Budget 2015: Builders fired up by pledge on ports, rail and power

For those who travel on crowded highways, this is crunch time for Tony ­Abbott’s pledge to be an “infrastructure PM”.

Fed Budget - Infra

From the perspective of Australians who travel on crowded highways and train lines, as well as the people who build them, this is crunch time for Tony ­Abbott’s pre-election pledge to be an “infrastructure prime minister”.

Halfway through its first term, the government’s second budget contained some welcome sweeteners for those who see infrastructure building as key to boosting employment levels and mitigating some of the effects of the mining slowdown.

Peter Ryan, managing director of South African construction giant WBHO’s Australian operations, said the announcement of a $5 billion fund for new ports, rail and power projects across northern Australia represented a sound long-term strategy which would be particularly beneficial for infrastructure builders now struggling in Western Australia and Queensland.

He said moves to upgrade the country’s rail lines to take more freight off choked highways would be particularly welcome. “If that’s commenced during the government’s current term, that will be fantastic,” he said. “I’m really glad they’ve struck a bit of diversity in their strategy.”

The civil engineer said he was concerned by Treasurer Joe Hockey’s strong focus on small business, warning tax breaks worth up to $20,000 would not have the same effect on job creation as investment in major infrastructure works.

“The focus in Mr Hockey’s speech on the sole proprietor, the local cafe or the tradie lost me a ­little bit,” Mr Ryan said. “That doesn’t create a long-term economy, that gives people survival.

“A half a billion dollar project would employ 10,000 people. This is where jobs will be generated.”

WBHO has been investing in the Australian building industry through acquisitions since 2001, and is now planning to merge its operations into one entity which will shift focus from high-rise construction and retail to telecommunications, defence, roads, bridges and ports. Mr Ryan, who previously worked as general manager for Leighton Contractors, said the firm expected to have a turnover of more than $1 billion by 2020.

He said while the budget’s infrastructure spending appeared strong, it could have been more evenly spread. “There was very little said about Victoria,” he said. “There is not enough infrastructure work in Victoria to maintain the competitive environment, and that will put pressure on the contracting fraternity.

“In the last budget, there was about 14 pages just on NSW and two on Victoria. Twelve months down the track, you have NSW producing very good economic confidence.”