit but rather on political election promises. I believe that it is in order to avoid the embarrassment of having an independent body saying to the government: 'This is not the priority project that you should be funding,' that the independent body is being stripped of its power.

I raise another matter in respect of South Australia's share of local roads funding. Members opposite claim that this is the infrastructure Prime Minister that we now have in Australia, and that we have historical amounts of money being expended on national infrastructure. For the last two decades, South Australia has been receiving less than its fair share of local roads funding. South Australia has over 11 per cent of the nation's roads; it has over seven per cent of the nation's population; yet it receives over five per cent of road funding from the federal government. Each year, because of that injustice, the amount of money that is given to South Australia been supplemented. In fact, in the last government's budget the supplement was in the order of about $17 million a year for the next three years. South Australia is given that supplementary funding in order to make up the shortfall that it would otherwise be entitled to if it were to be given what we believe to be a reasonable share of the national road funding—a reasonable share being somewhere between the population quota of seven per cent and the total proportion, 11 per cent, of the country's roads. It is interesting to note that under the Roads to Recovery program the amount that South Australia gets is over eight per cent. In respect of that allocation, the quota seems quite reasonable and certainly much fairer than what it is under the other formula.

Given that, if South Australia is to get an increased share of local roads funding, it would come at the expense of allocations to other states, I can understand the difficulty in the past, with ministers saying, 'If South Australia gets an increased allocation, someone has to lose out.' The way to correct the anomaly—it is an anomaly that dates back about 20 years; I do not understand the historical context of it—is to increase the quantum of money that goes into road funding. You could then increase South Australia's allocation without decreasing the amounts that go to each of the states. My question to members opposite is this: if this is a historical amount of funding that is being provided to infrastructure, is this now not the time to correct the imbalance and give South Australia, once and for all and permanently, its fair share of national road funding from the federal government? I believe the opportunity is before us right now with this legislation and I would urge members opposite to consider correcting what has been a long-term anomaly and to restore South Australia's fair share of local roads funding.

This legislation has other aspects to it that are also of concern. I note with interest that the reference to climate change in Infrastructure Australia's guidelines is totally removed in this legislation. I find it unusual and perplexing that a government would think that just because you remove a reference to climate change it means the issue will go away. The truth of the matter is that it will not go away just because you remove references to it in your guidelines or in your legislation. That is a retrograde step on the part of the government. The reference to climate change is in there for a very good reason—that is, to ensure that projects take into account the possible effects of climate change into the future, when they are prioritised in terms of whether they should or should not get funding.

It is also interesting to see that the tax concessions for private investors in infrastructure are also being excluded from this legislation. We know that within Australia there is a deficit of infrastructure funding and infrastructure spending throughout the country. We know that the only way that that deficit will ever be made up is if we go into joint partnerships with private investors from time to time. In order to do that, there has to be an incentive for those investors. To take away the tax concessions that previously existed in legislation is a retrograde step, because it means that you will no longer attract the level of private investment in major infrastructure projects that you might otherwise have done, and in turn that means that infrastructure will either be delayed or never be built. As members opposite have quite rightly pointed out—and members on this side have pointed out the same—efficient infrastructure adds to national productivity. It is as simple as that. In turn, national productivity not only adds to the nation's income but also adds to business efficiency and viability. We need to do all we can to ensure that we have the infrastructure that we need to serve this country, and not do the opposite by taking away the tax concessions which were put in place for a very good reason.

I return to my initial point, about transferring authority back to the minister, from a different perspective. A number of national bodies, including the Business Council of Australia, the Tourism and Transport Forum and the Urban Development Institute of Australia, all support Labor's amendment to restore authority to Infrastructure Australia. They do so because they understand that Infrastructure Australia will always act independently—free of politics—to argue the case about which projects need to be funded first.

We are dealing with considerable expenditures in infrastructure. It was the last Labor government that made infrastructure spending a major priority in this country. Under Labor we went from being about 20th in infrastructure spending amongst OECD countries to being first. That was the difference Labor made, ensuring sufficient public funds were dedicated to infrastructure in this country. To its credit, the Abbott government has maintained a high level of infrastructure spending. However, it is important not only to maintain a high level of infrastructure spending but also to ensure that it is spent in accordance with the priorities that best serve this nation. If bodies like the Business Council of Australia can say to the government that allocating funds to projects needs to remain independent of politics then the suggestion that Infrastructure Australia needs to remain independent is not simply some sort of left-wing conspiracy.

The independence of Infrastructure Australia will ensure the projects that are truly deserving of priority get the priority they need and hopefully the minister will, in turn, support them through the final determination. I do not doubt that ultimately these decisions always will be made by government, but the transparency of having an independent body put up a list of recommendations will be welcomed by the public. If the minister, having seen the recommendations from Infrastructure Australia, determines not to support the priorities then it will be necessary to explain that determination. If there is a justifiable argument then so be it, but if there is no justifiable argument then the public will have a right to know why a project was funded ahead of another project that everyone else knew full well would have given the taxpayers a better return for their dollars. At the end of the day, these are Australian taxpayer dollars—in the order of $50 billion to $60 billion over the next three or four years. These are substantial funds. The public have a right to know that those funds will be spent not in accordance with the political priorities of a government, regardless of which government is in office, but in accordance with national priorities where those funds will provide the Australian people with the best return on their dollars.

For those reasons, I believe that the amendments moved by the shadow minister should be considered by the government. I believe that they are appropriate. With those comments, we broadly support the expenditure in this bill but I hope that members opposite take the opposition's amendments into consideration.

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