Senator CARR(6.21 p.m.) —I would like to say a few things in support of the Democrats' amendments to this bill. The opposition supports the bill in general and it also supports the amendments moved by Senator Kernot. The reasons why Ralph Willis and Laurie Brereton indicated on 15 December last year the changes to the policy that were announced concerning the future application of infrastructure bonds to road projects need to be highlighted to the Committee. Essentially, those changes went to the question of the uneconomic effect of the application of infrastructure bonds to road projects and the distortions to the economies that occurred as a result of the application of privatisation to roads.

The City Link project in Melbourne is the best example of which I am aware of just how much impact a project can have on a community. The point has been demonstrated again and again. Some studies have highlighted that it is much more expensive for private than public enterprise to complete projects such as City Link. In Melbourne, $300 million worth of additional expenditures were granted to the City Link project as a result of direct subsidies by the state government. They do not appear on the budget papers as costs of the project by the consortia building that project. This includes features such as flyovers, which have been constructed at public expense, to avoid traffic lights and the construction of bridges which are not included in the prospectus. For instance, the bridge over the Yarra resulted in a dock needing to be moved. That led to additional expenditure of $200 million by the people of Victoria.

The City Link legislation was rammed through the Victorian parliament in such a way that it denied public debate and consultation. We have seen 66 measures undertaken by the state of Victoria to undermine public debate and prevent public discussion in terms of the anti-competitive aspects of that project. That included items such as the corralling of traffic, the closing of roads and the prevention of compensation claims by residents affected by the City Link project. There has been the avoidance of environmental law considerations in the whole project. No EIS has been undertaken for the Tullamarine extension. A grossly inadequate environmental process has been undertaken with regard to the other two legs of that project.

This contract locks in the future policy options for the people of Victoria for 34 years, which is extraordinary. In today's dollar terms, that means additional expenditure for motorists who use that freeway of $1,500 per year. That is a guaranteed profit for 34 years. There are guaranteed subsidies from the state to make sure that various measures are undertaken to protect the privileged position of that consortia with regard to Melbourne.

Advisers to government have mentioned that this legislation includes 350 projects. If this is the sort of project you want to fund under infrastructure bonds, you have to think very seriously about this matter. There are much more substantive issues that go to the heart of public policy than what arises by this sort of project.

The former Treasurer, the honourable member for Gellibrand (Mr Willis), and the former Minister for Transport, the honourable member for Kingsford-Smith (Mr Brereton), indicated that the building of private roads inflated the cost because of the legal and financial complexities. The network risks that were involved ensured that there was a direct subsidy to the consortia building the road, the transfer of public assets and the undermining of public options regarding transport options being considered for Melbourne.

There could be no clearer example of the anti-competitive nature of such a project than the attempt being made to ensure that there is a monopoly of freight on the Tullamarine freeway, which is the link between the docklands and the airport. A real issue that arises concerns the implications of the transport options for Melbourne city. A major metropolitan area of this country is being undermined by this project in terms of private, secret deals. They are enforced through a legislative program by a government that is quite clearly not interested in a proper discussion of these sorts of issues.

As the minister indicated last December, the actions of the national Labor government at that time indicated that its concerns reflected widespread community apprehension about the implications of projects such as City Link and the M2 project. For the Treasurer (Mr Costello) to indicate to us today that the government would reverse this matter is totally inappropriate. In policy terms, it is a retrograde step and one that I trust the Senate will strongly oppose and continue to do so.