Infrastructure injections questioned
An infrastructure lobby says the “big spending” infrastructure budget will actually see a reduction of about $2 billion.
The Federal Government is pushing to fund big-ticket infrastructure projects off-budget through equity contributions.
Infrastructure Partnerships Australia chief Adrian Dwyer said the bold claims of a multi-billion dollar spend are not matched by “cold hard cash”.
“At a time when our population is growing and our cities are more congested than ever, we need to see infrastructure dollars trending up, not down. We need to see $10.7 billion put back into the budget for infrastructure,” Mr Dwyer said.
“This will be disappointing to the states, because the warm infrastructure narrative pre-budget has not been met with cold hard cash in the budget papers.”
The Government has been celebrating its $75 billion spend on infrastructure over 10 years, including what it says it $24.5 billion in new funding.
But that headline figure relies on equity injections for projects like Melbourne's $5 billion airport rail link. This allows the spending to be made off-budget and improve the budget bottom line.
Opposition infrastructure spokesperson Anthony Albanese described it as a “hoax”.
“This is a budget that delivers zero when it comes to new infrastructure,” he said.
“This is a government that is all about making grand statements but not about delivering new infrastructure.”
Labor state governments have slammed the infrastructure spend too, Queensland Deputy Premier and Treasurer Jackie Trad lamenting being left “with the crumbs”.
ANZ economist Cherelle Murphy said capital investment funding was “disappointing”.
“Despite speculation about new capital spending, most newly-announced projects had already been allocated funding. The budget simply specified where this funding is going,” Ms Murphy said.
“Commonwealth capital spending [in the form of direct capital investments, grants to the states and territories for capital purposes and investments in financial assets for policy purposes] was very little changed.”
EY chief economist Peter Crone said the infrastructure funding allocation is lower than the previous budget in real terms.
The funding is also not as high the government's infrastructure advisory body, Infrastructure Australia, recommended.
“It is clear the Commonwealth is going to play a greater role in city-shaping transport projects, with Melbourne Airport Rail Link and the North South Rail Link in Sydney featuring as projects it will be participating in alongside the states,” Mr Crone told Fairfax.
“The projects identified in the Budget do not completely align with Infrastructure Australia's priority projects and initiatives list. “
Almost half the projects from the Budget are not on the IA priorities list.
“Conversely, of the 13 projects on IA's high priority and priority projects list, only four received funding in the budget (Brisbane Metro, Adelaide North-South Corridor – Regency Road to Pym Street, Beerburrum to Nambour Rail Upgrade and Adelaide North-South Corridor Future Priorities),” Mr Crone said.