Infrastructure Australia: no teeth, no money, no hope

Of all the nations in the G20, Australia’s record in creating modern infrastructure is the least progressive and most inefficient.

There are two main reasons for this.

One is that our outdated Federal Constitution leaves responsibility for infrastructure in the hands of State Governments, with the Commonwealth being able to influence matters only by offering finance to the States. The only exception to this is infrastructure for Defence, which is totally a Federal matter.

Equally negative is that the Commonwealth does not offer sufficient funds to meet the huge challenge that modern infrastructure demands.

Political Parties on the left and right of Federal Parliament believe they can win elections only by handing out increasing amounts of middle class welfare. The Howard Government was infamous for this. It was the most significant provider of handouts of my lifetime, wasting the profits of a decade of prosperity, instead of investing in the future through Infrastructure.

Rudd and Gillard did nothing to turn this around. In fact, they added to it, using Howard as their excuse.

This leaves us to face the historical fact that States have an extremely poor record of infrastructure investment, and they waste enormous sums of money through inefficiency. They have large bureaucracies whose main aim is to preserve themselves in jobs, while blaming the Feds for not giving them more money to waste.

Most importantly, States do not co-operate with one another in any way — the Council of Australian Governments being a place where they can attack the Commonwealth in unison, while working feverishly behind the scenes to steal Federal money from one another.

In a worthwhile attempt to get things moving, the Federal Government established Infrastructure Australia and elected a Board comprising entrepreneurial types who appointed a top ranking CEO in Michael Deegan.

They elected to prepare a national agenda of priority projects, inviting the States to submit a list of their infrastructure priorities, but this turned out to be a disaster because State Premiers merely trotted out parochial projects that they had promised the voters at their previous election, and not one of them was national in character or, in some cases, not even essential.

It was really profoundly disgraceful, especially as, when Infrastructure Australia put forward national projects for consideration, the States found insular reasons to stridently oppose them.

Because achievements to date have been far from significant, despite splendid efforts by Michael Deegan, the Abbott Government is currently implementing legislative changes to the way in which Infrastructure Australia operates, but the proposed changes are disappointingly timid, and they have made a poor start to their implementation by making Michael Deegan redundant — a genuine tragedy. They also ignore the fact that it has never been clear as to how Infrastructure Australia relates to the Department of Transport, an error that constantly causes unnecessary demarcation disputes.