In his first major interview since being appointed chief executive of Infrastructure Partnerships Australia, Adrian Dwyer has taken aim at the prime minister’s controversial infrastructure funding method, and told the Coalition to do better ahead of next week’s federal budget.
Dwyer, who took over as the lobby group’s boss in March, reportedly told the Australian Financial Review the Turnbull Government should stop funding major infrastructure projects via off-budget equity investments, and should commit at least $7 billion in actual funding to infrastructure in the 2018 budget.
“What we want to see is the cranking up of funding – hard, predictable funding,” Dwyer was quoted on April 30.
“What we don’t want to see is tricky, off-budget financing which is only good for the short-term health of the budget.”
A $7.4 billion contribution to the Inland Rail project was included in the 2017 budget announcement by federal treasurer Scott Morrison. But the money was classified as an ‘equity investment’, meaning it wasn’t counted against the budget’s bottom line, as it is assumed that money will be recouped in the long-term.
The Coalition’s $5 billion Northern Australia Infrastructure Facility is another attempt at making an off-budget contribution to infrastructure.
IPA has repeatedly criticised the policy, saying it effectively cuts to shreds the amount of actual money being spent by the government on the nation’s infrastructure.
IPA says the Coalition needs to boost its four-year outlook of infrastructure spending by as much as $7.5 billion.
“The bottom line is the long-term 10-year trend has been 1.5% of government spend on infrastructure over the forward years,” Dwyer said. “We are pretty focused on seeing a return to trend on this, which would need $7.5 billion over the forward years. There is growing population and those services are going to need to be delivered.”
Dwyer is reportedly in favour of a second round of the Coalition’s asset recycling scheme, which encouraged states to privatise major existing infrastructure to secure additional funding from the Commonwealth for new infrastructure projects.