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Tuesday, 25 November 2008
Page: 11288

Mr TRUSS (Leader of the Nationals) (7:07 PM) —For the past year we have been bombarded with claims, often completely fanciful, about what the Nation-building Funds Bill 2008 and its cognate bills will actually do. In particular, the Building Australia Fund has been put forward as the saviour for a countless number of infrastructure projects, particularly road and rail, around the country. The states have seen it as the saving grace for their budgets. Those with ambitious ideas around the community have seen it as a way in which funding might be provided.

The federal government has fed this speculation by leading everybody to believe that their projects will be on the list to be funded. Indeed, the Prime Minister, in quite an extraordinary feat of dexterity, has listed infrastructure expenditure in two of his plans, two of his wars, over the last few months. When Labor was worried about inflation, we had his four-point plan to beat inflation and, lo and behold, a $70 billion expenditure program on infrastructure was part of the plan. Now when the problem is a recession, an infrastructure plan is part of the solution to beating unemployment—the war on unemployment. So we have the same cure for two opposite diseases. Originally, Labor was telling us inflation was out of control—it had almost doubled during its term in office—and so we needed to spend money on infrastructure. And then, when the problem is not inflation but is in fact a recession, we have the same cure: it is going to spend more money on infrastructure.

I am all for spending money on infrastructure. I think we do need to keep building our country and making it strong. It is important that we use our resources when they are available to help secure the basic lifelines—roads, rail and infrastructure—for the future. But the reality is that an infrastructure program was never going to confront inflation. In fact it was quite likely to feed it. The government’s economic illogicality was only matched by the fact that when it was trying to beat the recession a little later, it proposed exactly the same solution.

The facts are that under the previous government there was a very substantial increase in expenditure on infrastructure. When we came to office, 2.9 per cent of GDP was spent on infrastructure. When we left office, that figure had grown to 5.4 per cent. So the members opposite cannot be lecturing this side of the House about who are the nation builders. We virtually doubled the GDP proportion that was spent on infrastructure. We are the government that commenced AusLink. We are the people who built major railway networks and supported the construction of other vital infrastructure projects.

In fact, in spite of the rhetoric that you are hearing from Labor tonight, and over recent times, even with the money that is being allocated in the building fund, Labor will spend quite a deal less on roads and rail between now and 2014 than the previous government would have spent. Labor is actually cutting expenditure on infrastructure. It is hard to believe that when you listen to all of the rhetoric about how it is building things and how new projects are going to come online and that the Building Australia Fund is going to be the cure for all evils. It is actually going to cut funding. The road and rail sector in particular has a great deal to be concerned about with regard to the attitude of this government. The Building Australia Fund, for instance, is only going to provide $7 billion over three years for roads and rail. That is about one-third of what we provided in the last AusLink program—a quarter of what we would have provided under the next AusLink program. Labor is continuing AusLink, although it is providing it with a little less money. The funds available under this Building Australia program very much need to be kept in perspective.

The other issue that is of particular significance is that there is $7 billion available over three years for road and rail, but, from what we can ascertain, the requests for funding under the Building Australia Fund for roads and rail are around $400 billion. So we have $7 billion to be shared amongst $400 billion worth of requests. It is hardly going to leave a lot of happy people around the countryside. They have been led to believe that there are going to be projects all over the place, but of the $400 billion being asked for in road and rail—there is more being asked for, for other things—only about $7 billion is going to be available over three years.

As previous speakers have said, another very important point to note is that if there had not been a coalition government for the last 11 years, there would be no money available for Building Australia. Every single dollar comes from the current surplus, which was inherited from the previous government, and the money that had been put aside in future funds by the previous government. Had Labor been in office, we would have had deficits, not surpluses, at this time of the year. There would have been no money put aside. So when Labor talks about what it is going to spend under the building fund, let me make it absolutely clear: it is not spending money that it has raised, it is not spending money that has somehow or other been miraculously invented; it is spending the money that it inherited from the previous government. And so all of those building projects, all of the railways, all of the roads are in fact funded by the legacy left by the previous coalition government.

There is supposed to be $26.3 billion available for these three funds on 1 January next year and $41 billion by 30 June next year, but, of course, the missing $14 billion that has to be found next year is to come out of the budget surplus. What surplus? It has already dissipated to something like $5 billion, and most people believe that Labor is heading for a deficit. The Treasurer and the Minister for Finance and Deregulation will not use the word, but most people believe there will be no money left—there will be nothing to put into the Building Australia Fund to deliver on the promises that Labor members are making today.

I want to look also at some of the other elements of the processes that Labor is putting in place for the Building Australia Fund. The government said that the decision-making process will be ‘above politics’, with well-credentialed Australians put on the board of Infrastructure Australia, tasked to find the right projects to be funded in the right places at the right time. The government stated in the May budget that an infrastructure priority list would be considered by COAG, which we can only take to mean that the states and territories were to have some say over which projects would get the final nod. The sacred nature of these funds does not end there. The Minister for Infrastructure, Transport, Regional Development and Local Government solemnly declared on 4 June:

Public investment in infrastructure will no longer have regard to political cycles or electoral boundaries.

That is a bit rich coming from the member for the Fort Street High School, but nonetheless he says it will no longer have any regard to political cycles or electoral boundaries.

The political cycle part of that is a bit interesting. Here we are, one year into the term of the government, and they have done no road building and no rail building whatsoever. They have in fact prevented some projects which were virtually about to start, like the F3 to Branxton project. That is not happening. It could have been started by now, but Labor stalled all of that. The reality is that there have been no new projects that were not already in the pipeline announced and funded by the current government. We are now going to have this windfall of funding, which will be announced over the next six months or so. A little bit of planning will then go on and—lo and behold!—at about the time that the next election is due to be called, we will have all these sod-turning ceremonies and the start of all those projects. Yet we are being asked to believe that this has got nothing to do with the electoral cycle? Don’t make us blush! I cannot understand how the minister for infrastructure can even say such a thing and keep a straight face. This is deliberately designed to meet the electoral cycle, but the government will pretend that the projects just happened to be about to start at that crucial time. They have nothing in mind other than to try and save the bacon of Labor members, who have failed to deliver anything during their term in office.

These all are lofty words, and there may be some kind of a magic pudding of funds to fund almost anything that Australians might desire, but in reality we all know that they are slush funds. They are not totally above politics; they are slush funds to try to bail out Labor state governments and local members with pet projects.

Let us look also at how the rhetoric has failed to match the action. In today’s Age, we can see how far Labor have strayed from the original promises that they made about these funds. To paraphrase the Victorian government, it has been agitating for weeks to get some answers from the Commonwealth so that it can make infrastructure plans of its own. It would like a seat at the table as the federal government promised it would have in the budget. On budget night we were told that the states would have a role in the selection of these projects. But a spokesman for the minister for infrastructure cut the Victorians short. He said: ‘This is not a COAG decision. It will be determined by the federal government.’ The federal government is going to make the decision about which projects are going to be funded.

If that is not enough, the budget statement declaration that the priority list would be considered by COAG seems to have gone out the window. The Infrastructure Australia board also will not have a say. We were told that all of these things were going to be decided by the board of Infrastructure Australia. We heard the previous speaker and other speakers commenting about how all these eminent businesspeople are going to be put on this board so that all the decisions would be above reproach. But Infrastructure Australia is not making the decision; COAG is not making the decision; the government and the minister are making the decision. And you are asking us to believe that it is not a slush fund!

In addition to that, somebody apparently did not tell the Treasurer, because he said today that, in fact, infrastructure is going to be right at the centre of the discussions at the COAG meeting in December. You cannot have it both ways. It is not on the agenda, according to the Prime Minister; the Treasurer says it is going to be right at the heart and centre.

There has been enormous confusion about the priorities. Originally, Labor said that the priorities were to be set by Infrastructure Australia. They said that COAG would have a say. But now it is clear the government is going make the decision. Projects were going to be assessed independently, we were told. However, all of the ALP election promises are exempt from the independent assessment process. Labor has virtually promised the whole fund already to people. Members have been out there making promises, such as their Better Regions program. Only Labor members and Labor candidates could apply. The applications are closed—no more applications are going to be entered into—and they are all going to be funded. No independent assessment will take place. Some of these projects had specifically been rejected for funding through the proper departmental processes. Labor promised them during the election campaign. They are immune from independent assessment and they are all going to be funded.

We just heard the member for Werriwa talk about a project in his electorate, which he says is ‘going to be funded’—it is going to be funded; it is a Labor election promise. Where is Infrastructure Australia’s role in assessing whether that project is worthy? What is the worth of all those independent businessmen if their advice is not going to be taken? In addition to that, you have to assume that all ALP election promises are meritorious and worthy and rank above everything else. That is what you are asking us to believe.

Dr Kelly interjecting

The DEPUTY SPEAKER (Hon. KJ Andrews)—Order!

Mr TRUSS —It is a slush fund, and Labor have decided which projects are going to be funded. They have announced most of them. They are immune from the process and we are being asked to believe that there is some kind of credibility about what is going on. The advisory panels have been sidelined. MPs have been listing projects all night that are going to be funded. Where is the independence in the process if these members have already got the wink and the nod that their funding is going to be all right?

Opposition members interjecting—

The DEPUTY SPEAKER —Order! The level of conversation is too high.

Mr TRUSS —This cannot be a slush fund, and we are going to move some amendments to the legislation. If the government does not accept those amendments it will be a further clear demonstration that this is a slush fund aimed at bailing out moribund state Labor governments and involving processes to artificially milk money into the system so that they can pretend that they are spending it. If Labor do not want this program to be labelled as a rort scheme, they should accept those amendments to bring some honesty and accountability into the program.

Victoria, of course, had good reason to be concerned about what was going to happen with the allocation of the funds. They asked for $10 billion, but it seems they will only get the crumbs from the table. The Victorian Premier had obviously read Saturday’s Sydney Morning Herald, where the Prime Minister stated that, no matter how economically incompetent the New South Wales government is, it would be helped big time when money from these funds is doled out.

It is supposed to be independent, but the Prime Minister is telling New South Wales that they can get funding for some of their projects. That is hardly surprising, I suppose, because the Prime Minister is pretty dependent upon the New South Wales Right for the numbers for his leadership. Of course, the wife of his lieutenant, the minister for infrastructure, is the New South Wales Deputy Premier, so I hope that there is going to be appropriate arms-length distance between the decisions made about New South Wales.

It is worth looking at the New South Wales submission for money for the Building Australia Fund in some detail. We only have to rely on the media reports because, in reality, the state government has declined to reveal its full submission. We have heard that there is $41 billion planned from the three funds, although a lot of that is not available. As the surplus created by the former coalition government spirals downward into the whirlpool of Labor’s looming budget deficit, only $26.3 billion is left, with $12.6 billion for the Building Australia Fund. But New South Wales alone has asked for $40 billion. It is not going to go round. At the top of the list is $4 billion for an eight-kilometre rail line running through Labor seats in Sydney’s inner west. All the projects on the top rung of Labor’s priority list—$20 billion worth—are in Labor electorates. The regions in New South Wales miss out, as they always did. In Queensland the Bligh Labor government’s top 13 priority projects for Building Australia funding are all south of the Sunshine Coast.

It is obvious when you read the front page of the Sydney Morning Herald on 7 October that some projects are going to miss out. One is the $12 billion North West Metro rail line from the city to Rouse Hill, despite the fact that it has been promised on eight separate occasions by the state Labor government. However, the New South Wales Premier Morris Iemma and bureaucrats in February were told not to bother putting the North West Metro on the New South Wales wish list, because there were no votes for federal Labor in it. And we are being asked to believe that this fund is above political cycles and electoral boundaries!

The state and territory governments alone have put forward $235 billion worth of requests for funding from the Building Australia Fund and there is about $450 billion worth of projects altogether. Many of $450 million worth of projects are undoubtedly important and deserve funding. They have not been built in some cases because the private sector did not have the cash to build them or because other projects were given priority. You cannot do it all at once and the task will never be completed; we will always need more money for infrastructure. You do need to plan and build a national network—something which the previous government had done. We were involved in an extensive program of planning with the states to develop AusLink, and therefore for the first time we had a priority, a long-term planning arrangement for the road and rail systems of our country.

Finally, I want to talk a little bit about the Communications Fund. This bill axes the Communications Fund. I spoke about it earlier today in the debate on the matter of public importance and I asked the minister a question during question time, which he refused to answer. I asked: what plans does the government have in mind to do the work that the Communications Fund was established to do? It was set up specifically to meet the future technology needs of people who live in regional areas. It was a fund in perpetuity. Two billion dollars was provided out of the proceeds of the sale of Telstra. It was there permanently to be able to provide funding to upgrade telecommunications infrastructure in the future. This money is being stolen to go into this group of Labor slush funds and there is no alternative in place.

I call on the minister in his summing up to tell us what plans Labor has for modernising telecommunications, not just this year and next year, not just a response to the Glasson review, but what are we going to do in 10 and 20 years time? Where is the funding available to guarantee to country people that they will not be left behind? Labor’s broadband scheme looks like falling in a heap and may deliver little or nothing to regional areas. What is going to be available for country people to catch up with the technology? You have stolen the money. You have stolen the money that was promised to regional areas. That money was committed in legislation which I understood Labor supported. Now you have taken that money away.

We will move amendments to preserve the Communications Fund. Those will be vital amendments for the future of regional Australia. I call on the government to accept those amendments in the spirit of developing legislation that is fair and decent. We must have a continuing Communications Fund to ensure that this vital infrastructure is provided in perpetuity for the people who would otherwise miss out as a result of these funds being commandeered for other uses. (Time expired)

The DEPUTY SPEAKER (Hon. KJ Andrews)—Before calling the next speaker, I remind members to address their remarks through the chair.