ABC 774 Melbourne Mornings

Interview

DCI040/2017

01 May 2017

Subjects: Victoria regional rail

Jon Faine: Mr Chester, good morning to you.

Darren Chester: Good morning, Jon.

Jon Faine: The working relationship between the Commonwealth and the state on this infrastructure spending, is it improving?

Darren Chester: Well in parts it is, Jon. Jacinta Allan and I have had several meetings in recent months and we met again as recently as yesterday to talk our way through these regional rail projects. But it is fair to say it hasn’t been a great relationship at senior levels over the last couple of years and we need to try and rebuild that. What we saw yesterday is further proof of that, that there is more work to be done because the Premier has basically announced a range of projects allocating federal money that he doesn’t have. We need to try and—when the dust settles from the two Budgets, from the state and federal Budgets—it will be up to people like Jacinta Allan and I to work out what we actually can afford and how we can work in partnership with proper plans, proper business cases, and some state funding on the table for what is primarily a state responsibility.

Jon Faine: Yes, it is a state responsibility to deliver it but this is money that even though it is federal money, it’s money that unarguably is Victoria’s because of the asset sale incentives, is it not?

Darren Chester: Well this is the point, Jon. You are saying; inarguably it is Victoria’s money. Well there is an argument about it and the two Treasurers have been dispute for the best part of 12 months about that. So, the fact that they are in dispute sort of highlights the point that the Premier’s making announcements on money that he doesn’t have. It was all federal funding that he talked about yesterday, not a cent of state money and I’m simply making the point that we need to actually see the plans in detail, we need to see the business cases—which we haven’t seen—and we want to see some state commitment to investing in the regional rail network as well. Now we can’t expect the Federal…

Jon Faine: Why?

Darren Chester: Well we can’t expect the Federal Government to pick up the entire tab.

Jon Faine: Why should Victoria—I do understand the principle, but given that it is money that… it just is our money. That is what the formula provides for. Where is it written down that the state must also either match it or contribute to it? It is effectively money you have to give to Victoria for Victoria to decide what to do with.

Darren Chester: Well you are saying that it is Victoria’s money. The two Treasurers have been disputing the details of that for many months now because Victoria didn’t fulfil the terms of the agreement, they didn’t meet the deadline in terms of the Port of Melbourne sale, there was an agreed figure before the Port of Melbourne sale actually went through of $877 million and then the Port of Melbourne sale yielded a higher amount so the Victorian Treasurer has gone back to the Federal Treasurer demanding more money. Now in all those circumstances the money is clearly still in dispute and that is why it was particularly unusual for the Premier to be out there yesterday allocating $1.45 billion of federal funding which he doesn’t have. He had time to produce a very slick public relations video but didn’t have time to send us a business case. Now, after the Budgets are done, after the state Budget comes out tomorrow and the federal Budget next week, I’m sure we’ll have a much clearer picture of exactly who has money on the table for regional rail and Infrastructure Victoria and we’ll need to get a deal done.

Jon Faine: There is something a bit weird about this. You are a National Party minister in a Coalition government complaining about a commitment to regional rail. Shouldn’t you be applauding it and going; hurrah, at last.

Darren Chester: Well you are putting a lot of words in my mouth there, Jon, and I’m certainly a supporter of regional rail, and you’ve had me on this program talking about it…

Jon Faine: I would have thought so, yes. I would have thought so.

Darren Chester: But we have to be able to pay for it. Now, if I was on your program now agreeing to spend $1.45 billion of Australian taxpayers’ money and I told you I didn’t have a business case you would be tearing strips off me. I don’t have a business case. I have not received a plan from the Victorian Government and I haven’t seen any indication that they are actually going to put any of their own money on the table for what is primarily a state responsibility. But having said all of that, I’m an absolute support of regional rail because I think it will actually deliver the decentralisation aims the Government is pursuing. But we have to be fair dinkum about this. The Premier has to send us his plan, his business case and we have to work together on it.

Jon Faine: Oh look, I think, I presume one of the first things you do before you actually lock it in and they’ve announced, for instance, I think $10 million it is, for a feasibility for the airport link. They have also announced $100 million to do the final planning on finishing the Ring Road. I mean, this is all part of the allocation isn’t it? To say okay, we want to spend it on regional rail and we are going to now start doing those business cases. Is that not the next logical step?

Darren Chester: Well what normally occurs in these negotiations where there is going to be a federal commitment and a state government commitment is the two ministers working in partnership and make the announcement at the appropriate time when they have gone through the whole business case process.

Jon Faine: That would be good.

Darren Chester: That would be good. What was particularly unusual and it is a very unusual way to do business was the Premier coming out yesterday announcing the $1.45 billion of Australian taxpayers’ money for projects, which he hasn’t provided any of those to the Commonwealth on and the money is still in dispute. Now I know it is frustrating for people, they don’t really care who provides the money, they just want the work done. But I actually have responsibility for Australian taxpayers’ money and I need to make sure we are getting value for money and at the same time we are picking the best projects. Now, as I said, once the two Budgets are done in the next week or so the silly season, the speculation will end and we will have to get down to the hard work of negotiating a good outcome. I’m very confident that Jacinta Allan and I can sit down and work out how we get that investment into regional rail which will deliver those long term benefits that you and I have talked about so many times in the past.

Jon Faine: Well I think if Jacinta Allan and Darren Chester sat down in a room and sorted it out and everybody else just left you to it, I think it would be a lot easier.

Darren Chester: It would be easier. But that doesn’t always work like that, Jon. Look, it is politics in 2017. It is a pretty tough game and it is a bit frustrating…

Jon Faine: It has always been the same, always will be.

Darren Chester: Well I’m hopeful that we will get through these next seven or eight days. We will know the details of each level of government’s budgets and we will know what money’s actually on the table to deal with and we’ll have real money and real business cases to work on. And we’ll get those investments occurring just like we did last year when we worked out how to actually spend that East West Link money finally and we got $3 billion of work which is rolling out across Victoria.  We will need to work out some sort of arrangement on this money.

Jon Faine: As always, thank you for your time too.

Darren Chester: All the best, Jon.