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Wednesday, 12 March 2008
Page: 1660


Mr RAMSEY (6:18 PM) —The Infrastructure Australia Bill 2008 is very important, and I am pleased to be able to speak in this debate. I would firstly like to tell you a bit about the electorate of Grey and the things that are happening there at the moment. Whilst the thrust of this legislation is not unwelcome, what I am very concerned about is that Infrastructure Australia will be just another body that may not have the teeth that we need to get the job done. One of the things that I have been increasingly worried about as I look around my electorate is that federal governments have funded much of the capital works and the infrastructure that is happening and we seem to see a great lag in state governments carrying their fair share of the load. I do not want to get into state-bashing on this—it is important that we bring everyone together—but my concern is that Infrastructure Australia will not have the teeth to perform this job.

Our states are swimming in GST collections. As we are talking about infrastructure issues, I might raise the issue of fuel. Some three years ago, fuel was around $1.10 a litre and it is now $1.50 a litre—a rise of 40c. For every litre, that is an extra 3.6c that is collected in GST. There were 37,000 megalitres consumed in Australia in 2007. South Australia’s share of the GST windfall on that consumption was around $100 million. That is unbudgeted income. It comes as a windfall for the government, and still things are not happening as quickly as we would like to see. Page 5 of the Bills Digest, providing information and analysis advice on this bill, says:

It is noteworthy that the areas where the Commonwealth had whole or partial responsibility—airports, telecommunications and national roads—ranked relatively highly. Areas of state government (and to a lesser extent local government) responsibility were most in need of remediation.

In the concluding comments on page 19, the Bills Digest says:

But what the relationship will be between Infrastructure Australia and regulatory bodies—such as the Australian Energy Regulator, the Australian Energy Market Commission, and state bodies such as Essential Services Commission of South Australia—is unclear. Nor is the relationship clear between Infrastructure Australia and other Commonwealth government agencies such as Treasury, which play a role in developing policy that affects infrastructure.

Hence my concern about the weaknesses of Infrastructure Australia.

The seat of Grey promises great things to come. I spoke a little in my maiden speech about my electorate, as new members are wont to do. Grey will become the economic generator for South Australia. I call it the 92 per cent factor. Grey covers 92 per cent of South Australia; thus it stands to reason that we have 92 per cent of the resources. We will probably produce less than 92 per cent of the exports but, with the great explosion that is happening in the mining industry in South Australia at the moment, I believe that the great wealth that will underpin the South Australian economy will come from my electorate. It is my intention, as the member for Grey, to make sure that the windfalls from that increased production, the explosion that we are going to see, will be reinvested back in the electorate and be invested in infrastructure.

So what needs to be done in Grey? I have quite a long list of issues. It seems exceedingly long but, as I pointed out, as Grey covers 92 per cent of the state, we might well need more than just one-ninth of the infrastructure—as 11 seats in South Australia would indicate. The port of Thevenard, on the west coast of Eyre Peninsula, already puts through two million tonnes a year of traditional product—gypsum and wheat or grains. There are problems at the Thevenard port. It is very shallow. There is a mineral sands deposit north of Ceduna being developed by Iluka Resources of which will produce 500,000 tonnes of zircon and ilmenite a year. The current ship limitation at Thevenard is 20,000 tonnes. To move around the world the type of commodity that we are talkings we need to be able to get bigger ships in. If we cannot achieve that, we are looking at much more expensive options much further away. The next port is 400 kilometres away in Port Lincoln. So there are problems there. A report that was prepared for the Eyre Regional Development Board puts forwad a $39 million solution. For the farmers out there, if we do not achieve a breakthrough soon, the shipping will dry up completely and they will be looking at freight bills of $40 to $50 a tonne.

This brings me to Port Bonython, just out of Whyalla, in the upper Spencer Gulf. We will need a new deep sea port in the upper Spencer Gulf, as there are a lot of projects swinging in the state at the moment in the mineral exploration area which will otherwise become unviable. We have four companies that have recently banded together to push for development of the port—Western Plains Resources, Centrex Metals, IMX Resources and Ironclad Mining—who estimate there will be 20 million tonnes of ore going out of northern South Australia by 2015 and, at this stage, we have no means of getting that onto a boat. There is already an iron ore loading facility at Whyalla controlled by OneSteel, but we are going to need a lot more.

We have a backlog on maintenance of state roads. The last official estimate I saw, which was some years old, was a $200 million backlog. Old worn-out roads on Yorke Peninsula and in the mid-north, roads like the Kulpara to Yorketown, and the Barrier Highway north of Burra are old bitumen tracks which you can barely drive a truck on and are ill suited to the needs of a modern export economy. We have growing communities on Yorke Peninsula. Yorke Peninsula is becoming, dare I say, the Sunshine Coast of South Australia, and we are seeing major developments, with a Greg Norman golf course going in at Moonta and major housing developments. People are moving up from Adelaide; they are taking their retirement cheques, getting out of the smoke and going to the beautiful shores of Yorke Peninsula.

Many of these communities are on antiquated water systems. Once again, there is a backlog due to underinvestment by state governments. The delivery line into Ardrossan is 75 years old and we are sitting on refusals for development there because there is just no more water. In the mid-north town of Orroroo, only 800 people live in Orroroo, but they have been living there for 90 years—I do not mean all of them individually; not everyone in Orroroo is 90 years old, I might point out. But it is a town that has been there for a long time and has proof of its existence. It is only 25 kilometres away from a pipeline, yet none has ever been built. While we know water is a big issue, there are also all these infrastructure problems.

We have a number of wind farm developments, on the Eyre Peninsula in particular, have stopped because the interconnector to Eyre Peninsula that used to bring all the power into the peninsula was designed 30 years ago—consequently we have turned around and there are now enough wind farms on the Eyre Peninsula to send the power back down the line the other way—and is no longer capable of getting away what could be generated in that part of the world. The Peninsula is particularly friendly for wind generation. So there is this backlog of infrastructure issues in Grey which needs to be addressed.

I would like to point out what has been good. In the last 10 years or so a lot of money has been spent on infrastructure, in particular on the roads under the AusLink program. We have seen major upgrades of National Highway 1 from Port Wakefield to Port Augusta. We have seen the Eyre Highway widened and upgrades to the Stuart Highway. We have seen enormous investment in local roads through the councils. If anyone should think to ask the councils what they think of government funding, they would say, ‘Well, we don’t even bother to ask the state any more; we just go to the federal government, because we know that, under the Roads to Recovery program, if we put up a good project we have a good chance of seeing it approved.’

We had a rail upgrade, once again on the Eyre Peninsula. If something was not done, the railway was going to have to close. We were looking at growers transporting grain 250 kilometres or more by road to port, with the accompanying stress on the roads. I will just run you through the figures in the rescue package for the railway. The federal government put up $15 million under AusLink; the operator put up $11 million; ABB Grain, the main operator of the grain accumulation set-up along the railway line and on the Eyre Peninsula, put up $4½ million; a levy was placed on the growers to produce $2 million towards this $30 million upgrade; and the South Australian government matched the growers, putting up just $2 million.

The point of all this is to say yes, by all means, establish Infrastructure Australia. But what are we going to do to make sure that this body has got teeth? I seriously wonder whether Infrastructure Australia and the regulations that surround it have the power to fix any of this or whether it is just going to be another talkfest. I certainly hope they do fix it. I certainly hope they can make a difference. But will it be able to, in the end, get the state Labor governments to lift their end of the bargain and step up to the plate and deliver what they should be delivering from the windfall tax dollars that they are receiving at the moment?