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Porkies and porkbarrelling – the Coalition’s approach to infrastructure

In June 2015 Reserve Bank governor Glenn Stevens pleaded with the government to do more to lift the economy.

In the past year “public final spending didn’t grow at all, public investment spending fell by 8 per cent.  It would be confidence-enhancing if there was an agreed story about a long-term pipeline of infrastructure projects,” the governor said.

“The impediments to this outcome are not financial,” he told the Economic Society of Australia in Brisbane. The funding is readily available, at very low interest rates.

The impediments are political.

Borrowing to fund infrastructure that will earn a return makes sense even if it runs up deficits and debt. It is “not the same as borrowing to pay pensions or public servants”.

In September 2016, incoming Reserve Bank chief Philip Lowe repeated the appeal for the government to do more.

“Another option is for some entity in the economy to use the low interest rates to increase its spending. The government could either use its balance sheet or its planning capacity to do infrastructure spending.”

“That is what most businesses do; they meet their ongoing costs through their revenue flow and they borrow to build assets. So the test is: can the government, can any of us find assets to build that generate a return for society?”

Tony Abbott came to power promising to be the Infrastructure Prime Minister.  We have been told over and over again that the government has engaged in record spending on infrastructure with the figure of $50 billion repeated by all.

This is, like most things this government says, a lie.

The actual money committed between 2014-15 and 2018-19 is $34 billion with another $8 billion proposed to be invested “onwards.’’ meaning into the unspecified future.  And even those commitments are not being met.

In its 2014 Budget, the Coalition undertook to invest $8 billion on infrastructure in the 2015-16 financial year. But the recently released Final Budget Outcome for 2015-16 shows the Government invested $5.5 billion and $490 million of that was a one-off payment to the WA Government as GST compensation.

That underspend followed an underspend of $900 million in the previous year.

The cuts have been made to projects including the Pacific Highway, Bruce Highway, Adelaide’s South Road upgrade and Brisbane’s Gateway North project.

Forward projections from this year’s Budget show that in 2019-20 investment on rail will fall to zero (2016-17 Budget Paper Number 1, page 5-38).

To add insult to injury, Malcolm Turnbull wasted $18 million of public money prior to the election on propaganda advertisements which falsely claimed the Government had delivered record investment.

Morrison’s December MYEFO showed an even sorrier tale as pointed out by Shadow Minister Anthony Albanese.

Today’s MYEFO announcements on infrastructure represent the Government’s final abandonment of the Infrastructure Australia process of evidence-based decision making on infrastructure investment.

The closure of the Building Australia Fund, which was for projects approved by Infrastructure Australia, would be bad enough in itself, but the funding of 75 small projects, 73 of which are in Coalition-held electorates at the time of the election, is an appalling abuse of Commonwealth responsibility.

Not one of these projects has been approved by Infrastructure Australia.

While the Government has found funding for pathetic pork barrelling, it has failed to invest in major public transport projects including Brisbane’s Cross River Rail project, the Melbourne Metro, the Western Sydney Rail Line, the Peth Metronet or AdeLINK.

The Turnbull Government has at least six Ministers with infrastructure responsibility, including Infrastructure Minister Darren Chester, Urban Infrastructure Minister Paul Fletcher, Regional Development Minister Fiona Nash; Northern Australia Minister Matt Canavan, Prime Minister Malcolm Turnbull and his Assistant Minister for Cities, Angus Taylor.  We could also include Communications Minister Mitch Fifield with the NBN.

The Government has rejected an application from the Opposition for charter letters from Mr Turnbull to his Ministers explaining who does what in this critical policy area.

The Opposition’s application under Freedom of Information laws was rejected on the basis that the material might reveal information before Cabinet.

Since when did the responsibilities of Ministers of the Crown become a state secret?

Why would reporting on the real state of the NBN lead to police raids?

Why are we ignoring cost benefit analyses?

What return will we get for the $400 billion they have found to spend on war toys?

Rather than listening to the advice of independent experts, this government uses infrastructure spending for its own political purposes and are consequently costing the nation dearly.

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28 comments

  1. Jaquix

    All falling on very deaf ears, obviously. This government will go down in history as a complete waste of time. Not only that, they are squandering the opportunities provided by low interest rates. They are just fiddling while Rome burns, unfortunately.

  2. Harquebus

    If we contracted our economy and reduced our population, we would not need to build energy guzzling infrastructure and save ourselves a fortune and future maintenance costs. It will also reduce pollution and environmental damage.
    Borrow, build, borrow some more and build some more is a ponzi scheme which is already showing signs of collapse.
    Calls to increased infrastructure spending is just another attempt to extend our growth motivated economic system and pretend that there will be no adverse consequences.

  3. Kaye Lee

    You have no imagination Harquebus. You just automatically launch into the same well-rehearsed spiel regardless of the topic at hand.

    Building public transport will reduce pollution and energy guzzling cars. Building the NBN will reduce the need to travel. It would also provide jobs which would increase government revenue and improve the quality of life of those employed. We could build medical centres to service regional and remote communities. High speed rail could greatly reduce air travel and allow for decentralisation away from the cities. So many constructive things that would improve the lives of so many without bringing about environmental armageddon.

  4. Roswell

    Kaye Lee, if you, Harquebus and I were sitting next to a crystal river with snow-capped mountains towering above us, you and I would see and comment on the beauty of nature. Harquebus would see WW3 and the end of life on earth.

    If we were together watching a candle burn . . .

    If we were together watching baby kittens play . . .

    Who said he had no imagination!

  5. Harquebus

    Kaye Lee
    We are not building public transport. The federal government has recently announced major road projects in Vic. and NSW. to alleviate congestion.
    The NBN is being constructed for a population that is going to decline. Part of it at least will be abandoned as will a lot of other infrastructure.
    “High-speed trains are hugely expensive to build and operate and consume more than twice as much electricity to run as regular trains”

    You have selected a couple of examples whereas I was referring to “new infrastructure” spending as a whole.

    Infrastructure spending is not a solution for resource depletion, pollution, environmental destruction nor ecocide.

    Cheers.

  6. Kaye Lee

    “We are not building public transport.”

    That’s not true. I agree we could do more but your statement is incorrect.

    “Infrastructure spending is not a solution for resource depletion, pollution, environmental destruction nor ecocide.”

    No but it can certainly contribute improvement to all those things.

    “High-speed trains are hugely expensive to build and operate and consume more than twice as much electricity to run as regular trains”

    HSR would not be used to replace normal trains. It would reduce air and road traffic and free up existing rail lines for freight. It could be powered by renewable energy. It could possibly replace the need for a second airport in Sydney.

    “Effect on Emissions

    This rail network would provide zero emission journeys in the east-coast corridor. It is expected to reduce travel emissions within the east-coast corridor by 28%, which equates to a 13.5% reduction in regional travel emissions Australia-wide.

    Emissions created from the HSR construction would be offset after 5 years.”

    http://bze.org.au/high-speed-rail-plan/

  7. Miriam English

    An important piece Kaye. I hope you don’t mind that I’ve posted it to my facebook account along with a link back here. This is the sort of information that should have the maximum number of eyeballs on it.

    Harquebus, our population is declining. We bring in immigrants to boost the number of working-age people (a bit pointless if the government maximises the level of unemployment, but there you go). Infrastructure, as Kaye pointed out, can make great energy savings, and by making the population safer and more comfortable the birthrate continues to decrease. It actually is in line with what you should want.

  8. Harquebus

    Current global economic and environmental circumstances are continuing to validate my “well-rehearsed spiel”.

    Kaye Lee
    “No but it can certainly contribute improvement to all those things.” I don’t think so.
    There is no such thing as “renewable energy” and low speed trains will consume considerably less.
    Thanks for the link. I will read it.

    Miriam English
    I think you mean that our birth rate is declining.

    Cheers.

  9. corvus boreus

    Miriam English,
    ‘Our population is declining’.

    Not so I’m afraid. Not nationally, and not globally.

    Australia (ABS); “Overall, Australia’s population grew by 337,800 people (1.4 per cent) to reach 24.1 million by the end of June 2016. Net overseas migration added 182,200 people to the population (2 per cent higher than the previous year), and accounted for 54 per cent of Australia’s total population growth.” Dec 14, 2016

    World (Worldometer); World Population (2016 and historical)
    Year Population Yearly % Change
    2016 7,432,663,275 1.13 %
    2015 7,349,472,099 1.18 %
    2010 6,929,725,043 1.23 %
    2005 6,519,635,850 1.25 %

    Growth rates have been slowing, and are, based upon current/recent trends, predicted to peak and begin reversing somewhere near the end of the century, but currently, births>mortalities in Homo sapien populations.

  10. John Ward

    During the recent election campaign Prime Minister Turnbull professed to have the authority to redistribute CEFC renewable energy funds as he :
    Misappropriated $1billion from the Clean Energy Finance Corporation (CEFC) to fund his brand new creation, the Clean Energy Innovation Fund (CEIF). Prime Minister Turnbull then repossessed $800 million from the, yet to be authorised by parliament, CEIF $1billion back to treasury reducing the budget deficit with ‘renewable energy funds’ to make up for the loss of $800 million the Parliament had deducted, post the July 1, 2016 election from the aborted ‘Arena shut down.’
    These funds were planned to assist the growth of renewable energy to protect future generations against threatening climate change.

    The PM is pilfering the future from the yet unborn and treating the CEFC, as a hollow log to empty when he wishes to balance the books, minus the permission of the Parliament to do so.
    The PM also ‘seized’ a further $1billion of renewable energy funding to finance a new ‘Better Cities Fund.’ 
    Since a further $1 billion appropriated from the CEFC to clean up the Barrier Reef. 
    Mainly this money has financed the beef and sugar industries to bankroll ‘run off’ concerns those industries were already undertaking.

    Remember, the CEFC was established by the 43rd Parliament with the expressed and mandatory objective to catalyse increased flows of finance into the clean energy sector.
    The CEFC invests in accordance with the legislation, the Clean Energy Finance Corporation Act 2012 (CEFC Act) and the Clean Energy Finance Corporation Investment Mandate.

    When Tasmania’s Bass Strait under-sea cable failed just before the election the PM’s agile answer was to pledge $1.5 billion for a second Bass Strait undersea cable link to the mainland.
    $100 million was set aside to prevent the closure of the Steelworks in Whyalla SA.

    The University of Tasmania’s Northern Campus in Launceston received a pledge of $150 million to be extricated from the CEFC. 

    Prime Minister Turnbull is saying to Tasmanians and UTAS, ‘you can have an expanded Northern Campus or a renewable energy industry, but you cannot have not both.’
    Cabinet Ministers have combined to remove all funds from the Clean Energy Finance Corporation. Pledging the total amount $5.6 billion, left in the CEFC account to other good LNP causes.

    At the same time Malcolm Turnbull was subsidising the fossil fuel industry with (IMF estimates) $1,712 per Australian a year or $41 billions of taxpayer funds.

    This includes exploration funding for Geoscience Australia and tax deductions for mining and petroleum exploration. See Great Australian Bight and BP etc, etc.

    Coal is not cheap, reliable and affordable. Coal is, across the board, exceptionally subsidised, political corrupting and malignant.

    The IMF calculates that Australians subsidisations to the Fossil Fuel Industry account for hidden adverse costs spread out across the states and the ATO, that ultimately, permanently come out of taxpayers’ pockets.
    The same IMF financial forensic methods applied to the price of coal-generated electricity, should account the cost of ‘Black Lung’ in miner’s and pollution related disease and death among the general population and workforce.

    Coal is not cheap and has not ever been ‘cheap and affordable,’ the price is governed by where direct and indirect outlays and subsidisations are concealed.
    The price of electricity is an intrinsic artifice of government and a political choice these days to prolong the use of Coal as a squalid deal by both political parties with their generous donors.

    However, on closer examination, there appears to be a Round Robin scheme here.
    Taxpayer money is handed to the Fossil fuel Industry in the form of subsidies.
    The fossils fuel industry donates to the Liberal and National Party, the ALP, the IPA, the Sydney Institute, the Menzies Centre Et al., in turn the LNP Looks the other way as international corporations remove profits by ‘paying head’ office for research and any other dodgy scheme the ATO allows, they do these things, without paying Australia a fair tax and to plunder our resources.

    Ultimately, the LNP is funded with taxpayer receipts which started out as subsidies.
    There is a Royal Commission in this.

  11. Miriam English

    Yeah, oops. You’re right. I meant birthrate… here in Australia.

    Here is a video that explains very entertainingly how the change to stable population is already happening in a surprising number of the world’s countries, and how it is accelerating nicely:
    Overpopulation – The Human Explosion Explained
    https://www.youtube.com/watch?v=QsBT5EQt348

  12. Kaye Lee

    A good video Miriam…thanks.

  13. silkworm

    “… by making the population safer and more comfortable the birthrate continues to decrease. It actually is in line with what you should want.”

    Miriam, you’ve hit the nail on the head. I was actually going to say the same thing.

    One of Harquebus’ problems is that he only thinks locally, not globally. When we increase our migrant intake, the net increase in the global population is zero. But by bringing others here, we can skill them and send them back to their own countries where they will help to raise the standard of living and, as you said, this will allow their birthrate to decrease. In particular we should be educating the womenfolk of third world countries as an educated woman is likely to have fewer children than an uneducated one.

    I agree with harquebus to a large extent that increasing population anywhere is a problem given our reliance on fossil fuels. However, no one seems to have twigged to the role that religion, especially conservative religion, has in pressuring women to have large families. Thus exposure to secular ideas is welcome from an ecological standpoint.

  14. Terry2

    Kaye

    I expect to see a strident defence of the coalition’s infrastructure spending, posted on this site any moment, from any one or all of the six Ministers with responsibilities in this area.

    Surely, the many media managers employed by this government are out there monitoring this site ?

    Hello, hello……is there anybody there….hello ?

  15. silkworm

    Terry2, you seem to have missed the main message of this article, which is that the Coalition is handling it by porkbarreling. In my book, porkbarreling is unethical. What do you think?

  16. Kaye Lee

    silkworm,

    What a very good point that I must admit I had never consciously acknowledged – migration adds nothing to the global population and will actually hasten the declining birth rate.

  17. Miriam English

    silkworm, I have to admit I hadn’t thought of immigration as creating a net lowering of the birthrate. What a brilliant viewpoint. Thank you.

  18. totaram

    Silkworm:”..One of Harquebus’ problems is that he only thinks locally, not globally. .”

    I think his problem is that he doesn’t think much at all. He just surfs the web looking for “opinions” that support his prejudices. Any and all “facts, figures, numbers, actual written evidence in official documents” that might not agree with his beliefs are strenuously excluded. Opinion pieces containing obvious logical fallacies are accepted as correct, if they are of the right sort, and trotted out here as if they are gospel and we should uncritically accept them because some person has put them out. Trite statements such as “now physics and geology will call the shots” are trotted out as proof of superior “scientific” thinking. When has any process on this planet or indeed in this universe gone against physics and geology? It’s just not possible! Anyone making a statement like that has no idea about physics or geology.

    In a previous post I have pointed out that economic development leads to falling birth rates, and by about 2030 total population may begin to fall, depending on how well we, as a species, manage to prolong life, and also on how economic development proceeds.. No influence on Harquebus and his posts.. And he has no idea how we will “reduce out population starting now”. Perhaps he will be the first to stand before the firing squads that form part of the “Australian Culling Force”.

    I’ll leave it at that. I don’t want to derail the thread.

  19. Jennifer Meyer-Smith

    Large scale infrastructure projects are most welcome if they are intended to contribute to sustainable and livable communities such as the fast rail south to north and a possible another west to east.

    Wind turbine networks strategically placed across Australia and solar panel fields are other infrastructure projects that need further support.

    Decentralisation must be encouraged in regional areas with industries and government bureaucracies picked up and deposited there, so that regional, rural and remote communities have the same socio-economic advantages that urban communities have.

    However, besides the large-scale multi-billion dollar infrastructure projects, greater attention should be paid to local projects that will assist local socio-economic needs of local populations.

    Such large ideas would too much for the feeble minds of the LNP unless they can ensure their rich mates get to win any bid for the contracts to build these projects. They probably would oversee substandard results anyway like Malcolm Muck did with the NBN.

    Leave the Big Ideas and Big Ventures to the experts of The ALLiance once it gains government anytime soon.

  20. Matters Not

    What totaram said. Absolutely no evidence of a ‘critical consciousness’. Very sad!

    But still an annoying – waste of space – ‘pest’.

    But then again, all criticisms/evaluations/reactions go straight through to the keeper.

  21. wam

    thanks miriam I have been laughed at for advocating climate change may be the most serious danger to earth(BT, before trump) linking the lemon letting the chance to sink the loonies for voting with the deniers slip and then he helped the rabbott kill any chance of a gillard lead climate recovery.
    The boys made climate change unfashionable relegating it to the third reason for renewable investment after profit and providing energy to the world who cannot get as rich as us on carbon.
    As for infrastructure albo does well with those of us who struggle to spell infrostructure nuch less understand it.
    ps someone here suggesting send people back home with skills(columbo plan)? Be nice if we taught our own youth skills.

  22. babyjewels10

    Harquebus, how do you imagine we could “reduce our population?”

  23. Phil

    Hi silkworm:

    Quote – “In particular we should be educating the womenfolk of third world countries as an educated woman is likely to have fewer children than an uneducated one”

    Correct me if I’m wrong, but I always thought men were an equal partner in the baby making process? Should not men also be educated or is it to be the sole responsibility of women to manage pregnancy so that men can just do what men like to do without conscience or repercussion?

    I might add that it is not only ‘third world’ folk who would benefit here – Australia has a fair burden to carry in the ignorance stakes.

  24. Kyran

    “The Opposition’s application under Freedom of Information laws was rejected on the basis that the material might reveal information before Cabinet.”
    Does anyone else recall when the ‘Infrastructure PM’, teeny, tiny, tony abbott, released cabinet papers to the ‘Home Insulation RC’?
    Nasty precedent, that one.
    A sitting PM revealed ‘information before cabinet’ outside of the normal 30 year embargo on the basis that the infrastructure spending was errant, therefore requiring urgent disclosure.
    Wasn’t his communications minister talcum? Talcum was the bloke who silenced Nick Ross for his disparaging articles on the NBN, whilst denying he had completely messed up the NBN roll out. Whether it be talcum’s ignorance of his job or a deliberate intent to sabotage his own portfolio can only be the subject of speculation. For what it’s worth, in either event, neither defence is feasible. Not if you are the minister, IMO. Certainly a more urgent need for disclosure, IMO.
    At least six ministers for infrastructure. At least three ministers for defence. No charter letters.
    “Why are we ignoring cost benefit analyses?”
    At a guess, ‘we’ aren’t, ‘they’ are.
    Thank you, Ms Lee, and commenters. Take care

  25. Miriam English

    Phil, I’ll answer your question.

    Yes, all things being equal, of course it is just as important for men to be educated too, but things are not equal, especially in impoverished places. There, it has been shown that not only are women often almost completely powerless, but that a small amount spent helping them has a much, much greater effect than spending it on the men. This is partly because if women can make decisions on their fertility and the well-being of their children it has a much greater impact. If men have all the power then women become just the men’s f*cking recreation.

    Muhammad Yunus, the guy who came up with microfinance, found that loaning small amounts to women benefitted the families more than loaning it to the men. Men divorcing their wives and leaving them and the children homeless is a big problem in many poor parts of the world. Muhummad Yunus hit upon the solution to this by loaning to a family for home improvements only if the home was in the name of the wife. As well as getting homes improved it stopped the women and children being thrown out on the street.

  26. Max Gross

    The Deplorables (and the Holier-Than-Thous!) are in charge

  27. Harquebus

    Hey, babyjewels10. Over here:
    http://theaimn.com/depopulate-or-perish/

    I have read the criticisms of me. While just about every aspect of our society and the world in which we live continues to deteriorate, just look at the number of articles published here complaining about it, I don’t think that my critics have much to stand on.

    Cheers.

  28. guest

    Further to Jennifer Meyer-Smith’s comments @6.43 about wind turbine networks and regional development, it is interesting to read Graham Lloyd’s article “Green planet will be key to unlocking reliable energy” in the WE Australian. It proposes some projects for all our infrastructure ministers.

    Lloyd mentions a Chinese report which hi-lights a “new multi-billion-dollar economy based on plants; ie bio-energy. It gives Lloyd a chance to take a swipe at wind turbines.

    “… the emerging, humiliating confirmation from South Australia’s living experiment that replacing fossil fuels with intermittent renewable energy will be more difficult than previously imagined”.

    Of course, what he has done here is to cherry-pick a one-off event and ignore the fact that a storm blew down 22 power poles, causing the shut-down of the inter-connector and the wind turbines. Nor does he acknowledge the fact that wind farms are increasingly employed globally.

    But he does go on to show that the treatment of bio-mass to produce bio-energy is wide-spread even here in Oz, such as the use of left-over sugar-cane material. All kinds of biological and vegetable materials are usable.

    However, he does make passing reference to criticism of bio-energy by various environmental groups. The destruction of the environment in Indonesia to produce a mono-culture of palm oil plants is one kind of criticism.

    Another is that the production of bio-energy and its use are in close proximity. Lloyd acknowledges this in his suggested benefits for regional areas.

    Lloyd is quite excited about the monetary benefits of bio-energy production, speaking in terms of billions of dollars, but lamenting the relatively paltry up-take of investment.

    And well he might. The magazine New Scientist, September, 2016 (not mentioned by Lloyd) questions the viability of the bio-mass/bio-energy concept. Advocates for bio-energy do not count the carbon emissions from burning bio-mass.

    As a little addendum, Tony Eggleton (2013) p. 127 tells us: “Four hundred million years ago it was warm and the CO2 levels in the atmosphere were 10 times those of today. This encouraged plant growth and led to the major coal deposits of the world. But the plants took the CO2 out of the atmosphere, and as they did the temperature fell, leading to extensive polar ice sheets.”

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