David Coleman (Banks, Liberal Party) Share this | Hansard source

I am very thrilled to speak on the Asset Recycling Fund Bill 2014, a very good piece of legislation. I will start by responding to some of the remarks of the member for Charlton. He is always a colourful contributor in this place. The problem with the previous government's approach in this area, as in so many others, was to announce a whole lot of projects and do absolutely nothing about funding them. We have seen this right across the board, but nowhere more so than in infrastructure.

The list of projects is a list of infamy. In Western Australia, there was the Great Northern Highway and the North West Coastal Highway—neither were funded by Labor. In South Australia, there was the APY Lands road network—not funded under Labor. In Queensland, there was the Cape York regional package—not funded. In New South Wales, there were a number of projects: Bolivia Hill, Mount Ousley, the Tourle Street Bridge duplication and, close to the member for Charlton, the Scone level crossing—all unfunded projects. One of the first things this government had to do in this infrastructure space was fund these projects. It is all well and good to put out a press release, to stand at the relevant intersection, shake hands with someone and say, 'This is going to happen,' but unless you actually fund the project, it cannot happen. The alternative to funding it is to just borrow more money and increase the debt level of this nation. That of course is something we would not countenance. So there is a very clear contrast.

The bill we are discussing today is a very good piece of legislation. In a very practical way it encourages the states to recycle their assets and to invest in new productive infrastructure. The fund has some $5.9 billion in it—a very substantial amount indeed. The fund will provide additional funding of 15 per cent when a state seeks to invest in an infrastructure project after recycling an asset. The combination of that 15 per cent incentive with a fund of about $6 billion means that, if the fund is fully utilised, there will be $40 billion of additional infrastructure investment. This is important because these are big, expensive projects and it is not always easy to find the funds to make them happen. A 15 per cent incentive will be very effective in pushing projects across that line of viability, projects that otherwise might not have happened.

Rather than creating a whole new bureaucracy, setting up a new department or setting up lengthy negotiations with the states, the Asset Recycling Fund provides a very simple signal to the states: if you are willing to invest in important capital expenditure, we will stand there right beside you and provide a 15 per cent incentive. That will be critical because, as I said, many projects are just short of that line; 15 per cent will tip many of them just over it.

Infrastructure is important economically because it is the economic gift that keeps on giving. Once you put in place a critical piece of infrastructure—whether it is a road, a port or any other similar facility—once you make that difficult decision to invest, in many cases, many billions of dollars, that piece of infrastructure is then there for the long run. If it is a road, say, it delivers for you on day one, it delivers for you a year down the track, it delivers for you a decade down the track and it delivers for you many decades down the track.

Think about some of the iconic infrastructure in our nation's history. Think about the Sydney Harbour Bridge, for example. What an extraordinary piece of infrastructure that is. In the 80-plus years since its construction, it has generated incalculable economic benefits for the people of Sydney and for the nation more generally. Then there is the Snowy Mountains scheme, another well-known example. Closer to the present day, there is the M4 highway in Sydney. Imperfect though it is—and we are going to fix that with the WestConnex—it has undoubtedly had an enormous impact in opening up Western Sydney to economic growth. We have seen many business precincts pop up along the M4. That would not have happened had the road not been there. With those business precincts—with the warehouses and the factories—come the jobs. Ultimately, why do we care about economic growth? We care about economic growth because economic growth means jobs, and infrastructure means economic growth. That is why it is so important.

There is no question that infrastructure is important. I suspect even those opposite would acknowledge that basic point. But those opposite have shown an inability to take the really tough decisions in this space. There has been no harder or more important decision in infrastructure than the decision to build an airport in Western Sydney. Western Sydney has been crying out for an airport for decades. The original identification of the Badgerys Creek site occurred back in 1969. I was born in 1974, so for my entire life there has been a proposal to build an airport at Badgerys Creek. We all know that there are complexities associated with building a new airport. As a consequence of those complexities, the project did not get approved. It did not go forward. It took the Prime Minister, with his vision of infrastructure for the nation and for Western Sydney, to bite the bullet and make that hard decision.

Frankly, I think the vast majority of people in Sydney know we had to do it and know it was the right decision. There is a strong level of community support—and so there should be. Badgerys Creek is going to be a huge economic boon for Western Sydney. There will be 4,000 jobs in construction. That is great, but of course construction only goes on for so long. What is arguably more important is the ongoing economic benefit—the ongoing infrastructure improvements, the productivity improvement, the fact that you will be able to get freight into Western Sydney more quickly and at lower cost. What does that mean? More freight comes in and so you get more economic activity in Western Sydney, with more material moving through those warehouses. When more material moves through those warehouses—because it can move around so efficiently—what happens? More jobs. That is why it matters.

The best forecast is for an extra $60 billion in GDP by 2060. That is an important figure, but these figures can sometimes be a bit abstract. What does it really mean? It means a huge number of new jobs for Western Sydney. It also means that for Kingsford Smith Airport—a loyal servant of the nation for many decades—there is a reality about what it can and cannot do. It can only grow so far. The approval of a second airport means that we all recognise that Kingsford Smith has a logical capacity. That capacity will be reached fairly soon and Badgery's Creek will help to fill the void.

Badgery's Creek is accompanied by the Western Sydney roads package. This is a critical development. Bringelly Road, Northern Road and Elizabeth Drive are all roads that have not kept pace with the growth of Western Sydney. My colleagues the member for Macarthur and the member for Lindsay, whose electorates are directly involved in this, have been articulate advocates for the need of an upgrade of that infrastructure. A $3 billion project will be great for the area.

It is also great to see the cooperation of the state government. The Commonwealth is providing some 80 per cent of funding for the Western Sydney road project, and the state is providing 20 per cent. This is a good common-sense example of governments rolling up their sleeves and getting things done. That is what the people of Western Sydney and Australia generally want to see.

Closer to my electorate, the government has made a very important infrastructure commitment in stage 2 of the WestConnex. Most critically for my electorate, this means the duplication of the M5 East. The M5 East can be an incredible frustration to drive on. It is only two lanes. This will make four. It is the main arterial road from the south-western part of Sydney into the city—from the Beverly Hills interchange, which is in my electorate; the duplication going towards the city. Best estimate from the department is that it will save 25 minutes for people travelling to the city in peak hour. That is an enormous benefit from a productivity perspective and from a family-life perspective, because it means people get home quicker at the end of the day. That can only be a good thing. So there is great cooperation with the state government.

There is a $1½ billion direct injection from the Commonwealth and a concessional loan of $2 billion, which has really helped. As we discussed before, with these projects, it is often about tipping them over the edge and making them happen, and that $2 billion concessional loan has got WestConnex and the M5 duplication over the line—so much so that the development will start next year and the project will be completed within five years. These are lengthy projects, and that is a very good time frame.

WestConnex will be a tremendous benefit and is consistent with the government's overall approach to getting the economy moving again. We see a similar situation in environmental approvals, where the Minister for Environment has stepped forward and provided approvals for some $400 billion of projects that were sitting idle under the previous government in a maze of indecision, red tape and bureaucratic malaise. The Minister for the Environment last year, prior to Christmas—one of the first things he did on taking office—stepped in and said, 'These are critical and massive job-creating projects, and we are going to enable them to happen.' At the end of the day, that is the critical role of government: enabling things to occur in the economy. The government has great limitations on what it can do regarding direct intervention in the economy, and so much of that is best left to the private sector. What we can do—and what we are doing, through this infrastructure package—is enable private-sector investment.

We are not used to that in my state of New South Wales, because in 16 years we had a state Labor government. We had more announcements about infrastructure than the births, deaths and marriages page. There were all sorts of things that were going to happen. I have to say, we did as a populace, the people of New South Wales, become a little cynical. The Parramatta-Epping rail link was announced with much fanfare; we literally lost count of the number of times. There were so many hard hats, so many fluro vests, so many announcements and so much happening. At the end of the day, people will judge governments on their results—as they should—and the infrastructure results in New South Wales, in that sorry period between 1995 and 2011, were just appalling. That is why it is so great to see the emphasis on infrastructure, from the New South Wales government working hand in hand with the Commonwealth, in this asset-recycling area.

One of the fundamental commitments of the government prior to the election was to build the roads of the 21st century. We know that we need that. We know that for too long difficult infrastructure projects have been put in the too-hard basket. This government, through a combination of direct investment, incentives for states to invest and getting rid of arbitrary and excessively regulated approval processes so as to allow the private sector invest, is going to build the roads of the 21st century. WestConnex is a critical one for my electorate and this bill will assist in that tremendous government initiative.

See this speech in context