Wednesday, 12 May 2021
Northern Australia Infrastructure Facility Amendment (Extension and Other Measures) Bill 2021; Second Reading
I rise to speak on the Northern Australia Infrastructure Facility Amendment (Extension and Other Measures) Bill 2021. Labor has a long history of supporting development in northern Australia. In fact it was Labor that appointed the very first Minister for Northern Australia, under the Whitlam government. The governments of Chifley, Curtin, Whitlam, Hawke, Keating, Gillard and Rudd have all contributed heavily to the development of northern Australia. More recently we supported the 2015 report, Our north, our future: white paper on developing northern Australia and the initiatives in it, including the star of the show—the $5 billion Northern Australia Infrastructure Facility, better known as the NAIF. It was clear at the time and remains obvious now that the north, which has been neglected for so long, needed a leg-up to achieve its full potential. While Labor supports the northern Australia agenda and the NAIF, that doesn't mean we shouldn't look at ways to improve it. It is the job of an opposition to scrutinise government policy, hold it to account for its failings and suggest improvements. When it comes to the NAIF, for many years we have been making many constructive suggestions about how it can be improved.
Rarely have we seen a program that has so wholeheartedly failed to deliver what was promised. That is from a government that is notorious for making announcements that it doesn't deliver. The fact is, the NAIF is shamefully behind schedule and has woefully underdelivered on what the Morrison government promised it would do. It must be an embarrassing day for the government to have to come cap in hand, admitting that it has wasted five years, and ask for more time to get the NAIF working. It's a bit like a student back at school having to ask for an extension on a class project because they spent too much time talking about what they were going to do and showing off in class, rather than sitting down and getting it done. In fact, the NAIF has been such a flop it's now widely referred to as the 'no actual infrastructure fund'. While I know it's a big disappointment to people on the other side of this chamber, it's even more of a disappointment to communities in the north who were once excited by the opportunities it promised.
For those who haven't had the pleasure of spending time in northern Australia, the region is vast and geographically remote, but it's also home to a number of world-class leading businesses and industries. It is bursting at the seams with opportunities in traditional industries like agriculture, mining and tourism, and in emerging industries like renewables, hydrogen, tropical science and many other things.
As outlined in the government's northern Australia agenda, the NAIF was supposed to offer loan support to projects across Northern Queensland, Western Australia and the Northern Territory as an alternative to traditional bank loans. We know that it can be tough to get business loans in remote regions, and sometimes traditional banks don't appreciate the value of out-of-the-box innovation—the kind we want to see more of in the north. There are organisations from Townsville to Darwin and across to Karratha and everywhere in between that are leading the world with innovations in mining, agriculture, health, education and sustainability. These smaller unique projects which have had a hard time getting a bank loan were hoping to find a partner in the NAIF. Unfortunately, for many this hasn't proved to be the case to date. That's because, in the six years since it was announced, the NAIF has comprehensively failed to deliver what the government promised.
If there's one thing this government is good at, as I say, it's making an announcement. Any time there's a headline to be had, there they are, ready to cut a ribbon. But there's a long way between announcement and delivery, and this government seems to drop the ball every time. The NAIF, sadly, has become just another example of this habit of the Morrison government. We see media release after media release about projects the NAIF has approved or how much they say they'll spend from the NAIF. But when you look at how much has actually got out the door and into communities it's a completely different story. As I mentioned before, the NAIF is so shamefully behind schedule that it has now had to ask for more time to get the job done.
When the coalition government established the NAIF, it promised to invest $5 billion in five years. Instead, now it's expected to take double that or maybe even more. When the NAIF appeared before Senate estimates at the end of March, it revealed that, of its $5 billion budget, only $314 million had actually been released. That's about six per cent of its budget that has been released after five years. In my home state of Queensland, the NAIF has released only $56.7 million. I really think that people in North Queensland and northern Australia generally would have thought they'd see more come out of the NAIF by now. As I say, it means that, at this point in time, only six per cent of funding has got out the door in the time in which 100 per cent of the budget was supposed to be spent. So there's still 94 per cent of the NAIF's funding to get out the door and into northern Australia. At this rate, it will take nearly 80 years to release the full $5 billion that was promised to northern Australia via the NAIF. That money is no good sitting in a Canberra bank account. We need to get those funds out to businesses in northern Australia so that they can start building infrastructure, employing locals and improving services in the north.
It's good that the Morrison government will have more time to fix its mistakes, but with this track record it's fair for communities to be sceptical about the government picking up its act. Even when the NAIF does approve a project for funding, this government's prejudices are blocking it from proceeding. Only last week it was revealed that the Minister for Resources, Water and Northern Australia, Minister Pitt, had personally intervened to veto a NAIF loan to a $380 million renewable energy project near Cairns in Far North Queensland. The NAIF board had approved this project. They'd finally found a project that was worthwhile to invest in. It was going to create jobs and do lots more for North Queensland. But Minister Pitt quietly overturned it. This is, as I understand it, the very first time a minister has used this power. Minister Pitt told the head of the NAIF, via a letter, that the approval of this project was inconsistent with the aims of the federal government. Killing a $380 million project and the jobs that it would have brought to Far North Queensland is a new low for this government. This project would have delivered 250 jobs in North Queensland as well as delivering more reliable and affordable power, which would have actually generated more jobs in more industries.
Far North Queensland economies have been hit particularly hard by the COVID pandemic, especially with the closure of international borders. Now is not the time to be ripping the rug out from under new jobs for locals. This is an embarrassing move by this government. Its own prejudices against renewable power and the jobs it can create have led to it overturning a NAIF-approved loan to a company. It is embarrassing that we've got a minister who will put his own prejudices ahead of the region that he claims to represent. It's embarrassing that we've got a minister who would rather stick his head in the sand than fund good, clean, cheap energy projects that could deliver jobs to regions that need them. I might say, I look back on the fact that when Senator Canavan was the Minister for Northern Australia he at least allowed funding for solar farms and other renewable projects to go ahead. In fact, the biggest loan that the NAIF has approved is for a renewables project in North Queensland. But it would seem that under Minister Pitt that kind of thing has no future because of his own prejudices against those kinds of projects. It is a deep shame, and it's people in Far North Queensland who are missing out.
When these NAIF powers were introduced to the parliament, it was claimed that they would only be used to ensure that projects contrary to the national interest would not be funded. Ripping the rug out from under 250 energy jobs in Far North Queensland is not in the national interest. This government's prejudice against renewables is costing jobs and lower power prices and is holding regional Australia back. The NAIF is plagued by enough problems in getting money out the door, without having to manage a minister who quietly goes around knocking off projects that he doesn't like.
As I mentioned earlier, Labor has been making constructive suggestions about what can be done about the NAIF for a number of years now. While the decision to overhaul the NAIF via this legislation is encouraging, the fact is this government has had to be dragged kicking and screaming to do it. I've said before that it's easy to lose count of how many reviews and rehashes of programs the government has announced for northern Australia in the last few years. It's taken four reviews in as many years, two Senate inquiries and countless calls from Labor for the government to agree to make any changes to the NAIF operations. All of this inaction has meant people are still waiting to get any real results—that's if they haven't already given up and taken their projects interstate or overseas.
Finally, at the end of last year, the Morrison government agreed to come to the table on some long-overdue reforms. Labor hopes, when implemented, these reforms will be a step in the right direction. However, after the games we saw from Minister Pitt last week, Labor will be putting forward some amendments of our own to safeguard the NAIF from ideological whims of the minister of the day. People in northern Australia can't afford to see the next five years roll by and still be no better off. Scott Morrison, the Prime Minister; and Keith Pitt, the minister, must stop talking about it and start getting money out the door.
Looking at the legislation as it has been proposed by this government, Labor supports the proposed extension of NAIF for another five years, beyond its current expiry of 30 June this year to 30 June 2026. I've spoken to business, community leaders and others in the north about this, and many still hold onto the hope that the NAIF can fill an ongoing market gap in accessing finance in the region. There are project proponents interested in seeking funds through the NAIF. Let's hope the government makes better use of the next five years and gets behind them.
Labor also supports the proposal to expand the activities eligible for financial assistance beyond the construction of northern Australia infrastructure to the development of northern Australia economic infrastructure. This change is consistent with much of the feedback received by the Senate inquiry into the effectiveness of the Australian government's northern Australia agenda—that the NAIF should support more smaller projects. The inquiry repeatedly heard from stakeholders across the north that the NAIF was not accessible to smaller projects, and, while big ticket infrastructure projects are always important, often smaller projects have the largest impact on communities in the region.
This legislation will also allow the NAIF to lend directly to project proponents, rather than directing funding through state and territory governments as it currently does. The biggest criticism of the NAIF, both from Labor and people in the north, is the length of time that it takes to get money out of the door to projects. Labor wants to see the money hitting the ground faster, and hopefully simplifying the administrative processes will assist this. I might just say that, in reaching our position on this bill, we have consulted the Queensland, Northern Territory and Western Australian governments, none of whom have any issue with being taken out of the process of NAIF loans being forwarded. As I say, we hope that that move will increase the speed at which the government can get money out the door.
It's important to acknowledge the concerns raised by environment groups that these changes would remove the ability of state or territory governments to block a project that may have adverse environmental impacts; however, as I say, the three relevant state governments as well as many other groups across the north have given this change the green light. In addition, any project considered by the NAIF would still have to meet existing federal, state or territory environmental and other regulatory processes, and the NAIF Act retains the prohibition on a minister directing the NAIF to fund a particular project.
Something that Labor has been calling for, for years now, is for the NAIF to broaden the types of financial assistance available to provide to projects. Currently, the NAIF only provides loans. This bill proposes that in addition to loans the NAIF offers letters of credit, purchase of bonds, guarantees in equity investments. These investment options are consistent with other government financing bodies such as the Clean Energy Finance Corporation. This change could have a massive positive benefit, especially for smaller projects and those led by First Nations communities, which historically have had a much harder time receiving NAIF assistance. As of 25 March this year only two First Nations projects have reached the investment decision stage with the NAIF, and together these two projects only represent one per cent of the NAIF's total funds. This is just not good enough, and it's led to one of the amendments that Labor will be proposing to this bill.
I'll just very briefly touch on the amendments we're proposing, because we'll have an opportunity to talk to them at more length later on. Labor has been calling on the government and the NAIF to work on having greater engagement with First Nations communities on the development of northern Australia. The bill attempts to address this by including experience in economic development for Indigenous communities in the list of fields of expertise sought for the NAIF board. Labor supports this change, but we do not believe that this goes far enough. First Nations communities are such an important part of northern Australia but are often completely left out of the discussion by this government. To really address the challenges First Nations projects face in accessing the NAIF, Labor would like to see a dedicated position on the NAIF board for a First Nations representative. Both the Indigenous Land and Sea Corporation and Indigenous Business Australia require First Nations members on their boards. We don't believe the NAIF should be any different.
Labor would also like to see the Indian Ocean territories included as part of northern Australia. My time is running out, so I'll come back to that at a later point. A further amendment that we are proposing, which is particularly important in light of Minister Pitt's actions, is to encourage the NAIF board to support projects that help Australia achieve net zero emissions by 2050, something that will create jobs and help our environment. There are a range of other amendments that we'll be putting forward, but I'll talk to them later. I also want to flag that I'll be moving a second reading amendment in my name, circulated on sheet 1284.
At the end of the motion, add: ", but the Senate:
(a) notes the Government's failure to:
(i) deliver what it promised as part of its Northern Australia Agenda, and
(ii) get money out the door of the Northern Australia Infrastructure Facility; and
(b) further notes that the Bill includes amendments that the Opposition has been calling for over a number of years; and
(c) calls on the Prime Minister and the Government to:
(i) learn from their failures with the Northern Australia Infrastructure Facility over the past five years,
(ii) deliver the funding they have promised for development in Northern Australia by speeding up the release of funds from the Northern Australia Infrastructure Facility, and
(iii) realise the potential in Northern Australia and re-commit to delivering on their Northern Australia Agenda".
I rise to speak on this Northern Australia Infrastructure Facility Amendment (Extension and Other Measures) Bill, which, for everybody's mercy, I'll just call the 'NAIF bill' in future. People will remember that when this first was set up five years ago it was at the behest of the National Party and it was a $5 billion slush fund for coalmines and dams. The then Minister Canavan was in charge at the time, and it was pretty obvious that that's what they were seeking. They extracted that commitment from the Liberal government, and, hey presto, we got the NAIF.
It's been interesting to watch over the subsequent years. There have been some positive projects that have received funding under NAIF, projects that we would consider environmentally sustainable, job creating and generally good for the region. So it's been fascinating to watch what was initially set up as something to fund dirty projects that would wreck the planet but keep the Nationals happy actually be a force for some good when it funded those positive projects. So we approached this amendment bill with some interest.
The bill now wants to extend the NAIF for a further five years, because they actually have had trouble getting the money out the door. Maybe it's because those coalmines and dams are in fact uneconomic and a bad idea, and the private sector sees that and doesn't want to go through with those sorts of developments. But these amendments also want to put a departmental officer onto the NAIF board, they want to remove the ability of state governments to veto funding going to projects in their states and they want to expand the types of funding mechanisms to include equity investments and acquisition of derivatives.
The amendments have been promoted as a way of achieving flexibility, but the aim is really clear: the government wants to deliver for its mates. That's what it does best, and certainly what it did in last night's budget. We raised concerns at the time that this would be a bank for fossil fuels, and with these amendments, proposed by the government in this bill we're debating now, that would be locked in. It would be undeniably a bank for fossil fuels.
Minister Pitt, who's the minister now, didn't even try to hide his desire that the NAIF be used as a slush fund for the gas industry when he made his remarks last time this was debated, and, in fact, I think it was in the media last week that he boasted about how these amendments would open up more opportunities for Beetaloo infrastructure financing. We know the Beetaloo is a massive gas basin that this government and, I think, sadly, the opposition at the time—I remember an announcement from the then leader Bill Shorten promoting the Beetaloo as a gas extraction boon—now want the NAIF to fund. And it's somewhat ironic—frankly it's hypocritical—because Minister Pitt just used his veto power as the relevant minister to stop funding going to a wind farm with a battery backup. Yet he wants public money to go to opening up a new, massive gas basin, which would turbocharge the climate crisis, when we have alternatives to gas as energy that don't wreck the climate. Minister Pitt wants to use public money to stop renewables. He doesn't want it to fund renewable projects that would've created 250 jobs in northern Queensland; no. He instead wants it to open up a new gas basin.
We're kind of used to that from this government. It's fossil fuels or nothing. It's yet another dirty energy fund that is yet another fossil fuel subsidy. It's adding insult to injury, really, because in last night's budget—as I've said numerous times since then—we saw yet more fossil fuel subsidies. So this government is handing out public funds to coal, to oil, to gas—to the dirty energy sector—hand over fist. They cannot get the money out the door fast enough when it is public money for dirty projects. And yet they're blocking funding for clean renewable projects.
Minister Pitt has also boasted that the amendments will allow the Commonwealth to bypass the states and take away that veto power. It's very interesting, because the states' veto power was in fact used to block public money going from the NAIF to Adani for one of their coal railways. The Queensland government at the time—who were a Labor government and are still in power in my state of Queensland—felt the force of a really strong public campaign that demanded that they stop public money going to opening up the Galilee coal basin, which, if it was opened up, would be the equivalent of the seventh largest emitter in the world, if it were a country, that basin is so big and so much of a carbon bomb. Full credit to the Queensland Premier at the time, who, under so much public pressure, stopped that funding going to Adani. So it is very interesting indeed to hear Senator Watt say that his party has now consulted with the Queensland government and the other relevant governments, who, apparently, according to Senator Watt, don't want that veto power anymore. Well, little wonder! The Queensland government also love coal—they love opening up new coal basins; they love supporting coal and coal-fired power—so of course they don't want the ability to say no. They want to be able to say that their hands are tied—that they can't stand in the way of this public taxpayer money going to the fossil fuel industries—because, actually, they think that's a good idea. Frankly, I think that says all you need to know about the approach of both of the big parties to spending taxpayer dollars on fossil fuels.
We will be moving a series of amendments to try to fix this fund and turn it into a fund for sustainable, job-creating, positive projects to service northern Australia and treat it with the environmental sensitivity and the dignity that the community desires for good development in the north. There have already been some great projects funded under this NAIF. We want to see more of the good projects funded and less of the projects funded that First Nations mobs have not consented to, that are making the climate crisis worse and that don't generate anywhere near the jobs that they promise—as is always the case with the coalmining sector, which, frankly, wants to automate as quickly as possible.
We have long argued that the NAIF should consider the federal government's policy commitment to the Paris Agreement. Our current domestic pledges, and the ambition needed to come anywhere close to what the science says is needed to meet international goals under that agreement, without question mean not funding fossil fuel infrastructure. And yet the Morrison government wants to use the NAIF to fund gas pipelines. It wants to open up new gas fields. It wants to use public funds to throw more fuel on the climate crisis. The $51 billion in fossil fuel subsidies in last night's budget wasn't enough for this government! They want this $5 billion slush fund to be able to open up new gas pipelines, roads and new gas facilities. They just want more and more taxpayer dollars for the fossil fuel industries that donate to their re-election campaigns and then often offer them plum jobs when they leave parliament. It's an absolute lark!
We will be moving amendments to say that the NAIF should not be allowed to invest in fossil fuels because we are in a climate crisis and we have other alternatives that can provide clean energy that's more affordable, that creates more jobs and that respects the environmental limits of the north. I hope that the opposition has a rethink on their position on that because, when amendments were moved in the House calling for NAIF to not invest public money in new coal, in oil, in gas, they didn't want that. They voted for this fund to be able to invest in fossil fuels, and the government of course voted as well. I hope they have had a rethink on that position because I actually thought they expressed differently at some point, but I will leave it for them to explain their position.
The other amendments that we'll seek to move would require the environmental impacts of a project to be assessed as part of the process of deciding whether it's suitable to invest in. That would include looking at the principles of ecologically sustainable development, which includes the precautionary principle, which says: 'If you're not sure you're not going to stuff something up, well, don't do it. If there is a risk of stuffing it up, just hold off.' Our amendments would codify those. We moved those same amendments when this fund was first set up five-odd years ago. We received absolutely no support for them then, and I hope the story is different now.
Onto the investment risk, there are proposals for the government to change the modes of funding that can be made available under this facility. Equity investments, which is what is being proposed, open NAIF up to more speculative investing, which would leave the government holding significant risk for the benefit of private companies. Acquisition of derivatives can leave the government with an open-ended unquantifiable liability if a project proponent becomes insolvent. There have been a few examples of projects that NAIF has funded that have then been canned. I will be asking in the committee stage of this bill what has happened to that money, so this is a live prospect.
There are some worthwhile small-scale projects including those championed by First Nations that would benefit from broader investment opportunities, and that is exactly why we're moving an amendment saying that only those smaller scale or First Nations operations should be allowed to access this equity funding. Without that amendment, we fear that these government amendments would in fact incentivise speculative investment that could underwrite gas supply and prop up otherwise stranded assets. Given the NAIF's poor governance practices and processes for assessing the risk on public lending, especially risk in relation to fossil fuels and climate change, this is an unacceptable risk. Tighter rules around eligibility for equity investment options introduced by the bill are essential to ensure that the government isn't left carrying the can for unsustainable fossil fuel projects, which is exactly why our amendments would restrict the use of equity investments to projects undertaken by small businesses and Indigenous corporations. Again, I urge the chamber to consider supporting those amendments so that we can get the benefit for those small operators and Indigenous corporations without yet another pathway to subsidising fossil-fuel infrastructure.
The bill also proposes to remove the mandatory requirement for infrastructure to stimulate population growth in northern Australia. But removing that requirement will again make it easier for the minister to push NAIF into funding gas infrastructure and pipelines, including pipelines that aren't even located in northern Australia. In terms of the board, requiring the secretary of the department to be a member of the NAIF board undermines any semblance of independence and makes the NAIF directly susceptible to ministerial influence, as if it isn't enough already. The minister's been spruiking fossil fuel projects already and using NAIF to further the government's discredited and dream-like state of a gas-fired recovery.
When the NAIF was created, the government said:
The expert, transparent and arms-length design of the Board lends credibility to financial markets, while ensuring the Commonwealth invests in projects which are viable, provide public benefit and unlock the potential of northern Australia.
When it turns out those investments aren't in fossil fuels, the government tries to regain control of the decision-making process. In the Senate inquiry into the operation of the NAIF, we heard evidence from First Nations and regional communities in northern Australia that the board did need to take a more innovative approach to investment and look beyond the traditional and often outdated and unsustainable projects like mines and dams, yet this bill and this government are stuck in that same tired 1950s mindset.
On the veto power, which I touched on earlier, we strongly oppose allowing NAIF to loan directly to entities, bypassing state and territory governments. Previous reviews have in fact raised concerns about the constitutional validity of direct loans, and the government hasn't provided any compelling evidence that those concerns have been addressed. So we're calling for this bill to be referred to the Environment and Communications Legislation Committee to allow this issue and other problems with the bill to be examined. This is an opportune time for me to foreshadow that I will be moving a second reading amendment standing in my name.
The NAIF's clear function is to grant financial assistance to states and territories for the construction of northern Australia economic infrastructure. That's from the existing legislation. Previous reviews of NAIF identified the need for it to work more closely with state and territory governments, not to completely ignore and go around them. So providing the option of bypassing the states and territories simply increases the federal government's power and takes away a key check and balance. It also puts worthwhile projects at risk where the constitutional validity of the loan arrangement is unresolved. In short, this is yet more public money for fossil fuels, but it doesn't have to be that way. We can amend this facility so that it promotes positive sustainable development in the north. That's exactly why the Greens will be moving the amendment I mentioned.
I rise to speak to the Northern Australia Infrastructure Facility Amendment (Extension and Other Measures) Bill 2021. It's interesting. I have come to this place specifically to support legislation and actions such as this. It is the comments of both the opposition and the Greens that provide resolve and steel in my heart as to why this was the right decision—the fantastical description of northern Australia and the complete lack of understanding of the outrageous control provided by inner-city Greens and people who have no understanding of the potential of northern Australia and the opportunities it provides, of what they continue to deny to the communities in northern Australia, both Indigenous and other. It is enough to make me weep.
So I support the amendments that have been brought forward by Minister Keith Pitt, as they are practical and able to continue facilitating the financing of critically important projects in northern Australia. This coalition government is about turbo charging its investment program and agenda for northern Australia, to make it easier for projects to receive funding and to generate economic development and jobs, not just as the country emerges from the COVID-19 pandemic but into the future. As part of the 2020-21 budget our government announced reforms to the NAIF to provide more flexibility, increase risk appetite and widen the scope of eligible projects.
It sticks in my craw that we have members of the Greens—who have left the chamber, of course—who are not prepared to listen to the reality of what is going on. They're not interested in understanding that there was no battery in the proposed infrastructure that was rejected by the minister. There is no reality in their concept that this is a fund that has been established only to fund fossil fuel projects. This is a fund that allows an intervention in the capital crisis that is happening in north Australia. It has been the failure of the market for insurance and, more broadly, the failure of our banking institutions to lend to projects—not just large ones but small ones, like truck stops, housing and other business projects. The proposed reforms seek to address stakeholder criticism of the NAIF regarding it being risk averse and not proactive enough and follow recommendations from the statutory review of the NAIF.
I'm going to touch on just a couple of the proposed amendments to the NAIF Act 2016, the first of which is to extend the period of time in which the NAIF can make investment decisions to 30 June 2026. This is critically important, because the government's announcement recently on the re-investment pool, the $10 billion program over 10 years, will facilitate greater investment in the north, which has not been able to happen due to the market failure in northern Australia. It will accelerate lending, allowing the NAIF to lend directly to proponents under certain circumstances.
There's been some comment about whether or not the states should have approval points in this process. Remember that, in addition to the state jurisdictions not providing any finance in NAIF approval, not having any skin in the game, there is also an extensive array of approval processes at local government, state government and federal government level. So this suggestion that the NAIF is in any way going to threaten the environmental, cultural or other parts of northern Australia is fanciful. This is a nation that's tied up in so much red tape, so many approval processes, that we could not possibly provide any more opportunity to stop projects than we already do.
Senator Waters referred to the precautionary principle. We in the north are very familiar with the precautionary principle. Projects apply for approval and, after seven or eight years, withdraw their application because there is no way through the approval processes of local, state and sometimes federal governments. These changes will allow the approvals process to be sped up, at least for NAIF funding. Remembering that projects have already gone through an approval process and there is no financial skin in the game for the states, projects sit on state government Treasurers' desks for 283-odd days, on average. Guess who pays for that? The project proponents, who are spending money on consultants and on other sorts of approval processes. That is coming out of money that could be spent on the ground to improve businesses and communities in northern Australia.
The change in the legislation will also permit the NAIF to establish on-lending partnerships with local financiers to improve access to NAIF finance for smaller project proponents. These partners have the expertise to work with smaller proponents to demonstrate their suitability for NAIF finance and will extend the NAIF's reach to those smaller projects that need added assistance in these economically challenging times. This is an incredibly exciting change. I've got projects lining up. We're racking and stacking projects that will bring jobs and economic prosperity to northern Australia, and they're waiting on these changes to go through the Senate.
There is absolutely no way that we should be allowing this bill to be referred to any other committee, when it has been subjected to statutory reviews and to Senate inquiries. The work has been done. We cannot delay these people getting on with terrific projects that will bring real jobs, prosperity and opportunity to our communities in northern Australia.
The NAIF was previously restricted to funding physical construction works only. I'm delighted that these changes, the practical changes brought by the very practical minister, Minister Pitt, will allow NAIF finance to be available to additional elements of infrastructure construction, such as equipment purchases or leasing, training and the expansion of existing business operations. These reforms will ensure that the NAIF can take a holistic approach to supporting economic growth and jobs.
It might interest members of the opposition and the Greens to know that total NAIF investment is now sitting at $2.9 billion, money that has gone out the door. These are completed projects like the centre of excellence at the Cowboys stadium in Townsville, the construction of the accommodation at JCU, the approval of the hydro project at Kidston. There are projects right across Australia that are going to bring real jobs, real opportunity to the north. Again, it is time for people based in inner-city Melbourne, inner-city Brisbane to stop lecturing those of us who live in northern Australia and are desperate for this opportunity, desperate for this kind of capital availability. We've also talked about empowering the NAIF to use equity finance. Again, I'm not sure what part of what risk means I need to explain to the opposition and the Greens. What these changes to the NAIF will do is they will allow the government to take a stake in some of these investment opportunities, to take a risk and back businesses that will build developments, that will build agriculture and irrigation projects, that will build mining projects, that will build the supporting infrastructure that communities need and want. The Greens and Labor will talk about risk, but they never talk about opportunity because they never put their hands in their own pockets and build something—a job, a project. Instead, that is always left to real people, real conservatives, and this is what this legislation is going to do.
We're also strengthening the governance of the board by giving it a greater mix, adding a government board member, making the Minister for Finance jointly responsible for the investment mandate, allowing the NAIF board to delegate decision-making where appropriate, and adding experience and economic development for Indigenous communities to the list of relevant areas for board expertise. We are providing $83.5 million from 2020-21 to 2025-26 to the NAIF for the five-year extension and to implement these reforms. As I said, there has been a statutory review. It commenced in July 2019, it was released in 2020, it made 28 recommendations. This review was extensive, with over 100 entities consulted and 122 face-to-face meetings across the north taking place. I was part of a select committee of the Senate on the effectiveness of the northern Australia agenda. It was chaired by the opposition and it recommended that these reforms recommended by the statutory review be passed by the parliament as a priority. Well, here we are trying to pass the recommendations of the statutory review, and I am delighted to hear Senator Watt talking about supporting these changes to the NAIF. But it is embarrassing to have a shadow minister who doesn't understand the difference between money approved and money out the door, who doesn't understand the way project funds are drawn down in a project, who doesn't understand that sometimes a project can be completed before the funds are drawn down, and yet continues banging on about this in this Senate chamber. It's becoming tiresome.
I think we might need to run some sort of workshop, finance 101. While we're at it, we'll do water 101 because I'm tired of being lectured by opposition senators who don't understand that water rights sit with the states. The water resource plans and the water allocations are held by the state governments and that happens under the federal Constitution. The reason that works is that as states we are so parochial. We don't want to hand over approvals for water projects to anybody else. It doesn't matter how much money the federal government throws at water projects—currently we're up to $3.5 billion being available for water projects in this country—and can we build a dam in Queensland? Of course we can't because Labor doesn't believe in water projects. They don't believe in developing the north, they don't believe in opportunity and prosperity for people who live north of Brisbane because they don't understand what it's like.
But those of us who do live in that part of the country know the opportunities, know the people, the families, and the communities—people like Senator Matt Canavan, who lives in Rockhampton, and me; I live in Townsville. We know the opportunities. We talk about them at every barbecue and at every meeting. We wring our hands and say: 'Why can't the south understand what could happen if you unleash the potential of the north—the potential of our people, the potential of massive rainfall, and the potential of suitable soils that has been already demonstrated by the CSIRO in multiple studies? Why is it that we continue to have our hands tied behind our back? Why are our children's opportunities removed by second-class education given by the state education departments? Why do we have second-class roads and state departments that don't spend the maintenance money for roads that they have in their budgets? Why do state governments continue to treat anybody in the northern half of Australia as some kind of second-class citizen?' I think they think we are possibly a little bit simple. I think they think we're not smart enough to come in out of the sun, but we know what is possible in the north. These NAIF reforms will help us in part to deliver for Australia, for our families, and for our communities. I commend these changes and I will be supporting them 1,000 per cent.
The Northern Australia Infrastructure Facility Amendment (Extension and Other Measures) Bill 2021 is an improvement on what has been a very chequered history for the government under the Northern Australia Infrastructure Fund. But the improvements we have here do not go nearly far enough, which is why Labor has proposed a series of amendments which we look forward to pursuing during the committee stage of the bill.
A range of significant flaws in the bill were addressed in the committee report, but there are also many other areas where we haven't seen the legislation before us go far enough. It's time for action, it's time for jobs, and it's time to see that the $5 billion that's been promised to northern Australia is actually delivering what it's supposed to and what was promised. We can't afford to see in our country yet another episode of the Morrison government overpromising and underdelivering. We need to see the government actually listening to feedback and being more committed than it was last time. We have a government that simply doesn't take on board feedback. It simply shuts down critiques and puts forward its own position. That's not the way to get things done in Australia. Labor, on the other hand, wants to see NAIF work, and we want to see northern Australia reach its potential.
There is a veto power that Minister Keith Pitt made use of recently, and Labor believes that is, and has been, a very dangerous tool. We've seen that, when the NAIF Board did approve a renewables project like the wind farm in northern Queensland, Minister Pitt still had the final say. This is not good decision-making. On the one hand, you've got the ideological position of a government and a minister, and, on the other hand, you've got a board—never mind that it's stacked with a number of Liberals—that has made a good economic decision to support a renewable energy project. Still, Minister Keith Pitt seeks to use his veto powers to overturn such a decision. There are renewables projects like the Kidston pumped hydro project near Townsville. Northern Australia is absolutely full of potential for hydrogen, particularly in my home state of Western Australia—hydrogen, solar and wind, and hydrogen projects that are also driven by solar and wind, as well as tidal and other forms of renewable energy. Hydrogen, as well as other manufacturing and industrial processing, can be, and should be, supported by cheap renewable energy. We should have a national northern Australian infrastructure fund that supports those objectives so that northern Australia can harness its natural potential on behalf of the nation.
We see a timely amendment in one that would encourage the NAIF board to support projects that help Australia achieve net zero emissions by 2050. This is something that Labor very much believes will create jobs and help our environment. I ask those opposite to think seriously about this: where do you honestly think northern Australia, far from Canberra, is going to find its future? Is it only going to be in fossil fuels? No. We know that it's going to be based on its enormous renewable energy power. Yet, we seem to be beset, over and over, by an ideological obsession from the coalition to oppose a renewable energy agenda, to see this kind of interference taking place in organisations like the NAIF. We want to create jobs and help our environment, but, equally fundamentally, we want a future for northern Australia and its people.
In the last 18 months, we've seen a very challenging environment for northern Australia. We've seen drought, fire and floods in the eastern states. We've seen trade embargoes, which have certainly affected Western Australia. We've seen COVID-19. In particular, we've seen significant skills and housing shortages right across the north, be it in Queensland, the Northern Territory or Western Australia. Everywhere I go in Western Australia, there are people struggling to find rentals and companies struggling to find skilled workers. It's been like this for a while. We've cycled through it many times, yet, we find that, particularly in places like Karratha and Port Hedland, this Commonwealth government doesn't want to offer up any solutions.
In terms of the amendments and the objective of NAIF, we really want to see NAIF's investments mandate updated. In this sense, it should include a portfolio benchmark return in line with that of the Clean Energy Finance Corporation. NAIF loans and equity investments are in for-profit projects. Labor believes that this should be fair and reasonable; we have an expectation that the government has a return on the investment of taxpayer funds in private sector projects. In this context, again, it goes to why we don't actually look to proper commercial arrangements, where we don't have this ridiculous type of veto power. Frankly, many corporations, given what the interest rates are globally at the moment, could choose NAIF or might say to themselves: 'The risk of pursuing approval through NAIF is simply ridiculous. It's not worth it, because not only have we got the normal commercial arrangements; we've also got arbitrary and ideologically informed veto powers, and this is absolutely ridiculous.'
Key points that Labor has pursued relate very much to the Indian Ocean territories—that they should also be included in having access to the NAIF, and, critically, that First Nations communities are embedded in the decision-making process. It's a dire shame and a dire problem that they have so often been left out of consultation and other processes by this government. We believe that the change that's in the legislation before us doesn't go far enough. It simply doesn't place First Nations people in a decision-making position over the kinds of projects that they would like to see go forth. For example, we very much believe that First Nations people should have a dedicated person on the NAIF board, a First Nations representative. The Indigenous Land and Sea Corporation and Indigenous Business Australia require First Nations people on their boards, and, in Labor's view, we don't believe that NAIF should be any different at all.