Melbourne to Brisbane Inland Rail Symposium - Parkes, NSW
22nd June, 2012
Cr Ray Donald, President of the Shires Association, Cr Ken Keith, Mayor of the Shire of Parkes, my parliamentary colleagues Darren Chester, John Cobb and Mark Coulton, Councillors, ladies and gentlemen.Thank you for the opportunity to speak to your Symposium today on the Inland Rail project.
The project is one of the most important long-term projects for Australia and close to the hearts of many in this room. Myself included.
Done right, it will improve the capacity, reliability and productivity of the highest growth freight corridor in Australia.
But it will also provide great new opportunities for communities dotted along and around its path.
That is a very exciting prospect for us all.
Done wrong or too slow and it could be another white elephant.
None of us - not affected communities, the farmers and mineral resource projects across the relevant regions, not the businesses that are waiting to use it, the investors or the regional and national economies - can afford for this to fail.
History of rail in Australia
The rollout and development of our freight rail network in Australia has been spasmodic and completed in an ad hoc piecemeal way.
That's not anyone's fault. Not even Labor's.
It is a product of the economic and engineering capabilities of the nation at the time and the freight and passenger movement priorities of the era.
As you will all be well aware, much of the rail network we have today was originally built by individual colonial governments in the mid-1800s to connect inland populations with the capital cities and seaports.
At that time the thought of connecting the nation wasn't even a consideration, so we ended up with three different major rail gauges in different parts of the country.
In 1917, anyone wanting to travel from Perth to Brisbane had to change trains six times as the track gauge chopped and changed at each interval.
Remarkably, it wasn't until 1995 that Australia had a standard gauge track between all of our mainland capitals.
Today, we operate in a global market. That reality is becoming more obvious every day.
Our ability to get our products to market, wherever that may be, is vital to our economic prosperity.
It is especially important for our exports sectors - particularly agriculture and minerals - that they can get from farms or mines to ports in the most efficient way possible to maximise our global competitiveness.
Every efficiency we can squeeze from supply chain costs and streamlining the network equates to millions in revenue for regional economies where the bulk of our national wealth originates.
The Coalition has been, and remains, a fervent supporter of the Inland Rail Project. We have from the start.
In 2006 the former Coalition Government commissioned the North-South Rail Corridor Study to examine the freight flow along the route, current choke points and the economic and social benefits of an expansion of the rail freight network.
Released in September 2006, the study found that total road and rail freight movements within the north-south corridor between Melbourne and Brisbane accounted for 22 million tonnes.
At that time, freight flows in most markets within the north-south corridor were expected to double over the next 25 years.
Those forecasts are now expected to be exceeded.
Rail can be very competitive with road on the Melbourne and Brisbane corridor, and enjoyed an estimated 30% of market share at that time. This is unsurprising when you consider the advantages rail gains when carrying goods over a vast distance.
The 2006 study forecast that rail's share of Melbourne-Brisbane freight market would more than double from 30% to 67% by 2029 with an upgraded coastal sub-corridor and inland rail corridor.
In 2007 we took the next step, commissioning a scoping study for the project. With the election of federal Labor in 2007 the study was shelved for two years.
It wasn't until July 2010 that the Melbourne-Brisbane Inland Rail Alignment study was delivered.
And since then, there has not been any expenditure on the Inland Rail project and nothing seems to be planned over the next four years.
Remember the more than $50 billion Labor splashed out during the global economic downturn?
Where are the long-term productivity gains? Why wasn't this an opportunity to fast-track the Inland Rail project?
That sort of forward thinking, projecting down the line wasn't just late, it never left the station.
Labor now says it will commit $300 million from its Nation Building 2 Program to the Inland Rail, but it doesn't start until 1 July 2014. And I will not even get into the issue of whether the states will have to pay 50%.
This money will trickle out between 2014 and 2018.
That means the vast majority of the funding for the project will not come online until 2019-20 at the very earliest.
I remind you of the fact that the total project cost for the Inland Rail, as of the 2010 study, was estimated at $4.7 billion.
The $300 million on offer is peanuts.
Clearly, the government's commitment to build this nation building project is shaky at best.
The Government's Rail Alignment study concludes that that:
"... it would be appropriate to re-examine the [Inland Rail] project between 2015 and 2020."
But the study notes that decisions need to be made now to preserve and protect the preferred route.
That preferred route, which you all would know, runs from Melbourne to Brisbane through Albury, Junee, Parkes, Moree, Toowoomba and on into Brisbane.
But, as I understand it, the final route is still yet to be determined by the Government.
There are still vacillating arguments whether the route should go through Albury or Shepparton. The government has had five years to consider those pros and cons... for goodness sake make a decision.
There is still agonising about the alignment as the track approaches Brisbane. And remember half of the total projected cosy of this project is the last hundred or so kilometres into Brisbane.
The Department has said that "a decision on the final alignment will not be made until after 2014-15."
So, to recap... the corridor isn't confirmed, let alone reserved, the alignment won't be decided for another 2-3 years, and most of the funding will not flow until 2016-17 (at the earliest).
Today, I pledge that an incoming Coalition government will pick up the pieces and make decisions to get the project back on track and moving.
I want this completed and up and running sooner, not later.
The line needs to be in place in time to meet the rising demand - not years after other parts of the rail system are clogged.
When last in Government the Coalition clearly showed its commitment to the project and sent a strong signal to investors that the Coalition was fair dinkum about overcoming the looming transport crisis.
The private sector responded and was excited, so too were local communities... all have been left hanging, stranded in limbo.
Importance to the freight network
Latest estimates have our national freight task doubling by 2020 - trebling along the eastern seaboard over the same period.
This means our freight task is growing and gaining pace faster than anticipated in 2006.
Historically rail hasn't fared well over shorter interstate routes, like Melbourne to Sydney and Sydney to Brisbane, due to costs and reliability issues.
In 2006 we found that the on-time reliability of rail was around 40-45% along the corridor, compared to 95-98% for road transport.
It is true that the completion of the Northern and Southern Sydney Freight Lines will significantly impact the ability to move freight in and out of Sydney, which is the choke point on our freight network.
However, that shouldn't be the end of our investment in the interstate freight rail network.
As you know, the Inland Rail project can cut the time it takes to move freight from Melbourne to Brisbane from over 33 hours to less than a day.
The Albury route is 173 kilometres shorter than the coastal line.
This will dramatically improve the reliability and capacity of the network and turbo-charge rail as a competitive transport option compared to roads.
It is no secret that if we don't make a significant investment in our rail network and have more of our freight carried by rail, we won't have just double the number of trucks on the road but tripled or quadrupled them.
Our roads are already congested... imagine the state of travelling, timelines, and productivity if we don't get this right.
Without a greater share of the freight task being carried by rail, as well as coastal shipping, our existing freight and transport system will grind to a halt, productivity and economic growth will decline and congestion will be unbearable.
Australia is overdue for a sweeping strategic overhaul of infrastructure. Linking efficient road and rail networks to dramatically upgraded metropolitan and regional ports, and building on social infrastructure, is essential.
The government's announcement of the National Freight Strategy and the National Ports Strategy is welcomed, but they have done little to improve on an infrastructure network that is disjointed, perpetuates existing inefficiencies and only compounds freight load problems into the future.
The objectives of these strategic documents remain unfulfilled. They need to be more than just words on paper.
Effective and efficient transport infrastructure - where road, rail and ports mesh together, rather than a set of separate, disparate projects - are needed to deal with heightened demand over the next 20 years - both domestically and globally... let alone the next 40 years.
Global population is expected to exceed 9 billion people by 2050. In Australia, we're tipped to top 36 million.
That's a lot of mouths to feed, not to mention a lot of people on roads.
The United Nations estimates that to keep pace with global population growth, agricultural production must increase by an unprecedented 70% over the next 40 years.
To put that into perspective, food production over the next four decades has to exceed all the food that has been produced over the entire course of human history.
It is mind-boggling to comprehend. But comprehend it we must.
Our famers are renowned as among the best - if not 'the' best - on Earth. They are gearing up to do their share in meeting this monumental food task.
But they must be backed up with a freight network capable of not only moving a phenomenal amount of food, but be able to do so quickly and efficiently to maximise food freshness and keep costs down.
Governments are required to do more than just make funding announcements to claim hollow credit. We need a clearly defined National Infrastructure Strategy to be laid out and an action plan.
That is why Infrastructure Australia was created, but it too has languished as Labor fiddles. It has not been consulted before any of the government spending decisions were announced.
Again, this is more than just dollars - and far more than typical ad hoc spending on an electorate-by-electorate basis to which we have become accustomed.
With our cities choking on congestion, opening up and expanding the capacity of regional rail and ports for export growth is overdue.
This demands a commitment to a long-term plan, inter-connecting regional roads with national highways, new rail networks - including the Inland Rail - and upgrading port facilities (in cities and regions) to not only cope with increasing volumes but generate greatly improved efficiency.
That is why the Coalition is committed to a 15-year rolling infrastructure plan, to be updated every five years, to better plan, fund and deliver the infrastructure this country needs to grow and prosper.
And I say to you that regional Australia, and the communities and districts along the Inland Rail route, will be key contributors to that growth and in the vanguard of that prosperity.
To do anything less would be to deny this and future generations their birth-right to a proud, optimistic and ambitious Australia that says we're up for the challenge and ready to go full steam ahead.
Throughout this country's history, the transport network has evolved to account for changes in demands, trends in industries and changes in transport technology.
Agriculture has been a pivotal driver of this evolution, developing ports - and the roads and rail to them - focused on the movement of produce.
Manufacturing and mining followed using the same infrastructure.
Infrastructure investment on corridors, modes and specific projects of the past are now often antiquated.
Timely and efficient delivery of agricultural produce, in addition to the greater volumes required, need to be planned for now.
Farmers are responding to changes in market demands. These trends need to be considered and accounted for as part of a modern investment in infrastructure.
For example, Australia's port facilities are being focussed more and more on bulk minerals and container imports.
They must be flexible in their operations to allow new agricultural industries to develop, and support growth in existing industries.
The transport sector is one of Australia's major greenhouse gas contributors, and opportunities to increase the efficiency of transport through improved infrastructure and an increased reliance on rail freight transport provides an opportunity to reduce emissions - and also to reduce the impact of energy price rises.
However, as you may be aware, the carbon tax will hit rail and shipping services from day one but won't impact on the trucking industry until 1 July 2014.
The carbon tax will cost the rail industry in excess of $100 million in its first year of operation... and it chugs along, getting higher and higher each year thereafter.
This cost will be passed directly on to local communities and to our industries and exporters. It will make it harder for Australian products to compete on world markets because none of our competitors will have to bear this cost.
It will cost local jobs and add distress to struggling local communities.
What is more, it will add hundreds of millions of dollars to the cost of building the Inland Rail.
A Coalition Government will repeal the carbon tax and, in doing so, will remove this disincentive for rail.
Australia has reached a critical point in its history and a reactive approach to infrastructure investment is not an option.
We need a holistic approach, of which the inland rail project is a vital component.
This is one train line that simply must to arrive on time.
Inland Rail: important to regional Australia
The importance of this Inland Rail project to regional Australia must not be underestimated.
Unsurprisingly, the project has been met with great enthusiasm by farm groups, rural communities, businesses and local councils dotted along the proposed corridor, many of whom are represented here today.
The Inland Rail will inevitably lead to the creation or expansion of regional freight hubs for grain and other agricultural products, as well as minerals and other bulk commodities.
It will provide new options for processing and manufacturing away from capital cities.
The project is an investment in local jobs in our regions. But it is also an investment in future regional and national growth and prosperity.
If you will, a new golden corridor through which to drive and re-energise inland NSW, Queensland and Victoria.
The time has come to seriously address Australia's population squeeze and pull the policy levers that can re-energize and build the under-developed 97% of this country that is regional.
It's an investment that can also be a tonic for Australia's city ills -unclogging our cities already bursting under a national population of just 22 million people.
With much of Australia's real wealth generated in the regions, The Nationals argue it is only fitting that a fair share of the revenue they create should be returned to the regions.
But it's more than that. We recognise the role regional areas can, and must, play in overcoming Australia's national challenges.
Australia's population is already the most densely packed in the OECD.
In fact, it's almost double the OECD average, with 88% of our people crammed into around 3% of the landmass - that's Sydney and Newcastle, Melbourne, Brisbane and Queensland's south east, Adelaide and Perth.
In Australia today we need to be bolder and realise that ignoring regional Australia is no longer an option this country can afford.
We must refocus population growth and spur commercial opportunities in the regions.
It's time to seriously invest in nation-building, including redeploying human capital, to develop and populate inland Australia; ensure regional businesses can achieve their full productive capacity and provide more Australians with better opportunities and higher living standards.
Conclusion
Finally, I want to say that whenever we talk about infrastructure we always do so in the context of costs... hardly ever in terms of opportunities.
Productivity gains are the difference between winning and losing in the ever-changing domestic and global marketplace.
So when I look at infrastructure needs across Australia I see opportunities, as well as the costs of not getting on with genuine nation-building to take us into the next 20 years of meeting bourgeoning demand.
If we get it right, our miners will continue to mine and process resources for the world. Our farmers will continue to produce food and fibre for an ever-hungrier world.
And Australians will continue to have ready access to the products they want from around the world.
We have to ensure that our infrastructure is geared to meet those growing demands and that our communities can share in that growth.
Only with a well-developed and efficient infrastructure can our nation achieve its full potential.
I understand its importance, not only for regional Australia but for our nation.
The Inland Rail project is essential and it's time we got on and built it.
Once again, I thank you for the opportunity to speak to you today.
[ENDS]
