Federal budget: Fears regional works will be scrapped

A review into the nation’s 738 already-approved infrastructure projects has raised fears that many regional, rural and remote works will be scuttled.

Billions of dollars’ worth of infrastructure projects slated for regional, rural and remote Australia face being cut, delayed or scaled back amid accusations that successive Coalition governments left the budget full of “press release projects”.

The federal government announced on May 1 that an independent panel will review the nation’s 10-year infrastructure pipeline after the number of approved projects increased from under 146 in 2012-13 to the current 738.

No Labor-­approved projects will be scrutinised and those not currently under way are particularly vulnerable.

Up to 100 Victorian road and rail upgrades, with an attached federal funding allocation of $7 billion, remain in various stages of planning.

While the Infrastructure Investment Program’s funding envelope will remain at $120 billion, Infrastructure Minister Catherine King said Labor will now only fund projects that are “genuinely nation-building, economically sustainable and resilient to our changing climate”.

However, the Nationals labelled the panel “a razor gang” established to save money in the federal budget and could cut coalition-approved rural road and rail projects, such as the Shepparton bypass and the upgrades to the Great Alpine Road and Princes Highway east and west.

Federal Transport Minister Catherine King visits a Cross River Rail project site in Brisbane. Picture: NCA Newswire/Dan Peled

Ms King said, while no target or estimate had been set for how many projects were to be cut, reducing the number on a “proper cost benefit analysis” would ease supply chain and workforce pressures and help reduce inflation.

“Communities will benefit from national significant infrastructure with shorter and safer travel, more liveable cities, suburbs and regions, while the economy benefits from the certainty brought by a smoother delivery of investment matched to project timelines,” she said.

Infrastructure Australia estimates that as of May 2023, there is a shortfall of about 95,000 workers on public infrastructure projects across the country.

Since 2020, the cost of construction raw materials has also increased considerably.

Of the 738 projects under the microscope, 497 are worth between $25 million and $50m, 391 worth between $5m and $25m and 162 worth $5m or less; the latter includes funding for initiatives such as traffic lights and culverts.

Ms King alleged that the Liberals and Nationals “didn’t use the IIP to invest in nationally significant infrastructure, they used it as a massive electoral pork barrel fund”.

However, Nationals leader David Littleproud said the review was a “smokescreen” for the government to reduce infrastructure spending through regional Australia.

He said while projects such as the $30 billion Inland Rail Project and the controversial $2.2b Victorian Government Suburban Rail Loop will remain safe, he fears much-needed upgrades for rural roads were clearly under threat.

“In regional Australia, we lost $23 billion in the (October) budget and they are coming back for regional Australia again,” he said.

Nationals leader David Littleproud speaks to the media during morning press conferences in Parliament House in Canberra. Picture: NCA NewsWire/Gary Ramage

“And just so everyone understands, everyone will pay because you might wipe the sweat off the brow, living in a capital city going, ‘that’s good because we’ll get all our urban infrastructure’.

“But if the road and rail infrastructure isn’t right to get product from a paddock to your plate or onto a ship, then the bills aren’t paid and your cost of living goes up.”

Federal Member for Gippsland Darren Chester believes regional road safety, transport infrastructure, local governments and bushfire recovery projects should be quarantined from scrutiny.

He also said the review was “an ominous sign” for several local projects yet to start construction.

“Minister Catherine King has failed to respond to any of my letters since June last year requesting consideration for critical road safety projects like upgrading the Great Alpine Road and further stages of Princes Highway improvements, which were already part of the previous government’s budgets,” Mr Chester said.

“Too many people are killed and injured on substandard regional roads.”

Meanwhile, Federal Member for Nicholls Sam Birrell fears the review has opened the door to de-fund the Shepparton bypass, despite last October’s floods proving the need for a second river crossing.

A spokeswoman for Ms King said “improving the lives of regional Australians and improving transport infrastructure within and between our regional communities is of national significance”.

“We are focused on delivering our election commitments to regional Australia, such as upgrades to freight highways in South Australia and upgrading the Bruce Highway,” she said.

The 90-day review will begin soon and report about August.

Meanwhile, the situation will be compounded if Treasurer Jim Chalmers cuts the $3.25 billion Local Roads and Community Infrastructure program in next week’s budget, as increased defence and aged-care priorities place greater strain on government spending.