Pat Conroy (Charlton, Australian Labor Party) Share this | Hansard source

I am pleased to make a contribution on the Asset Recycling Fund Bill. In beginning I would be remiss not to comment on the contribution from the member for Herbert who lectured this side about stable ground rules and predictability—this from the party of regional rorts. This from the party that changed infrastructure legislation to take away from an independent expert body, Infrastructure Australia, the ability to grant tax concessions for designated infrastructure investments and grant those powers to the Deputy Prime Minister who presided over the regional rorts affair. The hypocrisy and the chutzpah of The Nationals on regional rorts and infrastructure investment is beyond belief. But I will give it to the member for Herbert: he said all that he said with a straight face, and I respect his ability to do that.

I am pleased to make a contribution on these bills, and the purpose of these bills—let's make no bones about it—is to encourage state and territory governments to privatise assets and recycle the proceeds into new infrastructure. Labor is moving two sensible amendments to the bills. The first requires that the minister may not recommend a proposal for Commonwealth funding unless they have considered advice from Infrastructure Australia as to the merit of the project, especially its contribution to productivity. The second requires that the finance minister table a disallowable instrument for each privatisation or reinvestment transaction that the government deems eligible for the incentive payment as a precondition for the paying of Commonwealth funds. In relation to the substantive nature of these bills, Labor believes that the federal government does need to provide leadership in collaboration with our states in funding nation-building infrastructure projects. Government standards are important in this process in ensuring that decisions on investment are made in the broad national interest and not in the interests of political parties. The work of Infrastructure Australia is critical in this regard, and I will elaborate on this further in my contribution.

Labor recognises that asset recycling can be beneficial in certain circumstances and not in others. It is the obligation of the individual state and territory governments to make these determinations in consultation with their communities. The federal government of course already makes a very substantial contribution to many infrastructure projects, and Labor is of the view that it is a retrograde step to replace the substantial direct contribution with a simple 15 per cent incentive. If you are going to have a 15 per cent incentive, that cannot be an excuse for the federal government to retreat from infrastructure funding in other ways. Labor believes that this new asset recycling approach must be in addition to the very substantial levels of federal government funding in nation-building projects. Anything less will have a dire consequence for economic growth and prosperity in this nation. It is also worth noting the record investment in infrastructure that occurred under Labor—and this was delivered without state governments privatising their public assets to pay for it.

All sides of the House agree on the fundamental importance of infrastructure investment to the Australian economy. It is of vital importance that governments invest in roads, rail, ports and airports. The World Economic Forum's Global Agenda Council on Infrastructure makes the very important point that the cost of building infrastructure is vast but the cost of failing to make these investments is incalculable. The OECD correctly identifies that upgrading infrastructure drives competitiveness, boosts trade and promotes economic growth. So, investing and building new infrastructure as well as improving existing infrastructure is fundamentally important to growing our economy and improving productivity. And of course the completed and upgraded infrastructure assets deliver enormous benefits for the economy and our society as a whole. The OECD has also noted that new ways of infrastructure financing are needed. And, as I have said previously, asset recycling can be an appropriate vehicle to fund new assets and infrastructure.

Labor has proposed amendments that enhance this purpose. These are having Infrastructure Australia assess the new infrastructure as 'productivity enhancing' and the requirement to table a disallowable instrument for each privatisation or reinvestment transaction. These ensure that this asset-recycling vehicle is appropriate and is in the national interest. And it is important that we include Infrastructure Australia in this process, because, since its creation in 2008, Infrastructure Australia has made a very important contribution to the way the federal government makes decisions on infrastructure investment. In the year Infrastructure Australia was created, its chair, Sir Rod Eddington, said of the new body:

It introduces a bold new approach to identifying, planning, funding and implementing infrastructure of national significance across Australia. It also introduces rigorous and robust economic analysis of infrastructure investments prior to government decision-making.

It is disappointing therefore that the current government is seeking to undermine its effectiveness and operation. It is clear that the Deputy Prime Minister wants a return to the days of infrastructure investment decisions being made on the basis of coalition electoral advantage and not the broader national interest. If the federal government is to pursue this asset recycling model, it is essential that Infrastructure Australia remain involved in the process. The amendments we are proposing ensure that it does.

The amendment, which will ensure that, before approval, Infrastructure Australia provides an assessment that the new infrastructure is 'productivity enhancing, including publishing a cost-benefit analysis, greatly strengthens the bills. In speaking on the asset recycling bills, it is relevant to highlight Labor's approach to infrastructure investment and what we have seen from the coalition since they have come to government. Those of us on this side of the House are rightly proud of our record of achievement in infrastructure investment. Because of this record investment, Australia has gone from being ranked 20th out of 25 in the OECD to being ranked second in terms of spending on infrastructure as a proportion of gross domestic product. This is a great achievement. It is an achievement that the last Labor government and the then Minister for Infrastructure should be rightly proud of. And it is a very important statistic: because of Labor's investment, Australia is ranked second among the nations of the developed world in terms of infrastructure investment.

And let's looks at what the results of that investment have been. The roads budget doubled to $46.5 billion; local government road grants were lifted by 20 per cent; $13.6 billion was invested in urban rail infrastructure, more than all Labor's predecessors combined; and $3.4 billion was invested in the rail freight network. As well as these investments, the fundamental importance of infrastructure to Labor can be seen in the fact that we appointed the first-ever dedicated Minister for Infrastructure and created Infrastructure Australia.

Now, let's compare Labor's record with what the Abbott government has done in just nine months. They are re-announcing projects that have been funded by Labor; they are refusing to invest money in public transport; they have cut almost $1 billion out of financial assistance grants to local councils for roads; and they have cut $52 million to reserve a corridor for high-speed rail on the east coast and shut down the high-speed rail advisory group. What a pathetic start from a man who wants to be known as the infrastructure Prime Minister. And it is no surprise, because those on the other side have form on this issue. This is the coalition that delivered the regional rorts affair. We cannot forget the cheese factory that was funded and closed down, the rail line that burnt down, the half-million-dollar grant to Coonawarra Gold for a project that was never built, and my personal favourite: the pet food factory that never opened. Think of all those pets that are going without food now because of the regional rorts affair! And that is the track record of those on the other side. They have not met a barrel of pork that they have not wanted to get their hands into.

This is important in the context of infrastructure in my region of the Hunter. On speaking on this issue, we need to be very conscious of the needs of the Hunter Valley, which is a high-growth region and provides a very strong economic contribution to our economy. The Hunter benefitted greatly from the previous Labor government's historic infrastructure commitments. The Hunter Expressway is the biggest infrastructure project ever undertaken in the region. The $1.7 billion expressway, funded by Labor, has recently been opened. Its benefits are significant. It cuts travel times between Newcastle and the Hunter Valley by up to 25 minutes and provides an easier and more direct route to the Port of Newcastle for heavy vehicles.

The coalition's neglect of the Hunter is apparent in the recent budget. In the budget lock-up, when local Hunter journalists enquired about infrastructure funding in the budget for the Hunter, Treasury officials referred them to the Hunter Expressway project. These officials were apparently not aware that the Hunter Expressway was funded by the Labor government in the 2009-10 budget, and had been open and operating for several months. This demonstrates the complete lack of commitment to Hunter infrastructure from those on the other side. When they were questioned about it, the only project they could point to was a $1.7 billion project funded and built by Labor.

That is not the only important piece of infrastructure in my region that we should be discussing. The Glendale Transport Interchange is the most important infrastructure need, not only in my electorate of Charlton, but for the whole of the Hunter Region. Close to $40 million has been invested in this project from all levels of government. I am proud that although the infrastructure concerned is primarily the responsibility of the New South Wales government, the previous federal Labor government has invested $12.5 million towards the project. This funding is being used to complete major road works in preparation for the construction of the Pennant Street Bridge and rail overpass. This is a very large project that will take a considerable amount of time and resources to complete.

The second stage of the interchange will require further significant funding. Unfortunately it appears that no additional funding was allocated to this project in the recent New South Wales budget. The New South Wales Liberal government has already committed some of the proceeds of the privatisation of the Port of Newcastle to light rail infrastructure in the inner city of Newcastle. However, the residents of western Newcastle and western Lake Macquarie, which I represent, are equally entitled to an allocation of funding from the privatisation. Given Glendale is the most important infrastructure project for the Hunter, it would be inexcusable for the state government not to direct further funding to complete the interchange.

The Port of Newcastle was sold for $1.7 billion, in excess of double what the Liberal government thought they would get for it, yet they are recycling less than $350 million of that to the region. It is only fair that the Glendale Transport Interchange, the most important piece of infrastructure in the region, is built with the proceeds from the port, a port built on transport of goods that have come from the western suburbs of Newcastle, from Westlake Macquarie and from up the Hunter Valley. Residents there will directly benefit from the Glendale Transport Interchange. If this is an example of asset recycling under the coalition I am very worried about what they will do in future, because it demonstrates again that they have only contempt for the Hunter and only pay lip service to the region.

The high-speed rail is another example of this contempt. High-speed rail is a fair way off in terms of being economical, but Labor did the right thing in government. The member for Grayndler allocated $52 million to feasibility studies and put together a working group to look at preserving a corridor. These are all important projects which mean that when high-speed rail becomes economical on the east coast we will be ready to move. This will be a revolutionary project for the east coast and my region in particular. If it were feasible to commute daily to Sydney in less than two-and-a-half-hour to three-hour each way, that can only be good for my region. It would grow the economic base and the population and really secure the future of Australia's sixth largest city.

But the coalition have thrown all of that away by abandoning this effort. They should be in a position where they understand that advance planning is incredibly important. The Badgerys Creek announcement this year, welcomed by people on my side, could proceed only because in the 1980s the visionary Hawke Labor government preserved the land, did the planning and set aside the zoning of the land so that the project could go ahead when the time was right. Those on the other side take no lessons from history, unfortunately.

Another area where they show contempt for my region is the Resources for Regions program run by the New South Wales Liberal government. It is another example of asset recycling, which is what we are debating in this bill. The Resources for Regions program aims to support regional and rural communities affected by mining by addressing infrastructure constraints. Local government areas that are identified as being mining affected communities are eligible to apply for funding from the program. The New South Wales government recently added the local government areas of Cessnock, Maitland and Newcastle to the list of council's eligible for funding. Late in the process they are only adding Cessnock, Maitland and Newcastle to this program for mining affected areas. I cannot think of any local government areas that are more the heart blood of mining than these areas, except for one, which is the Lake Macquarie City Council LGA, which is yet to be added to this list. I am proud of the fact that there are six operating coal mines in Charlton. I would, however, ask the New South Wales government to explain how a council that has six operational mines within its boundaries is not a mining affected community. Perhaps the Hunter Liberal MPs can explain this to my constituents. It is outrageous that Lake Macquarie Council is not eligible for this program, and it again demonstrates that the Liberal Party only pays lip service to the Hunter Region.

To conclude, Labor is of the view that in certain circumstances asset recycling can have merit, but of course state and territory governments have to determine this with their communities. The amendments moved by my colleague the member for Grayndler improve and strengthen the bills. The involvement of Infrastructure Australia in assessing productivity enhancements is important and vital to avoid the regional rorts we saw under the last coalition government. Having a disallowable instrument means that this parliament has the final say on how Commonwealth funding is allocated. God forbid those on the other side who want to support the privatisation of a hospital.

I can assure my constituents that whatever the fate of these bills are, and whatever the future intentions of the New South Wales government are, I will continue to lobby for improved infrastructure in Charlton, most particularly the Glendale Transport Interchange, the most important infrastructure priority in all the Hunter region.

I commend the amendments to the House.

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