Darren Chester (Gippsland, National Party, Shadow Minister for Regional Education) Share this | Link to this | Hansard source

On behalf of the coalition I rise to speak on the Infrastructure Australia Amendment (Independent Review) Bill 2023, which is before the House. The purpose of this bill is to amend the Infrastructure Australia Act 2008 to give partial effect to the government's response to the Independent Review of Infrastructure Australia, which was released on 7 December last year. Reviewing Infrastructure Australia was a pre-election commitment of the government, and the independent review of this body was announced on 22 July 2022. It was undertaken by two respected Australians: Nicole Lockwood, Chairperson of Infrastructure Western Australia, and my good friend Mike Mrdak AO, a former secretary of the Department of Infrastructure and Regional Development and a former secretary of the Department of Communications and the Arts.

Infrastructure Australia is a corporate Commonwealth entity that was established by the Rudd government in 2008. It's also worth noting that this body is in fact a creation of our current Prime Minister when he served as the Minister for Infrastructure, Transport, Regional Development and Local Government in that era. It's quite telling that this government has assessed the performance of Infrastructure Australia over its nearly 15-year life and found the organisation wanting. This bill represents, at the very least, a partial repudiation of the organisation's functions and governance structures as they were fundamentally established by the now Prime Minister himself.

The bill provides a new object of the act—for Infrastructure Australia to be the government's independent adviser on nationally significant infrastructure investment planning and project prioritisation. This gives partial effect to recommendation 1 of the independent review. The coalition notes the independent review's first recommendation to the government includes the advice that Infrastructure Australia 's mandate should be expanded beyond advising on nationally significant transport, energy, communication and water infrastructure to also be the government's independent adviser on nationally significant social and economic infrastructure. Recommendation 6 of the independent review also suggested Infrastructure Australia's remit be expanded to include social infrastructure. These recommendations have been rejected by the government and are therefore not featured in this bill.

The bill also repeals almost all of the current functions of Infrastructure Australia as provided in sections in 5(a) to (gb) and sections 5A to 5C of the current act. In place of Infrastructure Australia's current functions the bill proposes a series of new functions and products to conduct audits or assessments of nationally significant infrastructure to determine adequacy and needs, to conduct or endorse evaluation of infrastructure projects, to develop targeted infrastructure lists and plans and to provide advice on nationally significant infrastructure matters.

The bill also amends the Infrastructure Australia Act 2008 to replace the current 12-member Infrastructure Australia board with three commissioners appointed by the minister, comprising a chief commissioner and two commissioners. Additionally, transitional arrangements are included in the bill, to recognise the existing work of Infrastructure Australia. What we have here in this bill is the government admitting that the legislative structure put in place originally by the now Prime Minister needs to be fixed, and as a result they have decided to give Infrastructure Australia a new object, new functions and a completely new governance structure.

While this bill is framed as giving effect to the recommendations of the independent review, it's important to place on the public record that a critical assessment of the response to the review shows the government has not in fact accepted some of its key recommendations. The review received 59 submissions and held 40 meetings with approximately 140 participants across government and industry. In October 2022 the independent review provided its report to the government, outlining 16 recommendations and a further matter for government consideration. As mentioned, the government's response to the independent review did not support a number of the report's recommendations. In fact, eight of the 16 were not supported.

The government did not support key recommendations to provide enhanced transparency. An example of this was the proposal that Infrastructure Australia provide two new annual statements to the government, which would be publicly tabled to inform budget processes and to report on the performance outcomes being achieved by the infrastructure investment program. Also, a proposal that the Australian government must formally and publicly respond to Infrastructure Australia's advice, findings and recommendations within six months was not supported by this government. Despite what the government says, the Australian people can clearly see this administration has an aversion to being transparent.

The government also did not support the recommendation to form an infrastructure bodies council to enable better collaboration and coordination between Infrastructure Australia and the states and territories. Several other recommendations of the independent review will be implemented via non-legislative processes, including by a ministerial statement of expectations and an infrastructure policy statement on land transport. The independent review proposed three alternative models for the future governance of Infrastructure Australia: option 1 was to maintain the status quo; option 2 was to establish a commission model, which was their preferred model; and option 3 was for a streamlined board model.

The proposal in this bill represents an altered version of option 2. By proposing to replace the 12-member Infrastructure Australia board with three commissioners, the government is reducing the diversity of expertise at the head of this body and reducing its independence from government. The views of the minister will hold significant influence with the three commissioners, who are themselves appointed by the minister. This compares with the current governance model, whereby nine Infrastructure Australia board members are appointed by the government and three are appointed from nominations agreed by the governments of the states, the Australian Capital Territory and the Northern Territory.

When added to the redefined functions of Infrastructure Australia in this bill, which require the commissioners to have regard for the government's policies and require them to evaluate infrastructure proposals submitted by the government, it's clear Infrastructure Australia will enjoy less independence in the future. In addition, the government has confirmed via briefings that an advisory council will be established by Infrastructure Australia to provide advice to the commissioners. Unfortunately, the advisory council is not referenced in the bill, and therefore the parliament is not being invited to set guidelines about the composition or role of that proposed advisory council.

The coalition reserves the right to have more to say on this during the debate in the other place. However, briefings have confirmed the government's intention, as outlined in their response to the review, that senior officials from the Department of the Prime Minister and Cabinet, the Department of the Treasury and the Department of Infrastructure, Transport, Regional Development, Communications and the Arts will sit on the advisory council, supported by three to four experts from the infrastructure and labour sectors. This is the heavy hand of the Commonwealth government stepping in to influence the decisions and the direction of Infrastructure Australia. There is a concern here that, in making these changes of the government's to Infrastructure Australia, industry expertise may be lost, as well as expertise and experience in delivering infrastructure in regional Australia in particular. The government has made no provision in the bill for commissioners to be appointed who have expertise and experience in the issues impacting regional Australia. The coalition will therefore propose amendments during consideration in detail to address this concern, and I encourage the government and all members of this place to give close consideration to supporting these.

In addition to making Infrastructure Australia less independent, the government's reforms will make Infrastructure Australia a less authoritative body when it comes to the evaluation of infrastructure projects. Firstly, the minister has made it clear the government wants to shrink the number of projects on the infrastructure priority list; this is mentioned in the explanatory memorandum. Interestingly, while the relevant clause in the bill, being 5C(1), refers to the development of a targeted infrastructure priority list, nowhere in the bill does it require the list to be any smaller—or larger, for that matter—than currently exists. Indeed, the briefing provided to the coalition by the government on this bill has confirmed there is nothing in the bill which will prevent a future government from working with Infrastructure Australia to expand the infrastructure priority list if the government chooses to reduce its investments in infrastructure projects. However, by proposing to streamline Infrastructure Australia's focus on a smaller number of nationally significant projects, the government is reducing its utility.

Further, and perhaps more significantly, the government is proposing Infrastructure Australia merely endorse project assessments submitted by the state and territory governments. This is a government walking away from providing independent oversight and assessment of the priorities of the state governments. While there is reference to the agency developing a national planning and assessment framework to promote national consistency in infrastructure evaluations, as a Commonwealth body Infrastructure Australia lacks the power to enforce assessment standards on state and territory departments and agencies. The Commonwealth government makes a substantial investment into public infrastructure which is delivered and ultimately owned by the states and territories. Often the Commonwealth is investing 50 per cent—or, in regional areas, 80 per cent—of the funding to deliver major road projects. Australian taxpayers expect the Commonwealth parliament to exercise suitable oversight so that infrastructure projects deliver material benefit and that maximum value for investment is secured. This should be an important role for Infrastructure Australia. But will the organisation's ability to provide advice on this be diminished by the requirement in this bill, so that they endorse the state assessments instead of running an independent ruler over project submissions themselves?

The coalition recognises that, since the election, there have been questions over the future mandate and operations of Infrastructure Australia. As a result of this government's approach to the body and its leadership, in September 2022 there were five resignations from the board. This has resulted in several months where the board has lacked a quorum of members. The government has subsequently appointed interim board members until such time as its proposed reforms can be enacted.

The coalition firmly believes Infrastructure Australia is an important body, and it's important that parliament provides the organisation with a clear mandate for its future activities. In this regard, the federal coalition does not seek to frustrate passage of the government's legislation—albeit there are concerns that this bill will result in Infrastructure Australia being less independent and less authoritative. The coalition proposes to support the legislation with amendments which will be designed to ensure that the commissioners have experience on the issues of regional communities and provide transparency where, contrary to its pre-election commitments, the government makes nationally significant infrastructure and investment decisions without obtaining advice from this body.

I conclude my remarks by moving a second reading amendment to this bill:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading, the House:

(1) notes this Government's record of cancellations, cuts and delays to infrastructure projects across Australia;

(2) criticises the Government's failure to adhere to processes of assessing infrastructure investment projects they set themselves before the 2022 election by agreeing to invest $2.2 billion in the Melbourne Suburban Rail Loop and $2.5 billion in the Brisbane Arena without first obtaining advice from Infrastructure Australia; and

(3) notes the nation-building and economy strengthening $120 billion 10-year pipeline of infrastructure investments inherited by the Government upon its election in May 2022".

Ross Vasta (Bonner, Liberal Party) Share this | Link to this | Hansard source

Is the amendment seconded?

Jason Wood (La Trobe, Liberal Party, Shadow Minister for Community Safety, Migrant Services and Multicultural Affairs) Share this | Link to this | Hansard source

I second the amendment and reserve my right to speak.

Debate adjourned.