Home' Future Building: The Australian Infrastructure Review : Volume 8 Number 1 Contents futurebuilding
New South Wales Treasurer
across the state, providing hope to the 60,000 people currently
on the waiting list.
It has allowed us to build costly, but vital, infrastructure
while maintaining our commitment to fiscal responsibility, and
protecting our AAA credit rating. New South Wales is on track
to be the first state to have a net worth of $250 billion.
Asset recycling is why Infrastructure Partnerships Australia
called our last state budget an ‘infrastructure budget’; it puts
hard dollars behind actual transport, health and education
projects – which is in stark contrast to other states.
Infrastructure is not only the backbone of our future state – it
is the backbone of our current fiscal strength.
There would be few jurisdictions around the world that could
point to a healthy budget surplus, negative net debt, growing
net worth and a record infrastructure spend.
Recent economic data has also been positive. Business
investment, public infrastructure and dwelling construction
have been strong, helping to lift construction activity, driving
employment and productivity growth.
Unemployment is at five per cent – the lowest of any
state across Australia. This increase in activity has created
an extra 92,000 full-time jobs in New South Wales over the
Housing approvals are at record levels, totalling 70,000 for
the past financial year, while capital expenditure in New South
Wales is the highest in the nation for the first time in more than
New South Wales also has the strongest business conditions
and confidence of the mainland states, and consumers here are
among the most confident in the nation.
The lesson for governments is that investing in infrastructure
is a strategic way to boost growth. Central banks have been
trying monetary stimulus for some time, but the New South
Wales experience proves that economies can be kickstarted
with large-scale infrastructure investment.
In fact, we estimate that our infrastructure agenda alone will
add around half a percentage point to the state’s Gross State
Product (GSP) over the next two years.
Despite all these benefits, New South Wales continues to
be penalised for our success. A recent survey conducted by
Infrastructure Partnerships Australia shows that the majority
of Queenslanders want their government to use asset
recycling to fund infrastructure, as opposed to raising taxes
or increasing debt.
Whilst in New South Wales we have reformed, our
neighbours up north have refused to do so, putting political
ideology before the progress of their people.
Whilst we are busy building up our infrastructure, they are
busy building up their back-office bureaucrats. And thanks to
the current GST distribution system, their failure to reform is
Over the next four years, the taxpayers of New South Wales
are underwriting the poor decisions of the lazy Queensland
Government by handing over more than $6 billion. This is an
unfair system that needs to change.
In terms of infrastructure, the good news is that our plans
are just beginning. Being a good government is about managing
dual horizons – what is in front of us and what is yet to come.
Our last budget signalled a number of important infrastructure
priorities that we are now turning our minds to. Over the next
four years, we are undertaking more than $41 billion of major
capital works in the transport sector alone.
Development and planning funding has been allocated for
the proposed Western Harbour Tunnel, Beaches Link and F6
Extension. Each of these projects will need detailed business
cases before any investment decisions are made.
Work continues on the Sydney Metro City and Southwest
a project that will make room for an extra 100,000 train
commuters per hour.
In Western Sydney, significant capital is being invested to
support the second airport at Badgerys Creek, generating tens
of thousands of jobs in the process. But our building agenda is
much broader than transport.
Over the next four years, record amounts are being invested
to build and upgrade more than 90 schools, creating an
additional 1,500 classrooms to accommodate growing demand.
We have also kicked off the biggest programme of hospital
building this state has ever seen. There will be new and
upgraded hospitals in a number of areas, including Concord,
Campbelltown, Nepean, Tweed and Randwick.
Cultural institutions are not being neglected, either, with
ambitious plans for new museums and sporting facilities, in both
regional and metropolitan New South Wales.
On the asset recycling front, we will continue to proceed
with our plans to sell a 51 per cent stake in Sydney Motorway
Corporation, to help fund construction of the next phase of
WestConnex, the M4–M5 link.
This will mean that it is built sooner, and the people of New
South Wales will continue to benefit from the growth in the value
of the Government’s ongoing shareholding.
We are also in discussions with the Federal Government
around the future of Snowy Hydro.
At a time when energy prices and energy security are top of
mind for this Government, it is important that we consider the
future of this asset carefully.
It now presents another opportunity to unlock value and
fast-track important projects needed to secure our future. While
on the topic of energy, I do want to make some observations.
I am a firm believer that renewable energy sources are
the energy of the future. The energy network of tomorrow will
be distributed and decentralised, relying on clean and green
technology, in contrast to the model we have today. Current
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