Transcript - Minister King interviewed on ABC TV Insiders program with David Speers

HOST, DAVID SPEERS: Catherine King, welcome to the program.

MINISTER FOR INFRASTRUCTURE, TRANSPORT, REGIONAL DEVELOPMENT AND LOCAL GOVERNMENT, CATHERINE KING: Hi, thanks for having me on.

SPEERS: So the Treasurer we just heard there. He says we can't be spraying money around. Let's start with what you are announcing in the budget or today ahead of the budget, a total of $9.6 billion in transport projects - just explain to us where that's coming from.

KING: So, that is the election commitments that we took, obviously, to the last election and we’re really reconciling those in the Budget going forward. So, from Suburban Rail Loop, to high-speed rail, to roads in every state and territory, they are really very much part of the bread-and-butter budget that we're about to see, which is about our infrastructure funding going forward.

SPEERS: And is it reprioritised from other areas?

KING: There's a mix of that and that'll all be accounted for in the Budget in just under two weeks.

SPEERS: Just looking at what you have announced, is your biggest single announcement today, $2.2 billion for the Suburban Rail Loop project in Melbourne. Now Victorians will know it, this is the most hotly contested issue in the state election campaign in Victoria that's currently underway. Labor wants it, the Liberals want to redirect that money into health instead. Why not wait another six weeks until the state election is over, so you can see whether Victoria want this project or not?

KING: So the first thing is obviously we announced our commitment to the first tranche, this is really about early works. So the first part of suburban rail, we did that way back in May and again, we're honouring our election commitment. This project really will be transformational for Victoria. We saw the Prime Minister was over in Perth with METRONET, which is a really similar sort of project where we're actually trying to look at activating suburbs and trying to actually build new hubs around those train stations and build new train stations. And that's really what this is about for Melbourne. So it's a project we're really committed to. We certainly know that the Victorian State Labor Government is committed to it. I certainly hope the Liberals...

SPEERS: We also know the Victorian Auditor-General has some issues. He's been critical of this suburban Rail Loop project saying, well at least the business case presented was inadequate and didn't support a fully informed investment decision. There's a risk the value of the project is being overstated. Have you looked at those criticisms?

KING: Yeah, look certainly I've looked at that. And I've talked to the Victorians about that. And I'm very confident in the work that they have undertaken. And as I said, we've put $2.2 billion into that first early work stage there.

SPEERS: Has Infrastructure Australia even signed off on this?

KING: We've had conversations within the Department itself and as you know, Infrastructure Australia at the moment, we are undertaking a review of that and we'll certainly, for any forward funding for the Suburban Rail Loop, we'll be working with Infrastructure Australia...

SPEERS: You've committed $2.2 billion a Commonwealth - a lot of money. What does Infrastructure Australia say?

KING: So at this stage, they have not undertaken a review of the business case they've done some...

SPEERS: Why not wait until they've done that, Infrastructure Australia are the experts here.

KING: Yes, certainly, we've relied on in the election context, we obviously relied on the business case that the Victorians put to us, a substantial business case that we have confidence in.

SPEERS: The one the Auditor-General's criticised.

KING: Again, there's been some challenges around that. But again, this is for the early works of this project. We haven't made any further commitments. We'll talk to the Victorians around that as we go forward. They've obviously got an election that they're facing. And this will be a contested project I'm sure, but it's something we have confidence in.

SPEERS: The most populous state, New South Wales gets less than half what you're giving to Victoria. In fact, we've got a break down here and see how much each state is getting. New South Wales, in fact, is getting less than Queensland, less than Victoria, less than the Northern Territory as well. Why?

KING: Well, I guess to some extent, it was what projects were put to us at the time of the election campaign. We'll work with the New South Wales Government as we're leading to the May Budget.

SPEERS: So they didn't put projects to you, is that what you're saying?

KING: I would just say we had a slightly different relationship in opposition with the Victorians than we did with New South Wales, so we didn't really have a lot of projects on the table, from opposition from them. But we'll talk to the New South Wales Government in the lead-up to the May budget, as to where their priorities are.

SPEERS: Since you've been in government they've been at you for funding, one in particular the Warragamba Dam, they want to increase the wall of the Warragamba Dam - $1.6 billion. They want you to fund half, will you?

KING: We'll have conversations and we're in conversations with them at the moment. I understand the New South Wales Department is again talking to Infrastructure Australia, there's a bit more information we're going to need before we make decisions about that, and that will sit within the water infrastructure portfolio. But again, that would be something that we'd have a look at in the lead up to the May budget. The budget in October is really about our election commitments, honouring those and then whether there's any further funding for infrastructure and states...

SPEERS: Because there's been some reporting that the PM has privately said no to this, you'll say it might come in the next Budget this funding for Warragamba Dam?

KING: Well again, we'll have a look at it. At this stage we haven't got enough information from the New South Wales Government of which to make a decision. I think there's some back and forth between Infrastructure Australia and the New South Wales Department and I haven't seen any of that as yet. But we're open to just talking to the New South Wales government about what their priorities might be. But that would be a decision leading into the May budget next year, it wouldn't be a decision and certainly not a decision I'm going to make via media conference frankly.

SPEERS: Fair enough. I want to ask you also today's parcel of funding includes $1.5 billion in Darwin for marine infrastructure. Just hoping you can clear this up because in the budget that the Morrison Government handed down, Barnaby Joyce secured $1.5 billion or thereabouts for port infrastructure in Darwin. You're now announcing a further...?

KING: So this is the Middle Arm project. We committed to Middle Arm during the election campaign. That is what this is. It comes out of the Barnaby Joyce energy security package.

SPEERS: So it's the same?

KING: Well, there's two things we're doing slightly differently. One is we want to equity-fund this, so we want the Commonwealth to have a stake. This is a really substantial build within the marine precinct. So within Darwin, it's a big economic boost for Darwin. It also includes freight hubs and intermodal hubs around Katherine as well, that's part of this long-term project.

SPEERS: Is it a new port?

KING: No, it's not a new port. So this got completely confused during the election campaign when we suddenly saw this defence infrastructure, where Peter Dutton sort of muddied the waters here. So what it is, is Middle Arm is currently an existing patch of land that's underutilised, it's actually about building a big jetty out, to be able to actually get, potentially hydrogen in and other goods in, so it's actually not a port in and of itself. It's enabling infrastructure, to allow goods and services in and out, so it's not a container port, or anything like that. And it's definitely not a defence...

SPEERS: So it's for hydrogen?

KING: It may be for hydrogen. It's one of the things that's been talked about as a possibility for this particular project.

SPEERS: Let's talk about savings. Where are you going to find some money in the Budget. We've heard a lot about the audit of waste and rorts that you've been involved in. What have you found; how much will be cut?

KING: Yes. So again, all of that will be reconciled in the Budget, but of course, we've naturally had a look at a few things. The first has been things like, you would have remembered the commuter car parks, the Urban Congestion Fund. I've also had to have a really hard look at what is deliverable within the infrastructure pipeline. There's a lot of things that the previous government sort of announced with a lot of fanfare, but when you actually look at the capacity constraints, you look at the amount of money available, they're really going to take a long time to build so there'll be some reprofiling that's built into the Budget. So, pushing those out a bit with more realistic timeframes for actual delivery of them. And there will be some cuts particularly in terms of those things that we saw, that were basically just extraordinary rorts in terms of the commuter car parks.

SPEERS: Extraordinary rorts, but how much are you saving?

KING: Yeah, so again, you'll see that in the Budget, nice try David but we'll talk about that in the Budget.

SPEERS: So there will be a figure in the Budget that says we've saved this much through this rorts and waste audit?

KING: There will certainly be within my portfolio there'll be, you'll see where the reprofiling has occurred. You'll see where we've spent money and will account for all of that. And obviously each portfolio will do that.

SPEERS: So will anything be returned to the Budget bottom line you're talking about reprofiling...

KING: Certainly there will be money returned.

SPEERS: Billions?

KING: Again, nice try, we'll see all of that in the Budget process.

SPEERS: Well, okay, well, let me ask you about a few specifics here. Can you at least give us an example of a car park that you've decided is wasteful and will no longer go ahead or any other project you can give us an example of so people can understand what it's all about?

KING: There'll be a couple of things. So certainly in terms of things like the Urban Congestion Fund and commuter car parks, there'll be car parks that we're not proceeding with. And basically, the reason I'm doing that is that they've actually been underfunded. So, if I was to proceed with some of those, I would actually have to find an additional billion dollars to build them in the first place. And there's just not headroom in the budget to be able to do that. The other thing obviously is in terms of, there's a big mess in terms of some of the regional grants programs. And I've had to have a really hard look at where did the previous government invest, where it's going to actually help economic development in the regions and really work my way through those. So some of the things that the previous government funded we'll fund and some of them we won't.

SPEERS: The Regional Accelerator program, $2 billion fund, what happens to that?

KING: So, that one in particular was a strange one. Frankly, I think that Bridget McKenzie, put forward again, that which she sort of then sort of ran around the country during the election campaign announcing all sorts of bits and pieces out of. Certainly we’ll be keeping some elements of that, again, that sit with the agenda of the new government around training people, making sure we've got good university funding, those sorts of things we'll keep, but a large proportion of it we won’t.

SPEERS: So that will go. Okay, Building Better Regions Fund?

KING: Building Better Regions Fund - the sixth round. The applications closed back in December last year, I think and it wasn't assessed before the government left.

SPEERS: So you'll get rid of that whole round?

KING: I haven't made a decision about that yet, but what I do want to say is that I actually recognise how important funds like that are for regional communities and for local government in particular to be able to supplement local infrastructure. So there will be a regional grants program of some sort. It will not be the sort of terrible, skewed program that we've seen in the past. The Audit Office obviously did a pretty strong review of the Building Better Regions Fund, didn't have great things to say about the distribution of that. And I recognise regional grants are pretty, pretty important for local government in particular. The Community Development Grants is another area, not many people knew about them because they weren't a competitive, open grant. They were basically a slush fund. $3.2 billion of money went through that. They were announced all over the place, two days before the election campaign actual proper, so not funded within the budget. So we're having to try and work our way through some of them and some of them are really important and worthy projects.

SPEERS: Labor also promised hundreds of millions of dollars in the lead up to the election to swimming pools and sporting clubs and a lot of them in marginal seats. You said after the election, the department would look at those as well. Run the ruler over and see if any of those were going to stack up on merit grounds, are any of your promises going to bite the dust?

KING: Yes they will, if they don't meet, so over $5 million that was part of my portfolio for the first time, I've asked the Department to undertake...

SPEERS: And they have found some?

KING: Not yet but they're still in the process of undertaking the merits review, but if they come to me, and they say on the basis of the merits review, this project can't proceed, then it will not proceed.

SPEERS: Swimming pools promised in Higgins and McEwen, Corangamite, Flynn, Blair, Pearce - appears a lot of marginal seats, a lot of swimming pools. Why does the Commonwealth and I know you could probably argue it's not just you both sides do it. Why does the Commonwealth have to fund swimming pools and tennis courts and boat ramps? Don't we have local and state governments that can do that?

KING: If you talk to local government, they'll say that particularly these large-scale projects are beyond the means of their rate base to actually be able to find the funds to do and generally those are partnerships between federal, local and state government to be able to deliver for liveability, whether it's in suburbs or in our regional communities...

SPEERS: But can't you just give grants to local government -

KING: We do that as well.

SPEERS: And they can decide what their communities need. I mean, this is where the political pork barrelling comes in.

KING: We do that as well. So we do that through Financial Assistance Grants to local government, and we do that through the local roads and community infrastructure fund that gets distributed, but these are sort of bigger-scale infrastructure projects that really are beyond that sort of rate base. Beyond that financial assistance, grant space.

SPEERS: A lot of them are less than a million bucks that you're spending on.

KING: Some of them. So the under under $5 million are election commitments that will be accounted for separately.

SPEERS: This is this is where the charge of pork barrelling comes in doesn't it?

KING: Yeah look, I understand the point that you're trying to make. And I guess that in terms of election commitments, and the audit office recognises that election commitments, the process for selection is in essence, the election campaign. That's how we do it. We need to account for those separately and very clearly. The problem of what the previous government did is you had Community Development Grants which started off as their election commitments, and suddenly you had popping up Pauline Hanson in Rockhampton with a big check, One Nation candidates in WA for a soccer club, but they sort of used it then as this whole, this is how we're just going to dip in and out of it.

SPEERS: You're still using taxpayers money to try and win seats -

KING: In terms of that, so we'll account for that through the budget process, particularly, so under $5 million, there'll be a separate fund for that -

SPEERS: As long as there's a line in the Budget...

KING: That we are clear that that is what that was. In terms of competitive grants programs or anything that's sitting within the budget. There has to be a transparent and clear process in terms of that.

SPEERS: Finally the floods in Victoria, New South Wales and Tasmania. There is still a way to go before we see the full impact of the damage. Any estimates at the moment of what this is going to cost to rebuild the regional infrastructure here?

KING: Yeah. Look, not yet. I mean, you can clearly say particularly just seeing, some of the road infrastructure is absolutely horrendous. But the good thing is that now the Government, you've seen it in Queensland and New South Wales is actually building back better, where actually you weren't allowed to do that before you just had to do like for like. Now you can actually build in resilience, build back better to actually try and mitigate against some of the disasters that we've had. So that's the funding that we've put in through the Disaster Recovery Fund in New South Wales and Queensland, and I'm sure Victoria will have a very significant ask after these events and our hearts go out particularly to people in Shep, Mooroopna and Echuca who are really in the gun at the moment, we've been fairly lucky in my community, we've had a fair bit of damage, but nothing like we're saying there and you know, who would have thought to see Maribyrnong and Kensington underwater? It's incredible.

SPEERS: They're terrible. Catherine King, thanks very much for joining us.

KING: Really good to be with you.