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The Blue Book An analysis of the infrastructure and related policies of the Abbott Government 9 SEPTEMBER 2013

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Page 1: The Blue Book - IPA...The Blue Book 9 September 2013 2 Infrastructure Partnerships Australia is a national forum, comprising public and private sector CEO Members, advocating the …

The Blue Book An analysis of the infrastructure and related policies of the Abbott Government

9 SEPTEMBER 2013

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Infrastructure Partnerships Australia is a national forum, comprising public and private sector CEO Members, advocating the public policy interests of Australia’s infrastructure industry.

FOR MORE INFORMATION PLEASE CONTACT: BRENDAN LYON CHIEF EXECUTIVE OFFICER INFRASTRUCTURE PARTNERSHIPS AUSTRALIA Level 8, 8-10 Loftus Street, Sydney NSW 2000 PO Box R1804, Royal Exchange NSW 1225 T| 02 9240 2050 E | [email protected] ZOE PETERS MANAGER, POLICY INFRASTRUCTURE PARTNERSHIPS AUSTRALIA Level 8, 8-10 Loftus Street, Sydney NSW 2000 PO Box R1804, Royal Exchange NSW 1225 T| 02 9240 2050 E | [email protected]

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Contents 1. Introduction .......................................................................................................... 5

2. Assessment of the economic and fiscal outlook .................................................. 7

Analysis of the Coalition’s fiscal strategy commitments .......................................... 7

3. Analysis of the historic and projected infrastructure investment trends, on current settings ..................................................................................................................... 11

Introduction ........................................................................................................... 11

Key findings .......................................................................................................... 11

Background - Historical infrastructure investment trends ...................................... 12

What has been the public investment trend? ........................................................ 14

How does Australia compare internationally? ....................................................... 14

How does the Coalition’s aggregate economic infrastructure investment compare to the former Government’s budgeted commitments? .......................................... 16

4. Machinery of Government: A new Infrastructure Australia ................................ 18

Introduction ........................................................................................................... 18

Summary of key points: ..................................................................................... 18

Structure and mandate analysis: ........................................................................... 19

Renewed audit ...................................................................................................... 19

Renewed 15 year pipeline ..................................................................................... 20

Commonwealth investment oversight ................................................................... 20

A funding and financing arm ................................................................................. 20

Ex post analysis .................................................................................................... 21

5. Rebasing expenditures: A commission of audit ................................................. 22

6. Rebasing revenue: A new taxation reform process and other matters .............. 23

Introduction ........................................................................................................... 23

Abolition of the Carbon Tax ................................................................................... 23

Abolish the Minerals Resource Rent Tax (MRRT) ................................................ 24

Reduce the company tax rate ............................................................................... 24

Tax Administration ................................................................................................ 24

7. Efficient infrastructure finance: Developing a domestic bond market and considering a return for infrastructure bonds ............................................................ 25

8. Accelerating projects: Simplifying project approvals .......................................... 26

9. Restoring mobility: Transport commitments ...................................................... 27

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Introduction ........................................................................................................... 27

Major road and highway commitments.................................................................. 27

Roads to Recovery and Black Spot programmes ................................................. 29

Freight Rail ............................................................................................................ 29

10. Energy market reforms ................................................................................... 31

Abolition of the Carbon Tax ................................................................................... 31

Energy White Paper .............................................................................................. 32

Energy Advisory Council ....................................................................................... 32

Northern Australia ................................................................................................. 33

11. Telecommunications ....................................................................................... 34

12. Appendix A: Project Commitments in Detail ................................................... 37

i) Detailed Transport Project Commitments .......................................................... 37

a. Bruce Highway (QLD) ..................................................................................... 37

b. East West Link – Stage One (VIC) ................................................................. 39

c. Gateway Upgrade North (QLD) ...................................................................... 41

d. Gateway WA ................................................................................................... 42

e. Melbourne – Brisbane Inland Freight Rail Route ............................................ 43

f. Midland Highway Upgrade (TAS) ................................................................... 45

g. Pacific Highway Upgrade (NSW) .................................................................... 46

h. South Road Upgrade – Darlington Interchange (SA) ...................................... 48

i. Toowoomba Second Range Crossing (QLD).................................................. 49

j. WestConnex (NSW) ....................................................................................... 51

k. Warrego Highway Upgrade (QLD) .................................................................. 53

l. F3-M2 Link (NSW) .......................................................................................... 54

ii) Appendix C: Source Policies ............................................................................. 64

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1. Introduction The election of a new Australian Government brings substantial opportunities for the infrastructure sector, in terms of immediate increases to committed project funding; and formal processes to review the prioritisation of projects and budget reforms needed to increase and sustain national capital investment. Figure one, below, shows IPA’s analysis of the Coalition’s committed investment in infrastructure across the forward estimates. This analysis shows that the Coalition Government’s commitment is circa 25 per cent above the funded commitments of the former Government.

Figure 1 – Commonwealth economic infrastructure investment (committed budget spend + new Coalition spending commitment, excluding NBN and stimulus)

Source: IPA Analysis based on Commonwealth Budget papers and Coalition Costings

But it is likely that the process commitments to enhance Infrastructure Australia, as well as reviewing both revenue and expenditure, will offer the most substantial long-run benefits. The Coalition’s policy to reform Infrastructure Australia represents a mature and prudent template to enhance the skills within, and impact of, that critical agency. The broadening of IA’s remit to assess all Commonwealth project investments with a value above $100 million offers a meaningful opportunity to oversight Commonwealth expenditures across the whole of government (apart from Defence). The Coalition has also committed to important reviews of both expenditure (through the Commission of Audit) and revenue (through the taxation white paper).

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These processes will identify efficiencies and capital assets for privatisation in the immediate term; while allowing for a detailed national discussion about how our revenue strategy can better match our recurrent and capital expenditure requirements. The former Government has much to be proud of in infrastructure. The creation of Infrastructure Australia; the appointment of a coordinating national infrastructure minister and a range of other initiatives have left a strong architecture that has permanently changed the national approach to infrastructure. Now, with that architecture in place, it is pleasing to consider the positive impact that a new Government committed to increasing firm dollar investment may have on the nation’s infrastructure backbone. Of course, the election of a new Parliament with a stable majority government, of itself, will offer a greater degree of predictability and reliability in the policymaking process. In any case, IPA hopes that you find this analysis useful and we welcome any feedback you may have.

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2. Assessment of the economic and fiscal outlook

“Prudent budget management. That’s our pledge.”

Statement by the Hon Joe Hockey MP and the Hon Andrew Robb AO MP 28 August 2013

The election of the Abbott Government provides an important opportunity to renew momentum toward nationally significant infrastructure projects, and implement the enabling policy and budget reforms that will be needed to support efficient and sustained delivery. Indeed, the election of the Abbott Government will see an increase of national investment in Nation Building infrastructure by circa 25 per cent over the forward estimates (discussed further in the next section). Nonetheless, the incoming Government faces the same fiscal and economic conditions that in part frustrated the former Government’s broader infrastructure ambitions. The Pre-Election Economic & Fiscal Outlook (PEFO) provides a flavour of the funding challenge that will confront the Abbott Government, as they move to liberate funding for projects beyond the signature projects which formed the basis of the election campaign. The PEFO found:

• the Commonwealth will deliver a deficit of circa $30.1 billion in FY 2013/14, equivalent to 1.9 per cent of GDP;

• general government net debt will reach circa $184 billion in FY 2013/14 (11.7 per cent of GDP);

• growth is estimated at 2.5 per cent of GDP in FY 2013/14, rising to three per cent in FY 2014/15, but these estimates are highly sensitive to downside risks;

• unemployment will grow from circa 5.6 per cent now to circa 6.25 per cent over FY 2013/14;

• terms of trade will retreat at 5.75 per cent in FY 2013/14 and a further 2.75 per cent in FY 2014/15; and

• Australia is facing several years of below-average nominal GDP growth.

Analysis of the Coalition’s fiscal strategy commitments While the Coalition’s core fiscal objective is to return the budget to surplus, they have prudently avoided specifying a particular fiscal year for that to occur. This is critical, because it provides the Government with latitude to progress its announced projects and

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programmes, while it considers revenue and expenditure opportunities to rebalance the budget over the medium term. The Coalition has focussed strongly on fiscal management, with its first term policy and programme commitments funded from within the existing budget funding envelope. The Coalition has identified $41.9 billion in savings over four years to fund its $33.1 billion in expenditure commitments. Key expenditure and savings measures are outlined in Table 1, below. Full expenditure and savings measures are detailed in Appendix B. While the Coalition has some flexibility in terms of the timeframe in which it will balance the budget and begin reducing net debt, the Abbott Government will likely be keen to articulate a process to achieve fiscal balance in its first budget. Table 1 Fiscal Impact of Federal Coalition Policies

FISCAL BUDGET IMPACT OF FEDERAL COALITION POLICIES Total $m

Removal of Carbon Tax Package

Total Savings From Removal Of Associated Expenditure 7,471

Foregone Revenue From Removal Of Carbon Tax -13,519

Net Budget Impact - Carbon Tax Package -6,048

Removal of Mining Tax Package

Total Savings From Removal of Associated Expenditure 18,370

Foregone Revenue From Removal of Mining Tax -3,700

Net Budget Impact - Mining Tax Package 14,670

Coalition's Paid Parental Leave Scheme Package

Net Budget Impact - Coalition's Paid Parental Leave Scheme Package 1,103

Coalition's Infrastructure Package*

The Coalition’s Plan to Reduce Traffic Congestion: East-West Link -1,500

The Coalition’s Plan to Reduce Traffic Congestion: WestConnex Sydney -1,500

The Coalition’s Plan to Reduce Traffic Congestion: Gateway Brisbane -1,000

Toowoomba Range Crossing -130

Pacific Highway -2,563

North-South Road Adelaide -300

Perth Airport Gateway -622

Swan Valley Bypass -200

Bruce Highway -2,092

Sydney F3 to M2 link1 -255

Midland Highway -120

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Warrego Highway -200

Melbourne-Brisbane Railway -180

Princes Highway duplication -258

Ipswich Motorway - Darra Rocklea -65

Tiger Brennan Drive widening -70

Great Ocean Road -25

Ravenswood interchange -45

Condah-Hotspur Road -3

Princes Highway East -5

Mt Barker interchange -8

Outback Way -33

Kin Kora roundabout -13

Shoalhaven River Bridge planning -10

Jane Street extension -20

Narellan Road -40

Moree Bypass stage 2 -15

Dalrymple Road -20

D'Aguilar Highway -16

Local Road Projects (27 projects) -26

Bridges renewal programme -180

Total Coalition Infrastructure Commitments -11,512

Less:

Existing Funding Allocated from the Nation Building Program 6,134

Do not proceed with Melbourne metro rail 75

Do not proceed with Cross river rail 453

Do not proceed with Perth urban rail public transport 100

Do not proceed with Tonsley park public rail transport project 32

Do not proceed with Airport rail - planning 3

Do not proceed with Mulgrave River bridge 40

Net Budget Impact - Coalition's Infrastructure Package -4,676

Building Stronger Communities and Regions

National Stronger Regions Fund -400

Community Development Grants programme -342

Redirect Building Better Regional Cities programme 25

Mobile Blackspot programme -75

Net Spending - Building Stronger Communities and Regions -792

Other Announced Coalition Savings

Reduce Public Service headcount by 12,000 through natural attrition 5,212

Restore humanitarian immigration intake to 13,750 p.a. 1,269

Redirect Carbon Capture and Storage Flagships program 349

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Further Coalition Savings

Foreign Aid - grow in line with inflation 4,500

Water Buybacks - re-phase four years' spending over six years 650

Connecting renewables - connecting to the grid - suspend until committed demand is identified 185

Net Budget Impact - Further Coalition Savings 6,382

Public Debt Interest 1,313

Coalition Budget Impact

Total Coalition Savings (Including Public Debt Interest) 41,969

Total Coalition Policy Commitments -33,178

Net Impact of Coalition Measures on Budget (Fiscal Basis) 8,791

Net Impact of Coalition Measures on Budget (Cash Basis) 6,090

Note:

Carbon Tax abolition - growth dividend (not included above) 1,100

Coalition Debt Reduction

Other Savings Affecting Debt not included above 9,967

Debt reduction as a result of Coalition Policies 16,057

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3. Analysis of the historic and projected infrastructure investment trends, on current settings

“I hope should we win the election, that I will be remembered as an ‘Infrastructure Prime Minister’…

Hon Tony Abbott MHR July 2013

Introduction Measuring the Federal Government’s actual and committed level of infrastructure investment can be difficult, because of the varying means by which the Commonwealth invests in projects, and the multiple sources of statistics. For example, aggregate civil infrastructure measures by the Australian Bureau of Statistics (ABS) also capture privately funded, mining related infrastructure investment (such as port or rail facilities), masking the level of actual, public investment. Additional complexity arises too, because the Commonwealth’s investment in infrastructure is largely through grant allocations to the states, as well as a range of other factors. This complex array of statistics was evident during the campaign, with the former Government arguing that Coalition policies would see a reduction in infrastructure investment. Our analysis finds that, far from reducing the level of committed investment, the Coalition’s project and programme funding envelope has actually increased the committed capital spend across the forward estimates by some circa 25 per cent, compared to the former Government. This section seeks to provide a clearer analysis of the current level of investment and the forward trend, including the outlook for national investment from the Coalition’s announced settings.

Key findings Our analysis finds that the Coalition’s committed investments in economic infrastructure will increase spending over the forward estimates by circa 25 per cent – around $4.67 billion in nominal terms – over the programme announced by the former Government in the May 2013 Federal Budget. Other key findings from this analysis include:

Australia’s total investment as a proportion of GDP is significantly higher than the OECD average; but the proportion of investment funded by Australia’s governments remains below the OECD average, when measured in terms of Gross Fixed Capital Formation (GFCF). o Australian GFCF equalled 26.5 per cent of GDP in 2010. The OECD average in

2010 was 18.3 per cent of GDP (OECD, 2013);

o The share of total GFCF attributable to Total General Government spending is slightly below the OECD average. Total General Government GFCF accounted

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for 15.6 per cent of Australian GFCF in 2010 – this compares to an OECD average of 16.2 per cent.

All levels of government in Australia have increased their public infrastructure

investment in recent years, but it is now in accelerating retreat. o Total General Government GFCF increased consistently through the 2000s,

peaking at 2.8 per cent of GDP in FY 2009/10 (ABS);

o In nominal terms, engineering construction work done (for the public sector) increased 105 per cent in the 10 years to 2012;

o Commonwealth investment in economic infrastructure increased from an annual average 0.74 per cent of total Commonwealth expenses (0.14 per cent of GDP) in the five years to FY 2007/08 (inclusive), to 1.6 per cent of total Commonwealth expenses (0.40 per cent of GDP) in the five years to FY 2012/13 (inclusive).1

Total public infrastructure investment is likely to decline markedly over the next

four years, as the states and Commonwealth reduce their capital investment relative to the preceding four years. o Commonwealth infrastructure investment under the Coalition’s settings will

average 1.4 per cent of total Commonwealth General Government expenses across the forward estimates, compared to 1.12 per cent committed by the former Government. However, Commonwealth investment over the last four years has averaged 1.6 per cent of total general government expenses.

Background - Historical infrastructure investment trends Public and private infrastructure investment has increased markedly over the last decade, but is now in retreat (as discussed in the next section).

The ABS Engineering Construction Activity series is one measure of activity which clearly illustrates this trend.

Figure 1 and Figure 2, below, show the substantial acceleration in Engineering Work Done and Engineering Commencement through the 2000s.

While both measures remain historically high, the beginning of the retreat can be clearly seen in Figure 1; while Figure 2 also shows the comparatively anaemic growth in publicly funded infrastructure investment, compared to the substantial acceleration in privately funded (generally mining related) infrastructure spending.

1 Sourced from Commonwealth Budget papers, this figure includes economic infrastructure only. Commonwealth expenses include General Government expenses only.

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Figure 1 — Engineering Construction Activity, work done ABS Engineering Construction Activity, Work Done ($’000)

Source: ABS (8762.0), 2013

Figure 2 — Engineering activity, work commenced ($’000)

Source: ABS (8762.0), 2013

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What has been the public investment trend? While headline capital investment trends have been mostly underpinned by increased private sector activity, particularly resource-related investment, available indicators suggest that public infrastructure investment has also increased from the mid-2000s through FY 2009/10. Figure 3, below, measures GFCF across Commonwealth and state governments. This shows the substantial increase in public infrastructure investment from FY 2004/05 (3 per cent of GDP) to FY2009/10 (4.8 per cent of GDP), and the accelerating retreat in the ensuing years.2 3

Figure 3 – Commonwealth and State GFCF (Total Non-Financial Public Sector)4

Source: IPA analysis based on 2013-14 Commonwealth Budget

How does Australia compare internationally? A recent study by the OECD, National Accounts at a Glance 2013, found that Australia expends more than most comparable jurisdictions on capital investment, when both private and public funding are aggregated. This is shown in Figure 4, below.5

2 These figures include Public Non-Financial Corporations (PNFCs) such as port authorities, utility providers where public and so forth. 3 These figures do not reflect the Commonwealth component of the combined GFCF, because a proportion of Commonwealth investment is reflected only in the state figures, because of the ownership treatment of the investment. Detailed analysis of Commonwealth investment is discussed below. 4 2013-14 Federal figures are based on former Government Budget (May 2013) 5 Gross Fixed Capital Formation (GFCF) refers to the net increase in physical assets (investment minus disposals) within the measurement period. It does not account for the consumption (depreciation) of fixed capital, and also does not include land purchases. It is a component of expenditure approach to calculating GDP

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Figure 4 – Gross fixed capital formation, volume (Percentage of GDP, 2011)

Source: OECD, 2013

The OECD analysis had been used by the former Labor Government to promote a narrative about the level of intervention that has been undertaken since 2007. This contention is not supported by the data, because while the OECD analysis provides a useful indicator of overall infrastructure investment, it does not describe the relative adequacy of investment in public infrastructure. In particular, national GFCF captures aggregate investment by business and households, as well as the public sector. Figure 5 provides a closer analysis of the OECD data, showing that in Australia the share of total capital investment attributable to ‘general government’ is in fact slightly below the OECD average. In 2010, 15.6 per cent of total capital investment in Australia was attributable to general government spending – compared to an average of 16.2 per cent across the OECD. Figure 5 – GFCF by sector (Percentage of total gross fixed capital formation, 2010)

Source: OECD, 2013

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This further supports the thesis that Australia’s favourable aggregate investment (as a percentage of GDP) has been substantially underpinned by the capital-intensive resources boom. Note: The share of total investment attributable to government will depend on a range of macro and micro economic factors; such as the extent of corporatisation, the size of capital intensive industries (including resources) as well as economic growth.

How does the Coalition’s aggregate economic infrastructure investment compare to the former Government’s budgeted commitments? Figure 6, below, shows the projected drop in the former Government’s economic investment as a proportion of total Government expenditure over the forward estimates. Average annual spending as a proportion of total Government expenditure was projected to fall to 1.12 per cent, down from a peak of 1.6 per cent. In nominal terms, this would represent a reduction in funding from the recent trend of circa $8.4 billion across the forward estimates. The Coalition’s final costings commit an additional $4.68 billion over the forward estimates, a circa 25 per cent increase on the commitment under the former Government’s FY2013/14 budget.6

Figure 6 – Commonwealth economic infrastructure investment (committed Budget

spend + new Coalition spending commitment, excluding NBN and stimulus)

6 Preliminary analysis based on Coalition costings released 5 September 2013. Updated figures will be available immediately following the 2013-14 Mid-Year Economic and Fiscal Overview (MYEFO).

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Source: IPA Analysis based on Commonwealth Budget papers and Coalition Costings

The Coalition has, however, committed to cut the Regional Infrastructure Fund, saving $2.49 billion over the forward estimates.

However $790 million in regional and community infrastructure commitments have been foreshadowed by the Coalition.

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4. Machinery of Government: A new Infrastructure Australia

“It cannot be overstated how important efficient infrastructure is to unlocking our nation’s potential… “

“The Coalition will reform Infrastructure Australia to enhance its capability as an independent, transparent and expert advisory body.”

Speech by the Hon Warren Truss MP Infrastructure Partnerships Australia Symposium

Sydney, 25 July 2013

Introduction The Abbott Government has committed to a substantial reform of Infrastructure Australia’s mandate, structure and focus. The most important expectation on the agency is likely to be a return to first principles – the identification and acceleration of projects of national significance; together with a higher expectation in identifying and championing national reform. The Coalition has been in deep consultation with the infrastructure sector over its proposed changes to Infrastructure Australia, over the past several years. The essential aspects of the policy see the creation of a formal reporting relationship between the CEO and Board; and the provision of new personnel with skilled understanding of project funding and financing. While Infrastructure Australia is widely acknowledged as an important enabler for national investment and policy reform, many would regard Infrastructure Australia as having yet to achieve the desired level of impact in either regard. The Coalition’s plan to increase independence and renew both the infrastructure audit and resulting project priority list each represent substantial improvements to the status quo and are likely to see a return to an optimistic approach to project delivery.

Summary of key points:

• Sir Rod Eddington will be retained as the Chairman of the Infrastructure Australia Council;

• the position of Infrastructure Coordinator, will be abolished; • the organisation will be led by a Chief Executive Officer, reporting to the Infrastructure

Australia Council; • the Coalition will restructure the agency to include a funding and financing advisory

function, that will work with states to develop the business case and funding opportunities for priority projects;

• the reformed Infrastructure Australia will be tasked with undertaking a new audit, producing a deeper and better-evidenced 15 year pipeline of priority projects;

• the audit will be refreshed every five years;

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• all Commonwealth capital investments above $100 million will be subject to analysis by Infrastructure Australia, including transport, telecommunications, water, energy, health and education-related capital investment, but will exclude Defence; and

• all projects seeking Commonwealth support will have a published Benefit Cost Ratio (BCR).

Structure and mandate analysis: The Coalition’s policy for Infrastructure Australia identifies a return to two fundamental outcomes:

1. identifying nationally significant projects; and 2. identifying fiscal and procurement reforms to accelerate the funding and delivery of

these projects. The Coalition has announced that it will seek to retain the agency’s Chairman, Sir Rod Eddington, but has also announced that it will abolish the Infrastructure Coordinator’s position. The agency will instead be led by a Chief Executive with a reporting relationship through the Infrastructure Australia Council (Board). The retention of the Chairman will ensure continuity for Infrastructure Australia, while the refresh of personnel recognises the substantially changed expectations that will rest on the agency, and the new skills required to acquit these roles well. The Coalition’s policy also serves to substantially enlarge Infrastructure Australia’s prioritisation role. Effectively, Infrastructure Australia will continue to assess and prioritise projects for inclusion on the agency’s pipeline; but will have a new requirement to assess and provide advice on all Commonwealth Government capital investments greater than $100 million across the whole of government, except for Defence. Provided Infrastructure Australia is adequately resourced for this role, it offers a considerable opportunity to drive efficiency across Commonwealth capital expenditure. Prime Minister Abbott has also stated that this oversight of investment will place new accountabilities, with the Federal Government having to provide a ‘national interest’ justification for departing from Infrastructure Australia’s advice. The oversight of social infrastructure investments (such as health, education or others) marks a substantial change for the agency, which up until now has been limited to consideration of economic infrastructure projects.

Renewed audit

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The Government has announced that it will require Infrastructure Australia to undertake a fresh audit of the nation’s infrastructure. While a similar exercise was undertaken in the first term of the Rudd Government, the time provided for the audit was substantially reduced, limiting the depth of analysis that underpins that work. Whereas the initial audit used a desktop assessment of projects put forward by state, territory and local governments (and a broader call for community submissions), it is likely that the renewed audit will use a more robust methodology, based around economic drivers. This approach would allow Infrastructure Australia to advise the national government about where infrastructure is insufficient to support current or forecast economic activity; and to carefully consider how state project priorities serve to address these gaps. The audit will also be required to be undertaken every five years, balancing certainty on the near-term priority projects with the opportunity to progressively revisit the assumptions underpinning the audit and realign infrastructure strategies to meet changing circumstances over time.

Renewed 15 year pipeline A core component of the Coalition’s policy will be the development of a firm infrastructure project pipeline, including procurement timeframes. The Coalition policy requires the renewed pipeline to be ready within 12 months.

Commonwealth investment oversight The enlargement of Infrastructure Australia’s role to oversee Commonwealth capital investment plans above $100 million marks a substantial increase in Infrastructure Australia’s role across the Commonwealth and potentially, provides the agency with a greater level of engagement with state agencies. The policy change will mean project proposals in areas including transport, water, energy, health and education (but excluding Defence), will be assessed and given a relative priority by Infrastructure Australia, including a published BCR. It is likely that this role will require both new skill and the development of new assessment tools to consider relative priorities between social and economic projects.

A funding and financing arm The commitment to equip Infrastructure Australia with new resources skilled in project funding and financing recognises the gap between prioritisation and facilitation. The inclusion of this suite of skills will allow Infrastructure Australia to work with sponsoring jurisdictions, the private sector and the Commonwealth to drive innovative funding and financing options for national priority projects.

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The funding and financing arm is understood to be advisory (not transactional) and will be tasked to work with the Commonwealth and state treasuries and the private sector to identify innovative funding and financing options to increase the pace of project delivery.

Ex post analysis Importantly, the Abbott Government has also announced that it will task Infrastructure Australia with undertaking ex post analysis of project performance. While the ex post analysis aspect is unlikely to fire the public imagination, it will provide a very important data source to allow continuous improvement in project assessment and prioritisation methodologies, because it will equip the Commonwealth to measure the actual impact of each project against the business case’s assumptions.

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5. Rebasing expenditures: A commission of audit The Commission of Audit will likely be a first order priority for the Government, as it moves to take charge of the budget. The Commission of Audit should be an area of substantial focus for the infrastructure sector, given that its success in liberating recurrent and capital efficiencies will offer new project funding opportunities. As with the Vertigan, Schott and Costello reviews in Victoria, New South Wales and Queensland respectively, the Audit will be used to inquire into the current structure, productivity and efficiency of Commonwealth expenditures – and identify reform options to drive efficiencies into recurrent expenditures. The enabling policy, Creating Jobs by Boosting Productivity, identifies the objective as ensuring “that government agencies are only doing what they really have to do, and doing it as efficiently as possible”. The Government have also signalled a wide remit for the Commission of Audit, with Tony Abbott saying in Opposition: "I'm very happy to have the Commission of Audit go through the whole of the administration, to tell us whether, in their opinion, they think things can be done better.” The Commission of Audit will identify areas of overlap and duplication across tiers of government, spending programmes that are surplus to requirement or of low value, and look at broad opportunities to increase the value for money achieved from public service delivery and spending programmes. With the Commonwealth holding more than $110 billion in non-financial assets, it is likely that a detailed Commission of Audit will consider where markets might be created (or completed), and where invested capital can be liberated from existing Commonwealth businesses and assets. Asset sales that are likely to be considered by the Commission of Audit include:

• Medibank Private (sale confirmed) – circa $4-4.5 billion; • Australian Rail Track Corporation (IPA proposal) – circa $4.1 -$5.1 billion; and • Snowy Hydro (IPA proposal) – circa $5.7 billion (Joint ownership Cth, NSW, Vic

governments) Other divestment opportunities have also been mooted, including contentious options such as Australia Post, although this is less likely in IPA’s view. The Commission of Audit will be the first comprehensive review of Federal expenditure since the Commission of Audit undertaken by the Howard Government in 1996.

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6. Rebasing revenue: A new taxation reform process and other matters

“There is plenty of room for improvement in our tax system so that it is fairer, simpler and helps deliver lower taxes…

The Hon Joe Hockey, MP Address to the National Press Club

Canberra, 22 May 2013

Introduction Given the substantial fiscal and economic challenges, the commitment to a detailed review of the nation’s revenue strategy, through a tax green paper/white paper process, together with the Commission of Audit discussed above, may ultimately prove to the be most substantial long-term commitment of the new Government. The commitment will see a comprehensive process of consultation and review, with a view to finalising a green paper within 24 months. While the process will undoubtedly revive aspects of the Australia’s Future Tax System (Henry) Review, this time the GST will be included in the terms of reference, potentially allowing for a substantial improvement on the options canvassed by Mr Henry. The Abbott Government has committed to take any material changes to the electorate, before implementation. The return to a traditional green paper/white paper process will be welcomed by the business sector and investors, following the surprise changes to tax regimes for carbon, minerals and Managed Investment Trusts over the past term.

In advance of the taxation review, the Abbott Government has committed to a number of changes to specific tax measures, including:

• abandoning carbon pricing; • repealing the Minerals Resource Rent Tax; and • reducing the company tax rate.

Abolition of the Carbon Tax The Government’s most well publicised taxation policy is the removal of the suite of acts that constitute the carbon pricing regime.

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The Government’s commitments will see the Department of Prime Minister & Cabinet instructed to immediately prepare draft legislation to repeal the tax, ready for Cabinet to consider within 30 days of the election. It is widely expected that this will be the first bill moved by the new Government.

Abolish the Minerals Resource Rent Tax (MRRT) The Government has committed to a repeal of the MRRT, with a net positive impact of $14.67 billion over the next four years.

Reduce the company tax rate The Abbott Government has committed to cut the company tax rate by 1.5 per cent, reducing the rate from 30 per cent to 28.5 per cent. For businesses with more than $5 million in taxable income, the cut negates the impact of the Coalition’s proposed 1.5 per cent increase in the company tax rate in order to fund a Paid Parental Leave scheme, announced by the Coalition in 2010. The lower rate will take effect on 1 July 2015. This commitment is costed at $5 billion over the forward estimates.

Tax Administration The Abbott Government has also committed to additional oversight of the Australian Taxation Office (ATO), through a Standing Committee of the Parliament. This reform will see the Commissioner of Taxation attend public hearings, akin to the Joint Standing Committee on Economics oversight of the Reserve Bank. The Government has also signalled that it will consider dividing the ATO between its revenue collection and compliance functions, after advice from the Standing Committee discussed above. Finally, the ATO will increase the number of Second Commissioners of Tax from four to seven, with Shadow Treasurer Joe Hockey stating in May that the new deputy commissioners will be “outsiders who have market place experience to the executive group”.7

7 Hockey, Joe (2013). Address to the National Press Club. 22 May 2013 http://liberal.org.au/latest-news/2013/05/22/joe-hockey-mp-address-national-press-club

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7. Efficient infrastructure finance: Developing a domestic bond market and considering a return for infrastructure bonds

“There is no doubt that an active and well developed market in retail corporate bonds is the missing link in our country’s otherwise sophisticated financial system.”

Andrew Robb, Shadow Minister for Finance 16 January 2013

The Coalition has made a number of statements over time about the desirability of a domestic corporate bond market to ease the exclusive reliance on bank debt and provide additional price competition for project finance; as well as leaving open the door for tax advantaged infrastructure bonds, along the lines of a similar programme that was terminated by the Howard Government in 1997. Neither the domestic bond market initiative nor the infrastructure bonds option have been the subject of a detailed public document for the 2013 election. In a November 2012 speech to the University of Melbourne, Shadow Finance Minister Andrew Robb argued the merits of a domestic bond market, saying the missing element is “a transparent system in which the two types of assets can be compared and assessed side by side”. The Abbott Government has also outlined the potential for the issue of a long-dated Commonwealth bond (with tenor of between 30 and 50 years) providing a sovereign rated benchmark to price long term project bonds. The Abbott Government has also signalled that it will consider a role for tax advantaged infrastructure bonds, increasing the relative attractiveness of project bonds for investors. In an address to an Infrastructure Partnerships Australia luncheon in May 2013, Mr Robb said a detailed proposal for such a scheme has been developed and will be examined by the Office of Financial Management. The scheme will be aimed at “leveraging tens of billions of dollars of new infrastructure in certain projects”, Mr Robb said.

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8. Accelerating projects: Simplifying project approvals

“Economic investment has been delayed and in many cases entirely deferred, not through rejection of projects but through the multiple layers of bureaucracy…

“A Coalition government will maintain current environmental protections while cutting the duplication and administrative burden which is unnecessarily delaying major investments and hampering job creation.”

The Hon Tony Abbott MHR 26 June 2013

The Abbott Government has committed to a substantial simplification of the environmental approvals process to streamline project delivery, while efficiently protecting environmental and heritage values. The Coalition policy will see Federal assessment powers under the Environmental Protection and Biodiversity Conservation (EPBC) Act referred to the states, allowing for a single approval process. The new system will also see local government approvals (where they are triggered) occur within the single process. The move to streamline assessments into a single process had also been the aim of several reviews (see Alan Hawke’s reviews) by the former Government, but agreement with the states and territories remained elusive. Implementing a streamlined process will require long-term bilateral agreements with each state and territory, referring the Commonwealth’s approval powers to the States.

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9. Restoring mobility: Transport commitments

“We will get on with the job of building the modern infrastructure required to unclog our congested roads and highways to improve the productive use of the nation’s time – millions of hours wasted time can be converted into more productive economic activities, helping to grow a stronger economy. If workers spend less time in traffic jams they will have more time at work and more time with their families.”

Our Plan, Real Solutions for all Australians, p. 23 January 2013

“We will help get major infrastructure projects going across Australia, within 12 months.”

The Hon Tony Abbott MHR 4 August 2013

Introduction Road projects and freight rail form the basis of the project commitments and infrastructure strategy of the Abbott Government, with the urban rail priorities of the former Government (such as Cross River Rail and Melbourne Metro) less likely to receive Federal funding. While the former Government was eager to highlight this modal divergence, the Abbott Government has stated that while urban rail is important, a national government needs to invest in the projects that offer the greatest aggregate national benefit. In addition to major headline investment for marquee projects like the WestConnex in Sydney ($1.5 billion), East-West Link in Melbourne ($1.5 billion) and the Gateway North Motorway Upgrade in Brisbane ($1 billion), the Coalition has flagged a broader move to an 80:20 funding split with state governments on national road network investments – including the Pacific Highway and Bruce Highway. The substantial proportional increase in national highway funding – and the circa 25 per cent increase in transport investment funding, presumably means that the states and territories will be able to liberate capital that otherwise would have funded a greater proportion of these projects; capital funding that can be repurposed toward state priorities, such as urban passenger rail. The Coalition has also flagged that is not opposed to funding urban passenger rail as the Commonwealth’s fiscal position improves.

Major road and highway commitments

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Road transport investments form the backbone of the Abbott Government’s project commitments, with a suite of major urban, inter-urban and strategic freight network road projects receiving funding commitments. Table 1 gives an overview of those commitments. In line with their commitment to improve the transparency in infrastructure funding, the new Government will task Infrastructure Australia with completing planning and assessment, including publishing full cost-benefit analyses for each project. Note: Appendix A contains project fact sheets on these major projects. Table 1 – Major road funding initiatives, Abbott Government

Project State Description Estimated cost

Coalition funding

Bruce Highway

QLD The upgrade of the Bruce highway is a programme of projects aimed at improving safety, increasing capacity and heightening the highway’s flood immunity.

$11bn $6.7bn (over 10 years)

East West Link (stage 1)

VIC The full East West Link is a proposed 18-kilometre cross city connection north of the Melbourne CBD. The Stage 1 component includes 4.4 kilometres of twin three lane tunnels from the Eastern Freeway to CityLink.

$6bn - $8bn $1.5bn

WestConnex NSW A proposed 33 kilometre link between Sydney’s west and the airport and Port Botany precinct.

$10bn - $13bn

$1.5bn

Gateway Upgrade North

QLD Capacity upgrades to improve road freight connectivity between key northern centres and the port precinct.

$1.4bn $1bn

Gateway WA WA A package of road improvements and additions which will upgrade the road network around the Perth Airport.

$1bn $686m

Swan Valley Bypass

WA The construction of a 40 kilometre highway from the Tonkin Highway/Reid Highway intersection in West Swan to the Great Northern Highway at Muchea.

$840m $615m

South Road SA Upgrade of key sections of TBC $500m

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Upgrade – Darlington Interchange

South Road located within Darlington to remove key bottlenecks and increase capacity.

Midland Highway

TAS The progressive upgrade of the Midland Highway to improve safety and increase capacity

$2.7bn $400m (over 10 years)

Pacific Highway

NSW Full duplication of the highway between Sydney and Brisbane to duel carriageway grade.

$8.2bn $5.6bn

F3-M2 NSW The project would comprise tunnels under Pennant Hills Road, connecting the F3 Freeway at Wahroonga to the M2 Motorway at West Pennant Hills/Carlingford.

$2.65bn $405m

Warrego Highway

QLD Upgrade of the highway to create increased capacity in line with increasing passenger and freight traffic.

$635m $508m

Toowoomba Second Range Crossing

QLD The construction of a second range crossing that takes highway traffic around Toowoomba rather than through it

$1.66bn $700m

Roads to Recovery and Black Spot programmes The Coalition is expected to retain the Roads to Recovery programme. This programme allocates around $350 million per year to the improvement of local and state or territory roads. When the budget reaches a “strong surplus” the new Government has committed to increase funding for this programme. The Black Spot programme will also continue to be funded in line with existing commitments. This programme provides approximately $60 million a year to improve high-risk road sites.

Freight Rail The Coalition Government has committed funding of $300m to invest in the North South Inland Rail corridor, including a specific commitment to examine the development of a dedicated freight rail connection to the Port of Brisbane. The Australian Rail Track Corporation will be tasked with developing a 10-year strategy to deliver a new East Coast North South rail corridor to better connect Sydney, Melbourne and Brisbane, with construction to start within three years.

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Infrastructure Australia will develop the economic and financial case for the project, including opportunities for private funding and financing options for the new link. The $300 million investment will be directed towards the following key milestones:

• identifying a preferred corridor from Moree to the Port of Brisbane; • delivering the preliminary engineering design and environmental assessment; • land acquisition and approvals from Illabo to Toowoomba; • establishing a corridor between Rosewood (west of Ipswich) and Acacia Ridge (south

of Brisbane); • investigating a rail tunnel linking the Port of Brisbane to Acacia Ridge; and • establishing a new 24/7 freight connection from Acacia Ridge Intermodal Terminal to

the Port of Brisbane to free up capacity for the south east Queensland passenger network.

The dedicated 24/7 freight connection from Acacia Ridge to the Port of Brisbane, expected to be largely via new tunnels, would give the opportunity to remove existing interfaces between passenger and freight trains on the urban network – freeing up capacity on the passenger network, increasing the reliability of rail freight service to and from the Port and removing freight trains from existing urban surface rail corridors which run through residential suburbs in Brisbane’s south. The project will increase capacity and reliability and reduce the time it takes freight to move from Melbourne to Brisbane. It will also improve the movement of agriculture and coal from the Western Downs and Surat Basin.

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10. Energy market reforms

“If elected a Coalition Government will resume the comprehensive and co-operative approach with all stakeholders including State Governments, energy generators, distributors and consumers, to ensure Australia’s energy future is on a strong footing and spiralling power prices are addressed.”

The Hon Ian Macfarlane MP, Shadow Minister for Energy and Resources July 2013

The Coalition policies focus on putting in place a more favourable and more stable policy framework for Australia’s domestic energy sector, principally by reducing “green tape”, encouraging new investment and in-turn placing downward pressure on energy prices. The Shadow Minister for Energy and Resources, The Hon Ian Macfarlane MP, has also stated that the creation of a more “vibrant” and “competitive” energy and resources sector will be a key goal for the incoming Government, with the Coalition committing to 14 initiatives at a cost of $100 million over the forward estimates. Key commitments include: abolishing the carbon tax; developing an energy white paper; suspending and then abolishing the Clean Energy Finance Corporation (CEFC); introducing an Exploration Development Incentive; and establishing an industry advisory council.

Abolition of the Carbon Tax As noted earlier, the Abbott Government’s first legislative priority will be to repeal the carbon tax. On 5 August, Tony Abbott wrote to the Secretary of the Department of Prime Minister and Cabinet advising of this commitment. In addition to the carbon tax itself, associated spending measures will also be abolished, with the exception of household compensation measures. In particular, the new Government has committed to immediately task the Department of Prime Minister and Cabinet with drafting legislation to repeal the tax, ready for the Cabinet to approve within one month and introduced into Parliament on the first sitting day. Once the tax is repealed, the Environment Minister will introduce legislation to enact the Coalition’s Direct Action Plan on climate change and carbon emissions. The Government has made a pledge to reduce carbon emissions by five per cent by 2020. To achieve this goal, it will establish a $3 billion Emissions Reduction Fund to allocate money to domestic projects designed to reduce carbon emissions, such as the exploration of soil carbon technologies and abatement.

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Additionally, the new Government has committed to immediately suspend the operations of the CEFC, and will instruct the Department of Finance and Deregulation to prepare legislation to permanently shut-down the Corporation. The CEFC, established under the former Government’s Clean Energy Future package, is a legislated fund dedicated to investing in clean energy. Under its enabling legislation, the CEFC’s investment activities were to be funded through an appropriation of $2 billion to a special account every year for five years, commencing from 1 July 2013.

Energy White Paper The Minister for Resources and Energy will, within the first week of Government, commence work on an Energy White Paper, to develop a coherent, integrated national energy policy. The Government has committed that this paper will be released within a year. The Coalition’s Policy for Resources and Energy states that the Energy White Paper will consider how “the nation’s energy resources can be developed in a constructive, collegiate and cost-effective way, to the ultimate benefit of consumers”. This will include ensuring that cost-recovery and pricing for consumers is managed transparently and fairly for both investors and consumers. The White Paper will also examine the role of biofuels, LNG, CNG and LPG as alternative transport fuel sources.

Energy Advisory Council The Government will also establish an industry advisory council for the energy and resources sector. The Minister for Resources and Energy and a prominent industry leader will co-chair the Council. The Council will provide informative consultation and recommendations on proposed legislation or policies that affect the energy and resources sector. Other aspects of the Coalition’s Policy for Resources and Energy are to:

o abolish the MRRT; o streamline the environmental approvals process, as discussed above; o introduce an Exploration Development Incentive allowing investors to deduct mining

exploration expenses against their taxable income; o develop a responsible coal seam gas management policy; o convene an urgent meeting of relevant state governments, gas producers and

explorers to develop and implement a gas supply strategy for the East Coast Australian gas market to 2020;

o introduce a maritime surveillance regime for offshore platforms; o introduce greater scrutiny of applications for oil and gas retention leases; o formalise the agreement to sell uranium to India; o examine the potential use of thorium as an energy source for export;

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o resolve community concerns over wind farms by establishing a National Health and Medical Research Council programme or Independent Expert Panel to investigate any health impacts; and

o support the development of logistics systems for LNG as a transport fuel, particularly in the East Coast capital city transport corridors.

The new Government has also committed to develop a White Paper on Northern Australia which considers options for transforming the region, including developing a major energy export industry by 2030.

Northern Australia The Government’s policy document, 2030 Vision for Developing Northern Australia, proposes that by 2030 an energy export industry worth $150 billion to the economy could be operating in Northern Australia. The development of this industry would help meet growing world energy demand, which is projected to increase by 47 per cent between 2010 and 2035. Northern Australia is home to 90 per cent of Australia’s gas reserves in the Browse, Bonaparte and Carnavon basins, and potential renewable energy projects in the area have also been identified, including the Kings Canyon Solar Power Station, the Burdekin Dam Hydro-Electricity project and Kennedy Wind Farm. To further investigate this proposal, and other proposed options for Northern Australia, a White Paper on Northern Australia will be developed by the Department of Prime Minister and Cabinet within twelve months. Infrastructure expansion will also form a key focus area in the White Paper on Northern Australia, particularly expanding port, airport and rail infrastructure aimed at making better use of the proximity to Asia. To assist in this regard, Infrastructure Australia will also be tasked with conducting a comprehensive audit of Northern Australia's infrastructure, and will devise a 15-year rolling priority list of projects of various scales, guided by cost-benefit studies.

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11. Telecommunications

"If you believe that there are very big economic benefits from universal, very fast broadband, then you want to get it built as quickly as possible and as affordably as possible. And we will deliver that."

The Hon Malcolm Turnbull MP September 2013

Delivering a more modest but lower cost broadband network, which could be completed two years earlier than the previous Government’s National Broadband Network (NBN), is another key infrastructure commitment of the incoming Government. The Coalition’s Plan for Fast Broadband and an Affordable NBN states, “Our goal is for every household and business to have access to broadband with a download data rate of between 25 and 100 megabits per second by late 2016.” As a point of comparison, downloads currently average less than five megabits per second. The Coalition’s policy also includes provisions to investigate and introduce facility based competition and co-funding arrangements of fibre rollouts. Importantly, the policy also restates that contracts for the rollout will be honoured, but that the Coalition "will reserve the right to review and seek to vary any contracts" in line with its broadband policy objectives. As a first step, a transparent cost-benefit analysis of the NBN will be completed to find out the quickest and most cost-efficient way to upgrade broadband to all areas where services are now unavailable or sub-standard. Priority in delivery will go to areas currently with the poorest service. The Government has committed to using existing infrastructure where possible, with the aim of delivering the NBN more cost-effectively. The plan calls for a technologically agnostic approach, involving a ‘fibre to the node’ (FTTN) rollout, which extends fibre to cabinets within a few hundred metres of user premises and relying on existing copper infrastructure to reach for the “last mile” connection to customer premises. The Coalition plan will also utilise the already built Hybrid Fibre Coaxial (HFC) networks, set to be shut down by NBN Co. The Coalition has claimed this will increase bandwidth more cost-effectively than a ‘fibre to the premises’ (FTTP) approach. The Government will still use an FTTP approach in greenfield housing estates, subject to commercial feasibility considerations, as well as in business districts, industrial and commercial parks, schools, hospitals, medical centres and universities, and in areas with exceptionally high maintenance costs. Table 2 shows the planned NBN at finish of rollout in 2019, by technology type.

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Table 2: the Coalition NBN at finish of rollout in 2019

Source: The Coalition’s Plan for Fast Broadband and an Affordable NBN Key prices will be capped nationally ensuring people in regional and rural areas are not disadvantaged and receive affordable services. Impediments to infrastructure competition that were introduced to provide a monopoly to the previous Government’s NBN will be removed, and opportunities to improve competition among retail service providers will be examined. The Government has previously stated that it would retain the $3 billion in contracts NBN Co. has already signed to build two new satellites, and will seek opportunities to allow investment in the fixed wireless network. "We will consider opportunities to realise value from the satellite contract by seeking private operators or owners for the NBN satellite service, if this enables price and service levels for regional consumers to be improved," the Coalition's policy states. The policy also commits the Government to continuing work already underway to connect 700,000 homes to fibre by the middle of next year; however contractors will be tasked with building to the node rather than premises within a year of a Coalition government being elected to office. The Coalition has also committed to removing or waiving impediments to infrastructure competition introduced by the previous Government to provide a monopoly structure to the current NBN. NBN Co's existing agreement with both Telstra and Optus would see those companies Hybrid Fibre Coaxial (HFC) networks - capable of providing up to 100mbps internet connections to around 2.5 million households - being switched off and dismantled. The Coalition's plan would see these networks retained and actively operated, allowing facility based competition to occur between the different technologies, subject to an "equitable renegotiation satisfactory to NBN Co and the Government". In a marked departure from the current NBN, the Coalition has also committed to explore opportunities for co-funding of fibre rollouts; and will task NBN Co with reporting to the Government within 180 days on the feasibility of co-funded FTTP deployment. Under the

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proposal, fibre co-funders would provide at least 50 per cent net (incremental) funding, with financial or ownership arrangements being a matter for negotiation between NBN Co and a co-funder. "State or local government, utilities or investors may have interest in ownership and funding of fibre rollouts in certain areas for a number of reasons," the policy states. Finally, the policy states that the Coalition will immediately initiate three reviews, each with a specific focus and reporting horizon. This would include:

• a strategic review of NBN Co's rollout progress, costs, structure, internal capabilities, commercial prospects and strategic options;

• an independent audit of the public policy process which led to the NBN and NBN Co's governance structure; and

• an independent cost benefit analysis of the availability of broadband via currently utilised and alternate technologies.

The new Government will issue a revised statement of expectations to NBN Co, which will stipulate that the limit on the public capital available to NBN Co is $29.5 billion. Key points of difference between the new Government’s NBN and the former Labor Government’s NBN are contained in Figure 7 below.

Figure 7: A comparison of NBN plans

Source: ABC News http://www.abc.net.au/news/2013-09-04/report-shows-households-will-be-3800-better-off-under-nbn/4932976

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12. Appendix A: Project Commitments in Detail

i) Detailed Transport Project Commitments

a. Bruce Highway (QLD)

Status Upgrade ongoing. Cost The Queensland Government and RACQ claim $11 billion is

required to bring the road up to an acceptable standard. Government

support The Coalition has made a $6.7 billion funding commitment to completing the Highway upgrade within the decade. This is comprised of $2.1 billion in Federal contributions over the forward estimates (to 2016-17) and a further $4.6 billion over the following six years. The Coalition will negotiate an 80:20 funding agreement with the State Government, taking the total spend to $8.5 billion.

The Bruce Highway is a major north-south corridor connecting Brisbane with Cairns in Queensland. The 1,670km-long Highway passes through the major cities of Maryborough, Rockhampton, Mackay and Townsville. The Bruce Highway is a vital link for 11 coastal ports and the subsequent freight movements. It provides key linkages between inland production areas and towns. The Highway connects the ports and business centres within south-east Queensland, and offers accessibility to many coastal tourist attractions in Queensland. It also serves as a local roadway for many regional communities. The highway carries huge traffic volumes daily, with the north of Brisbane segment witnessing more than 100,000 vehicle movements each day. Major projects on the Bruce Highway to be funded by the Federal and Queensland governments over the forward estimates include:8

o Cooroy to Curra project – completing Section A, commencing Section C and further project funding ($885 million);

o Yeppen Floodplain upgrade ($246m); o Caloundra Rd to Sunshine Motorway upgrade – commence construction on

Stage 1 and planning for Stage 2 ($250m); o Mackay Ring Road – Stage 1 part construction and corridor planning and

preservation ($205m); o Townsville Ring Road – Stage 4 ($175m); o Caboolture to Caloundra Upgrade ($122m);

8 https://lnp.org.au/wp-content/uploads/2013/07/The-Coalitions-Policy-to-Fix-the-Bruce-Highway.pdf

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o Vantassel St to Flinders Hwy duplication ($113m); o Calliope Crossroads ($53m); and o Sandy Gully Bridge Upgrade ($57m).

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b. East West Link – Stage One (VIC)

Status In market. Expressions of Interest (EOIs) received for Stage One. Cost $6 – $8 billion.

Government support

The Coalition has committed $1.5 billion to get construction underway within 12 months of forming government.9 The Victorian Government also allocated $294 million towards the project in the 2013/14 State Budget.10

Private sector involvement

The East West Link – Stage One will be delivered as an Availability Public Private Partnership (PPP).11

The full East West Link will be an 18 kilometre cross-city road connection between the Eastern Freeway at Hoddle Street and the Western Ring Road in Sunshine West. Because of its size, the project will be delivered in stages. Stage One of the East West Link will include a six kilometre link connecting CityLink at Parkville to the Eastern Freeway at Hoddle Street. The road will be tolled, however tolling revenue will not recover the full cost and significant government investment is therefore required.

Figure 1: East West Link Route

Source: Linking Melbourne Authority

9 http://www.liberal.org.au/building-melbournes-east-west-link 10 http://www.dtf.vic.gov.au/Publications/State-Budget-publications/Budget-Information-Paper-No-2-Infrastructure-Investment [Page 15 details funding commitment] 11 http://www.linkingmelbourne.vic.gov.au/pages/pdfs/east-west-link-stage-one--short-form-business-case.pdf

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In June the Victorian Government released a Short Form Business Case for the East West Link Stage 1 – the Eastern section of the East West Road Link identified by Sir Rod Eddington in his 2008 analysis of the project.12 The Short Form Business Case includes a headline cost benefit analysis for the Stage 1 proposal which comes in at a BCR of 1.4 for a discount rate of seven per cent when including Wider Economic Benefits (WEBs).

Table 1: Economic Metrics of the East West Link Stage One

Source: State Government of Victoria

Linking Melbourne Authority modelling has found that around 80,000 to 100,000 vehicles would use the East West Link each day. Delivering the first stage of the East West Link would:

o complete the missing link between the Eastern and Tullamarine Freeways to relieve pressure on the Monash-West Gate corridor;

o improve freight efficiency and connections for major industries in Melbourne’s north, east and south east to the Port of Melbourne and international airports;

o cater for the large volume of traffic already using disconnected roads along the east west corridor north of the CBD between the Eastern and Tullamarine Freeways;

o alleviate the major congestion bottlenecks on the Eastern Freeway at Hoddle Street; and

o help to improve community amenity and on-road public transport by taking cars and trucks off congested inner-city surface roads.

On 18 July 2013, the Stage One tender process opened and by late August, four consortia had lodged Expressions of Interest (EOIs) by the deadline. The indicative project timeline would see a successful PPP proponent selected by the fourth quarter of 2014 with construction of the Link completed in 2019-20.

12 http://www.linkingmelbourne.vic.gov.au/pages/pdfs/east-west-link-stage-one--short-form-business-case.pdf

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c. Gateway Upgrade North (QLD)

Status Pipeline. The project was rated as Threshold by Infrastructure Australia on this year’s National Infrastructure Priority List.13

Cost $1.4 billion.14 Government

support The Coalition has committed funding of $1 billion to advance the project within 12 months of forming government.

The project includes the upgrade of Gateway North between Nudgee Road and Barrett Street northbound, and Depot Road southbound, including improvements and widening from four to six lanes, and the installation of managed motorway treatments and cycle facilities.15

Figure 3: Gateway Upgrade North Route

Source: Commonwealth Nation Building Programme fact sheet

The upgrading works will significantly improve levels of service on the motorway by providing additional capacity, thereby reducing queuing and delays that currently stretch back along the motorway and onto the surrounding arterial network.

13 http://www.infrastructureaustralia.gov.au/coag/files/2013/QLD_Gateway_Upgrade_North_Brief.pdf 14http://www.nationbuildingprogram.gov.au/publications/reports/pdf/new_projects/QLD_Gateway_Upgrade_North.pdf 15http://www.nationbuildingprogram.gov.au/publications/reports/pdf/new_projects/QLD_Gateway_Upgrade_North.pdf

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d. Gateway WA

Status Early works underway. Construction expected to commence late 2013.16

Cost $1 billion. Private sector involvement

Main Roads WA awarded the Alliance contract by competitive tender in November 2010 to Gateway WA which comprises Leighton Contractors, Georgiou, GHD, AECOM and BG&E.

Government support

The Coalition has committed project funding of $686 million.17 The Western Australian Government has allocated $318 million.18

The Gateway WA project includes upgrades to the road network surrounding Perth Airport and the freight and industrial hubs on Kewdale and Forrestfield. The project includes:

• a freeway-to-freeway traffic interchange at the Tonkin and Leach highways intersection, with free flowing movements in all directions, and new access to the international airport terminal;

• an interchange at the Tonkin Highway, Horrie Miller Drive and Kewdale Road intersection, removing one of Perth’s worst black spots;

• an interchange at the Leach Highway and Abernethy Road intersection; • an upgrade of the existing interchange at the junction of the Tonkin and Roe

highways; • widening of the Tonkin Highway to six lanes between the Great Eastern and Roe

highways; • an upgrade of Leach Highway to ‘expressway standard’ between Tonkin Highway

and Orrong Road;

Infrastructure Australia has identified Gateway WA as a nationally significant project under its Competitive International Gateways goal to improve Australia's trade performance. The project is a national priority driven by the expected doubling of the freight task and passenger air travel between now and 2031. It is expected to be delivered by 2017.

16 http://www.leightoncontractors.com.au/news-and-media/news/leighton-contractors-agrees-gateway-wa-cost-and-scope-proceeds-to-delivery/ 17http://www.tonyabbott.com.au/LatestNews/PressReleases/tabid/86/articleType/ArticleView/articleId/9400/The-Coalition-will-build-better-roads-in-Perth.aspx 18http://www.mediastatements.wa.gov.au/pages/StatementDetails.aspx?listName=StatementsBarnett&StatId=7629

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e. Melbourne – Brisbane Inland Freight Rail Route

Status Proposed Cost $5 billion

Government support

The Coalition has committed funding of $300 million to progress the project. The proposal includes a dedicated freight rail tunnel from Port of Brisbane to Acacia Ridge

The project is an 1800km freight rail track linking Melbourne to Brisbane, which includes 25km of new track, that will be mostly underground, between Acacia Ridge (Brisbane’s southwest) and the Port of Brisbane. At present, the only north-south rail corridor in eastern Australia runs from Melbourne to Albury and then to Sydney, then generally along the coastline to Brisbane. An inland route from Victoria through central and North West New South Wales then into Queensland (through the towns of Albury, Parkes, Narromine, Narrabri, Moree and Toowoomba) has the potential to:

o reduce the time it takes to move freight from Melbourne to Brisbane by rail; o improve other rail performance aspects including reliability, availability and route

distance for freight in the far western sub-corridor; and o increase the capacity of freight rail paths between the two cities (removing five

northbound Melbourne–Brisbane services from the coastal railway by 2030 and around 28 by 2040), which could subsequently increase service performance on the coastal route for freight and passengers.19

The project will be largely privately funded. The Australian Rail Track Corporation will be tasked to work with interested parties to establish a staged, 10-year approach to the construction of the inland rail, with construction to commence within three years.20 Infrastructure Australia will also be asked to evaluate the project’s economic fundamentals and assess any private sector proposals. Key tasks include:

o identifying a preferred corridor from Moree to the Port of Brisbane; o delivering the preliminary engineering design and environmental assessment; o land acquisition and approvals from Illabo to Toowoomba; o establishing a corridor between Rosewood (west of Ipswich) and Acacia Ridge (south

of Brisbane); o investigating a rail tunnel linking the Port of Brisbane to Acacia Ridge; and

19 http://www.artc.com.au/library/IRAS_Final%20Report%20Executive%20Summary.pdf?201010 20 http://www.liberal.org.au/latest-news/2013/08/28/inland-rail-future-freight

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o a new 24/7 freight connection from Acacia Ridge Intermodal Terminal to the Port of Brisbane to free up capacity for the south-east Queensland passenger network.

Figure 4: Melbourne to Brisbane Inland Freight Route

Source: ARTC Inland Rail Alignment Study

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f. Midland Highway Upgrade (TAS)

Status Proposed. Cost $2.7 billion.21

Government support

The Coalition has committed $400 million to this project, delivered in yearly instalments of $40 million for 10 years.22

In conjunction with the State Government, the Coalition Government will progressively upgrade the Midland Highway, Tasmania’s major north-south transport corridor. The Highway is a critical freight connection from the Southern region to the State’s northern ports, and a major transport link for passengers travelling between the north and south. The Midland Highway between Perth and Breadalbane carried around 1.4 million tonnes of freight in 2009. It is a key link into Launceston and to industrial development adjacent to Launceston Airport, including a major new State-wide grocery distribution centre. It fulfils an important role as a passenger transport link, including for commuters between Perth and Launceston.

21 http://anthonyalbanese.com.au/category/ministerial-questions 22 http://www.liberal.org.au/building-strong-prosperous-tasmania

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g. Pacific Highway Upgrade (NSW)

Status This upgrade project is on-going. Around 56 per cent of the highway between Hexham and the Queensland border has been upgraded to a four-lane divided highway.23

Cost From 2008/09 until now, the Commonwealth and NSW governments have agreed on a $7.92 billion programme of work to upgrade the Highway, with the Commonwealth contributing $5.41 billion and the state contributing $2.51 billion. A further allocation of $3.56 billion in funding from the Labor Government was included in the 2012-13 Budget, conditional on a 50-50 funding arrangement with the State.

Government support

The Coalition has committed $5.6 billion to completing the duplication of the Pacific Highway from Newcastle to the Queensland border. This includes the existing $3.56 billion commitment by Labor, and $2 billion in redirected funding from the Parramatta to Epping Rail Line.

The Pacific Highway is a major transport route along the east coast of Australia. It links Sydney to Brisbane via the towns of Gosford, Newcastle, Taree, Port Macquarie, Coffs Harbour, Grafton, Ballina and the Gold Coast. The Australian and New South Wales governments have been jointly upgrading the Pacific Highway since 1996. The upgrade of the Pacific Highway encompasses the following three central priorities.

• PRIORITY ONE o Priority one is to complete dual carriageway between Hexham and Port

Macquarie, between Ballina and the Queensland border and between Raleigh and north of Woolgoolga, along with growing suburbs of Coffs Harbour.

o Priority one will be completed by the end of 2014 (weather permitting). With the opening of the Bulahdelah Bypass in June 2013, there is now a four-lane divided highway between Hexham and Port Macquarie.

• PRIORITY TWO o Priority two involves completing dual carriageway between Port Macquarie

and Raleigh. o Substantial progress on the dual carriageway upgrade is being made on

Priority two with the completion of the Kempsey bypass and all other projects within this section proceeding to construction.

• PRIORITY THREE o Priority three is to complete dual carriageway between Woolgoolga and

Ballina. 23http://www.rta.nsw.gov.au/roadprojects/projects/pac_hwy/documents/130806_pac_highway_report_card.pdf

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o Progress on priority three includes: Completing dual carriageway upgrades at Glenugie (now completed

south of Grafton) and Devils Pulpit (under construction north of Maclean); and

Finalising all planning and preconstruction activities for the remaining sections of undeveloped two-lane sections of the highway between Woolgoolga and Ballina.24

The project was listed as Ready to Proceed on Infrastructure Australia’s National Infrastructure Priority list in 2013.

24 http://www.rta.nsw.gov.au/roadprojects/projects/pac_hwy/masterplan.html

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h. South Road Upgrade – Darlington Interchange (SA)

Status South Road Upgrade – ongoing. Cost Unknown.

Government support

The Coalition will direct $500 million to the continued upgrade of South Australia’s North-South Road Corridor.25 The SA Government and Federal Labor have announced funding for a separate part of the South Road Upgrade – the Torrens Road to River Torrens. Federal Labor committed $448 million as part of the 2013-14 Budget; the State Government committed $530 million in the 2013-14 State Budget.

The South Road Upgrade forms part of the broader upgrade of the North-South Road corridor in South Australia, linking expanding residential areas. The Coalition sees their $500 million commitment being directed towards the South Road upgrade where it connects to the Southern Expressway, as recommended by the Darlington Transport Study, completed in 2011. 26 The project will include:

• South Road reconfigured between the Southern Expressway and north of Sturt Road into an expressway-standard road incorporating road network modifications;

• grade separation as an underpass extending below Flinders Drive and Sturt Road; and

• connection of the Darlington Interchange with the Southern Expressway to provide for two way flow.

25 http://www.liberal.org.au/latest-news/2013/08/24/coalitions-commitment-upgrade-adelaides-north-south-road-corridor 26 http://www.infrastructure.sa.gov.au/darlington

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i. Toowoomba Second Range Crossing (QLD)

Status Pipeline/Planning. Cost $1.66 billion.27

Private sector involvement

The project will be delivered as a PPP, with the preferred model consisting of a tolling operations package, availability payment based on KPI scheme and the State retaining patronage risk.

Government support

Having first announced funding for this project in 2007, the Government has committed $700 million and confirmed that work will begin in the first term. The Government has further committed to working with industry to deliver the remaining cost of the project, with a goal of having the road completed by 2017.28

The project involves construction of a second range crossing that takes highway traffic around Toowoomba rather than through it. The proposed 42km road corridor runs north of Toowoomba from the Warrego Highway west of the Helidon Spa to the Gore Highway around 17km south-west of Toowoomba. Key freight links from Brisbane to Darwin, Brisbane to Melbourne, south west Queensland and the Port of Brisbane all converge in Toowoomba. The existing Toowoomba range crossing is used by large numbers of heavy vehicles and has seen increasing incidents leading to frequent partial or full closures of the existing range, causing significant congestion and delays. This is expected to worsen in line with projected growth in the region. The Toowoomba Second Range Crossing aims to relieve pressure on the constrained network. Tolling is being considered as part of the project. The Full Project Tolled scenario has the highest BCR.29 The proposed Toowoomba Second Range Crossing will meet the following objectives:

• address a recognised constraint in the National Land Transport Network, improve the efficiency of freight movements and encourage economic development;

• improve safety on the network by providing an improved standard of range crossing with improved design features delivering greater benefits for road users and reducing the number of heavy vehicles and through-traffic using urban arterial roads in central Toowoomba;

• improve transport capacity over the range to meet future growth needs in the region; and

• improve community amenity, safety and liveability by redirecting heavy vehicle traffic away from the current range crossing and town centre.30

27 http://www.treasury.qld.gov.au/projects-queensland/projects/toowoomba-range-crossing/index.shtml 28 http://www.warrentruss.com/speeches.php?id=107 29 http://www.treasury.qld.gov.au/projects-queensland/projects/toowoomba-range-crossing/tsrc-presentation.pdf 30 http://www.treasury.qld.gov.au/projects-queensland/projects/toowoomba-range-crossing/index.shtml

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Figure 5: Map of the Toowoomba Second Range Crossing

Source: Projects Queensland

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j. WestConnex (NSW)

Status Pipeline Cost $10 - $13 billion

Government support

The Coalition has committed $1.5 billion to the WestConnex project. In October 2012, the New South Wales Government confirmed it would contribute $1.8 billion to the project, and the 2013-14 State Budget commits $111 million to the project.

WestConnex is a 33 kilometre road network project which will include capacity improvements on existing roads and new sections of motorway such as widening of the M4 east of Parramatta, an extension of the M4 East at North Strathfield to Taverners Hill in Petersham and duplication of the M5 East to King Georges Road. A Sydney Airport Access Link between the St Peters area and the M5 East portals will complete the missing link between the two motorways and provide better connections to the airport terminals, Port Botany and surrounding industrial areas. The strategic benefit-cost ratio for the WestConnex project has been assessed at more than 1.5. This is considered a high return for a major transport investment in an inner urban environment. The project’s benefits include:

o relieving congestion on the existing M4/Parramatta Road and M5 East (projected travel time savings are shown in Table 2);

o supporting freight movements between Sydney’s Gateways and the logistics hubs in Western and South Western Sydney;

o supporting people movements to Sydney Airport; o acting as a catalyst for urban regeneration along key corridors, particularly

Parramatta Road; and o enhancing the orbital road connectivity South and West of the CBD.

Table 2: Travel time savings with WestConnex in 2021 compared to travel via existing

routes

Source: Infrastructure NSW State Infrastructure Strategy

Infrastructure NSW and Transport for NSW simultaneously recommended the project as the State's highest priority in separate infrastructure plans in 2012. The project was the central

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plank of Infrastructure NSW’s State Infrastructure Strategy, released in October 2012.31 Infrastructure NSW has worked with Transport for NSW and Roads and Maritime Services (RMS) to develop a high-level reference scheme that integrates the proposed M4 Extension, M5 East Expansion and part of the Inner West Bypass.

Figure 6: WestConnex Reference Scheme

Infrastructure NSW’s State Infrastructure Strategy Infrastructure NSW analysis indicates WestConnex could be primarily funded by user contributions. Tolling arrangements for WestConnex would be based on experience on other roads, in particular the M7, with the tolls to comprise a distance-based charge, a flagfall charge and a maximum toll cap. Alternative funding mechanisms, including some degree of value capture, will also be taken into consideration. WestConnex would require loan financing to bridge the timing gap between capital expenditure and future toll revenues. In August, the WestConnex business case was submitted to New South Wales Parliament. Infrastructure NSW estimates WestConnex could be completed within 10 years.

31http://www.infrastructure.nsw.gov.au/media/16598/insw_tfnsw_and_roads_and_maritime_services_wcx_25_sept_2012_final_120927.pdf

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k. Warrego Highway Upgrade (QLD)

Status Ongoing Cost $635 million

Government support

The Coalition has committed $508 million to the Warrego Highway upgrade between Toowoomba and Miles.32

The Warrego Highway is Queensland’s principal east-west fright route, stretching 714 kilometres from Brisbane to Charleville. It facilitates the movement of coal, grain, meat and cotton for domestic and international distribution. Warren Truss announced $508 million in funding for the Warrego Highway between Toowoomba and Miles at the National Press Club in August. This would represent an 80:20 funding split with the State Government. The Warrego Highway is a four-lane, dual carriageway highway between Ipswich and Toowoomba, and generally a two-lane highway west of Toowoomba. It is the second highest trafficked rural national highway outside South East Queensland, after the Bruce Highway. The Highway upgrade is required as the heavy traffic due to mining and gas developments in the region have rendered the existing road not fit for traffic levels. Additionally, the Warrego Highway Upgrade will support an expected population increase of 95,000 by 2031 in the Surat Basin region (including Toowoomba, Western Down and Maranoa regional councils).33

Figure 7: Warrego Highway Route

Source: Queensland Government

32 http://www.warrentruss.com/speeches.php?id=128 33http://www.tmr.qld.gov.au/~/media/aboutus/corpinfo/Publications/Warrego%20Highway%20Upgrade%20Strategy/WarregoHighwayUpgradeStrategyfullversion.pdf

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l. F3-M2 Link (NSW)

Status Shortlist announced (August 2013) Cost The target project cost is $2.65 billion

Government support

The Coalition has committed $405 million to commence Sydney’s F3-M2 by late 2014.

The project, expected to be delivered under a Design and Construct (D&C) contract structure, would comprise tunnels under Pennant Hills Road, connecting the F3 Freeway at Wahroonga to the M2 Motorway at West Pennant Hills/Carlingford (see Figure 8).

Figure 8: F3-M2 Corridor

Source: Transurban

In 2012 the NSW Government received an unsolicited proposal from Transurban to deliver the F3 – M2 motorway. Under the Government’s new unsolicited bid framework, the proposal is undergoing a three-stage assessment process: evaluation of initial submission; development of a detailed proposal; and negotiation of a final binding agreement. Following the initial consideration of the proposal the bid has progressed to Stage 3, with the proposal likely to receive approval if, following the completion of the tender process, the final contract price is at or below the target project cost of $2.65 billion. The project will be jointly funded by the NSW and Federal Governments, Transurban and Westlink M7 shareholders. As part of the funding agreement, tolls will be applied to the F3-M2, the concession of the Westlink M7 will be extended and the truck toll multiplier on the Westlink M7 will be increased.

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A preferred tenderer for the D&C contract is expected to be selected by early 2014. Once completed the link would provide a connection between Sydney and the Central Coast, relieve freight and passenger congestion currently experienced along the corridor and provide additional capacity required to meet the forecast population and employment growth in the region. In August 2013 the NSW Government confirmed three shortlisted consortia for the project. They are:

o Thiess John Holland Joint Venture; o Lend Lease Bouygues Joint Venture; and o GlobalLink Joint Venture consisting of Ghella Pty Ltd and Acciona Infrastructure

Australia Pty Ltd.

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Appendix B: Full Fiscal Impact of Federal Coalition Policies

FISCAL BUDGET IMPACT OF FEDERAL COALITION POLICIES Total $m

Removal of Carbon Tax Package

Removal of Associated Expenditure

Discontinue business compensation measures 5,087

Discontinue energy market compensation measures 476

Discontinue land initiatives and unnecessary bureaucracies 439

Abolish other carbon tax measures no longer needed 1,468

Total Savings From Removal Of Associated Expenditure 7,471

Foregone Revenue From Removal Of Carbon Tax -13,519

Net Budget Impact - Carbon Tax Package -6,048

Removal of Mining Tax Package

Removal of Associated Expenditure

Re-phase Superannuation Guarantee increase 1,640

Not proceed with low income super contribution 3,722

Abolish twice yearly mining tax supplementary allowance 1,106

Abolish Schoolkids Bonus 4,641

Discontinue instant asset write-off increase 2,905

Discontinue phase-down of interest withholding tax 405

Discontinue tax loss carry back 950

Discontinue accelerated depreciation for motor vehicles 425

Reduce administrative and other expenses from scrapping the MRRT package 91

Regional Infrastructure Fund (net of funds which can not be returned to Budget, some projects have been separately funded by the Coalition

2,485

Total Savings From Removal of Associated Expenditure 18,370

Foregone Revenue From Removal of Mining Tax -3,700

Net Budget Impact - Mining Tax Package 14,670

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Coalition's Paid Parental Leave Scheme Package

Gross cost of the Coalition PPL -9,802

Less:

Existing Government scheme 3,665

Existing Commonwealth and State Public Sector schemes 1,229

Automatic adjustments to Government spending and revenue 1,611

Remaining cost -3,297

Levy of 1.5% on company taxable income above $5 million 4,400

Net Budget Impact - Coalition's Paid Parental Leave Scheme Package 1,103

Coalition's Infrastructure Package*

The Coalition’s Plan to Reduce Traffic Congestion: East-West Link -1,500

The Coalition’s Plan to Reduce Traffic Congestion: WestConnex Sydney -1,500

The Coalition’s Plan to Reduce Traffic Congestion: Gateway Brisbane -1,000

Toowoomba Range Crossing -130

Pacific Highway -2,563

North-South Road Adelaide -300

Perth Airport Gateway -622

Swan Valley Bypass -200

Bruce Highway -2,092

Sydney F3 to M2 link1 -255

Midland Highway -120

Warrego Highway -200

Melbourne-Brisbane Railway -180

Princes Highway duplication -258

Ipswich Motorway - Darra Rocklea -65

Tiger Brennan Drive widening -70

Great Ocean Road -25

Ravenswood interchange -45

Condah-Hotspur Road -3

Princes Highway East -5

Mt Barker interchange -8

Outback Way -33

Kin Kora roundabout -13

Shoalhaven River Bridge planning -10

Jane Street extension -20

Narellan Road -40

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Moree Bypass stage 2 -15

Dalrymple Road -20

D'Aguilar Highway -16

Local Road Projects (27 projects) -26

Bridges renewal programme -180

Total Coalition Infrastructure Commitments -11,512

Less:

Existing Funding Allocated from the Nation Building Program 6,134

Do not proceed with Melbourne metro rail 75

Do not proceed with Cross river rail 453

Do not proceed with Perth urban rail public transport 100

Do not proceed with Tonsley park public rail transport project 32

Do not proceed with Airport rail - planning 3

Do not proceed with Mulgrave River bridge 40

Net Budget Impact - Coalition's Infrastructure Package -4,676

Coalition's Health Policies

Strengthening General Practice

Doubling practice incentive payments for General Practice teaching -119

Investing in rural and regional teaching infrastructure -53

Investing in the nursing and allied health workforce -13

Investing in medical internships -40

Apply unallocated funds for health workforce development 155

Net Additional Funding to Strengthening General Practice -69

Boost Frontline Healthcare and Research

Full implementation and expansion of bowel cancer screening -46

Type 1 Juvenile Diabetes research commitment -28

James Cook University Institute for Tropical Health -42

The Coalition's policy for Dementia research -120

Funding from reprioritising Australian Research Council spending 103

Net Additional Funding to Boost Frontline Healthcare and Research -133

The Coalition's policy to index the Commonwealth Seniors Health Card -102

National Centre of Excellence in Youth Mental Health -13

An easily accessible, fully integrated e-Mental Health System -5

Peter's Project (cancer care centre) -10

Bear Cottage (children's palliative care) -2

Ballina Hospital -5

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Albury-Wodonga Cardiac Catheterisation Laboratory -5

Net Budget Impact - Health Policies -344

Coalition's Education Policies

Discontinue development of an Australian Baccalaureate 5

Reduce additional funding for Australian Curriculum, Assessment and Reporting Authority (ACARA) 23

Redirect Better Schools - Secure Schools additional funding 10

The Coalition's Policy for Schools

Safe and secure schools -18

Independent Public Schools Fund -70

Flexible literacy learning for remote primary schools -22

Online language learning for pre-school children - trial -10

The Coalition's policy for Better Apprentice Support -85

A New Colombo Plan -60

The Coalition's Policy for Better Child Care and Early Learning -11

Net Budget Impact - Education Policies -238

Other Coalition Policy Commitments

Agriculture, Forestry and Fisheries

The Coalition's Policy for a Competitive Agriculture Sector

Boost funding to rural research and development corporations -75

Better market access for small exporters -11

Stronger biosecurity and quarantine -20

Assist native title respondents with costs -2

Improve minor use chemical registration -6

Agriculture in education -2

The Coalition's Policy for Fisheries -9

The Coalition's Policy for a Strong and Sustainable Forestry Industry -15

Net Spending - Agriculture, Forestry and Fisheries -140

Crime and Terrorism

Supporting Australian victims of terrorism overseas -30

The Coalition's Policy to Tackle Crime

Safer Streets - Protecting Communities from Crime -50

Restore and further boost Customs funding for cargo inspections -88

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Net Spending - Crime and Terrorism -168

Environment

The Coalition’s Plan for a Cleaner Environment

Emissions Reduction Fund -1,550

Green Army -300

Other Environment Policies -163

Net Spending - Environment -2,013

Coalition's Plan to Grow Tasmania

The Coalition’s Plan to Grow Tasmania -74

Net spending - Coalition's Plan to Grow Tasmania -74

Building Stronger Communities and Regions

National Stronger Regions Fund -400

Community Development Grants programme -342

Redirect Building Better Regional Cities programme 25

Mobile Blackspot programme -75

Net Spending - Building Stronger Communities and Regions -792

Employment Policies

Restore and further boost the ABCC - additional funding on top of redirected Fair Work Building Inspectorate funding

-36

Employment Participation Plan

Indigenous employment (Australian Employment Covenant - funding of four trial sites) -45

Incentives to employers to employ over 50s -188

Jobseeker relocation allowance and job commitment bonus for young people -75

Redirect Mature Age Participation (job seeker assistance) 10

Net Spending - Coalition's Employment Participation Plan -297

Net Spending - Employment Policies -333

Border Protection Policies

The Coalition’s Plan for More Secure Borders

Operation Sovereign Borders Joint Agency Taskforce (OSBJAT) -10

Clear 30,000 Border Backlog -55

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Regional Co-operation to Combat People Smuggling

Improved regional intelligence and joint policing operations -67

Engage with local communities in Indonesia -20

Tighten regional border controls and improve identity management -38

Appoint special envoy for Operation Sovereign Borders -1

Enhanced air surveillance -27

Enhanced search and rescue capacity -71

Interception and transfer of asylum seekers -198

Border security - withdraw taxpayer funded immigration assistance to illegal boat arrivals 100

Border security - dividend from stopping the boats 1,088

Net Spending - Border Protection Policies 701

Coalition's Plan for the Automotive Industry

Reverse change to FBT arrangements for cars -1,795

Net Spending - Coalition's Plan for the Automotive Industry -1,795

Coalition's Plan for Manufacturing

The Coalition’s Plan to Boost Australian Manufacturing

Export Market Development Grants -50

Manufacturing Transition Grants Programme -50

Net Spending - Coalition's Plan for Manufacturing -100

Transport Policies

Improve road safety - support for Keys2Drive -10

The Coalition's Plan for Aviation

En route rebate scheme -4

Inquiry into best practice aviation -1

Expansion of CASA Board 0

Net Spending - Transport Policies -15

Resources and Energy

Exploration development incentive -100

Net Spending - Resources and Energy -100

Supporting Business

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Company Tax rate cut to 28.5 per cent -4,900

Other Small Business Measures -11

Net Spending - Supporting Business -4,911

Defence and Veterans' Affairs

The Coalition's policy for fair indexation of Military Super -780

Re-build ADF Gap Year programme -113

Restore Veterans' advocacy funding -4

Centenary of ANZAC funding -4

Net Budget Impact - Defence and Veterans' Affairs -901

Further Coalition Policy Priorities

Coalition Plan to Reduce Drownings -10

The Coalition's Policy for Disability and Carers -3

Marriage vouchers trial -20

Prime Minister's Indigenous Council -1

National Commission of Audit -1

ACCC Funding to ensure scrapping the Carbon Tax means lower prices -10

The Coalition's Policy to Enhance Online Safety for Children -10

The Coalition's Policy for Women -1

Coalition's Policy for Tourism -3

Net Spending - Further Coalition Policy Priorities -59

Net Budget Impact - Other Coalition Policy Commitments -10,700

Other Announced Coalition Savings

Reduce Public Service headcount by 12,000 through natural attrition 5,212

Restore humanitarian immigration intake to 13,750 p.a. 1,269

Redirect Carbon Capture and Storage Flagships program 349

Reduce Automotive Transformation Scheme 500

Net Budget Impact - Other Announced Coalition Savings 7,330

Further Coalition Savings

Discontinue Carbon Farming Initiative - advertising campaign 1

Reduce payments for grants to Australian Organisations 1

Reprioritise Indigenous Policy Reform program 42

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ITSA (reduced administration of minor insolvencies) 25

Streamline Family Court processes 30

Redirect Portrayal of Senior Australians in the media 1

Redirect National Crime Prevention Fund to the Coalition's Safer Streets Program 41

Reduce former Department of Climate Change 45

Discontinue direct Commonwealth funding to ICT centre of excellence 42

Discontinue ACT Pokies trial 42

Foreign Aid - grow in line with inflation 4,500

Discontinue establishment of Senegal diplomatic post 14

Revert to pre-2010 election personal staffing ratios 7

Further 0.25 per cent p.a. efficiency dividend - reduce advertising, 428

Discontinue Manufacturing Technology Innovation Centre 16

Discontinue Community Cabinets 13

Water Buybacks - re-phase four years' spending over six years 650

Reduce National Low Emissions Coal Initiative 42

Suspend National C02 Infrastructure Plan 13

Discontinue RET Counsellor to India 3

Geothermal and Tidal - allocate $40m of existing ARENA funding 40

Connecting renewables - connecting to the grid - suspend until committed demand is identified 185

Not proceed with further increase in instant asset write-off to $10,000 200

Net Budget Impact - Further Coalition Savings 6,382

Public Debt Interest 1,313

Coalition Budget Impact

Total Coalition Savings (Including Public Debt Interest) 41,969

Total Coalition Policy Commitments -33,178

Net Impact of Coalition Measures on Budget (Fiscal Basis) 8,791

Net Impact of Coalition Measures on Budget (Cash Basis) 6,090

Note:

Carbon Tax abolition - growth dividend (not included above) 1,100

Coalition Debt Reduction

Other Savings Affecting Debt not included above 9,967

Debt reduction as a result of Coalition Policies 16,057

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ii) Appendix C: Source Policies Should you require further specific detail on the Coalition’s policies across any infrastructure sector, please contact Infrastructure Partnerships Australia on (02) 9240 2050. Alternatively, the full suite of Coalition policy documents can be accessed HERE - http://www.liberal.org.au/our-policies

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Infrastructure Partnerships Australia Level 8, 8-10 Loftus Street, Sydney NSW 2000 T: 02 9240 2050 F: 02 9240 2055 E: [email protected] www.infrastructure.org.au