Transcript - Australian Constructors Association - FF24, Sydney.

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I begin by acknowledging the traditional custodians of the lands on which we meet – the Gadigal of the Eora nation.

I pay my respects to Elders past, present and emerging, along with all other First Nations people who are joining us today.

Our great cities are built on lands that have been cared for and protected by Indigenous Australians for countless generations. 

That is something we recognise today and every day.

I also want to thank Australian Constructors Association CEO Jon Davies for having me here today. 

The ACA plays such an important role in building our nation and ensuring a sustainable construction sector. It is always a pleasure to join you at events like this. 

I started this working week in Canberra and, after a visit to my wonderful colleague Fiona Phillips in Nowra, I drove up the Princes Highway to be here in Sydney.

It’s of course a beautiful drive, but I took particular joy in crossing the Shoalhaven on the New Nowra Bridge, a $350 million project we jointly funded with the NSW Government.

An estimated five million tonnes of freight travels along the Princes Highway each year, as one of our nation’s key freight corridors.

Investments like these will make it more efficient and, importantly, safer for drivers.

These projects also create jobs and bring opportunity to communities - workers clocked up more than one million hours combined to build the new Nowra Bridge.

Today, the Commonwealth is investing more money in transport infrastructure across Australia than at any point in our history – with the 10-‑year pipeline now sitting at over $120 billion.

Through the 2023 calendar year, public sector expenditure on road construction was $18.8 billion – an increase of 18 per cent on the previous calendar year and the highest level of spending on roads ever achieved in Australia. 

At the same time, we broke the record for public expenditure on rail, with $13.4 billion spent. 

While the Commonwealth is a major investor in public infrastructure, we are not the only investor.

States and territories too have their own pipelines of projects and priorities.

Infrastructure Australia, through their latest Market Capacity Report, tell us that major public infrastructure spending is now valued at $230 billion over the five years from 2022 to 2027. 

This is a good thing – we're building our nation’s future. 

Looking at major projects though, what I know is that we can’t make these investments, and deliver these benefits, without working with you and considering the entire ecosystem in which you operate. 

That amount of work cannot come without pressures – whether that be labour shortages in engineering and the trades, or limited supplies of steel and quarry products that are critical to meeting demand.

At the same time, I know that industry is delivering increasingly more complex projects, especially as part of the energy transition, which will add further demand to the construction sector. 

Now, one of the answers to this challenge is to boost productivity growth, which has been slow over the past 30 years, particularly when compared to neighbouring industries such as transport and manufacturing. 

The Australian Government is committed to continue working with jurisdictions and delivery partners to find consensus and explore productivity improvement measures -- themes that are well and truly on the agenda of this conference.  

The other thing to do is what we as investors must, and that is properly plan our infrastructure investments to maintain a steady pipeline of work.

That is what our government has done over the past two years – we have laid the foundations on which Australian infrastructure can continue to grow into the future.

Since coming to office over two years ago now, we have embarked on an ambitious and transformative agenda to reform commonwealth infrastructure investment and the way we make investment decisions.

The first of our major reforms passed Parliament in early December, when we restored Infrastructure Australia to its role as the Commonwealth’s principal infrastructure adviser.

These reforms defined IA’s mandate, improving the evaluation of infrastructure proposals, and refining the products IA delivers to better support government investment objectives – including ensuring a more targeted Infrastructure Priority List.

It was a surprise to me when I learnt this, but this year’s Budget was the first in which IA’s advice has played a formal part.

Last week, I had the pleasure of visiting Infrastructure Australia’s team right here in Sydney to thank them myself. They do important work that is shaping government decision making.

Then, of course, I initiated an Independent Strategic Review of all the Commonwealth’s investments.

This was a landmark step in ensuring that the Commonwealth’s land transport infrastructure pipeline is sustainable and fit-for-purpose.

It was about addressing financial pressures on the pipeline, easing the pressures on inflation and ensuring that when we committed to a project, we could deliver it.

This review found that the pipeline of infrastructure projects we inherited from our predecessors was undeliverable. It found $33 billion worth of known cost blowouts, and it found that without significant changes, the Commonwealth would be unable to commit to any new projects for ten years.

These were not easy findings for a government to receive – it meant we had to take hard decisions and implement difficult reforms.

The difficult reforms that we instituted following this review included returning to a preference of 50:50 funding with the states and territories for future investments, so both levels of government carry an equal share of both the benefits and the risks, particularly when it comes to properly scoping projects to minimise unexpected cost escalations.

And, importantly, we have undertaken reforms to ensure we don’t repeat the mistakes of the past – particularly through issuing the Commonwealth’s first Infrastructure Policy Statement.

This Statement commits the Government to focusing on delivering nationally-significant infrastructure projects. Nationally-significant means those projects which have a clear role for the Commonwealth and which deliver on the three Policy priorities for our investments:

•         Productivity and Resilience

•         Liveability, and 

•         Sustainability

It means more efficient roads, ensuring supply chains are resilient, building equity into the heart of where we live, improving prosperity, reducing our emissions and encouraging more sustainable ways to travel.

Taken together – and to steal the theme of this conference – these reforms have laid the foundation on which our infrastructure future will be built.

It was with these reforms in place that I was able to announce funding for new projects in the recent Budget such as $2.75 billion for the Sunshine Coast Direct Rail in Queensland, with 19 km of new, dual-track rail line from Beerwah to Caloundra and two new stations at Nirimba and Caloundra, a project for which community engagement is underway, an extra $3.25 billion to the North East Link in Melbourne that will save commuters more than half an hour on the roads, and get 15,000 trucks off suburban roads each day, and $7.7 billion in the Torrens to Darlington Project in Adelaide, helping drivers bypass 21 sets of traffic lights.

And as my colleague, Amanda Rishworth said to me yesterday, “cutting her commute time from 30 minutes to 15.”

We have also been able to invest in more projects in remote and regional areas.

For example, we committed $40 million for the Remote Community Access Roads Upgrades project in the Northern Territory, which will upgrade and seals priority access roads to remote Indigenous communities, including Imanpa, Emu Point and Mungkarta.

We continue to build on those strong, new foundations right now through our negotiations of the new funding agreement for transport infrastructure projects between the Commonwealth and the states and territories.

The new agreement will govern the Australian Government’s investment, in partnership with jurisdictions, in nationally significant infrastructure projects over the next 5 years. 

Our priority is to ensure that this agreement embeds infrastructure investment settings that are sustainable, well targeted and aligned to market capacity. 

The development of the agreement has been informed by the Halton Review into the current partnership agreement, the Independent Review of the Infrastructure Investment Program, and the Infrastructure Policy Statement which I released last November to guide the way we invest in transport infrastructure.

As part of the FFA negotiations, we have been looking at opportunities to deliver wider social, economic and environmental benefits through our collective infrastructure investment. 

This includes supporting opportunities for Australian industries and businesses, advancing skills development and workforce diversity, enhancing reporting requirements and enhancing the productivity and culture of the construction industry.

Of course, a part of improving the culture of your industry is about getting more women involved.

I can’t stress enough that in a time of workplace shortages, to have only 13% of your workforce being women can only ever hold your back.

There are a lot of good jobs in your industry – it is an exciting place to work and there is no reason there should not be more women filling those roles.

Reducing workplace injuries, mental illness, long work hours, and improving diversity would all significantly improve productivity. 

I commend the Australian Constructors Association for realising that, and for acting yourselves to address it.

Initiatives such as the Construction Industry Culture Taskforce hold great potential to uplift this entire industry. I look forward to seeing how that work progresses, and your sector changes, over the years to come.

And before I finish, I also must touch on the recent revelations regarding the CFMEU.

I am a supporter of unions, I have been a member of a union since I was 17 when I had my first job at Priceline at Gladstone in Victoria.

Like you, I know the important role that unions play in securing fair pay for their workers and in maintaining high safety standards.

Nowhere is that more important than your industry.

But we, as a government, have zero tolerance for the behaviour that has been seen recently in your industry and have taken the strongest action possible to eliminate it through appointing independent administrators.  

As a government, we are supporting the General Manager of the Fair Work Commission to appoint independent administrators to the Construction Division of the CFMEU.

We have requested the Fair Work Ombudsman undertake a targeted review of all enterprise agreements made by the Victorian branch of the construction division of the CFMEU that apply to Victorian “Big Build” projects.

The government will also use its procurement powers to ensure that enterprise agreements used on government funded projects are genuinely agreed and that workplaces are free from coercion and intimidation.

The Minister has also written to the AFP Commissioner requesting that the AFP investigate the recent allegations and work cooperatively with state police to investigate and prosecute any criminal breaches.

As the Minister for Infrastructure, I have also asked my department to provide advice to me on any issues relevant to projects where the Commonwealth, through its business enterprises, has a direct funding and contracting role, for example Western Sydney International Airport or Inland Rail.

I am writing, along with Minister Gallagher, to the Board Chairs of the various GBEs to seek assurance that taxpayer funds are administered appropriately and outlining my expectation that any allegations of untoward behaviour is raised with my office immediately.

I have also worked to embed refreshed and strengthened clauses in the new Federation Funding Agreement on Land Transport Infrastructure which is currently under negotiation between the Commonwealth and the states and territories.

This will embed the expectations of best use of tax payer funds to promote better accountability and minimise cost overruns. It will also provide greater clarity of compliance with workplace relations legislation and ensure that any allegations or instances of criminal behaviour or correction are reviewed and reported to the appropriate regulator.

This is our government doing our bit to stamp out this behaviour, but you all have a role to play as well.

These behaviours don’t occur in a vacuum. They happen on building sites across the country. It is up to everyone involved in the sector to reject these behaviours and to call them out, and you have the government’s support in doing that. 

Conclusion

Through these actions, and through the reforms I mentioned earlier, we can build a stronger, more productive construction industry that delivers better outcomes for the public and for workers.