Abbott Government seeking to reduce independence of Infrastructure Australia

Mr STEPHEN JONES (Throsby) (18:04): The rationale for the Infrastructure Australia Amendment Bill 2013 as outlined by the minister in his second reading speech is a fig leaf—a complete fiction. It is a fiction because, while pretending to strengthen the independence of Infrastructure Australia, the minister, through this bill, is in fact making Infrastructure Australia less independent. We know this because the bill repeals section 6(3) of the existing act to remove the provision that says:

Directions given by the Minister … must be of a general nature only.

In its place, the bill before the House sets out a whole host of ways that the minister can direct the work of Infrastructure Australia and intervene in the arm's length process that was fundamental to Labor's approach.

There can be no doubt that the establishment of Infrastructure Australia has been a resounding success. In the relatively short space of time it has been up and running Infrastructure Australia has successfully entrenched the idea of a more strategic approach to infrastructure investment in Australia. In fact, the model has been so successful it has been mimicked by state governments around the country. Infrastructure Australia has shown that the allocation of scarce government funding should be directed to projects in order of national and economic importance.

I want to pay tribute to the member for Grayndler in his role as the minister for infrastructure. He has a fine legacy. Indeed, a part of that legacy is the fact that he was the first infrastructure minister in any Commonwealth parliament, and the establishment of Infrastructure Australia is one of his great achievements and a great gift to the nation. While the idea of Infrastructure Australia is not new, it took a Labor government to properly resource and implement this all-encompassing and apolitical approach to infrastructure planning and funding. Infrastructure Australia established the need for objectivity and long-term planning into infrastructure funding. Through the establishment of Infrastructure Australia, Labor overhauled the way our nation plans, prioritises, finances, builds and uses infrastructure.    With the establishment of IA, Labor took a nation-building approach to infrastructure and ended the National Party disgrace of pork-barrelling and buck-passing on to the states. Naturally, those opposite were suspicious of IA when it was set up—at the time, the now minister did not even see the need for such an organisation to exist. It is welcome that, despite the changes entailed in the legislation before the House, IA will remain and continue its important role.

It is a fact that the minister's powers to interfere have been expanded. The coalition wants to weaken the independence of Infrastructure Australia by increasing the power of the minister to interfere in IA's evaluation processes. The minister will acquire the new power to nominate pet projects for evaluation under section 5A of the bill. The minister will have the power to exclude classes of projects from IA's consideration—for example, public transport projects, which we have been advised by the Prime Minister are not a part of the coalition's knitting bag. The minister will have a new power to prevent the publication of project evaluations and any reasons for decisions and evidence relied upon. This reverses the current position where material is ordinarily released and relied upon by industry and investors to base important decisions on.

The bill will replace the current provision preventing the minister from giving directions other than of a very general nature only and enable the minister to give new directions, acquiring specific power to give directions in specific areas, including what projects may or may not be considered by Infrastructure Australia. The minister will also be able to direct the manner in which other functions are performed. It is also a fact that the legislation before the House will mean that the decisions of IA will be less transparent, because they will require permission from the minister to publish the material that it believes to be commercial in confidence.

My understanding is that nobody in the business community or elsewhere has said that the existing board of IA has done anything other than a first class job. On that basis, it is passing strange to those of us on this side of the House that one of the first acts of the new minister is to bring legislation before the House that sacks the board, creates a new board and enables the minister to appoint, presumably, people who are friendly to those on that side of the House to the new board. That ensures that the new board will not have the same arm's length independence that Infrastructure Australia has enjoyed until this point.

It is also of concern to those on this side of the House—and this is perhaps even more extraordinary when you listen to the direct action rhetoric of the Minister for the Environment and others—that one of the first acts of the new government is to remove the provision in the IA charter that requires it to consider the impact of climate change of infrastructure policy and infrastructure projects and their capacity to reduce carbon emissions and to create more environmentally efficient infrastructure. That strikes us on this side of the House as very strange indeed and a backward step.

It is also a fact that the new body will be less resourced while given more tasks. The minister has said that the changes will be achieved without extra funding. As we can expect that staff salaries will increase over time and the corporation will cost more to run, this will reduce resources available to IA to do its functions. The government is saying that IA will have to do more of its own research—despite the fact that it already does research—on and analysis of the proposals that are brought to IA by state governments. Far from doing more, it is quite likely that IA will only have the capacity to do much, much less.

Another one of the problems with the legislation is that it stalls projects that are currently under assessment. We know that there are a number of projects currently being assessed for tax concessions under the tax concession arrangements put in place by the Labor government. These will now be held up and rendered less certain as a result of ministerial intervention—this at a time when governments, businesses and constituents of members on all sides of the House are crying out for increased action when it comes to spending on infrastructure.

Greater intervention is being dressed up as stronger governance. The government is making much of the change in governance structure via placing IA at arm's length from the department under CAC Act. But as we have already seen, this is a fig leaf to ensure that Infrastructure Australia has less independence and the arm's length that currently exists is reduced significantly.

I want to make a few observations on the importance of this legislation and infrastructure in general. Labor had a distinct approach in government to the planning and the funding of infrastructure. Labor's approach was about nation building. It understood that state governments, local governments and the federal government had to work together on the basis of the best projects to ensure that we got the best outcomes for the nation. That is because nation-building infrastructure is a responsibility shared by all layers of government. It is a responsibility that each and every member in this place has an interest in, since it touches the lives of constituents, either when they get on their bus or train to get to work or when they get in their car to travel our highways and national roads. It touches them more indirectly through increased productivity in our freight, rail, ports and social infrastructure.

Labor did not expect that the new government would embrace this approach. But we are disappointed in the new approach of the government to reduce the independence of Infrastructure Australia. Labor's last budget saw an unprecedented nation-building program, one that is building the modern, well-planned infrastructure that makes working people's lives easier, our businesses more competitive and the Australian economy more productive. Under Labor, total public and private investment in the nation's roads, railways, electricity generators and water storage facilities was 40 per cent higher in real terms than it was during the last full year of the former coalition government. We were working together with the private sector to encourage and to encourage investment in critical infrastructure. That is the benchmark to which this side will be holding the Abbott coalition government when it comes to his promise to be an 'infrastructure Prime Minister'.

In government Labor doubled the federal infrastructure spending from $141 per capita to $269 per capita, and that is a legacy that we are very proud of. We did this with the large-scale road, rail and public transport projects initiated by Infrastructure Australia and expected to generate long-term economic, social and environmental benefits worth almost three times more than what they cost to build.

Australia has an enormous infrastructure challenge ahead of it. We live in the highly competitive, globalised world of the 21st century. The quality of our infrastructure will drive productivity and will quite literally drive our capacity to continue to be a wealthy and lucky country into the future.

Since its inception Infrastructure Australia has served the Australian people well. Its arms-length approach to Australian infrastructure projects, putting economic productivity as the central criterion, has seen 55 per cent of Infrastructure Australia nation-building money going to urban rail on the basis of merit. It is on this basis that we are very concerned about some of the early decisions of the Abbott government. As I have said, they simply do not see urban rail as part of their knitting bag.

In government Labor strongly backed vital urban transport projects, including the Commonwealth's single-largest investment in urban rail, the Regional Rail Link in Melbourne. Disappointingly, since the election of the Abbott government, Commonwealth funding has been withdrawn from a number of important projects that were in the last federal budget, including Brisbane's critical Cross River Rail project, a tunnel under the Brisbane River that will deliver capacity for 17,000 additional passengers during peak times—needed because the existing rail bridge over the Brisbane River is about to run out of capacity. If Brisbane is to grow, Deputy Speaker Vasta—and I know this is a matter of direct concern to you—this is a critical piece of national infrastructure.

I also point to the Melbourne Metro, which Infrastructure Australia has reported could increase—

Ms Henderson: Mr Deputy Speaker, I seek to intervene by asking the member a question as to whether he is aware that the regional rail link in Melbourne is being funded—

The DEPUTY SPEAKER: I will ask the shadow parliamentary secretary: are you willing to give way?

Mr STEPHEN JONES: Mr Deputy Speaker, I would yield but they never ask the right question. On that basis I will continue. The Melbourne Metro project, which Infrastructure Australia has reported could increase passenger capacity on Melbourne's urban rail network by 30 per cent, has had its funding withdrawn.

Then there is the Perth Airport link. I see the member for Perth in the chamber at the moment. I have seen her speak quite passionately about this issue. She is a passionate advocate for infrastructure in her electorate and has a long history in urban rail and transport in her former role in the Western Australian state parliament. Then we look to the upgrade of Adelaide's Tonsley Park rail line, another project the government has withdrawn funding from. Prime Minister Abbott is on the record as having said:

We have no history of funding urban rail and I think it's important that we stick to our knitting, and the Commonwealth's knitting when it comes to funding infrastructure is roads.

We on this side of the House disagree with that. We on this side of the House understand that urban public transport infrastructure has to be integrated, and when you put more cars on roads that has a flow-on effect on congestion. We understand that we need an integrated plan for our urban public transport and that the Commonwealth has to work with state and local governments to ensure that our cities are fit-for-purpose when it comes to meeting the infrastructure challenges now and into the future.

We have seen some disappointing starts with the Abbott government when it comes to infrastructure planning and infrastructure funding. It is on this basis that Labor will be opposing the proposition before the House. We think it is a fig leaf; it is unnecessary and it reduces the independence of IA. (Time expired)