Transcript - Royal Institution of Chartered Surveyors (RICS) Building Confidence Conference
**check against delivery**
It is a pleasure to be addressing this ‘virtual’ gathering.
The focus of today’s conference is on the delivery of major construction and infrastructure projects, and for my part, how infrastructure can be a policy lever that creates aggregate demand at a time when our economy needs it.
I thank the Royal Institution of Chartered Surveyors for hosting this timely event.
It comes a month after the Treasurer delivered the seventh Budget of a Coalition Government.
It was a budget which increased our funding commitments for transport infrastructure to a new record of $110 billion over ten years.
Of course, the very idea of a ten-year horizon for Commonwealth infrastructure investments does, in and of itself, help with forward planning for a variety of industry sectors.
A 10-year rolling pipeline of Commonwealth projects – a concept introduced by the Coalition Government – is now well accepted in Canberra.
The City Deal concept is another Coalition initiative, through which we provide long-term certainty for commercial decision makers. In turn, City Deal commitments also help populate our ten-year pipeline of projects.
Certainty in our policy settings is the optimal approach across all of my portfolio responsibilities, as Minister for Population, Cities and Urban Infrastructure.
At least, in a normal year, but 2020 is anything but normal for population policy.
As the Prime Minister said in early March: ‘Whatever you thought 2020 was going to be about. Think again’.
We are facing some important challenges ahead with our migration and population forecasts.
A significant reduction in migration
While necessary, border closures have had a significant impact on the Australia’s migration outlook.
Australia’s population growth is expected to slow to its lowest rate in over a hundred years.
The budget assumes population growth of around 0.2 per cent in this financial year and 0.4 per cent in 2021-22.
Over time, migration has made a substantial contribution to Australia’s prosperity and the current reduction will adversely impact economic growth.
To counterbalance these and other effects of the pandemic, our budget strategy is squarely focused on supporting jobs and growth.
As the Minister for Population, Cities and Urban Infrastructure, and as the Acting Minister for Immigration, I have responsibility for putting both our population and infrastructure strategies into action.
Economic fundamentals and the economic fightback
The RBA has confirmed that Australia’s economic recovery is well underway and upgraded their forecasts for Australia’s economic growth and for our labour market.
Recent employment data shows our economy is continuing to recover from the global pandemic, with the Australian economy adding 178,800 jobs in October, exceeding all market expectations.
Since the onset of the COVID-19 pandemic, the Government has provided $257 billion in direct economic support to cushion the blow and strengthen the recovery.
The 2020-21 Budget commits a further $98 billion including, $25 billion in direct COVID-19 response measures and $74 billion in new measures to create jobs.
Under our plan, the economy is forecast to grow by 4¼ per cent next calendar year and unemployment is expected to fall to 6½ per cent by the June quarter 2022.
Without the Government’s economic support, the unemployment rate would have risen, and remained, above 12 per cent throughout 2020-21 and 2021-22.
Our plan will grow the economy and create jobs.
And one way we will do this is by investing more in infrastructure to help create these jobs.
Infrastructure investment continuing during COVID-19
This conference is titled the Building Confidence Conference.
And this is precisely what the Morrison Government is doing.
What Treasury says is that we need to boost aggregate demand in our economy – and one way we can do that is through building the infrastructure we need for the future.
COVID-19 has not slowed down our work on achieving major projects. Since March, we have seen the completion of major projects, part-funded by the Commonwealth, in most states:
- Northlink WA – the biggest road infrastructure project in WA’s history – was opened in April.
- The M1/M3 Merge at Eight Mile Plains in Queensland was completed, also in April.
- The M8 in New South Wales, part of the $16.8 billion WestConnex project, was opened to traffic in July; and
- The Darlington upgrade of South Australia’s North-South corridor was also completed in July.
- We also saw the start of Stage 2 of the Monash Freeway Upgrade in Victoria, in March.
Importantly, late last month, I was pleased to join with the NSW Premier to officially open the NorthConnex project – a gamechanger for NSW: reducing travel times by up to 15 minutes and allowing drivers to avoid 21 sets of traffic lights along Pennant Hills Road. More than 17,000 jobs were supported by this project since construction first began.
On Saturday, the Australian and Victorian Governments announced the long-awaited Melbourne Airport Rail Link – a gamechanger for Victoria, and a project that has eluded successive governments for decades. We are getting it done.
It will mean that from 2029, Victorians will be able to catch a train directly from the CBD to the airport.
The airport link is a nationally significant project and Victorians have been waiting a long time for it to become a reality. It will support up to 8,000 jobs during construction, and, when complete, it will slash travel times, bust congestion and be a major boost to the economy.
Also on Saturday, the Australian and Victorian Governments announced the Geelong Fast Rail project – another boon for infrastructure in my home state.
Construction of Geelong Fast Rail is expected to be underway from 2023, subject to relevant planning, environmental and government approvals. It will support over 2,800 jobs during construction.
It will deliver a major boost for the city of Geelong, where the population is expected to grow by almost 50 per cent in the next 30 years.
These are just some examples of our ongoing pipeline of road and infrastructure projects, which will deliver improvements to the lives of ordinary Australians.
New Budget measures
The 2020-21 Budget brings our transport infrastructure investment program over the next ten years to a record $110 billion.
These investments will support local jobs and businesses at the time it is needed most. Over the life of these JobMaker investments we will see an additional estimated 30,000 direct and indirect jobs injected into the economy.
We are driving the delivery of major infrastructure projects as we map the economic road back from the pandemic.
Every State and Territory will see new funding for critical transport infrastructure projects – these include:
- $750 million for Stage 1 of the Coomera Connector in Queensland
- $528 million towards upgrades to the Shepparton and Warrnambool rail lines in Victoria
- $136 million to progress Stage 2 of the Main South Road Duplication in South Australia.
We are also providing significant additional funding to priority projects across Australia, including:
- an additional $491 million for the Coffs Harbour Bypass in New South Wales, bringing our investment to $1.46 billion
- an additional $80 million for the Wheatbelt Secondary Freight Network in Western Australia, bringing our investment to $150 million.
We will stimulate local economies through an additional $1 billion for local governments nationwide under the Local Roads and Community Infrastructure Program.
We are also providing $2 billion for a new Road Safety Program, as part of our commitment to delivering safe roads for all users.
This additional investment builds on the $500 million we are already delivering for Targeted Road Safety Works.
Our cities agenda has established the use of City Deals as a way to deliver opportunities around Australia for building stronger, better, and more liveable cities.
Across the nation, City Deals are leveraging $16.8 billion in commitments, including more than $8 billion from the Australian Government, through a partnership approach with state, territory and local governments.
In the lead up to this year’s Budget, we announced funding for some major City Deal commitments.
Just last month we launched a new $1.5 billion dollar City Deal between the Commonwealth and Western Australian governments and the City of Perth.
This will bring government and private investment into the Perth CBD, creating almost 10,000 jobs.
The Perth City Deal will include the creation of the State’s first inner-city university campus, with more than 9,200 staff and students. As well as upgrades to the WACA, the Perth Concert Hall and cycling and walking infrastructure.
We also increased our funding commitment to the Sydney Metro – Western Sydney Airport rail link, which is a centrepiece of the Western Sydney City Deal.
The new 23km metro railway will become the transport spine for Western Sydney, by connecting from St Marys to the Western Sydney Aerotropolis via the Western Sydney International (Nancy-Bird Walton) Airport.
We are contributing $5.25 billion, the largest ever investment by an Australian Government in a public transport project. 5.8km of extra tunnelling has been designed for the new line, with six stations proposed for stage one.
Early construction work is scheduled for later this year to meet our objective of having rail connected to Western Sydney International Airport in time for the airport opening.
There’s 70 commitments under the Western Sydney City Deal that will transform the region and along with the airport create 200,000 jobs for locals.
All up, eight City Deals have been agreed to date. They are a genuine partnership between the three levels of government and the community, with deals now operating in all states and the Northern Territory.
This was a Budget which sets out our Economic Recovery Plan for Australia, taking into account the particular challenges and opportunities of the current pandemic.
Among the challenges is that Australia’s population growth is expected to slow to its lowest rate in over a hundred years.
Among the opportunities is a record level of funding for transport, road and rail infrastructure to generate aggregate demand and create jobs.
Our approach is squarely focused on supporting jobs and growth. This means bringing forward expenditure in our ten year pipeline of transport infrastructure projects.
Taken as a whole, this Budget will set Australia up well for a post-pandemic recovery.
I’m now happy to open the forum up to questions.