What the Federal Budget means for Australia’s infrastructure?

The 2017 Federal Budget has delivered a substantial investment in infrastructure, with the Government committing to $75 billion in funding for critical airport, road, and rail infrastructure projects.

The Government will also provide additional funding of $12 million over four years to Infrastructure Australia to support its future work program.

In a statement, Minister for Infrastructure and Transport Darren Chester said, “These investments will deliver an important economic boost, creating tens of thousands of new jobs during construction.

“On completion these projects will lift national productivity and drive economic growth.”

The rail sector big budget winners

A key investment in the 2017–18 Budget is a $20 billion commitment to upgrade Australia’s passenger and freight rail, which is critical to connect people to jobs, and services and goods to markets.

The Australian Government will invest $10 billion over the next decade for the National Rail Program, which will fund transformational rail projects within cities, as well as better connections between cities and regional centres.

This investment is aimed to reduce the burden on Australian roads, provide more reliable transport networks, and support the Government’s efforts to decentralise the economy and grow regional Australia.

The Australasian Railway Association (ARA) Chief Executive Danny Broad welcomed the announcement.

“The Government’s renewed commitment to rail, including through its $10 billion National Rail Program for urban and regional passenger rail, underscores its importance to Australia and is welcomed by the rail industry,” Mr Broad said.

An additional $30 million will also be provided to fund the development of a business case for the Melbourne Airport Rail Link. The Federal Government will work with the Victorian Government to access potential further funding for this project from the $10 billion National Rail Program.

Investment in Inland Rail

The Coalition Government is also providing an additional $8.4 billion in equity to deliver the Inland Rail project.

Inland Rail, the Commonwealth’s biggest rail project in 100 years, will provide a dedicated high-capacity rail freight link between Melbourne and Brisbane, to strengthen freight connections and with the aim getting freight off roads and onto rail.

The Coalition Government will deliver Inland Rail through the Australian Rail Track Corporation (ARTC) using a combination of Government equity and a Public Private Partnership for the Toowoomba to Kagaru tunnel section.

“The $8.4 billion announced by the Government today provides renewed confidence to all parts of the rail industry this project will be delivered,” Mr Broad said.

“Linking Victoria and regional NSW with Queensland will help get freight off the road and onto rail, address rising congestion in Sydney, and will deliver thousands of jobs; many in regional Australia.

“This project will deliver a strong economic contribution to the nation and will enhance productivity and increase consumer freight options.”

Regional rail sector investments

The Budget also includes over $1 billion for new and upgraded infrastructure in Victoria, utilising funding previously allocated to the Asset Recycling Initiative, despite the Victorian Government failing to meet the agreed requirements of the National Partnership Agreement on Asset Recycling.

Victoria will receive $500 million to build a better regional rail network with improvements to the North-East Line, the Gippsland Line and the Geelong Line, as well as a study into improving the Shepparton Line.

Victoria will also receive an additional $20.2 million for Murray Basin Rail, taking the Government’s total commitment to this project to $240 million. A further $460 million is available for Victorian infrastructure projects, which will be negotiated between the Australian and Victorian governments.

Major focus on WA infrastructure

The Government is investing $1.6 billion towards a $2.3 billion road and rail infrastructure package in Western Australia.

The Government’s record $10 billion investment in rail is in addition to $792 million for Perth Metronet.

$1.2 billion, including up to $792 million of Federal Government funding, will be allocated towards the METRONET and related projects, subject to a positive assessment by Infrastructure Australia.

Of the $760 million committed for road infrastructure, the Armadale Road/North Lake Road (Kwinana Freeway) project will receive $189.6 million, and the Leach Highway (Carrington Street to Stirling Highway) project will receive $73.6 million.

Funding Australia’s roads

In regard to road funding, strong gains continue to be made on the transformative Bruce Highway Upgrade Program with $844 million in program savings enabling new projects to be agreed with the Queensland government.

The Commonwealth will accelerate construction on the Pine River to Caloundra, and Deception Bay Interchange sections as well as additional safety works, including the upgrade of the Wide Bay Highway intersection.

The Australian Government will also provide $44.2 million towards regional road projects to improve regional road safety across Western Australia.

The Australian Government is continuing to fund the Black Spot Programme with $684.5 million from 2013–14 to 2020–21 so it can continue to deliver safety improvements, such as safety barriers and street lighting to sections of dangerous road that have a crash history.

Commitment to the Roads to Recovery Programme has also been maintained with $4.4 billion from 2013–14 to 2020–21 for the construction, repair and upgrade of local roads.

Government commits to Western Sydney Airport

The Federal Government has committed to the delivery of the Western Sydney Airport at Badgerys Creek, to be operational by 2026, saying the airport is vital to deliver new aviation capacity for Sydney and the nation.

It aims to provide better access to air travel for two million people who will be closer to Western Sydney Airport than Kingsford Smith Airport.

To ensure the airport is operational by 2026, the Government will establish a new Government-owned company.

The company, to be established in the 2017–18 Financial Year, will have board and management with strong private sector expertise, and will issue tenders for early works before the end of 2017.

The Government will commit up to $5.3 billion of equity to this company, to be invested over 10 years in line with the construction schedule.

The new airport is a significant investment for Western Sydney and will deliver net long-term benefits to the Australian economy, returning $1.80 for every dollar invested.

The Government is also boosting resources to the ATSB, providing an additional $12 million over five years, to continue to improve aviation safety and education.

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