Tuesday, 16 February 2021
Northern Australia Infrastructure Facility; Consideration
That the Senate take note of the document.
Senator Canavan was here. I was looking forward to talking to Senator Canavan about the Northern Australia Infrastructure Facility. In December last year, the government tabled a statutory review of the Northern Australia Infrastructure Facility. I think if there were any government funding body that was in desperate need of a review, it was the NAIF, better known as the 'No Actual Infrastructure Fund'. This $5 billion fund, announced by the government more than five years ago, has on the most recent figures released only a couple of hundred million dollars of its funds, which works out to roughly five per cent. So, five years after this funding body was announced, only about five per cent of the funds have actually been released and invested in projects across northern Australia. If there were ever an example of this government's prioritisation of announcements over delivery, the NAIF has to be pretty high up on the list. When this body was announced by the government, it was going to be creating jobs and funding projects right across northern Australia, something that was and still is desperately needed. We know that northern Australia can be an area that finds it difficult to attract private finance, for a whole range of reasons, including remoteness and the innovativeness of some of the projects and industries that are happening there. There is a need for a government financing vehicle to help fill the gap in private financing, and that's what the NAIF was held up to be.
This statutory review is not the first review of the NAIF that's been done by this government. I think we're up to about three or four reviews. It's not a bad record that this government has had to have a review of the NAIF almost every year since it was announced! Again, that's a bit of an indication that there are serious problems. But having said all of that, we welcome the fact that this review does seem to be finally acknowledging, and recommending change on, a number of issues that the Labor opposition has been highlighting for a very long time. It's probably two or three years now that we've been calling for fundamental change of the NAIF so that it can deliver on what this government promised, which was jobs and projects across northern Australia. I don't know why it's taken so long for these changes to actually be recommended, let alone implemented.
I do note that there's now a new minister, Minister Pitt. He seems to be moving a little bit more quickly than his predecessor, Senator Canavan, in actually getting this NAIF to work. I know that before too long the government will have some legislation introduced to try to implement some of the recommendations that have been made in this review. I've already indicated to Minister Pitt that the opposition will approach that legislation in good faith and, provided we think that the legislation will actually get the NAIF working at last, then we would be happy to support it. We've obviously got to go through that legislation in detail, but we hope that the recommendations in this review are going to be implemented. We've been saying for a very long time that the NAIF is not doing enough to fund some of the smaller projects that are in abundance across northern Australia but have not to date been able to attract finance from the NAIF. The reality is that, while there are megaprojects in the hundreds of millions of dollars or tens of millions of dollars in northern Australia, there are many more smaller projects that still have enormous potential to create jobs but have real difficulty obtaining finance from commercial banks. We'd like to see the NAIF pay a bit more attention to those kinds of projects.
I've had consistent feedback for years that the NAIF is too risk averse, and I welcome the fact that this review has indicated that the NAIF and its risk appetite will be reconsidered as well. I welcome the fact that this review indicates that the NAIF should be open to investing in means other than just providing loans—for instance, in taking equity stakes in projects.
The bottom line is that the NAIF is a worthwhile body. There is a need for a government financing vehicle for northern Australia, but the way the NAIF has been established so far has been a dismal failure. We welcome this review identifying some recommendations and we hope the government will act. I seek leave to continue my remarks later.
Leave granted; debate adjourned.