The government has announced commitments of $15.2bn over 10 years for road, rail and community infrastructure projects, as part of its stimulus measures to support employment in the post-pandemic economy.
“These new commitments will support over 30,000 direct and indirect jobs across the lives of the projects, the ministers responsible for infrastructure and roads, Michael McCormack and Paul Fletcher, said in their release.
But questions remain about the federal government’s ability to deliver on the ambitious infrastructure agenda, which it says takes the total infrastructure spend to $110bn over 10 years.
The government has been focusing on shovel-ready projects, often in partnership with the states, but the 2021-22 budget highlights the difficulty of spending on complex projects in partnership with other levels of government.
Both the opposition and road advocacy bodies, including the Automobile Association of Australia, have highlighted the continued underspend on infrastructure by the Morrison government.
In the lead-up to the budget, Labor’s transport spokesperson, Catherine King, said the government had failed to deliver to the tune of $1.2bn every year and was “not good on delivery”. She accused the government of reannouncing projects, pointing to several Western Australian road projects.
Figures compiled by the AAA, the umbrella group of Australian motoring clubs, show that over the past five federal budgets, there has been a total shortfall of $4.4bn in road spending alone.
The 2021-22 budget again points to underspending, with one of the biggest decreases in the forward estimates coming from infrastructure.
The papers say spending in the infrastructure investment program decreased by $188.7m in 2020-21 compared with last year’s budget, and will fall by $3.3bn over the four years to 2023-24.
This largely reflects “a re-profile of program funding to align with the delivery of project milestones” the budget papers reveal.
These longer timeframes may explain why the government is committing to $15.2bn in new projects but the total infrastructure budget has increased by only $10bn over 10 years.
Most of the big-ticket projects have already been foreshadowed by the government.
They include:
• $2bn to support delivery of the Melbourne intermodal terminal, which McCormack said would boost productivity by increasing the efficiency and capacity of the national rail freight network and take thousands of trucks off the road.
• $2.6bn for the North-South Corridor – Darlington to Anzac Highway in South Australia.
• $2bn for the Great Western Highway upgrade – Katoomba to Lithgow in New South Wales.
• $400m in additional funding for the Bruce Highway in Queensland
• $380m for the Pakenham roads upgrade in Victoria
• $237.5m for the Metronet to support grade separations and the elevation of stations in Western Australia
• $161m for the Truro Bypass in South Australia
• $150m for the Northern Territory national highway network
• $132.5m for the Canberra light rail – stage 2A
• $113.4m for the Midland Highway upgrades in Tasmania.
The package also includes an additional $1bn to extend the local roads and community infrastructure program.
The road safety program is also being extended to 2022-23, with additional funding of $1bn.
“This brings the total investment by the government in these two stimulus programs to $5.5bn since the start of the Covid-19 pandemic,” the ministers said. “Funding for projects under these programs is being provided on a ‘use it or lose it’ basis to ensure the projects are delivered efficiently.”
Regional Australia will be a particular focus, with $250m allocated for a sixth round of the building better regions fund and a bringing forward of grants to councils.
