WA square with the house as Kalgoorlie loan repaid

Media Release


23 July 2015

A fifty year old $106 million loan to the Western Australian Government to build the Kalgoorlie to Perth rail line during the Menzies-era has been fully repaid ahead of schedule.

The Australian Government loaned the original sum to help build a standard gauge line between the two centres for defence and trade purposes. It also formed the last part of a standardised East-West transcontinental rail line.

Deputy Prime Minister and Minister for Infrastructure and Regional Development Warren Truss welcomed the payment of approximately $1.3 million, the final instalment of the loan. The cost of administering the loan had become disproportionate to the amount outstanding.

“The project reflected the forward-thinking nature of the Menzies Government. Standardising the rail line was one of the most important projects in Western Australia and Australia's history, facilitating mining development, improving the defence of Australia, and delivering stronger trade and commerce,” Mr Truss said.

“The project connected Sydney with Perth in 1968, making it possible today for the Australian Rail Track Corporation to operate a modern railway that transports around 80 per cent of the freight across the continent.

“Then and now, the Australian Government's focus is in helping fund transformational infrastructure projects that improve productivity and promote economic prosperity.”

Mr Truss said repayment of the loan marked the final act of one of the important infrastructure reforms in the nation's history and delivered on the Government's deregulation agenda by removing the need for continued administration of the loan for both governments. Repayment of the loan also means that the enabling legislation can now be repealed.

“It is apt that repayment of the loan comes when we are commencing one of the next big rail reforms for the 21st century—the Inland Rail project between Brisbane and Melbourne,” he said.

“The Inland Rail will enhance the national standard gauge connection and, building on the full standardisation of the East-West transcontinental rail line, connect Brisbane to Perth and Adelaide, without going through Sydney and the 19th century coastal route.

“The Australian Government is committed to creating a rail freight network that will meet the needs of industry into the 22nd Century, supporting jobs and the economy more broadly.”

The loan from the Commonwealth, documented under the Railway Agreement (Western Australia) Act 1961, led to the completion of the standardised link in the 1970's.