A $4.7 billion federal Christmas present

The Rudd Government has announced a $4.7 billion ‘nation-building package’ to be spent on rail, road, education and small business assistance.
 
The government hopes these national infrastructure projects and the assistance to business will boost the level of GDP and help create up to 32,000 Australian jobs.
 
There are three key infrastructure elements in the package:
  • $1.2 billion in new funds into the Australian Rail Track Corporation
  • Bring forward $711 million in road spending to this financial year and next and more than double funding for the Black Spots program
  • $1.6 billion for university and TAFE infrastructure
The package also includes two tax changes:
  • A 10 per cent temporary investment allowance to encourage capital investment by Australian businesses
  • A 20 per cent cut in the next quarterly pay-as-you-go (PAYG) tax instalment for 1.3 million small businesses
Today’s package comes on top of the government’s $10.4 billion ‘Economic Security Strategy’ (cash handouts), the $6.2 billion ‘New Car Plan’, the $300 million local infrastructure funding boost, and the $15.1 billion COAG package.
 
The Government is planning to make further announcements about nation building projects, funded from the Building Australia Fund, and subject to the Infrastructure Australia priority list, early next year.
 
$1.2 billion for rail infrastructure
 
Over the next two years, $1.2 billion will be injected into the Australian Rail Track Corporation (ARTC) in 17 projects to improve the reliability and competitiveness of the rail freight network.
 
$580 million of this will be used to expand capacity along the rail corridors connecting Hunter Valley coal mines to the Port of Newcastle.  This $1 billion project will more than double the amount of coal being transported to export markets from 97 to 200 million tonnes a year.
 
Other rail projects funded include:
  • $55.8 million for Queensland border to Acacia Ridge track upgrade
  • $45.1 million for Sydney to Brisbane line – new, extended and upgraded loops
  • $29.7 million for Melbourne to Junee line – passing lanes
  • $45 million for Seymour to Wodonga track upgrade
  • $91.5 million for Cootamundra to Parkes track upgrade
  • $105.7 million for Western Victoria track upgrade
  • $50 million for Wodonga Bypass duplication
  • $42 million for Cootamundra to Crystal Brook  line – new and extended loops
  • $76 million for Melbourne to Adelaide line – extended loops
  • $23 million Adelaide to Kalgoorlie line – new and extended loops
  • $45 million towards the $90 million Advanced Train Management System (ATMS) trial set to bring train management into the digital age
$711 million for roads
 
The government will bring forward $711 million in spending in this year financial year and next to accelerate the commencement of 14 road projects.
 
The package will also more than double investment this financial year in the ‘Black Spots’ program from $50 million to $110 million.
 
Other road construction projects brought forward include a number of major highways in each state. On top of this road funding, the government will also set aside $195 million for investment in agricultural and social infrastructure to develop irrigated agricultural land around Kununurra following assessment of the projects by the state and Federal Government.
 
$1.6 billion for universities and TAFEs
 
$1.6 billion will be used for improving universities and TAFEs, and will include fast-tracking the spending of $580 million into 11 projects focussed on strengthening the research facilities at Australian universities, funded through the Education Investment Fund.
 
The government will also fund a one-off $500 million investment to target capital expenditure towards the development of teaching and learning spaces in Australia’s universities. This funding will be delivered through the Teaching and Learning Capital Fund for Higher Education.
 
The package also contains a $500 million injection into public skills and training infrastructure through the Teaching and Learning Capital Fund for Vocational Education and Training.
 
Infrastructure package meets with (almost) universal approval
 
Major rail organisations and infrastructure bodies unanimously welcomed Kevin Rudd’s announcements, with the rider that this should be a beginning, not the end for increased government spending on vital infrastructure projects.
 
Australian Logistics Council CEO Hal Morris said: “T&L’s highest priority is improving our interstate rail network, as reflected by the 23 Supply Chain Blockages recently identified by the ALC. 
 
“Today’s announcement is an important step towards addressing the backlog of work required and will be targeted to clearing the blockages on our rail network.
 
“However, it should be remembered, that a lot more will need to follow to deliver a truly competitive and efficient rail system,” Mr Morris said.”
 
The rail industry congratulated the Rudd government in making the largest single investment in rail in Australia since Federation. “This substantial investment starts to redress the underinvestment by government in rail over many years,” said Bryan Nye, CEO of the Australasian Railway Association (ARA).
 
“The $1.2b investment in the nation’s interstate rail track will improve rail capacity, speed and reliability in addition to creating 2000 new jobs. The funds will flow through the Australian Rail Track Corporation to re-sleepering, passing opportunities, track upgrades and other construction.
 
“The rail improvements will attract freight to rail reducing transport pollution, road crashes and improving the economy. Every additional train takes 150 trucks off the road, saves 45,000 litres of fuel and reduces greenhouse gas emissions by 125 tonnes.” said Mr Nye.
 
Australia’s largest rail business QR has welcomed today’s announcement of the $1.2 billion rail infrastructure package by the Federal Government but says there is still much be done to bring the national rail freight network up to task.
 
QR chief executive officer Lance Hockridge said the funding was an important ‘down-payment’ on the much-needed transformation of national rail infrastructure.
 
“Rail has been the poor cousin in terms of national infrastructure investment over past decades,” he said.
 
“Funding announced today is a down-payment on the large-scale investment that is required moving forward.
 
“But we still need to genuinely tackle the slow and congested east corridor, the most heavily trafficked transport route in Australia.
 
“The Melbourne-Sydney-Brisbane route is a long way from being a modern and efficient rail freight corridor with the required competitive transit times and capacity for high-volume trains.
 
“It’s encouraging to see money now flowing through to the critical east coast corridor, but let’s hope that there’s more to come.
 
“We need major inland freight hubs – to move freight away from congested capital cities like Sydney – with genuine and seamless multi-modal transport across road and rail. This corridor is the freight heartland of Australia.”
 

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