$5 billion NAIF to undergo fourth review in three years

The Federal Government’s key funding agency for development in Northern Australia is set to undergo its fourth review in three years.

THE Federal Government’s key funding agency for development in Northern Australia is set to undergo its fourth review in three years.

The Northern Australia Infrastructure Facility has repeatedly come under fire for being inflexible and limiting since its launch in 2016.

It has been subject to an independent review, a Senate inquiry, and an Australian National Audit Office review.

Northern Australia and Resources Minister Matt Canavan announced the statutory review yesterday, stating it would ensure the loan program can “continue to support development and jobs”.

“The NAIF has so far committed to $1.4 billion in investment decisions and condi-tional approvals, supporting projects across northern Australia, which are forecast to create more than 4000 jobs,” he said.

Under NAIF’s rules, a statutory review must be undertaken every three years, with the first one due as soon as possible after July 1 this year and consider the June 30, 2021 deadline for investment decisions and the benefit of extending it.

The Townsville Bulletin in September revealed less than 0.8 per cent of the NAIF’s $5 billion purse had been spent.

Opposition Northern Australia spokesman Senator Murray Watt seized on the announcement, saying Labor had consistently called for changes to the NAIF.

“As Minister for Northern Australia, Matt Canavan has had one job – to get the NAIF working,” he said.

“Today’s announcement is an embarrassing admission that he has failed to do his job.”

In April last year the Federal Government announced a suite of changes to NAIF following an independent expert review by Tony Shepherd.

The changes include removal of the 50 per cent cap on loans so NAIF is able to cover all of a project’s debt, expanding the definition of eligible infrastructure and establishing regional development hubs to support projects in the latter stages of financing.

So far $1.25 billion of the NAIF’s available $5 billion has been approved for 12 projects, including up to $98 million for James Cook University’s new Technology Innovation Complex and up to $50 million for the Townsville Airport redevelopment.

The $610 million NAIF loan approved for Genex Power’s Kidston Hydro Project is under doubt after the proponent announced it would not be able to reach financial close before the loan agreement lapses at the end of the year.

Members of the public, community organisations and interested stakeholders are invited to make public submissions to inform the statutory review by December 13.

Originally published as $5 billion NAIF to undergo fourth review in three years