PHIL DAVIES, EXECUTIVE DIRECTOR AT JACOBS, HOST: So before we open to the floor, I'd just like to thank Lorie [Agus, CEO, Melbourne Airport] for co-sponsoring this with us, but also as a big advocate for High Speed Rail, I've got to - I'm going to ask you one question and then open to the floor. I was proud to lead the team back in 2013 that, along with Jacobs, actually did the comprehensive study for the now Prime Minister. I know Tim Parker's used that as the basis for the great work that the High Speed Rail Authority has been doing. Most people probably outside of New South Wales, are not hearing so much about it. What? What's your vision for High Speed Rail?  

MINISTER FOR INFRASTRUCTURE, TRANSPORT, REGIONAL DEVELOPMENT AND LOCAL GOVERNMENT CATHERINE KING: So I think the first thing I'd say about what's the big difference about the approach we've taken this time is High Speed Rail has been on the agenda for a long period of time, and if we're going to turn it into not being an episode of Utopia, into reality, we have to actually learn some lessons from both overseas but also the way in which infrastructure is delivered. It's a massive project, and of course, we'd love to see High Speed Rail from Melbourne to Brisbane. That's the East Coast. But I think the challenge of the last project, it was just almost too big for people to imagine. Like, how do you do this? How do you tackle this, the biggest infrastructure project in the history of Australia? So what we concentrated on was looking at, where do we think the return is in the immediate short term, in terms of the long process of High Speed Rail? Where do we think the population growth is? Where are the economic opportunities? And really that Sydney to Newcastle section. And then looking at how you bring it beyond there, back out to WSI through Parramatta. But that's really the first bit of it. And so we've taken a very staged approach to getting the business case done, getting the right structures in both governance and the right people in place. And then now we've got the two-year development phase, which we've funded, which will literally go kilometre by kilometre along the route and actually do the detailed design work. Because what we found with frankly, Inland Rail, for example, that where we've just basically started a project without knowing where it's going to start or finish, without having the planning approvals in place -  the cost blowouts on that project have just been enormous - and it's just been really difficult to get and grapple that back into a shape where we can deliver it in a way that it actually adds to the productivity of our freight network as quickly as we can. So really, that's the approach we've taken. We will do a similar approach that you would do in your own industries. We have yet to make a final investment decision. We need all of that development phase for government to make that final investment decision. We are looking for private sector partners, both in that development phase, but beyond. I can't envisage that the Federal Government will be wanting to operate a rail line. So we are trying to look at, how does the Commonwealth sort of de-risk the opportunities for the private sector investment, and we're very serious about that. I think the rollout, if you look at Spain in particular, that's the sort of approach where they started with the bid, and then they started and were able to keep adding to their network, not necessarily the Spanish rail track or any of the trains. That's obviously part of the development phase, but if you look at the way they roll that out, so that's really what I've tried to do. You know, don't bite off too much all at once. That makes it almost unimaginable, really focusing on what is the project and how you deliver this bit of it, and then, you know, that provides the opportunity for future governments and future opportunities.

DAVIES: Great. Thank you. The question with the most votes here, folks, is linked to what the Minister said about Inland Rail. The question is - Minister, procurement for large infrastructure projects typically underestimates the final cost. Once we've committed to a project, there's no turning back. How do we get that done?

KING: So one of the things I've tried to do you might notice, well, you may not. If you're an infrastructure nerd like the Prime Minister or me, now, you'll notice one of the things I've done is really split off. I've got the infrastructure investment pipeline. It's a 10 year pipeline that when projects, you know, finish and come off. There's the 11th year that we start to put new projects on. And I'm still grappling with the long tail, frankly, of where, when we did the Infrastructure Investment Review, where there was so much announced in the pipeline, I couldn't deliver it without an additional $31 billion in the budget. And I'm still dealing with cost pressures that are partly the tail of COVID, but also, frankly, partly the product of announcements without planning and really understanding the costs of projects. So I'm still grappling with that coming through the system. So I've structured it largely in the mid year, economic financial outlook. I deal with cost pressures with the states and territories. We're really interrogating those pretty hard, and also not agreeing to a lot of them at times as well. So pushing back a bit on this notion that the money would just always flow from the Commonwealth regardless, and that, I think there's this incentive for some of the cost controls on some projects, particularly when we had previous projects at 80:20, whereas we don't do that. Now they're at 50:50. The other thing I've done is started announcing construction money, so separating that out. You'll see that on the advice I get from Infrastructure Australia, they will tell me something is ready to put planning money in, and we'll put that money up front, get that work done, get as best as we can – at the Commonwealth level and the state level – a handle on the cost of the project before we then commit to construction money. And that's really the approach I've taken. And if you think about the Infrastructure Priority List, really it's a horizon scan for me. It's like what is on the horizon in those big scale projects that I need to think about, in order to make room within the IIIP budget for the things that are going to really matter in terms of freight productivity and moving people around. So that's the reforms that I've done. But of course, that can be undone pretty quickly by the change of government. I'm hoping that's not the case for a while, a while yet. But that sort of discipline has been, I think, really important. And we're still a long tail in some of the previous projects to deal with, and so I've tried to make decisions based on better data. It may surprise people, I think I said it before, that when I came there was no advice, I just got a list. ‘Here are all of the things that have been asked for by State Governments.’ And I thought, How do I prioritise them? What ones are ready? I had no advice from, to be blunt, either my Department or Infrastructure Australia about what projects should be invested in by the Commonwealth at all. And so now that's changed. I get a very big packet of advice from Infrastructure Australia as part of the budget process, and advice from my Department about which ones are ready. And so hopefully we're making better decisions. We won't take the politics out of it entirely, that's the nature of the job and business that I'm in. But hopefully it's making better decisions based on evidence and trying to stage the projects as best we can. I think, in terms of some of the length of approvals,  with some of the changes to the EPBC Act that Senator Watt has done, I think you also see some changes in getting approvals done well.

DAVIES: As you know, we've got global government in the room, and this is a question regarding local government. You are Australia's largest owner and operator of urban infrastructure, so the question is, what's the government's plan to put councils on a more sustainable financial footing?

KING: Yeah, so a couple of things we did to start with was; the first was doubling the Roads to Recovery money that comes to local councils. That wasn't in the baseline of the budget, sorry Roads to Recovery was but the increase was not and basically what had happened, there's a lot of one off programs, so Local Roads and Community Infrastructure Program, which was a four year COVID recovery program, but it basically ended. And then Local Government, on that sort of basis, was reliant on the next budget, thinking 'the government might do another year of it, or they might not'. So what I've done in doubling Roads to Recovery, quite deliberately, I think by a billion dollars next financial year, is make sure that that's built into the baseline. So when I've got this Infrastructure Investment Pipeline, I've got the bit that is the new projects, and then I've got the bids that are just ongoing funding for ever and a day. And that's, that's what the Roads to Recovery is. And that's really, I think, important, because that hopefully provides Councils with that long term certainty on their roads budget, to actually be able to plan, not just one off budget cycles for your capital works programs. So that's the first thing that's been really important. Financial Assistance Grants are important. We, through budget cycles, make decisions about bringing them forward. I think we've got a House of Reps inquiry that we started last term, we’re yet to finish it. I'm wanting it to interrogate much more deeply what money is coming from the Federal Government to Local Government. Now, we've got Roads to Recovery, we've got Financial Assistance Grants, but there are billions of dollars that are also going for a range of other programs, both grants and in other portfolio areas. So we're trying to interrogate that a bit better. Are we going to be able to fill the gap for rate capping? No. I don't know if that's the responsibility of the Commonwealth to do that, but we're certainly conscious that we see Local Government as a really good and trusted delivery partner for things that the Commonwealth, as a jurisdiction in its own right, is very interested in delivering. So whether that's in housing, whether it's in road infrastructure, or whether it might be in skills and training, they're the sorts of things that we're looking at interrogating through the House of Reps inquiry in particular.

DAVIES: Thanks, Minister. The question here is, much like High Speed Rail, SRL is a multi stage project, what's your vision beyond SRL East, and when can we expect to work on the next stages? I'll just add a bit on, because there's another question that kind of works with that, what's your expectations around the timing for the rail link to the airport?

KING: Yeah, so in terms of SRL, the delivery is a matter for the Victorian State Government. I think the Victorian State Government will make decisions about what the phases are, but East is happening. As someone who grew up in the eastern suburbs of Melbourne, my experience of trying to get to Monash University Library with no car, when I was seventeen in my first year of university was - it was impossible! I had to wait until my parents could take me there, if at all. If I'd had a car, it would be able to drive over to do that. That sort of link between suburbs, we've always had this hub and spoke model, I think will really change transport across Melbourne, really quite substantially. I've been talking to a lot of people about the execellent economic opportunities that could happen because you've got this great, long legacy transport to come - I should say to people, please start eating something. The bread at least! I would be absolutely chewing my arm off if I was in your place, so please start. I will not be offended at all - And so I think that will be really important. But it's also if you think about if you live in Gippsland and you're trying to get your kids via public transport over to Monash Children's Hospital, you will actually allow that as well. So that's really the vision for the orbital of Melbourne. In terms of the airport, so the first thing we have to do, I mean, I would like to have it done tomorrow, but it can’t happen until you untangle those train lines around Sunshine. But that has to happen. We just can't get the spur, the spur line through, or if, even if we did, it would just mean that the way in which you get into Sunshine and then out to the airport just doesn't work. So that has to be done first, and that work has started. The second is that really, when we came to office, it was pretty much at a standstill. I think there'd been a bit of work done under the previous government around the services moving, and so early works had started, but there was a disagreement between the State Government and the airport, and we were sort of the neutral party in the middle going, 'we just wanted this thing done'. And they weren't talking to each other, really, and that was part of the part of the problem. So what we've got now is my Secretary, Lorie, Lorie's team and Victorian State Government –  Jerome also is there at the table – and they're working through all of the on-land issues at the airport itself, to try and get that done. That bit has to be finalised, and that is going really well. We'll have more to say about that as we sort of work with the Victorian government's delivery agency VIDA about what that looks like, and the cost of it overall as well. But it's progressing, is what I'd say, and it's in a much more positive space than it's ever been before. And I really look forward to, as the airport changes its own structures as well is to get that done. And I think the thing that's really been a game changer, and perhaps I shouldn't speak on behalf Lorie, but it is really just about the huge workforce that's out there. Actually being able to provide equitable transport opportunities for the workers at the airport, rail is actually the best option, and that'll probably free up parking space for other opportunities at the airport as well.

DAVIES: Okay, I think we've got time for one more. Oh we don’t! So Minister, many thanks for taking the time to speak to us today.